Appellants Brief — Grogan v. Hiram Walker & Sons, Ltd.
Supreme Court brief1922
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CONTENTS.
SETI WR TMEINO a iow nc cen cu ee casmuniut.cacn cota sues<e
ee ACNO TM CORE NO BIB ances ce becce nec tevctsaesbeceecees
NRE ate wine indnr es kek as antkakne sande cba tans
aah eacghckew kc weKiMveshoevewsie Kerk G se eatalarvehiantes
ENE MUN MINE PROBL Ain nan ex ue b ConA ton ccs wwe Nevin k Weeks
NNR S hrarcs Vn'cb anh V2.6 suri Nadisebecsulurn scans cv
EG Koen Cin ence Gon pce reKchens CORCEANSNCEMDEN ORE OE RECS
CONSTITUTIONAL, STATUTORY, AND TREATY PROVISIONS............
IN RIN oh on clan ened whic e ks dine w kn ek oe ats
pecuon 3, Tithe 11, of Volstead Act. ..... 22... 6 cccccc cc ececcne
SUONee CMRECIURE BECEION DU00. oc. 6c kiw cco cticesnsexdceacce
Article XXIX, treaty with Great Britain, proclaimed July 4,
ee icek piu wik nak h oa nin dxntn sats Leet nike tesco
ONMENTO QF BRBOR IN NGO. GM... <5 6 ss occ cee co knee caeaesss
EN de aA SOnkCn wnat KGa wa ca ceed CCU enh viene Cee de eek be
1. The eighteenth amendment and the national prohibition act
apply to and prohib) the transshipment of intoxicating
liquors for beverage purposes in or through the United
PE Week AtnUaUN eens unk sieeeSet enn ce ee sas sae eu bis oes
1. Such transshipments are within the very terms of the
ie nn eee
2. The plain object of the amendment and act was to
destrey all trattic in or dealing with intoxicating
PE os aNo etka chr ene en cots rue even nai vic nies
3. The amendment and the act clearly were intended to
prohibit the possession or transportation of liquor
for beverage purposes, whether for consumption
within the United States or without. ..............
4. The proceedings in Congress evidence the legislative
intention to prohibit all possession and all transpor-
tation except as specifically authorized.............
5. The language of the amendment and act being plain,
resort may not be had to construction to read out
WHE. 58 CROMISY RUCRUGONES. 5.4 okviwn 0c veax nas ev ceees
6. The prohibition on transshipments will not be read
out of the act on the ground that as applied to such
transshipments it has extraterritorial effect.........
J6689—22——1 (1)
21
28
ll
Aroument—Continued. Page.
Il. The national prohibition act in its application to the trans-
shipment of intoxicating liquor for beverage purposes is
constitutional and valid...........----+++eeeeereeere tees 30
1. Fallacy of plaintiffs’ contention. ......-----+++++5++*+ 20
2. Congress in legislating for the enforcement of the
eighteenth amendment may provide all means rea-
sonably necessary effectively to suppress the pro-
hibited ACtS......csccnccocceerenececestescesecens 31
3. Because of their noxious qualities all traffic in or deal-
ing with intoxicating liquor may be absolutely sup-
premned.....cssescenccccnnssscccccensccccsecesnes Od
III. Plaintiffs have not by proper allegations brought them-
selves within Article X XIX of the treaty with Great Britain
proclaimed July 4, 1871; but in any event said article has
been abrogated.........csscsesccccccesercrccscescscsccses o6
1. Neither plaintiff has alleged facts bringing it within
Apticte SKUs ccs scccnsccncceue ss cee acenseas tenes 26
2. The abrogation of Article XXIX was effected by act
Of CONZLORB. ... 06. c ce ececerecceneceececneceneenees 37
3. Presidents Cleveland and Harrison have declared
Article XXIX terminated.........-.++-esee rere ee 49)
4. The question being essentially political and not judi-
cial, the legislative and executive interpretations
should be followed...........-eeeeeeeeeeeeeeeeees 47
5. If Article XXLEX was not abrogated in the manner de-
scribed, then so far as it relates to shipments of
liquor it was abrogated by the national prohibition
Bi ce eu kL Ast horse he wh sas ive se eta eae eN ee ets s> 49
LV. Section 3005 of the Revised Statutes conferred no affirmative
rights with respect to the transshipment of merchandise:
Assuming that it did, it was superseded by the national
prohibition act so far as shipments of liquor are concerned... 0
1. Section 3005 conferred no affirmative PERS sees s es 50
2. Assuming that the section did confer the right claimed,
far as shipments of liquor are concerned......------ 53
3. The prohibition act supersedes all licensing and per-
missive statutes...........-.-seee cece eter eeeceess 4
4. The transshipments involved in case No. 639 are not
within the section............----se-sseeeeeerseees 59
CNN sia cand nn ven As nnea eee ensee esse ante sreyee eSR 0 FEET 59
CASES CITED.
Adams Express Co. V. Kentucky, 238 U.S. 190, 199...----++--+2++5- 24
American Banana Co. V. United Fruit Co., 213 U. 8. 347..--------- 29
Barker v. Harvey, 181 U.S. 481, BAR. cies 5 sack bases ee aoa weees*s 48, 49
Booth v. Illinois, 184 U. 8. BUR oo occ nc vuak ete’ 644+ SES bse nen eee 34
PEEL SYED SAPO ANTE NR ae BEMIS IT
ill
Page
Botelier v. Dominguez, 130 U.S. 238....... 2.02... ccccencccceucee. 49
Brougham v. Blanton, 249 U.S. 495... 20... 0.00. cc ccececcccceceee, 34
Caminetli v. United States, 242 U.S. BIO, SHO oe das a caceea tk uns 24, 25
Chae Chan Ping v. United Stoies, 130 U.S. 581.0000... -000000005.. 49
Chinese Exclusion Cases, 130 U. 8. 581........0..cccccececccecesse, 18
Corneli v. Moore, No. 174, decided January 30, 1922... ............ 28
Crane v. Camphell, 245 U.S. PU OTOR Sc e oboreece tC ee 34
Del., Lack, & West. R. R. Co. v. United States, 231 U.S. 363, 370 34
Er parte Crookshank, 269 Fed. 980... 0.0.0... c0ccceeccccccces.., 58
Fong Yue Ting v. United StAGR EO US BOB ovine. tw cs caus dreno 49
Foster v. Neilson, 2 Pet. 252, 814..... Pesckh nik teseas ket casero 40, 48
Hamilton Vv. Kentucky Distilleries, 251 U.S. ROG AB ark Cokie inne bie 20
Hanilton v. Rathbone, 175 U.S. RIGS BAR ic cA EERE AOR GCE SEL OS 24
Head Money Cases, 112 U. 8. 580.............cccsccccececccucces., 48
Holy Trinity Church Case, 143 U. 8, 457.......0.ccccccceccccccess, 6,25
Horner v. United States, 143 U. 8. 570... ......ccccccecccccceesss, 49
Houston v. St. Lowis Packing Co., 249 UL 8. 479. oo. cece cccec cee. 34
Knorville Iron Co. v. Harbison, 188 U. 8. UB... cece ccc ceccc seen, 34
Lenn Moon Sing v. United States, 158 U. FO NEED DM tite ad oe we dteal eee 49
McCulloch v. Maryland, 4 Wheat. 421, 423... 0.0.0... .cccccceces ss 32
Nutional Prohibition Cases, 253 U.S, BOD; BOO WSOT sv aisc sc dks vewsecucc jd5
Otte v. Parker, 187 U. 8. 06,008, O00... o.oo. conc ccccsceccceses, 33
Powell v. Pennsylvania, 127 U. 8. 678, 685... .......0000000-000... 32
Public Clearing House v. Coyne, 194 U.S. 497. 0... eee eee 3
Purity Extract Co, v. Lynch, 226 U. 8. 192...........00000000505... 33
Rainey'v. United States, 232 U.S. $10... ......000ec0cccscccccscss., 49
pps W, SOP ey, B00 Ti, BQO sos ok cece enn aucecceesciccccc.c 34
Sanchez v. United States, 216 U. 8. 167..........00.cccccecccccess.. 49
amt Ve PONT DUN NE UR oo irae vsckcen sees lac cockucecan cnn 3
Staughter House Cases, 16 Wall, $6...........000s000ceecececcec., 34
Strathearn S. S. Co. y. Dillon, 252 U. 8. 348..........00000000-... 29
Street v. Lincoln Safe Deposit Co., 254 U.S. OG) Ms Se kK bh ok ach ue 17, 26, 27
wuylor v. Morton, 2 Carta, 454.....0..cccc cc cccccccnsecccceces. es, 47
Thomas v. Gay, 160 U.S. 264, 971. oo... ccc cccccncoccse. 48
Thompson v. United States, 245 U.S. 547, O51. 2.00.00 eee 24
United States v. Gudger, 249 U. 8. 373...........ccccccccccccees... 26
United States v. Lee Yen Tai, 185 U.S. 213. ...................... 49
United States v. Levington Miu &e. Co., 232 U. S. 399, 409-10... ... 24
United States ¥. Stafog., 268 Fed. i ae TART Ea Lees | eye Te 58
Untied States v. Two Thousand Cases of Whiskey, 277 Fed. 410..... 58
Untied States vy, Yuginovich, No. 253, decided June 1, 1921......... 55, 56
Vigliotti v. Pennsylrania, No. 530, decided April 10, 1082... .5.5.. 58
Ward y. Mace Horse, 103 0. &. B04, 0... ccc cciccassccccnsccncnncecs 49
Whitney v. Robertson, 124 U. 8. 100........0...0.cececcesccccees.., 48, 49
STATUTES, ETC., CITED.
