Woods v. Bobbitt

• Decision Date: 02 January 1948
• Docket Number: No. 5653.,5653.
• Citation: 165 F.2d 673
• Parties: WOODS, Acting Housing Expediter, v. BOBBITT.
• Court: U.S. Court of Appeals — Fourth Circuit

165 F.2d 673 (1948)

WOODS, Acting Housing Expediter, v. BOBBITT.

No. 5653.

Circuit Court of Appeals, Fourth Circuit.

January 2, 1948.

Francis X. Riley, of Chicago, Ill. (E. D. DuPree, Jr., Hugo V. Prucha, and Irving M. Gruber, all of Washington, D. C., on the brief), for appellant.

J. Howard Hundley and Perry S. Poffenberger, both of Charleston, W. Va., for appellee.

Before PARKER and SOPER, Circuit Judges, and COLEMAN, District Judge.

SOPER, Circuit Judge.

This suit was brought against the defendant as the agent of the landlord of the residence property 3613 Kanawha Avenue, Charleston, West Virgina, to collect three times the excess rent charged the tenant from January 1, 1944, to March 1, 1946, over and above the maximum rent fixed by the Area Rent Director, and to secure the payment therefrom of the overcharge to the tenant. A verdict for the defendant was directed by the District Judge on the ground that the order fixing the maximum rent was void and of no effect since the service of notice of the order had been sent by unregistered mail and the plaintiff had failed to prove by affidavit that the document had been so mailed. The defendant seeks to support the judgment on the ground that the exclusive jurisdiction of the Emergency Court of Appeals to determine the validity of an order of the Rent Director affecting the rent of a particular piece of property does not arise unless the Rent Director, before entering the order, serves a notice upon the landlord in the manner prescribed in the Rent Regulation for Housing and thus affords the owner an opportunity to be heard and to protest against the proposed action.

The suit was originally brought against Myrtle C. French, the owner of the property, and O. B. Bobbitt, her brother-in-law, who, acting as her agent, collected the rents in question; but service of process upon the owner was not obtained and the suit proceeded against the agent alone. The property was rented by the owner at $80 a month on or about January 1, 1944, and shortly thereafter she moved to Illinois and arranged that the rents should be collected and forwarded to her by her brother-in-law or his daughter. The property was not registered as required by Sections 4(e) and 7 of the Rent Regulation, but the agreed rental was collected by the defendant for January, 1945, and for the period from June, 1945, to March 30, 1946. The property was sold by the owner on or about May 1, 1946, and it was then registered by the defendant in order to enable the purchaser to evict the tenant. Thereupon, on June 5, 1946, the Rent Director, acting under the authority of Section 5(c) (1) of the Rent Regulation, issued an order whereby the rent was reduced to $67.50 per month effective January, 1944.

At the trial below the plaintiff offered to prove by a clerk in the Rent Director's Office that a notice of intention to reduce the rent by the Director was mailed by regular mail to the address shown on the registration statement on May 20, 1946, and also that a copy of the order of the Rent Director dated June 5, 1946, decreasing the maximum rent of the premises from $80 a month to $67.50 a month, was mailed by regular mail to the defendant at the address shown on the registration statement. No affidavit of mailing the order in question was made or placed in the file in the Rent Director's Office, and the District Judge therefore rejected the offer of proof. The evidence should have been admitted at least for the purpose of showing that the proceeding was begun within three months after the registration statement was filed. See Section 4(e) of the Rent Regulation, 10 F.R. 3436. The judge, however, was of the opinion that the order reducing the rent was void, since the Rent Director did not proceed in strict accord with Section 1300-263 of Procedural Regulation No. 3, which provides with respect to the proof of notices, orders and other process, that when service is by unregistered mail an affidavit that the document has been mailed shall be proof of service; and he held further that under these circumstances the District Court had authority to consider the validity of the order and that the exclusive jurisdiction of the Emergency Court of Appeals to determine questions of validity under Section 204(d) of the Emergency Price Control Act, 50 U.S.C.A.Appendix, § 924(d), did not attach.^*

The defendant testified that he did not receive notice of the intention to reduce the rent, or notice of the order reducing the rent at the time of its passage, but admitted that in July or August, 1946, he received by registered mail a copy of the order reducing the rent. Neither the defendant nor the owner of the property ever filed a protest with the Expediter or an appeal to the Emergency Court of Appeals, as provided in Sections 203(a) and 204(d) of the Act, 50 U.S.C.A.Appendix, §§ 923(a), 924(d), or took any other steps to secure a vacation or revision of the order on the ground that they were not put on notice, or on any other ground. The instant suit was not brought until March 4, 1947.

It is firmly established that the United States District Courts have no power to consider the validity of a rent reduction order but that exclusive jurisdiction in respect thereto resides in the Emergency Court of Appeals and the Supreme Court of the United States; and this is true even though the claim is made that the person affected has been denied due process or that the order is void ab initio. In Yakus v. United States, 321 U.S. 414, 437, 64 S.Ct. 660, 673, 88 L.Ed. 834, it was said:

"The Emergency Court has power to review all questions of law, including the question whether the Administrator's determination is supported by evidence, and any question of the denial of due process or any procedural error appropriately raised in the course of the proceedings. No reason is advanced why petitioners could not, throughout the statutory proceeding, raise and preserve any due process objection to the statute, the regulations, or the procedure, and secure its full judicial review by the Emergency Court of Appeals and this Court. Compare White v. Johnson, 282 U.S. 367, 374, 51 S.Ct. 115, 118, 75 L. Ed. 388."

See also Bowles v. Meyers, 4 Cir., 149 F. 2d 440; United States v. George F. Fish, Inc., 2 Cir., 154 F.2d 798; Shrier v. United States, 6 Cir., 149 F.2d 606; Rosensweig v. United States, 9 Cir., 144 F.2d 30.

The defendant contends that the right of a landlord to complain to the Emergency Court of Appeals with respect to an individual rent order does not arise until the order has been passed and served by the Rent Director, and the owner has filed a protest against it without success, in conformity with the Rent Regulation and Section 203(a) of the Emergency Price Control Act. It is argued that the provision of Section 204(d) of the Act which confers exclusive jurisdiction to determine the validity of an order issued under Section 2 of the Act, 50 U.S.C.A.Appendix, § 902, upon the Emergency Court of Appeals and the Supreme Court relates to general orders applicable to a rental area which may be passed by the Rent Director without notice under Section 2(b) of the statute, but does not relate to an order affecting an individual property until the owner has been served with notice as provided by the Regulation and has had an opportunity to be heard before the order becomes effective and to file a protest under Section 203(a) of the Act. The decisions of the courts are to the contrary. It was specifically held by this court in Bowles v. Meyers, 4 Cir., 149 F.2d 440, 442, that the Emergency Court of Appeals and the Supreme Court have exclusive jurisdiction to determine the validity of...