Leimer v. Woods

• Decision Date: 19 May 1952
• Docket Number: No. 14403.,14403.
• Citation: 196 F.2d 828
• Parties: LEIMER v. WOODS, Housing Expediter.
• Court: U.S. Court of Appeals — Eighth Circuit

196 F.2d 828 (1952)

LEIMER v. WOODS, Housing Expediter.

No. 14403.

United States Court of Appeals Eighth Circuit.

May 19, 1952.

COPYRIGHT MATERIAL OMITTED

Walter A. Leimer pro se.

Cecil H. Lichliter, Special Litigation Atty., Office of Rent Stabilization, Washington, D. C. (Ed Dupree, Gen. Counsel, and Leon J. Libeu, Asst. Gen. Counsel, Office of Rent Stabilization, Washington, D. C., on the brief), for appellee.

Before SANBORN, WOODROUGH and JOHNSEN, Circuit Judges.

JOHNSEN, Circuit Judge.

This suit was originally instituted against appellant in March 1947 by the Administrator of Temporary Controls,¹ under the Emergency Price Control Act of 1942, as amended, 50 U.S.C.A.Appendix, § 901 et seq., for alleged violation of the Rent Regulation for Housing, 8 F.R. 7322, in having collected rents in excess of the established maximum, on some housing accommodations located in the Kansas City (Missouri) Defense Rental Area. The complaint sought an injunction and a restitution order under section 205(a) of the Act, 50 U. S.C.A.Appendix, § 925(a), and a judgment for damages in favor of the United States, in twice the amount of the overcharges, under section 205(e) of the Act, 50 U.S.C. A.Appendix, § 925(e). Appellant denied that there had been any overcharges and, both in the body of his answer as well as by separate notation at the bottom thereof, he made a general demand for a jury trial, within the requirements of Rule 38(b), Federal Rules of Civil Procedure, 28 U.S.C.A.

Disposition of the case on its merits was delayed for various reasons, including a protracted series of efforts on the part of appellant, acting as his own attorney, to prevent the action from being maintained against him.² Before the case finally came to trial in 1951, the Emergency Price Control Act had long been expired³ and the field of rent control had been made subject to the Housing and Rent Acts of 1947, 1948 and 1949, respectively, 61 Stat. 193, 62 Stat. 93, 63 Stat. 18, as amended and extended, 64 Stat. 253, 50 U.S.C.A.Appendix, § 1881 et seq.

During the pendency of the suit, changes and substitutions in the official plaintiff had resultingly occurred,⁴ and other amendments to pleadings had also been made. There further had been a formal order entered in the proceeding denying appellant the right to a jury trial on any issue. When the case finally came to trial, the court treated it as constituting entirely a matter of equitable jurisdiction, including the determination of whether violations had occurred and in what amount, and whether such violations had been wilful or the result of failure to take practicable precautions against their occurrence, as a basis for damages and the amount thereof, under section 205(e) of the Emergency Price Control Act, as amended, 50 U.S.C.A.Appendix, § 925(e), in relation to the violations originally alleged, and under section 205 of the Housing and Rent Act of 1947, as amended, 50 U.S.C.A.Appendix, § 1895(a), in relation to some claimed subsequent violations included in the second amended complaint.

The second amended complaint prayed for relief in the following form: (1) For a judgment in favor of the United States as damages in three times the amount of the alleged overcharges; (2) for an order of restitution in favor of the tenants, with a deduction of the amount thereof "from the treble damages adjudged to the United States;" and (3) for an injunction against further violation of the Housing and Rent Act then in effect and any superseding Act.

The court's decree was as follows: "(a) Ordered, Adjudged and Decreed that" appellant be enjoined from charging and collecting rent in excess of the legal maximum on the housing accommodations involved (whose location was set out) and from otherwise violating the Housing and Rent Act of 1947, as amended, and the Regulations issued pursuant thereto; "(b) It is Ordered that the Defendant pay to the Treasurer of the United States a Cashier's Check in the sum of $320.32 for and on behalf of the tenants, by mailing same to the Office of the Housing Expediter" at St. Louis, Missouri; and "(c) It is further Ordered that the Defendant pay to the Treasurer of the United States a Cashier's Check in the sum of $640.64 for damages." It will be noted that the allowance of damages (treble damages with the amounts of the overcharges deducted as restitution) was not made in conventional general judgment form, with collection enforcible only through execution and its auxiliary processes, but the payment of such damages, similarly as the restitution directed, was made the subject of a specific command and of the summary reach of a court of equity by an order to "pay to the Treasurer of the United States a Cashier's Check in the sum of $640.64."