Act of July 28, 1866, c. 208, 14 Stat. 328................ccccccceees
Act of Mar. 1, 1873, c. 213, 17 Stat. 482..............0..escceeees 38, 40, 47
IV
Page.
Act of Feb. 27, 1877, c. 69, 19 Stat. 240.......-----eeeeerersereccee 51
Act of May 21, 1900, c. 487, 31 |) ee 51
Act of Mar. 3, 1917, c. 162, 39 Stat. 1058, 1069.........----+--e++s 26
Act of Oct. 28, 1919, ¢. 85, 41 Stat. 308-9, 317, 322........- 13, 18, 49, 53, 54
Cong. Rec., v. 58, pp. 2449, 2976. ....-----seeeereeerereeerrcsress 21, 23
Cong. Rec., v. 33, p. 1736......----ee-ereeeeerersttsesesseee see es 51,52
Constitution of United States, eighteenth amendment.....---------- 12
Joint resolution, Mar. 3, 1883 [No. 22), 22 Stat. G41......---------+ 39
Judicial Code, section 238.......------seseeeerrceeerers esse sste ee 2
Messages and Papers of Presidents, Richardson:
Vol. 8, pp. 620, 624, 625........0eeeeeeeereceseeceeeeeeneees 41, 43
Vol. 9, pp. 335-339, 340, 345. . 0... eeeeeeeeee neers ee eeeees 44, 45, 46
Opinions of Attorney General:
Vob. 90, p. 908..0.000.ccncneccsnserevnerneccnnseronnnsteseces 46
Wek Bi. i MI inns cng one es anaes snes andreesensceesees ress 59
Proclamation of President Arthur, J uly 1, 1885, 23 Stat. | ae 40
Revised Statutes, section 2766. .........--.eeeeeree sete eerste eee 53
Revised Statutes, section 2866........--.-0eseeree reese tte ness 39
Revised Statutes, section 3005..........-+eeeereeer es 13, 47, 49, 51, 53, 54
Treaty with Great Britain proclaimed July....--- 4, 1871 13, 36, 37, 38, 46
=
Inthe Supreme Court of the United States.
OcrorneR TreRM, 1921.
Joun A. GroGan, CoLLecror or INTER-
nal Revenue, et al, appellants,
v,
Hiram Waker & Sons (Ltp.).
No. 615.
APPEAL FROM THE DISTRICT COURT OF THE UNITED
STATES FOR THE EASTERN DISTRICT OF MICHIGAN.
Tue Ancnor Line (HENDERSON BroTH- )
ers) (Ltd.), appellant,
v. >No. 639.
.
Grorare W. ALpripGe, CoLLECTOR oF Cus-
toras for the Port of New York.
APPEAL FROM THE DISTRICT COURT OF THE UNITED
STATES FOR THE SOUTHERN DISTRICT OF NEW YORK.
BRIEF FOR THE APPELLANTS IN NO. 615 AND FOR
THE APPELLEE IN NO. 639.
INTRODUCTORY STATEMENT.
These are suits to enjoin officers of the United
States from enforcing the provisions of the eighteenth
amendment to the Constitution and the national
prohibition act' against shipments of liquor (a) from
‘Called interchangeably “ national prohibition act,’’ ‘‘ prohibition act,”
and ‘‘ Volstead Act.”’
(1)
SR, cant Tete RRL Nine a TO TI ae Ta SR dee i ln tee em Ee hay
9
one foreign country through territory of the United
States to another foreign country and (0) from a for-
eign country into the port of New York for trans-
shipment to another foreign country. The right to
transport liquor into and through the United States
for export to points outside the United States is
asserted under the provisions of section 3005 of the
Revised Statutes and Article XXIX of the Treaty
with Great Britain proclaimed July 4, 1871.
Whether those provisions ever conferred the right
claimed, and if so, the extent to which such right
has been modified or abrogated by the eighteenth
amendment and the prohibition act, are the ques-
tions presented. The cases come directly to this
court under section 238 of the Judicial Code on the
ground that there is drawn in question (1) the
construction and application of the Constitution
of the United States; (2) the construction or validity
of a treaty and (8) the constitutionality of a law of
the United States. The two lower courts having
arrived at opposite conclusions, giving rise to much
confusion and embarrassment in the enforcement
of the prohibition act, the necessity of a prompt
decision by this court is manifest.
THE FACTS IN CASE NO. 615.
Bill of complaint.
Hiram Walker & Sons (Ltd.), a corporation of the
Province of Ontario, brought its bill in the United
States District Court for the Eastern District of
Michigan to enjoin the collector of internal revenue
and the collector of customs for that district from
interfering with and preventing the shipment of
whiskey from its plant at Walkerville, Ontario. into
the port of Detroit for conveyance to other ports of
the United States to be there exported to points
outside the United States. (Ree. 1-11.)
The bill alleged that pursuant to section 3005 of
the Revised Statutes and Article XNIX of the treaty
of 1871 plaintifY has for many years conducted a
large and profitable business in the exportation of
whiskey through the United Staies to foreign coun-
tries; that in 1920 a total of 86,815 cases, ageregating
$700,982 in value, was exported in this way, with a
loss of only 286 cases of the value of $2,380: that if
plaintiff were compelled to convey its Whiskey to
Mexico, South and Central America otherwise than
in transit in bond through the United States, the
increased transportation costs and delay in deliveries
would greatly impair if not destroy its fore’en busi-
ness. (Ree. 3-4.)
That on February 14, 1921, plaintiff presented to
agents of the collector of customs at Detroit 25 cases
of whiskey to be conveyed in bond through the United
States to customers in Mexico; that defendant, col-
lector of customs, purporting to act under the Vol-
stead law, seized said shipment and still retains the
same; that on July 14, 1921, plaintiff notified agents
of defendant collector of customs that it desired to
make a further shipment of liquor through Detroit
to New Orleans, for transshipment by water to
Puerto Barrios, in Guatemala; that representatives
of the collector replied that such shipment on arrival
4
at the port of Detroit, would be seized unless plaintiff
should obtain a permit from the State prohibition
director; that such permit was duly applied for and
refused; and that plaintiff is informed and _ believes
that the defendant, collector of internal revenue,
acting as agent of the Commissioner of Internal
Revenue, under the Treasury Department’s inter-
pretation of the Volstead Act, will institute criminal
proceedings against plaintiff and its property offered
for export through the United States. (Ree. 4-7.)
The bill then avers that the eighteenth amendment
relates only to intoxicating liquors “for beverage
purposes”; that there is no provision either in the
eighteenth amendment or in the Volstead Act declar-
ing or making unlawful the conveyance of whiskey in
bond through the United States for export to foreign
countrics; that such conveyance is expressly author-
ized by section 3005 of the Revised Statutes and
Article XXIX of the treaty of 1871, and that if said
Volsteadl Act shall be construed so as to forbid or
prevent such conveyance in transit in bond “then
such const-uction would make such act unconstitu-
tional.” (Ree. 7.)
ihe praver is that both defendants be enjoined
from further interfering with the in-transit shipment
of whiskey from plaintiil’s plant through the United
States to foreign countries; that defendants be re-
quired to return to plaintiff the shipment of whiskey
seized as alleged and which they are now holding;
and that defendants be enjoined from enforce-
ing the provisions of the Volstead law against plaintiff
5
or its property on thé ground that the transportation
of whiskey in the manner described constitutes a viola-
tion of such law. (Ree. 10-11.)
A rule to show cause was issued and a temporary
restraining order granted (Ree. 12-14).
The answer.
Defendants thereupon answered, admitting sub-
stantially all allegations of fact set up in the bill,
but denying the conclusions of law as to the inter-
pretation of the eighteenth amendment and the
Volstead Act, and the applicability of section 3005
of the Revised Statutes and the Treaty of 1871 to
the transshipment of woiskey. (Ree. 16-18.)
In addition, the answer averred that the continued
transportation of whiskey through the United States
would result in a portion of said whiskey remaining
in the United States in violation of law due to
thefts and other unlawful withdrawals while in
storage and en route. Counsel stipulated that the
issues made by bill and answer were issues of law
which could be determined without the necessity of
taking proof; and further, “that. the whiskey in
controversy was and is intended for consumption as
beverage whiskey.”
The decision.
District Judge Tuttle, on final hearing, entered a
decree permanently enjoining the defendants in
accordance with the prayer of the bill. (Rec. 20-26.)
