Billik v. Berkshire

• Decision Date: 13 March 1946
• Docket Number: No. 112.,112.
• Citation: 154 F.2d 493
• Parties: BILLIK et al. v. BERKSHIRE, Deputy Com'r, Bureau of Internal Revenue, Alcohol Tax Unit, et al.
• Court: U.S. Court of Appeals — Second Circuit

154 F.2d 493 (1946)

BILLIK et al. v. BERKSHIRE, Deputy Com'r, Bureau of Internal Revenue, Alcohol Tax Unit, et al.

No. 112.

Circuit Court of Appeals, Second Circuit.

March 13, 1946.

Harry G. Herman and Van Buren & Schreiber, all of New York City, for appellants.

Wendell Berge, Asst. Atty. Gen., and Herbert Borkland and Matthias N. Orfield, Sp. Assts. to the Atty. Gen., for appellees.

Before SWAN, CHASE, and CLARK, Circuit Judges.

CHASE, Circuit Judge.

This is an original petition to this court under the provisions of the Federal Alcohol Administration Act, 49 Stat. 978, 27 U.S.C.A. § 204(h), which is in effect an appeal from orders of the District Supervisor of the Alcohol Tax Unit and the Deputy Commissioner of Internal Revenue in charge of the Alcohol Tax Unit. The orders suspended for a period of thirty days the wholesalers and importers basic permits of Samuel Billik, Samuel Futterman, Irving Rice, Max Holtz, Joseph Kanengiser, Ruby H. Popper and Morris R. Sprung, co-partners in business under the firm name of Popper Morson Company, who maintain their principal place of business in the City of New York.

The permits were suspended solely on the basis of a finding, after hearings in accordance with 27 U.S.C.A. § 204(e), that the petitioners had violated price regulations effective under the Emergency Price Control Act of 1942, 50 U.S.C.A.Appendix, § 901 et seq., by selling sixteen hundred cases of whiskey in November, 1943, to the Tarrant Wholesale Drug Company of Houston, Tex. at eleven dollars per case in excess of the legal maximum price. The issues are (1) whether the finding is supported by substantial evidence and (2) if so, whether the administrative officers had the power to suspend the permits under 27 U.S.C.A. § 204(d) solely because of the violation of price regulations.

One Baumohl, a buyer for the Tarrant Wholesale Drug Company, testified at the hearing before the Hearing Officer that in November, 1943, he purchased sixteen hundred cases of whiskey from Futterman who represented the petitioners. He also testified that he paid Futterman $17,600 in cash at the time the sale was made as an inducement to sell the whiskey ostensibly at the ceiling price at which it was billed to the Drug Company in Texas which paid the bill. Futterman denied that he had received any cash from Baumohl. The Hearing Officer accepted the evidence of Baumohl and found accordingly. If believed, it is apparent that Baumohl's testimony was substantial evidence to support the facts found. His testimony that he paid Futterman related to a transaction in which he participated and what happened was obviously within his knowledge. The finding that the money had been paid turned upon questions of credibility in the light of all the circumstances including the impression made by the appearance of the witnesses when they testified and we cannot reverse an administrative finding on such an issue of credibility alone.

Accepting the finding, the more difficult issue is whether the sale of the whisky above the ceiling price was a legal ground for the suspension of the petitioners' basic permits. Sec. 204(d) of 27 U.S.C.A. provides that: "(d) Conditions. A basic permit shall be conditioned upon compliance with the requirements of section 205 of this title (relating to unfair competition and unlawful practices) and of section 206 of this title (relating to bulk sales and bottling), with the twenty-first amendment and laws relating to the enforcement thereof, and with all other Federal laws relating to distilled spirits, wine, and malt beverages, including taxes with respect thereto."

There being no other basis for the suspension of the basic permits, the precise issue is whether the violation of the price regulations, issued and effective under the provisions of the Emergency Price Control Act, supra, was a failure to comply with a federal law embraced within the meaning of the phrase "and with all other Federal laws relating to distilled spirits, wine, and malt beverages, including taxes with respect thereto" found in § 204(d).

Of course if all that were needed to construe a statute correctly were a starkly literal reading of the language regardless of whether the result so reached was one which could reasonably be thought to have been intended by Congress, one may easily say that the price regulations applicable to the sale of whisky are federal laws relating to distilled spirits. It would follow that the violation of them by the petitioners was a legal ground for the suspension of their basic permits. But statutory construction does not lend itself to so simple a solution and, perhaps unfortunately, the task of judges properly performed is not so easy as it otherwise might be. Attention must always be given to what Congress sought to accomplish by the statute. As we said in Federal Deposit Ins. Corp. v. Tremaine, 2 Cir., 133 F.2d 827, 830, "There is no surer guide in the interpretation of a statute than its purpose when that is sufficiently disclosed; nor any surer mark of oversolicitude for the letter than to wince at carrying out that purpose because the words used do not formally quite match with it." We reiterated that in Burnstein v. United States Lines Co., 2 Cir., 134 F.2d 89, 93. See also, Pembroke Realty & S. Corp. v. Com'r, 2 Cir., 122...