The principal contention of error urged for reversal is the court's denial of appellant's demand for a jury trial. This contention of course is of relevance and significance only on the question of the court's right, in the face of appellant's demand for a jury trial, to adjudicate the issues of violation, amount of overcharges and whether such violations had been wilful or the result of failure to take practical precautions, for purposes of damages under section 205(e) of the Emergeny Price Control Act, as amended, 50 U.S.C.A.Appendix, § 925(e), and under section 205 of the Housing and Rent Act of 1947, as amended, 50 U. S.C.A.Appendix, § 1895. The granting of general injunctive or restitutive relief, under section 205(a) of the Emergency Price Control Act, as amended, 50 U.S.C.A.Appendix, § 925(a), or section 206(b) of the Housing and Rent Act of 1947, as amended, 50 U.S.C.A.Appendix, § 1896(b), plainly is an exercise of jurisdiction by a court of equity and as such does not involve any right to a jury trial. Shields v. Thomas, 18 How. 253, 262, 59 U.S. 253, 262, 15 L.Ed. 368; Porter v. Warner Holding Co., 328 U. S. 395, 402, 66 S.Ct. 1086, 90 L.Ed. 1332; Ebeling v. Woods, 8 Cir., 175 F.2d 242. But equally as clearly, we think, in relation to the statute, must the awarding of damages under section 205(e) of the Emergency Price Control Act or section 205 of the Housing and Rent Act involved be regarded as wholly an exercise of jurisdiction on the part of a court of law. See Porter v. Warner Holding Co., supra, 328 U.S. at page 402, 66 S.Ct. 1086.

The damage right created by these statutes was legislatively given the form of an independent legal liability, without any substantive relationship to the equitable relief of injunction and restitution for which the statutes provide, and in general therefore it could not be treated judicially as having substantive subservience or incidence to these equitable remedies or their administration. The wholly distinct character of the two classes of rights created is doubly emphasized by the special line of separation or demarcation which the statute has drawn between them in their very grant. The statute vests the equitable rights of injunction and restitution in the Government and its agencies alone, while the legal right to damages is initially separately vested in the person overcharged. In connection with the damage liability, there has contingently been granted to the Government what amounts in effect to a right of succession, in that it "may institute such action", 50 U.S.C.A.Appendix, § 1895(c), if the person overcharged fails to bring it within a certain time or is not for any reason entitled to do so — the purpose being to enable the statute to succeed as fully as possible in its remedial object. This contingent, successory right to the separate legal cause of action for damages could hardly soundly be said to cause the liability to assimilate any inherent ancillariness to the remedies of injunction and restitution as initially independently established or to a court of equity's administration of that relief. Judicially, therefore, damages under the statute cannot be awarded to the Government as an ancillary incident in the exercise of the court's equity powers to deal with violations for purposes of injunctive or restitutive relief, such as the trial court here appears to have assumed to do. Cf. United States v. Friedland, D.C.Conn., 94 F.Supp. 721, 723; United States v. Mesna, D.C. Minn., 11 F.R.D. 86.

Nor, on this concept, is it any more possible to argue that the Government's attempted interlinking of damages with restitution, by the request in its second amended complaint to have any restitution granted deducted from the damages awarded, entitled the court to treat the damage liability in equitable incidence to the question of restitution, so as to permit it to award damages in equity as a matter of enabling it to effect disposition of the question of restitution. Apportionment or deduction of part of the recovered damages as restitution, in accordance with the prayer of the complaint, would involve, in its relationship to the cause of action for damages, simply subsequent, mechanical, appropriative action. And an honoring of the request, as the court did here, instead of giving rise to any basis for subordinacy as to the cause of action for damages, would rather tend to leave the situation devoid of any consideration, even procedural,⁵ for at all dealing with the question of restitution, until there had been a proper determination and recovery of damages at law — or in other words to suggest naturally and practicably an abeyance of the restitution jurisdiction until the damage recovery, which the complaint sought to make its source, had come to have existence.

In repeated and extended development — since the Government's succession to the right to damages is not made by the Price Control or Housing and Rent statute to give this separate liability of the defendant any substantive incidence or ancillariness to the equitable relief of injunction and restitution, the Government's joinder of these separate equitable and legal causes of action in a single complaint...