His opinion may be reduced to the following propo-
sitions: (1) That while, by a strict construction, the
—
6
Volstead Act in terms prohi>its the shipments under
consideration, yet under te doctrine of the Holy
Trinity Church Case, 143 U.S. 457, the court may look
beneath the words to the purpose and intendment of
the act; (2) that as the eighteenth amendment ex-
pressly relates to liquors intended ‘‘for beverage pur-
poses,”” and as Congress has expressed its intention
that the Volstead Act should he construed ‘to the end
that the use of intoxicating liquor as 2 beverage may
be prevented,” it follows that the underlying purpose
of the act was the prevention of the use of intoxi-
cating liquor as a beverage within the Uniied States;
(3) that the prohibition in the amendment and the
act against the “exportation” of intoxicating liquor
from the United States does not negative the inten-
tion thus attributed to Congress to confine their
application to the use of such liquor within the
United States; (4) that Congress passed the Volstead
Act with knowledge of the right to transship enjoyed
under existing acts and treaties, and the failure
expressly to repeal gives rise to an inference that
such right should continue; (5) that as repeals by
implication are not favored, the Volstead Act will
not be construed to have repealed section 3005,
Revised Statutes, if effect can be given to both; (6)
that for like reasons a treaty between the United
States and a foreign Government will not be regarded
as abrogated by a subsequent statute unless an
intention so to do is clearly and unequivocally indi-
cated; (7) that Article NXIX of the treaty of 1871
has not expired by limitation nor been expressly
abrogated; (8) that the contention that continued
7
shipments of whiskey through the United States
will result in unlawful removals and thefts is over-
come by the presumption that public officers will
faithfully perform their duty; and (9) that the express
exception in section 20, Title III, of shipments
through the Panama Canal and over the Panama
Railroad is not indicative of an intention to prohibit
all other “in transit” shipments. (Rec. 20-26: 275
Fed. 373.)
THE FACTS IN CASE NO. 639.
; Bill of complaint.
In this case The Anchor Line (Ltd.), a corporation
of Great Britain, engaged in the operation of steam-
ships from ports of the United KXingdom to ports of
Europe, Canada, and the United States, filed its bill
and amended bill in the United States District Court
for the Southern District of New York to prevent the
collector of customs from seizing, under the Volstead
Act, shipments of intoxicating liquors transported
by its steamers from foreign ports to the port of New
York for transshipment to other foreign ports. (Ree.
14-24.)
The amended _ bill alleges that plaintiff during
the past three years has transported large quan-
tities of wines and intoxicating liquors from Glas-
gow to the port of New York, where such liquors
were transshipped to vessels destined for the West
Indies and other countries outside the jurisdiction of
the United States, and that a substantial part of
plaintifi’s revenue is derived from the transportation
of such liquors. (Ree. 15.)
8
Section 3005 of the Revised Statutes and Article
XXIX of the treaty of 1871 are set up as in the
Walker case, and the same rights thereunder are
alleged. (Rec. 15, 17-18.)
It is further alleged that plaintiff has contracted
with a shipper in Glasgow to transport 25 cases of
whiskey from Glasgow to Hamilton, Bermuda; that
said whiskey has been shipped and is now in trans-
portation on the 8. 8S. Cameronia, on the high seas;
that such liquor is to be transshipped at New York
from the Cameronia to another vessel plying between
New York and Hamilton; and that defendant collec-
tor of customs, acting under the direction of the
Treasury Department, has threatened to seize and
forfeit said whiskey on arrival and has refused to
issue permits for transshipment in the port of New
York. (Ree. 18.)
Plaintiff is advised by counsel and _ therefore
avers that section 3005, Revised Statutes, has not
been impaired or repealed by the Volstead Act; that
the Volstead Act does not apply to the transship-
ment of liquors at ports of the United States in the
manner set forth in the bill; that the interpretation
given by the Attorney General and the ‘Treasury
Department to the effect that it applies to such trans-
shipments is erroneous; and that if the Volstead Act
purports to prohibit such transshipments it is uncon-
stitutional and void. (Rec. 16-17, 19-20.)
As in the Walker case, the prayer was that the
defendant collector be enjoined from enforcing the
provisions of the Volstead law against the plaintifi,
ats Papas eee SU EeeSEe AR ae SE ALR SN OR SS SO
9
and that he be enjoined from refusing plaintiff a per-
mit to transship liquors in accordance with section
3005 of the Revised Statutes. (Ree. 20.)
On July 22, 1921, an order was entered by the
District Court directing the United States marshal
on arrival of the S. 8. Cameronia to take into custody
for safekeeping the consignment of whiskey
men-
tioned in the bill of complaint. (Rec. 49.)
The answer.
Defendant filed a combined motion to dismiss and
answer which admitted the prine
fact but expressly denied that the treaty of 1871 was
still in effect and denied all conclusions of law pleaded
in the bill. (Ree. 24-30.)
For a separate and distinct defense defendant
alleged that the amount of liquor transshipped at the
port of New York during the past three years has
been large; that in all cases of such liquors arriving
by vessel the responsibility of the importing vessel
appears to cease forty-eight hours after landing of
the shipment or upon delivery to a Government
truckman or lighterman: that such liquors are fre-
quently to be exported by a vessel berthed at a
diferent dock and scheduled to sail sometimes
much as twelve days after the landing
ing vessel; that in some
ipal allegations of
as
of the import-
cases the dock from which
the exporting vessels sail is as much as six or seven
miles by land or water from the berth of the incom-
ing vessel; that in all cases there el]
of perhaps a day or more, and there
carriage by land or water or both
apses some time,
is involved some
, and that such
ay
10
lapse of time and necessity of carriage has subjected
such liquors to pilferage, loss, and other unlawful
disposition. (Ree. pp. 26-27.)
The answer further averred that both in cases of
importation by water and by rail there have been
heavy losses of intoxicating liquors destined for for-
eign countries, and that, on information and belief,
such liquors were purloined or stolen and ultimately
found their way into consumption for beverage pur-
poses in the United states. (fee. 27.)
Annexed to the answer as exhibits were schedules
prepared by the collector of customs showine in-
stances between July 1, 1919, and July 1, 1921, in
which losses occurred in consignments of liquor being
transshipped in New York between the time the coods
were landed and the time of their arrival on the ex-
porting vessel. (Ree. 27, 81-39.) Specific reference
was made of the theft of a barge containing 174 drums
of alcohol, of which only 29 drums were subsequently
recovered. (ee. 27.)
In addition, the answer averred that if plaintif’s
contention is correct, then it follows as a corollary
that any foreign vessel transporting liquor and bearing
clearance papers from one foreign port to another
may cruise at will in the territorial waters of the
United States, rendering, well-nigh impossible the
already difficult task of preventing the smuggling
of intoxicating liquor into the United States. (Ree.
29-30.) And in this connection the answer alleges,
on information and belief, that a large and profitable
business has been carried on -by American citizens
CF ER SIR BE Phe SOAPS TT REL
ll
with the object and result of importing liquor into
the United States in violation of law; that the vessels
employed by such persons are under British registry
and sail out of a British port in the Bahama Islands
with clearance papers for Halifax, another British
port; that one such vessel is now under seizure in New
York and that another recently was foreed into the
port of Philadelphia by stress of weather. (/d.)
The decision.
‘The case was heard by Circuit Judge Mayer
dismissed the plaintifi’s bill (Ree.
, who
06-57), holding:
(1) The national prohibition act taken literally ab-
solutely prohibits ihe transportation which plaintiff
finds necessary for its purposes; (2) the Congress
had plenary power to prohibit the transportation of
liquor for beverage purposes, even if intended for use
outside of the United States; (3) the
uct provides a
method by which intoxie:
iting liguors for nonbeverage
purposes may be transported, and the fact that the
transshipment of liquors is not included in the means
provided, indicates that Congress did not intend
exception ; (4) that the act, in line with the
ment, expressly forbids the ‘exportation’
cating liquors for beverage purposes; (
an
amend-
of intoxi-
3) the act in
this particular amounts to a practical construction of
the amendment to the effect that it absolutely de-
stroys all traflie in intoxicating liquors for beverage
purposes even though intended for use outside the
United States; (6) Congress had the right to set up
saleguards against the wrongful diversion of intoxi-
12
cating liquors; (7) section 3005 of the Revised Stat-
utes is of doubtful application, since it is a revenue
statute and exempts from customs duties merchan-
dise which otherwise would be dutiable, whereas the
shipments in question were not subject to duty,
could not have been imported, and the subject has
no relation to revenue; (8) while repeals by implica-
tion are not favored, where a later statute is plainly
inconsistent with a prior one, the latter necessarily
repeals the former; (9) section 3, Title II, of the
Volstead Act and section 3005 of the Revised Statutes
are inconsistent in terms, and to the extent that the
latter has any bearing on the case, it must be deemed
to have been repealed; (10) Presidents Cleveland and
Harrison having held that the treaty of 1871 was
abrogated, a court of first instance will not take a
contrary view.
CONSTITUTIONAL, STATUTORY, AND TREATY PRO-
VISIONS.
The applicable constitutional, statutory, and treaty
provisions are as follows:
The eighteenth amendment:
* * * the manufacture, sale or trans-
portation of intoxicating liquors within, the
importation thereof into, or the exportation
thereof from, the United States and all terri-
tories subject to the jurisdiction thereof, for
beverage purposes, is hereby prohibited.
Sec. 2. The Congress and the several States
shall have concurrent power to enforce this
article by appropriate legislation.
