Bowles v. Willingham 8212 10, 1944

• Decision Date: 27 March 1944
• Docket Number: No. 464,464
• Parties: BOWLES, Administrator, Office of Price Administration, v. WILLINGHAM et al. Argued Jan. 7—10, 1944
• Court: U.S. Supreme Court

321 U.S. 503

64 S.Ct. 641

88 L.Ed. 892

BOWLES, Administrator, Office of Price Administration,

v WILLINGHAM et al.

No. 464.

Argued Jan. 7—10, 1944.

Decided March 27, 1944.

Appeal from the District Court of the United States for the Middle District of Georgia.

[Syllabus from pages 503-505 intentionally omitted] Mr. Paul A. Freund, of Washington, D.C., for appellant.

Mr. Charles J. Bloch, of Macon, Ga., for appellees.

Messrs. Maxwell C. Katz, Otto C. Sommerich, and Benjamin Busch, of New York City, amici curiae.

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 1942, 56 Stat. 23, 50 U.S.C.App. (Supp.II) § 901 et seq., 50 U.S.C.A.Appendix, § 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, 28 U.S.C.A. § 41(1), 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, 28 U.S.C.A. § 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 neces- sity 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 areas¹ 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 accom- modations not rented on 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 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 Direc- tor 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 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-s 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 ad- vised her that he would proceed to issue an order reducing the rents. Before that wad done she filed her bill in the Georgia court. The present suit followed shortly, as we have said.

I. We are met at the outset with the question whether the District Court could in any event give the relief which the Administrator seeks in view of § 265 of the Judicial Code, 36 Stat. 1162, 28 U.S.C. § 379, 28 U.S.C.A. § 379, which provides that 'The writ of injunction shall not be granted by any court of the United States to stay proceedings in any court of a State, except in cases where such injunction may be authorized by any law relating to proceedings in bankruptcy.' We recently had occasion to consider the history of § 265 and the exceptions which have been engrafted on it. Toucey v. New York Life Ins. Co., 314 U.S. 118, 62 S.Ct. 139, 86 L.Ed. 100, 137 A.L.R. 967. In that case we listed the few Acts of Congress passed since its first enactment in 1793 which operate as implied legislative amendments to it. 314 U.S. pages 132—134, 62 S.Ct. pages 143, 144, 86 L.Ed. 100, 137 A.L.R. 967. There should now be added to that list the exception created by the Emergency Price Control Act of 1942. By § 205(a) the Administrator is given authority to seek injunctive relief in the appropriate court (including the federal district courts) against acts or practices in violation of § 4, e.g., the receipt of rent in violation of any regulation or order under § 2. Moreover, by § 204(d) of the Act one who seeks to restrain or set aside any order of the Administrator or any provision of the Act is confined to the judicial review granted to the Emergency Court of Appeals, which was created by § 204(c) and to this Court.⁵ As we recently held in Lockerty v. Philips, 319 U.S. 182, 186, 187, 63 S.Ct. 1019, 1021, 1022, 87 L.Ed. 1339, Congress confined jurisdiction to grant equitable relief to that narrow channel and withheld such jurisdiction from every other federal and state court. Congress thus preempted jurisdiction in favor of the Emergency Court to the exclusion of state courts.⁶ The rule expressed in § 265 which is designed to avoid collisions between state and federal authorities (Toucey v. New York Life Ins. Co., supra) thus does not come into play. The powers of the District Court under § 205(a) of the Act and § 24(1) of the Judicial Code are ample authority for that court to protect the exclusive federal jurisdiction which Congress created.

The suggestion is made that Congress could not constitutionally withhold from the courts of the States jurisdiction to entertain suits attacking the Act on constitutional grounds. But we have here a controversy which arises under the Constitution and laws of the United States and is therefore within the judicial power of the United States ad defined in Art. III, § 2 of the Constitu- tion. Hence Congress could determine whether the federal courts which it established should have exclusive jurisdiction of such cases or whether they should exercise that jurisdiction concurrently with the courts of the States. Plaquemines Tropical Fruit Co. v. Henderson, 170 U.S. 511, 517, 18 S.Ct. 685, 687, 42 L.Ed. 1126; The Moses Taylor, 4 Wall. 411, 428-430, 18 L.Ed. 397. And see State of Tennessee v. Davis, 100 U.S. 257, 25 L.Ed. 648; McKay v. Kalyton, 204 U.S. 458, 468, 469, 27 S.Ct. 346, 349, 350, 51 L.Ed. 566. Under the present Act all jurisdiction has not been withheld from state courts, since they have concurrent jurisdiction over all civil enforcement suits brought by the Administrator. § 205(c). But the authority of Congress to withhold all jurisdiction from the state...