Woods v. Richman

• Decision Date: 29 April 1949
• Citation: 174 F.2d 614
• Parties: WOODS v. RICHMAN et al.
• Court: U.S. Court of Appeals — Ninth Circuit

174 F.2d 614 (1949)

WOODS v. RICHMAN et al.

United States Court of Appeals Ninth Circuit.

April 29, 1949.

Ed Dupree, Gen. Counsel, Office of Housing Expediter, Hugo V. Prucha, Asst. Gen. Counsel, and Cecil H. Lichliter, Sp. Litigation Atty., all of Washington, D. C., and Sidney Feinberg, Atty., Office of Housing Expediter, of San Francisco, Cal., for appellant.

Bailie, Turner & Lake and Frederick I. Richman, all of Los Angeles, Cal., for appellee.

Before HEALY and BONE, Circuit Judges, and FEE, District Judge.

HEALY, Circuit Judge.

This action was filed by the Housing Expediter (appellant) in August 1947 to enforce compliance with the Emergency Price Control Act of 1942, as amended, 50 U.S. C.A.Appendix, § 901 et seq., and the Housing and Rent Act of 1947, 50 U.S.C.A.Appendix, § 1891 et seq. In an amended complaint the Expediter set out a schedule of alleged rental overcharges for 19 units or apartments in an apartment hotel operated by the defendants. The asserted overcharges covered periods of varying duration between January 1944 and September 1947, constituting infractions either of the former or of the present statute or continuing violations of both. It was alleged that the defendants had received from the occupants of these housing accommodations amounts in excess of the maximum legal rents established, and by such practices had violated § 4(a) of the 1942 Act, or § 206(a) of the 1947 Act, and regulations issued pursuant thereto. The relief prayed was (1) for judgment under § 205(e) of the 1942 Act for treble the amount of the overcharges, (2) that, pursuant to § 205(a) of the 1942 Act and § 206(b) of the 1947 Act, the defendants be ordered to refund to the tenants all excess rentals not previously refunded, and (3) that they be enjoined from demanding or receiving for the specified housing accommodations rents in excess of the legal maximum permitted.

The answer set up several defenses. As to certain of the apartments it was alleged that they were not subject to rent regulation, as to others that no rents above the ceiling had been collected, and as to the remainder that the defendants had restored or repaid to the tenants amounts received in excess of the permissible rentals. After joinder of issue, the parties, by stipulation, eliminated from the schedule of overcharges all items except two, namely those appertaining to apartments Nos. 407 and 412. As to No. 412 the period of claimed overcharge extended from May 15, 1944, to August 15, 1947. Upon the trial the court found that the rentals collected for this apartment were not in excess of the permissible maximum. The Expediter does not complain of this finding or ask us to review it.

The period of claimed overcharge in respect of the remaining unit No. 407, was from May 1, 1944, to April 10, 1946, and the total overcharge for this unit was alleged to be $233.35. The trial court excluded all evidence as to violations relative to this apartment on the ground that it was without jurisdiction to try that issue. Apparently, lack of jurisdiction was predicated on the fact that the 1942 Act had by its own terms expired prior to suit and after the violation had ceased, and that the right of treble recovery under § 205(e) of that Act was barred by lapse of the one year limitation prescribed in the section.

We think the court was in error in holding itself without jurisdiction to try the issue. Section 1(b) of the 1942 Act, as amended, fixed June 30, 1947, as the termination date thereof "except that as to offenses committed, or rights or liabilities incurred, prior to such termination date, the provisions of this Act and such regulations, orders, price schedules, and requirements shall be treated as still remaining in force for the purpose of sustaining any proper suit, action or prosecution with respect to any such right, liability, or offense." This saving clause preserves accrued rights and liabilities whether or not suit on account thereof is started prior to the termination date. Fleming v. Mohawk Wrecking & Lumber Co., 331 U.S. 111, 114, 119, 67 S.Ct. 1129, 91 L.Ed. 1375.

As already seen, relief was here sought, in part, under the provisions of § 205(a) of the 1942 Act and the substantially identical provisions of § 206(b) of the 1947 Act. The former is shown on the margin.¹ Considering § 205 (a), it was held in Porter v. Warner Holding Co., 328 U.S. 395, 66 S.Ct. 1086, 90 L.Ed. 1332, that an order for the restitution of illegal rents may be considered as a proper "other order," within the meaning of the section, as one appropriate and necessary to enforce compliance with the Act. The Court said, 328 U.S. at page 400, 66 S.Ct. at page 1090: "Section 205(a) anticipates orders of that character, although it makes no attempt to catalogue the infinite forms and variations which such orders might take. The problem of formulating these orders has been left to the judicial process of adapting appropriate equitable remedies to specific situations. Cf. Phelps Dodge Corp. v. National Labor Relations Board, 313 U.S. 177, 194, 61 S.Ct. 845, 852, 85 L.Ed. 1271, 133 A.L.R. 1217. In framing such remedies under § 205(a), courts must act primarily to effectuate the policy of the Emergency Price Control Act and to protect the public interest while giving necessary respect to the private interests involved. The inherent equitable jurisdiction which is thus called into play clearly authorizes a court, in its discretion, to decree restitution of excessive charges in order to give effect to the policy of Congress."

Section 205(a) provided a cause of action separate from that set out in § 205(e), and as respects such cause the one year limitation found in the latter section is not controlling. Blood v. Fleming, 10 Cir., 161 F.2d 292. The remedy afforded by § 205 (a) is in addition to others set up in the Act; and an order of restitution may be granted with or without a prohibiting injunction. Creedon v. Randolph, 5 Cir., 165 F.2d 918. See, also, Bowles v. Skaggs, 6 Cir., 151 F. 2d 817, 819. As justly observed in Creedon v. Randolph, supra, 165 F.2d at page 919, a requirement of restitution of overcharges tends to enforce the law prohibiting them. "That it operates," said the court, "to confer a benefit on the tenant, who has not seen fit to act in her own behalf, does not detract at all from the enforcement effect nor alter its nature."

Had the congressional policy in respect of rent control lapsed with the expiration on June 30, 1947, of the Emergency Price Control Act, we would assume that an order designed primarily to vindicate the defunct policy would no longer be appropriate in equity. But rent control has continued to be a national policy. In the declaration contained in the Housing and Rent Act of 1947, 50 U.S.C.A.Appendix, § 1891, it was recognized that an emergency still exists, and that for the prevention of inflation and for the achievement of a reasonable stability in the general level of rents during the transition period, as well as for other purposes, it has continued to be necessary to impose restrictions upon rents charged for housing accommodations in defense-rental areas. The 1947 Act prohibits the demand or acceptance of any rent for the use or occupancy of any controlled housing accommodations greater than the maximum rent established under the authority of the Emergency Price Control Act of 1942, as amended, and in effect with respect thereto on June 30, 1947, provision being made by the Expediter for general adjustments. 50 U.S.C.A.Appendix, § 1894. And, as already noted, the provisions of § 205(a) of the former Act were reenacted without change.²

We think, therefore, that it continues to be appropriate for the courts to consider whether an order of restitution should be made as a means of giving effect to the declared policy of Congress. The judgment appealed from is accordingly reversed and the cause remanded with directions to the court to hear the...