PEE EIA Se Rg RN Te yd CeO
13
Section 3 of Title ] I of the Volstead Act:
No person shall on or after the date when
the eighteenth amendment to the Constitu-
tion of the United States goes into effect
manufacture, sell, barter, transport, import,
export, deliver, furnish or possess any intoxi-
cating liquor except as authorized by this act,
and all the provisions of this act shall he
liberally construed to the end th
intoxicating liquor a
vented.
Liquor for nonbeverage purposes and wine
for sacramental] purposes may be manufact ured,
purchased, sold, bartered, transported, im-
ported, exported, delivered, furnished and
possessed, but only as herein provided, and
the commissioner may, upon application,
issue permits therefor: * * *. (Ch. 85, 41
Stat., pp. 308-309.)
Section 3005, Revised Statutes,
All merchandise wriving at any port of
the United States destined for any foreign
country, may be entered at the customhouse
and conveyed, in transit, through the terri-
tory of the United States without the pay-
ment of duties, under such regulations as to
examination and transportation as the Secre-
tary of the Treasury may prescribe.
Article XXIX of the tre:
concluded May 8, 1871,
at the use of
Sa beverage may be pre-
as amended:
ity with Great Britain
and proclaimed July 4, 1871:
It is agreed that, for the term of years
mentioned in Article XXXIII, of this ti
‘eaty,
goods, wares, or merchandise arriving at the
96689 22-_9
RLY Ion RUS es ed Oat
EWN Dipti ONAN NDS Ly as ete a ee
DOPE ee IE Pa SRG
14
ports of New York, Boston and Portland and
any other ports in the United States which
have been or may, from time to time, be
specially designated by the President of
the United States and destined for Her Brit-
annic Majesty’s possessions in North America,
may be entered at the proper customhouse,
and conveyed in transit, without the payment
of duties through the territory of the United
States, under such rules, regulations and
conditions for the protection of the revenue as
the Government of the United States may from
time to time prescribe; and under like rules,
reculations and conditions, goods, wares, or
‘merchandise may be conveyed in_ transit,
vithout the payment of duties, from = such
possessions through the territory of the United
States for export from the said ports of the
United States; and under like rules, regula-
tions, and conditions, goods, wares, or mer-
chandise may be conveyed in transit, without
the payment of duties, from such possessions
through the territory of the United States
for export from the said ports of the United
States. (Treaties, conventions, &e., vol. 1,
pp. 711-712, Senate Doc. No. 357, 61st Cong.,
2d sess.)
ASSIGNMENTS OF ERROR IN NO. 615.
The District Court erred:
1. In holding that the national prohibition act
does not forbid the transportation of intoxicating
liquor intended for beverage purposes, from Canada
to a foreign country, by transshipment, in bond,
through the United States.
—— scien imapeaneahes *
eg EL es iy er niles FOS EARP cs FAN TNS inhale, 20 bib De Ue Sai Fb Bh carat
15
2. In holding that the treaty between Great
Britain and the United States proclaimed July 4,
1871, was not abrogated by the adoption of the
eighteenth amendment to the Constitution and the
passage of the national prohibition act so far as said
treaty relates to liquors for beverage purposes.
3. In holding that said treaty was not abrogated
and terminated by the executive branch of the United
States prior to the adoption of the eighteenth amend-
ment to the Constitution of the United States and
the passage of the national prohibition act, so far as
said treaty relates to the transshipment of merchan-
dise from the British possessions to foreizn countries
and through the United States.
4. In holding that section 3005, Revised Statutes,
was not repealed by the national prohibition act so
far as said section pertains to intoxicating liquor for
beverage purposes.
5. In holding that the national prohibition act and
the regulations lawf ully promulgated thereunder, per-
mit the transportation of intoxicating liquor from
Canada to a foreien country, by transshipment in
bond, through the United States, under regulations
pursuant to the treaty aforesaid and section 3008,
Revised Statutes. (Printed in full, Rec. 28-31.)
Ae ee ee ae ee ek eh) a a Oe) senna -
16
ARGUMENT.
I.
THE EIGHTEENTH AMENDMENT AND THE NATIONAL PRO-
HIBITION ACT APPLY TO AND PROHIBIT THE TRANS-
SHIPMENT ' OF INTOXICATING LIQUORS FOR BEVERAGE
PURPOSES IN OR THROUGH THE UNITED STATES.
1. Such transshipments are within the very terms of
the amendment and act.—The eighteenth amendment
and section 3 of Title II of the Volstead Act ex-
pressly prohibit the “transportation” of intoxicat-
ing liquors within, the “importation” thereof into,
or the “exportation”’ thereof from, the United States
for beverage purposes.
In addition, the Volstead Act provides that no
b
person shall “ deliver,” “furnish,” or “ possess’’ any
intoxicating liquor ‘‘ except as authorized in the act.”
And further, that all provisions of the act “shall be
liberally construed to the end that the use of intoxi-
‘ating liquor as a beverage may be prevented.”
The transshipment of intoxicating liquor in and
through the United States necessarily involves “ im-
”»
porting,” “exporting,” “possessing,” “ transport-
ing,’ “furnishing,’’ and “delivering” such liquor.
The wording of the amendment and act, therefore,
plainly includes transshipment of intoxicating liquors,
as was conceded by counsel for Hiram Walker &
Sons (Ltd.) in the District Court. (Ree. No. 615,
p. 22.)
1 For convenience the word “transshipment” will be used to designate
both the transshipments at the port of New York involved in the Anchor
Line Case, No. 639, and the transshipments and ‘‘in transit” conveyances
involved in the Walker Case, No. 615.
17
Nowhere does the act expressly authorize such
transshipment or “in transit” conveyance of liquor;
therefore, under the very terms of the act they must
be deemed to be prohibited.
2. The plain object of the amendment and act was to
destroy all traffic in ordeal ing with intoxicating liquors.—
Counsel for complainants argue that the amendment
and statute have as their object the prohibiting of
the use of intoxicating liquor in the United States,
and that as the transshipment of liquor in and
through the United States does not directly con-
tribute to such use (a proposition which we do not
admit), it is not within their scope or spirit.
While the ultimate object is the prevention of the
use of intoxicating liquors, it is evident that the
immediate purpose is the destruction of all traffic in
or dealing with the interdicted commodities.
This follows from the language employed. Neither
the eighteenth amendment nor the prohibition act in
terms forbids the use of intoxicating liquors. As re-
cently pointed out by Mr. Justice McReynolds, they are
concerned merely with the incidents of ownership, such
asthe manufacture, sale, transportation possession, ete.
Street v. Lincoln Safe Deposit Co., 254 U.S. 88, 95.
The reason for this is that in dealing with a situa-
tion such as the liquor evil by constitutional amend-
ment or legislation, a more effective method of eradi-
cating it is by preventing the means by which it
comes into being, than by direct inhibitica on the use.
Had the eighteenth amendment and the Volstead
Act provided simply an inhibition on the use or
18
consumption of intoxicating liquors, there might be
room for the contention that such inhibition did not
extend to the possession or transportation of liquor
not intended for beverage use in the United States.
But such was not the language employed.
The truth of the matter is that both the amend-
ment and the statute have for their immediate pur-
pose the suppression of all traffic in or dealing with
intoxicating liquor within the United States. The
ultimate object of such suppression is, of course,
elimination of the use of intoxicants; but the amend-
ment and the act are actually concerned with the
means rather than the end.
38. The amendment and the act clearly were in-
tended to prohibit the possession or transportation of
liquor for beverage purposes, whether for consump-
tion within the United States or without.—When the
Volstead bill was under consideration in the Senate,
there was added an amendment, now section 20,
Title III, making it unlawful to import or introduce
into the Canal Zone, or to manufacture, sell, trans-
port, possess, etc., liquor within the Canal Zone.
(58 Cong. Rec. 4895.) The amendment contained
the following proviso:
Provided, That this section shall not apply
to liquor in transit through the Panama
Canal or on the Panama Railroad. (41,
Stat. 322.)
It is impossible to understand why this proviso
was made to section 20, Title III, while no similar
clause was added to section 3, Title IJ, if Congress
enn tee a) ew P Reed WHA Lia — — ~ SOR
Ride
19
really intended to exempt from the latter the trans-
shipment of liquors. The rule expressio unius est
exclusio alterius applies.
Again, both the eighteenth amendment and the
prohibition act expressly prohibit the exportation of
intoxicating liquors from the United States. Such
prohibition is inconsistent with an intention to re-
strict their application to liquors intended for con-
sumption in the United States,
The conclusion of the District Court in No. 615
(Ree. 24-25) to the effect that this provision is without
significance for the reason that “ exportation” neces-
sarily comprehends manufacture within the United
States, in violation of law, robs the provision of all
meaning and is untenable.
The manufacture of intoxicating liquors was ex-
pressly forbidden by the Volstead Act, and had been
prohibited for some time prior thereto by war-time
legislation. The provision in said act against ex-
portation can not, therefore, be restricted to liquors
manufactured in violation of law. ‘The provision
relates to all exportations of liquor, whatever the
circumstances attending its manufacture.
