United States v. EF Metzner Co., Civ. A. 1877.

• Decision Date: 22 March 1951
• Docket Number: Civ. A. 1877.
• Citation: 96 F. Supp. 792
• Parties: UNITED STATES v. E. F. METZNER CO. Inc. et al.
• Court: U.S. District Court — Eastern District of Kentucky

96 F. Supp. 792

UNITED STATES v. E. F. METZNER CO. Inc. et al.

Civ. A. 1877.

District Court of United States W. D. Kentucky.

March 22, 1951.

Dominic J. Cimino, Enforcement Atty., Office of Housing Expediter, Cleveland, Ohio, for plaintiff.

Marshall P. Eldred and Brown, Greenebaum & Eldred, all of Louisville, Ky., for E. F. Metzner Co., Inc.

John T. Fowler, Louisville, Ky., for John Payne.

SHELBOURNE, District Judge.

This action was instituted by the Office of The Housing Expediter, in the name of the United States, against John Payne, a resident of Detroit, Michigan, and E. F. Metzner Company, Inc. a corporation of Louisville, Kentucky, to recover for the benefit of tenants from whom excessive rents had been collected $307.50 and an additional amount of $615.00, twice the amount of the alleged overcharge, in favor of the United States.

The case was tried to the Court and the principal question here involved is whether Metzner & Company, acting as agent of the owner John Payne in the collection of rents, is jointly liable with Payne for the overcharge and penalty.

Findings of Fact

From the evidence and exhibits in the case, the Court finds the following facts —

1. John Payne, a resident of Detroit, Michigan, owned from and after July 5, 1943, a ten-room residence structure at 803 W. Chestnut Street, Louisville, Kentucky. The property was on July 5, 1943, registered for renting as a single ten-room housing accommodation and subsequently, on November 22, 1943, was registered as a rooming house.

The first registration was by John H. Humes, agent for the owner, the second registration being by John Dorsey, who appears to have been landlord-lessee.

Prior to July 1, 1947, the property was materially improved and converted into apartments. The two apartments or housing accommodations involved in this action are a second-floor middle room rented to Edna Merriweather and a second-floor rear apartment rented to Sylvester Fields. The tenant, Edna Merriweather occupied the second-floor middle unit from May 8, 1948 to January 10, 1950; the tenant Sylvester Fields occupied the second-floor rear unit from July 6, 1947 to December 6, 1949.

2. Edna Merriweather paid to Robert Payne, agent of the owner John Payne, $5 per week as rent during the period between May 8, 1948 and July 24, 1948, and from July 24, 1948 to January 10, 1950, paid rent to E. F. Metzner Company at the rate of $20 per month.

3. The tenant, Sylvester Fields, for the period from July 6, 1947 to July 24, 1948, paid to Robert Payne, then acting agent for John Payne, $10 rent per month and from July 24, 1948 to December 6, 1949, E. F. Metzner Company collected rent from the tenant Fields at the rate of $10 per month.

4. Prior to taking charge of the property July 24, 1948, as agent, E. F. Metzner Company, was advised by the owner Payne that the premises involved in this action were properly registered and the amount of rent being paid by the tenants was verified by contact with the tenants by the Metzner Company.

On November 3, 1949, E. F. Metzner Company, filed registration certificates in the office of the Area Rent Director at Louisville, Kentucky, disclosing that the second-floor middle room apartment, occupied by Edna Merriweather, was first rented in February 1947 at a rental of $10 per month. These certificates were received in the Area Rent Office and were stamped "This registration is accepted subject to inspection and review".

The registrations designated John Payne as the landlord, E. F. Metzner Company as agent, and directed that mail be addressed to E. F. Metzner Company, 402 South Fifth Street, Louisville, Kentucky.

5. Under date of December 28, 1949, the Area Rent Director issued an order decreasing the maximum rent and ordering refunds to the tenants in the two apartments. The order decreasing the maximum rent was made effective July 1, 1947, as to each apartment and fixed the maximum rent at $7.50 per month. These orders were sent by registered mail, addressed to John Payne, care of E. F. Metzner Company, at the address designated in the registration.

Each order directed that the rental in excess of $7.50 per month, collected after July 1, 1947, be refunded within thirty days from date of order, unless such refund should be stayed in accordance with the provisions of Rent Procedural Regulation 2.

E. F. Metzner testified that the registered letters came to his office, but were forwarded to John Payne at his Detroit address.

No refunds were made in accordance with the requirement of the orders.

6. For the period from July 24, 1948 to January 10, 1950, E. F. Metzner Company, as agent, collected rent from the tenant Edna Merriweather at $20 per month, thereby receiving $212.50 in excess of the maximum legal rent.

For the period from July 24, 1948 to December 6, 1949, Metzner Company, as agent, collected from Sylvester Fields, $10 per month or $40 in excess of the maximum legal rent.

John Payne, the owner, prior to July 24, 1948, and after May 8, 1948, received from Edna Merriweather $22.50 in excess of the maximum legal rent and from Sylvester Fields, prior to July 24, 1948, and after July 6, 1947, $32.50.

The overcharges aggregate $307.50, of which amount $252.50 was received by the Metzner Company as agent.

7. The owner Payne admits receiving the overcharges and E. F. Metzner admits collecting rentals in...