At the time the Volstead Act was passed there
was stored in bonded warehouses many millions of
gallons of distilled spirits manufactured in this
country strictly in accordance with law. (See opinion
of this Court ix: Hamilton vy. Kentucky Distilleries,
251 U.S. 146, 158, footnote.) In spite of the urgent
pleas of the owners, Congress, in passing the Vol-
—
: 20
stead Act, absolutely prohibited the exportation of
this surplus.
This liquor was bonded, tagged, and labeled and
could have been exported with no greater risk of
loss than attends the “in transit”? shipment of for-
eign liquor. But Congress forbade the exportation
of this legaily acquired liquor and it could have
been led to that decision only through apprehension
of the inevitable losses and diversions to unlawful
usage attendant upon the transportation to sea-
board.
It is hard to believe that Congress would prohibit
American citizens from exporting valuable stocks of
lawfully acquired liquor and at the same time allow |
aliens to flood the ports of the United States with _
liquor, and to transport large quantities thereof
clear across the country, when the chances of loss
by theft are no greater in the one case than in the
other.
Or, assume two competing distillers on opposite
sides of the Canadian border. Is it reasonable to
suppose that Congress intended to say to the American
distiller that his stock of lawfully acquired liquor must
be kept in his warehouse and at the same time allow
the Canadian distiller to transport his liquor at will
past the American’s door bound for Mexico and other
foreign countries?
The inclusion in the amendment and the act of the
ban on exportation conclusively points to the abso-
lute prohibition of ail transportation.
a.
21
4. The proceedings in Congress evidence the legis-
lative intention to prohibit all possession and all
transportation except as specifically authorized.—The
proceedings and debates attending the passage of the
Volstead Act show that it was the earnest desire of a
remarkably unanimous Congress to prohibit abso-
lutely all methods of dealing with intoxicating liquors
which experience had shown might lead to their
diversion to heverage purposes.
Section 3 of Title II, being the omnibus section of
the act, received special attention in both Houses of
Congress. There was considerable opposition to the
inclusion of the word “possess” in this section. For
instance, Congressman Gard, of Ohio, in speaking of
this section, said (58 Cong. Rec. 2449) :
When we considered this section we had the
word “‘use’’ after the word ““possess.”” The
word “‘use’’ has been stricken out and the
word *‘‘possess” should be stricken out. The
words “furnish” and “receive” in my opinion
should he stricken out unless. this House
intends to write a bill so drastic as to make it
appear in the eyes of the people of the United
States that there is nothing in it except a bill
of absolute prohibition.
But the word “‘possess”’ was retained by the con-
ference committee and its retention was thought of
such importance that the Senate conferees in their
report (8. Rep. 151) justified it at considerable
length:
The committee in the House struck out the
word “use” after “possess” and retained the
EG AE NTR Pea eta he PET SO hes ET ae
—
22
”?
word ‘‘possess’”’ for good reasons. * * *
These provisions are of the greatest impor-
tance to the officer who wants to enforce the
law. They are based on experience in the
States. If individuals are permitted to pos-
sess intoxicating liquor for beverage purposes
outside the home, officers of the law are con-
stantly embarrassed in their efforts to enforce
the law. It is always a question whether the
individual has the liquor legally or otherwise.
* #* * The strongest weapon that Congress
can put into the hands of faithful law-enforce-
ment officials will be a provision in this en-
forcement code to prohibit the possession
of intoxicating liquor for beverage purposes,
except as specificaily provided for in the act.
[Italics ours.] .
In order to strengthen this provision against the
‘“‘possession”’ of intoxicating liquor, section 33, Title
II, was placed in the law, making possession ‘‘ prima
facie evidence that such liquor is kept for the pur-
pose of being sold, bartered, exchanged, given away,
furnished, or otherwise disposed of in violation of the
provisions of this title” (41 Stat. 317).
The transshipment or ‘‘in transit’? conveyance of
intoxicating liquor necessarily involves the ‘‘ posses-
sion” of such liquor as well as its ‘‘transportation.”
As shown by the opinion of District Judge Tuttle,
this was conceded by opposing counsel in the Walker
case in the court below (Rec. No. 615, p. 22; 276
Fed. 373, 376):
It is clear enough, and is, I understand,
conceded by the plaintiff, that under a strict
aia Rea a Link. 28 an ARR LORENA. iene te A) eae eee Eee er eee
23
construction of the language of the statute,
the latter is sufficiently broad in its terms to
prohibit the shipments under consideration,
since it is undoubtedly necessary, in order to
make such shipments, to both ““possess”’ and
“transport” intoxicating liquor within the
United States.
As regards the word “transportation,” it was
practically the unanimous opinion of both Houses
that all transportation of intoxicating liquors should
be prohibited except in such cases as might be
specially provided for. An examination of the de-
bates discloses no instance of anyone questioning the
inclusion of this word.
It is noteworthy that all of the amendments pro-
posed for the evident purpose of weakening the law,
while they omitted other provisions contained in
the bill as passed, invariably included the prohibi-
tion against transportation. Thus, Congressman
Igoe, leader of the opposition, moved that the bill
be amended by striking out all after the enacting
clause and that there be substituted a provision for
punishing by fine of $500 or imprisonment for one
year “anyone who shall knowingly manufacture,
sell, or transport within the United States, or import
into the United States, or export from the United
States, any intoxicating liquor.” (58 Cong. Ree.
2976.) This persuasively indicates that it was the
unanimous view of Congress that all transportation
of liquor should be banned.
a
24
The legislative intent further appears from the
provisions of sections 13 to 16 of Title II which
subject carriers to the most stringent regulations in
respect of the transportation of liquor under the
permissive sections of the act. It seems incredible
that the Congress which made such rigid provisions
against evasion of the law through permissive trans-
portation would have left without restrictions im-
posed in the act the great business of transshipping
liquor at the ports of the United States and the con-
veying of it through the United States.
5. The language of the amendment and act being
plain, resort may not be had to construction to read out
what is clearly included.—The recent decisions of this
court are unanimous to the effect that where the
language of a statute is plain and unambiguous,
it can not be divested of its obvious meaning by
resort to construction. Hamilton v. Rathbone, 175
U. 8S. 414, 421; United States v. Lexington Mill &c.
Co., 232 U. S. 399, 409-10; Adams Express Co. v.
Kentucky, 238 U. 8. 190, 199; Caminetti v. United
States, 242 U. S. 470, 485; Thompson v. United
States, 246 U. S. 547, 551.
In Thompson v. United Siates, supra, the court
said:
The intention of Congress is to be sought for
primarily in the language used, and where
this expresses an intention reasonably intel-
ligible and plain it must be accepted without
modification by resort to construction or
conjecture.
Pike bi SS CREATES, RTL AP Pee dd OE
a.
25
And in Caminetti v. United States, supra, an ex-
treme case, the court characterized the rules as “ele-
mentary,” saying:
It is elementary that the meaning of a
statute must, in the first instance, be sought in
the language in which the act is framed, and
if that is plain, and if the law is within the con-
stitutional authority of the law-making body
which passed it, the sole function of the courts
is to enforce it according toits terms. * * *
Where the language is plain and admits of
no more than one meaning, the duty of inter-
pretation does not arise and the rules which
are to aid doubtful meanings need no dis-
cussion.
The case of Holy Trinity Church v. United Slates,
143 U.S. 457, and other cases relied on by plaintiffs,
to the effect that under certain conditions courts will
look beyond the letter of a statute to give effect to the
obvious spirit and intent, have no application. In
the Holy Trinity case this court held that the alien
contract labor law did not apply to a contract
between the Rev. EF. Walpole Warren, an Englishman,
and the Church of the Holy Trinity, a religious society
incorporated under the laws of a State, whereby the
former engaged to remove to the United States and
enter into the service of the latter as rector. The
conclusion was obvious and irresistible, and the case
has gained prominence mainly because of the learned
opinion by Mr. Justice Brewer. In that case, and
in the others cited, the results which would follow
from giving literal effect to the statutes involved
26
would have been absurd, bordering on grotesque.
Indeed, the cases are scarcely less far-fetched than
the historic instances from Puffendorf and Plowden,
cited by Mr. Justice Brewer.
Neither have the cases of United States v. Gudger,
249 U.S. 373, and Sireet v. Lincoln Safe Deposit Com-
pany, 254 U.S. 88, any bearing. The former arose
under the Reed amendment (act of March 3, 1917,
39 Stat. 1058, 1069), making unlawful the trans-
portation of liquor “into any State or Territory the
laws of which * * * prohibit the manufacture,”
etc., of liquor. The defendant was a passenger on a
railroad train bound from Baltimore, Md., to Ashe-
ville, N.C., traveling on a through ticket. While the
train was temporarily stopped at Lynchburg, Va., he
was arrested, his baggage examined, and whiskey
found. Although he had no intention of leaving
the train at Lynchburg or elsewhere in Virginia, he
was indicted for transporting liquor “into” Vir-
ginia in violation of law. ‘This court affirmed the
judgment of the District Court in quashing the indict-
ment, saying (pp. 374-375) :
* * * we think the court was clearly
right in quashing the indictment, as we are of
opinion that there is no ground for holding
that the prohibition of the statute against
transporting liquor in interstate commerce
“into any State or Territory the laws of which
State or Territory prohibit the manufacture,”
etc., includes the movement in interstate com-
merce through such a State to another. No
elucidation of the text is needed to add
pee tee eerste er ercenonerne mene cnemenecr eames aumen ern ememmnnseniiaiill
27
cogency to this plain meaning, which would
however be reinforced by the context if there
were need to resort to it, since the context
makes clear that the word “into,” as used in
the statute, refers to the State of destination,
and not to the means by which that end is
reached, the movement through one State as
a mere incident of transportation to the State
into which it is shipped.
The Reed amendment, unlike the nation
hibition act, did not prohibit transport
ally, but only transportation into a partic
al pro-
ation gener-
ular territory,
and the court simply gave effect to the plain wording
of the statute. The principle applied is the one con-
tended for herein, and if applied in the instant cases
will inevitably result in a holding that the shipments
in question are violative of the prohibition law.
In Street v. Lincoln Safe Deposit Co. the owner of
liquors lawfully acquired for personal consumption
had stored them in a warehouse where, as alleged
and admitted, they were in his “exclusive possession
and control.’ Section 33 of the Volstead Act ex-
pressly authorizes the possession of liquors lawfully
acquired in one’s private dwelling house for personal
consumption. The court held (1) that the ware-
house keeper might permit such storage of liquors to
continue after the effective date of the prohibition
act; (2) that the warehouse owner did not unlawfully
“possess” the liquors. in violation of section 3 of
Title II; and (3) that the act did not prohibit the
transportation of the liquors from the warehouse to
28
the home of the owner, under permit from the
Bureau of Internal Revenue.
The ground of decision, as explained in the later case
of Corneli v. Moore (No. 174), decided January 30, 1922,
was that by the admissions of the pleadings the
liquor in question was “in the exclusive possession
and control” of the owner, and the storage room
“was obviously the use of a convenience very com-
monly employed and contributory to his dwelling.”
The court merely gave preference to a liberal inter-
pretation of one of the permissive provisions of the
act over a construction which would have resulted in
the confiscation of liquors lawfully acquired. ‘The
difference between such a_ situation and _ that
involved in the instant cases, where no permissive
section is involved, is indicated by the following
excerpt from the opinion (p. 93):
That transportation of the liquors to the
home of appellant, under the admitted cir-
cumstances, is not such as is prohibited by
the section is too apparent to justify detailed
consideration of te many provisions of the
act inconsistent with a construction which would
render such removal unlauful * * *, (Ltalies
ours.)
It is clear that this case has no bearing on the cases
at bar; and it has been so narrowed and _ restricted
in the later case of Corneli v. Moore as to have no
application beyond its peculiar facts.
6. The prohibition on transshipments will not be
read out of the act on the ground that as applied to such
7 er
= wat as Jail ” J. Ae BP ARWSP ae ie SOE NE I
r a any “ Piatt RAR Oar NA alt Sa hw zs Aut
JS Pepe ie ate eine ss
29
transshipments it has extraterritorial effect—It is
argued that the national prohibition act if construed
to forbid the transshipment in the United States of
liquor in course of transportation from one country
to another will give the act an extraterritorial effect,
in that it will operate not merely to prevent the use
of liquors in the United States but will extend its
effect beyond the territorial limits of the United
States, and that, as Congress can not be presumed to
have intended such result, the law should not be so
construed.
Unlike American Banana Co. v. United Fruit Co.,
213 U.S. 347, cited by the plaintiff in No. 615, there
is involved in the present cases no attempt to apply
the laws of the United States to acts committed in a
foreign country. ‘The thing prohibited is the pos-
session or transportation of intoxicating liquor “ with-
in the United States.”
A like contention was rejected by this court in
Strathearn S. S. Co. vy. Dillon, 252 U. S. 348. ‘The
statute there under consideration was section 4 of the
seaman’s act of March 4, 1915, ch. 153, 38 Stat. 1164,
providing (1) that every seaman on a vessel of the
United States shall be entitled to receive on demand
from the master one-half of the wages which he shall
then have earned, at every port where such vessel,
after voyage has been commenced, shall load or
deliver cargo before the voyage is ended; (2) that all
stipulations in the contract of employment to the
contrary shall be void; and (3) that the section shall
96589 —23 3
“0
apply to seamen on foreign vessels while in harbors
of the United States.
It was contended that the provision must be con-
fined either (1) to American seamen or (2) to forei¢n
seamen serving under contracts entered into in ports
of the United States, since otherwise it would have
the effect to invalidate contracts of employment en-
tered into in foreign countries and valid where made,
and would in effect amount to an attempt to regulate
the making of such contracts outside the territorial
limits of the United States. ‘This court replied that
the act merely regulated the relation of master and
servant while a foreign vessel was in American har-
bors; that submission to such regulations Was a condi-
tion precedent to the right to enter our ports, and
that the imposition of such condition was within the
constitutional authority of Congress.
‘the reasoning of the opinion is plainly applicable
to the cases at bar.
Il.
THE NATIONAL PROHIBITION ACT IN ITS APPLICATION
TO THE TRANSSHIPMENT OF INTOXICATING LIQUOR
FOR BEVERAGE PURPOSES IS CONSTITUTIONAL AND
VALID
1. Fallacy of plaintiffs’ contention.—The ahove
proposition appears to have been conceded by
counsel in the Walker Case in the District Court (Ree.
No. 615, p. 22); and although contested in the
Anchor Line Case the point was not accorded serious
attention (Rec. No. 639, pp. 50-56).
The argument appears to run: (1) That the pur-
pose of the eighteenth amendment is to prohibit
31
the manufacture, sale, transportation, ete., of intoxi-
cating liquor for beverage purposes within the United
States; (2) that the prohibition act if construed to
apply to the transshipment of liquor in and through
the United States will prohibit the transportation
and possession of liquor for beverage purposes ouf-
side the United States; (3) wherefore, the act. is
broader than the amendment and beyond the power
of Congress to enact.
The fallacy of this argument, as well as of com-
plainants’ argument in reference to the construc-
tion of the act, consists in limiting the operation
and effect of the eighteenth amendment to a purpose
hot expressed therein. As we have seen (supra p. 12),
the eighteenth amendment prohibits absolutely the
transportation of intoxicating liquors (1) “within
the United States,” (2) “for beverage purposes.”
This juxtaposition demonstrates that the words
“within the United States” define the place where
the forbidden act may not take place, and that they
do not relate to or qualify the words “for beve ‘age
purposes.”
But accepting, arguendo, the premise, the con-
clusion does not follow, because—
2. Congress in legislating for the enforcement of
the eighteenth amendment may provide all means rea-
sonably necessary effectively to suppress the prohibited
acis.—It is the settled doctrine of this court (1)
that Congress in legislating within its constitutional
sphere for the suppression of a particular evil may
provide all means reasonably necessary to effectuate
32
the legislative will; and (2) that where the means
provided has some reasonable relation to the evil
at which the legislation is aimed the court will not
substitute its judgment for that of Congress as to
the necessity or advisability of the means.
This proposition is sustained by a principle of
constitutional construction announced in \JeCulloch
v. Maryland, 4 Wheat. 316, 421, 423, and ever
since adhered to. The principle was thus stated in
Powell v. Pennsylvania, 127 U. 5. 678, 685:
The power which the legislature has to pro-
mote the general welfare is very great, and the
discretion which that department of the Gov-
ernment has, in the employment of means to
that end, is very large. While both its power
and its discretion must be so exercised as not
to impair the fundamental rights of life, lib-
erty, and property; and while, according to the
principles upon which our institutions rest,
“the very idea that one man may be compelled
to hold his life, or the means of living, or any
material right essential to the enjoyment of
life, at the mere will of another, seems to be
intolerable in any country where freedom pre-
vails, as being the essence of slavery itself”;
yet “in many cases of mere administration the
responsibility is purely political, no appeal
lying except to the ultimate tribunal of the
public judgment. Aye
Applying the principle to that case it was held
that the courts would not override the legislative
judgment that the protection of the public health
quyeccratnenns — _
SAGE ke ge a Se nN a i en et ese
33
required not merely that the manufacture of oleo-
margarine be so regulated as to exclude noxious
ingredients, but prohibited altogether; that the
legislature had this choice of means.
In Otis v. Parker, 187 U. §. 606, 608, 609, it was
held that in order to Suppress gambling in corporate
stocks the legislature may avoid all contracts for the
sale of such stocks on margin, whether only a settle-
ment of price differences or a bona Jide acquisition of
the stock is contemplated.
Similarly in Public Clearing House v. Coyne, 194
U.S. 497, it was held that in preventing the use of
the postal service in aid of lutteries and fraudulent
enterprises Congress is not confined to excluding
matter relating to such enterprises but may prohibit
the transmission or delivery of all matter sent by or
addressed to persons participating therein.
A leading case on the subject is Purity Extract Co.
v. Lynch, 226 U.S. 192, in which it was held that a
State legislature, in order to make effective its pro-
hibition of the use of malt liquor might include
within the prohibition wholly innocuous beverages.
Mr. Justice Hughes, speaking for the court, said
(p. 201):
It is also well established that, when a
State exerting its recognized authority under-
takes to suppress what it is free to regard as
a public evil, it may adopt such measures
having reasonable relation to that end as it
may deem necessary to make its action
effective. It does not follow that because a
»
oe
transaction separately considered is innocuous
it may not be regarded as essential in the
legislative judgment to accomplish a purpose
within the admitted power of the Government.
That case was followed in Ruppert v. Caffey, 251
U.S. 264, in upholding the power of Congress, under
the war power, to prohibit the manufacture of all
malt gor vinous liquors containing as much as one-half
of one per centum of alcohol by volume, even though
they be not in fact intoxicating.’
In view of the instances cited, who will say that
the prohibition of the possession or transportation
within the United States of liquors for beverage pur-
poses, even though intended for consumption outside
the United States, has no reasonable relation to the
prevention of the use of such liquors within the
United States?
3. Because of their noxious qualities all traffic in or
dealing with intoxicating liquor may be absolutely
suppressed.—It can not be supposed that the power
conferred by the eighteenth amendment on Congress
and the States to suppress the use of intoxicating
liquors is not as great as the power theretofore pos-
sessed by the States to legislate on the subject.
Therefore, the many cases upholding the very drastic
prohibition laws of the States are in point. It will
suffice to quote from only one of these, Crane v.
Campbell, 245 U. 8. 304, 307-308, in which this
See, also, The Slaughter House Cases, 16 Wall. 36; Knoxville Iron Co. v.
Harbison, 183 U. S. 13; Booth v. Illinois, 184 U. S. 425; Silz v. Hesterberg,
211 U. S. 31; Delaware, Lack. & West. R. R. Co. v. United States, 231 U. 8.
363, 370; Houston v. St. Louis Packing Co., 249 U. S. 479; Brougham v.
Blanton, 249 U. S. 495.
o>
vv
court upheld a statute of the State of Idaho punishing
the possession of intoxicating liquor for personal use:
It must now be regarded as settled that on
account of their well-known noxious qualities
and the extraordinary evils shown by experi-
ence commonly to be consequent upon their
use, a State has power absolutely to prohibit
manufacture, gift, purchase, sale, or transpor-
tation of intoxicating liquors within its bor-
ders without violating the guarantees of the
fourteenth amendment. * * *
As the State has the power above indicated
to prohibit, it may adopt such measures as are
reasonably appropriate or needful to render
exercise of the power effective. * * * And,
considering the notorious difficulties always
attendant upon efforts to suppress trafiie in
liquors, we are unable to say that the chal-
lenged inhibition of their possession was arbi-
trary and unreasonable or without proper
relation to the legitimate legislative purpose.
We further think it clearly follows from our
numerous decisions upholding prohibition leg-
islation that the right to hold intoxicating
liquors for personal use is not one of those fun-
damental privileges of a citizen of the United
States which no State may abridge. A con-
trary view would be incompatible with the
undoubted power to prevent manufacture,
gift, sale, purchase or transportation of such
articles—the only feasible way of getting at
them. An assured right of possession would
necessarily imply some adequate method to
obtain not subject to destruction at the will of
the State.
36
Ill.
PLAINTIFFS HAVE NOT BY PROPER ALLEGATIONS
BROUGHT THEMSELVES WITHIN ARTICLE XXIX OF THE
TREATY WITH GREAT BRITAIN PROCLAIMED JULY 4,
1871; BUT IN ANY EVENT SAID ARTICLE HAS BEEN
ABROGATED.
1. Neither plaintiff has alleged facts bringing it
within Article X X 1X .—Said article, as we have seen
(supra, p. 13), provides that—
goods, wares, and merchandise arriving at the
ports of New York, Boston, and Portland and
any other ports of the United States which have
been or may, from time to time be specially
designated by the President of the United States
and destined for Her Britannic Majesty’s pos-
sessions in North America, may be entered at
the proper customhouse, and conveyed in
transit, without the payment of duties, through
the territory of the United States;—
and that in like manner—
goods, wares, and merchandise may be con-
veyed in transit, without the payment of duties,
from such possessions through the territory of
the United States for export from the said ports
of the United States. [Italics ours.]
In No. 615 Hiram Walker & Sons (Ltd.), alleges
interference with two shipments, viz, one from
Walkersville, Ontario, to the port of Detroit, and
thence through the territory of the United States to
customers in Mexico, and another from Walkersville
to Detroit and from Detroit to New Orleans for export
to Guatemala. Yet nowhere in its petition does the
plaintiff allege that the ports at which the shipments
37
were to he exported were “specially designated by
the President of the United States” in accordance
with the provisions of the article.
Again, it is clear that the language of the article,
providing that goods, wares, and merchandise may
“be conveyed in transit” “through the territory of
the United States,” relates to the transportation of
such goods from one port to another and not merely
to transshipments in a single port as alleged by
the Anchor Line in No. 639.
It is submitted, therefore, that neither plaintiff has
set up any rights under the treaty.
2. The abrogation of Article XXIX was effected by
Act of Congress.—Article XXIX as we have seen pro-
vides that it shall be in effect for the term of years
mentioned in Article XX XIII (supra, p. 18).
Article XX XIII, reads as follows:
The foregoing Articles XVIII to XXV, in-
clusive, and Article XXX of this treaty shall
take effect as soon as the laws required to
carry them into operation shall have been
passed by the Imperial Parliament of Great
Britain, by the Parliament of Canada, and by
the Legislature of Prince Edward Island on
the one hand, and by the Congress of the United
States on the other. Such assent having been
given, the said articles shall remain in force
for the period of ten years from the date at
which they may come into operation; and
further until the expiration of two years after
either of the high contracting parties shall have
given notice to the other of its wish to ter-
minate the same; each of the high contracting
——
38
parties being at liberty to give such notice to
the other at the end of the said period of ten
years or at any time afterward.
Articles I to XVII, inclusive, provide for the set-
tlement of the Alabama claims and for claims of
British subjects against the United States; Articles
XVIII to XXV, inclusive, and Article XXX relate to
fisheries; Articles XXIX and XXXIIT have been set
out above and the remaining articles cover miscella-
neous matters such as the use of waterways, arbitra-
tion of boundaries, ete.
On March 1, 1873, Congress passed an act entitled,
“An act to carry into effect the provisions of the
treaty between the United States and Great Britain
signed in the city of Washington the eighth day of
May, eighteen hundred and seventy-one, relating to
fisheries.”’
Section 3 of this act, giving effect to Article XXIX
of the treaty, is as follows:
That from the date of the President’s
proclamation authorized by the first section
of this act, and so long as the articles eighteenth
to twenty-fifth, inclusive, and articles thirtieth of
of said treaty, shall remain in force, according
to the terms and conditions of article thirty-third
of said treaty, all goods, wares or merchandise
arriving at the ports of New York, Boston,
and Portland, and any other ports in the
United States which have been, or may, from
time to time, be, specially designated by the
President of the United States, and destined
for Her Britannic Majesty’s possessions in
39
North America, may be entered at the proper
customhouse and conveyed in transit, without
the payment of duties, through the territory
of the United States, under such rules, regula-
tions, and conditions for the protection of the
revenue as the Secretary of the Treasury may,
from time to time, prescribe; and, under like
rules, regulations, and conditions, goods, wares,
or merchandise, may be conveyed in transit,
without the payment. of duties, from such
possessions, through the territory of the
United States, for export from the said ports
of the United States. (17 Stat. 482.) [Italics
ours. ]
This section was incorporated in the Revised
Statutes as section number 2866.
On March 3, 1883, Congress passed a joint resolu-
tion entitled, “Joint resolution providing for the
termination of articles Numbered XVIII to XXYV,
inclusive, and Article Numbered XXX of the treaty
between the United States of America and Her
Britannic Majesty concluded at Washington May 8,
1871. (22 Stat. 641.)
The resolution provided for the giving of notice of
the abrogation of the articles of the treaty named in
the title, and no others. Section 3 contained the
following provision:
And the act of Congress approved March 1,
A. D. 1873, entitled * * * go far as it re-
lates to the articles of said treaty so to be ter-
minated, shall be and stand repealed and be of
no force on and after the time of the expiration
of said two years.
SRT ene idm guite
a
40
By proclamation of January 21, 1885, President
Arthur gave notice that Articles XVIII to XXV, in-
clusive, and Articles XXX and XXXII will expire on
July 1, 1885. (23 Stat. 841.)
As noted, the act of March 1, 1873, giving effect to
the various provisions of the treaty, limits the opera-
tion of Article X XIX to the life of Articles XVIII to
XXV and Article XXX, and constitutes a legislative
interpretation of Article XXXIII as it relates to
Article X XIX; if not this, it is a legislative limitation
of the article which governs.
Section 3 of the act of 1873, giving effect to Article
XXIX (Section 2866, R.S.), expired by self-limita-
tion on the abrogation of Articles XVIII to XXV
and XXX, and there is, therefore, no legislation in
force to give effect to this Article.!| The observations
of this court in Foster v. Neilson, 2 Pet. 253, 314, are
pertinent:
* * * QOur Constitution declares a treaty
to be the law of the land; it is, consequently,
to be regarded by courts of justice as equiva-
lent to an act of the legislature, whenever it
operates .of itself, without the aid of any
legislative provision. But when the terms
of the stipulation import a contract, when
either of the parties engage to perform a par-
ticular act, the treaty addresses itself to the
political, not the judicial, department, and the
legislature must execute the contract before it
can become a rule for the court.
3. Presidents Cleveland and Harrison have declared
Article X XIX terminated.—President Cleveland, in
1 See editorial note, Compiled Statutes, 1916, vol. 6, page 6667.
el
41
a message to Congress dated August 23, 1888, re-
questing legislative action con ferring upon the Execu-
tive power to suspend by proclamation the operation
of all laws and regulations permitting the transit of
goods, wares, and merchandise in bond across or Over
the territory of the United States to or from Canada,
as a retaliatory measure against grievances suffered
by Americans at the hands of British subjects in
Canada, reviewed the provisions of the treaty and
legislation as to Article XXIX, and stated his opinion
that this article terminated the Ist day of July, 1885.
The President said:
I am of opinion that the “term of years
mentioned in Article XXXII,” referred to
in Article XXIX as the limit of its duration,
means the period during which Articles XVITI
to XXV, inclusive, and Article XXX, com-
monly called the “fishery articles,” should
continue in force under the language of said
Article XXXITI.
That the joint high commissioners who
negotiated the treaty so understood and in-
tended the phrase is certain, for in a state-
ment containing an account of their negotia-
tions, prepared under their supervision and
approved by them, we find the following
entry on the subject:
“The transit question was discussed, and
it was agreed that any scttlement that might
be made should include a reciprocal arrange-
ment in that respect for the period for which
the fishery articles shouid be in force.”
In addition to this very satisfactory evi-
dence supporting this construction of the
42
language of Article XXIX it will be found
that the law passed by Congress to carry the
treaty into effect furnishes conclusive proof
as to the correctness of such construction.
This law was passed March 1, 18738, and is
entitled “An act to carry into effect the pro-
visions of the treaty between the United States
and Great Britain signe} in the city of Wash-
ington the 8th dav of May, 1871, relating to
the fisheries.”” After providing in its first and
second sections for putting in operation. Articles
XVII to XXV, inclusive, and Article XXX
of the treaty, the third section is devoted to
Article X XIX, as follows: “See. 3. That from
the date of the President’s proclamation au-
thorized by the first section of this act, and
so long as the articles eighteenth to twenty-
fifth, inclusive, and article thirtieth of said
treaty shall remain in force according to the
terms and conditions of article thirt:-third of
said treaty, all goods, wares, and merchandise,
arriving,’ etc., ete., following in the re-
mainder of the section the precise words of the
stipulation on the part of the United States as
contained in Article XNXIX, which I have
already fully quoted.
Here, then, is a distinct enactment of the
Congress limiting the duration of this article
of the treaty to the time that Articles XVII
to XXV, inclusive, and Article XXX should
continue in force. ‘That in fixing such limita-
tion it but gave the meaning of the treaty itself
is indicated by the fact that its purpose is
declared to be to carry into effect the provisions
of the treaty, and by the further fact that this
PERIE LE IE VIE EEE V LE POLITE IIE INIA SEA IT AIR ARSE SPA BERD PORE EN —
43
law appears to have been submitted hefore the
the promulgation of the treaty to certain
members of the joint high commission repre-
senting both countries, and met with no ob-
jection or dissent.
After considering the effect of the act of March 1,
1873, the President continued:
There appearing to be no confiiet or in-
consistency hetween the treaty and the act
of Congress last cited, it is not necessary to
invoke the well-settled principle that in case
of such conflict the statute governs the
question.
In any event, whether the law of 187:
construes the treaty or governs it, section 29
of such treaty, IT have no doubt, terminated
with the proceedings taken hy our Govern-
ment to terminate Articles XVIII to XXYV,
inclusive, and Article XXX of the treaty.
* * * * *
If by any language used in the joint resolu-
tion it was intended to relieve section 3 of the
act of 1873, embodying Article XXIX of the
treaty from its own limitations, or to save
the article itself, I am entirely satisfied that
the intention miscarried. (Messages and Pa-
pers of Presidents, Richardson, vol. 8, pp.
| 620, 624, 625.)
President Harrison, in a message to Congress under
date of February 2, 1893, in response to a resolution
of the House requesting information as to regula-
tions concerning the transportation of imported mer-
chandise in bond, etc., took the same view as to Article
XXIX as his predecessor.
a
44
After reviewing the provisions of the treaty, and
the legislation under it, and quoting from the message
of President Cleveland, cited above, President Har-
rison said:
Section 3 of the law of 1873, which I have
quoted, however, contains a legislative con-
struction of Article XXIX of the treaty in the
limitation that the provisions therein con-
tained as to the transit of goods could con-
tinue in force only so long as Articles XVIII
to XXV, inclusive, and XXX of the treaty’
should remain in force.
* * * * x
* * * The enactment of section 3 of the
act of 1873 was a clear declaration that legis--
lation was necessary to put Article XXIX of
the treaty in operation, and that under the
treaty our obligation to provide such legisla-
tion terminated whenever Articles XVIII to
XXV and XXX should be abrogated. The
legislation was accepted by Great Britain as a
compliance with our obligations under the
treaty. No objection was made that our
statute treated Article XXIX as having force
only so long as the other articles named were
in foree.
sic arris 1en consider 1e Opinio
President Harrison then considered tl ns
which had been expressed by Secretary Bayard and
Senator Edmunds to the effect that Article XXIX
was still in force and disposed of them as follows:
An examination of the debates at the time
of the passage of this joint resolution (Mar. 3,
1883, supra, p. 39) very clearly shows that
Congress made an attempt to save Article
PRM LS oe ar8 . ene ‘ ee CNR oe a eo eT
45
XXIX of the treaty and section 3 of the act
of 1873. In the Senate on the 2ist of Febru-
ary, 1883, the resolution being under consid-
eration, several Senators, including Mr. Ed-
munds, the chairman of the Judiciary Com-
mittee, expressed the opinion that Article
XXIX would not be affected by the abrogation
of Articles XVIII to XXV and XXX, and an
amendment was made to the resolution with
a view to leave section 3 of the act of 1873 in
force. The same view was taken in the de-
bates in the House.
The subject again came before Congress in
connection wich the consideration of a bill (Ss.
3173) to “authorize the President of the United
States to protect and defend the richts of
American fishing vessels, American fishermen,
American trading and other vessels in certain
cases, and for other purposes.”
In the course of the debate upon the bill in
the Senate January 24, 1887, and in the House
February 23 following, the prevailing opinion
was, though not without some dissent, that
Article XXIX was still in force.
On the 6th of July, 1887, in response to an
inquiry by the Secretary of the Treasury, Mr.
Bayard wrote a letter, a copy of which aec-
companies this message, in which he expresses
the opinion that Article XXIX of the treaty
was unaffected by the abrogation of the fish-
eries articles and was still in force. In Au-
gust, 1888, however, Mr. Cleveland, in a mes-
sage to Congress, expresses his opinion of the
question in the following language :
96689224
eRe 2 Se ee Se ee
————
46
(Quoting the language set forth on p. 43,
supra.)
* * * % *
I am inclined to think that, using the aids
which the protocol and the nearly contempo-
raneous legislation by Congress in the act of
1873 furnish in construing the treaty, the
better opinion is that Article XNXIX in the
treaty is no longer operative. The. enact-
ment of section 3 of the act of 1873 was a clear
declaration that legislation was necessary to
put Article XXIX of the treaty into operation,
and that under the treaty our obligation to
provide such legislation terminated whenever
Articles XVIII to XXV and XXX should he
abrogated. This legislation was accepted by
Great Britain as a compliance with our obli-
gations under the treaty. No objection was
made that our statute treated Article X XIX
as having force only so long as the other
articles named were in force.
The conclusions of the President, so far as they
relate to the subject now under consideration, were
as follows:
First. That Article XXIX of the treaty of
Washingtomhas been abrogated.
Second. That even if this article were in
force there is no law in force to execute it.
(Messages and Papers of the Presidents, Rich-
ardson, vol. 9, p. 335, 339, 840, 345.)
The President transmitted with his message to
Congress an opinion of Attorney General Miller also
holding that Article XXIX was abrogated. (Opin-
ions of the Attorney General, vol. 20, p. 388.)
SEAT ARTS BEB AR Ae Dolan On ea ta cl
47
As regards the suggestion that the Treasury De-
partment has treated Article XXIX as still in force
after these expressions of the Presidents, we reply:
The Article is not self-executing but is dependent on
enabling legislation. The Treasury Department,
therefore, can have no concern with the Article but
only with legislation passed to carry it into effect.
As we have seen, Section 3 of the Act of March 1,
1873, giving effect to Article XXIX, is no longer in
force. However, Section 3005, R.S., providing for
“in transit” shipments, has been continuously on the
books since before the negotiation of the treaty. A
possible explanation is that existing Treasury Regu-
lations, erroneously supposed to be based on the
treaty, are in reality based on this independent
legislation.
4. The question being essentially political and not
judicial, the legislative and executive interpretations
should be followed.—In Taylor vy. Morton, 2 Curtis,
454, Mr. Justice Curtis, on circuit, said:
Is it a judicial question, whether a treaty
with a foreign sovereign has been violated
by him; whether the consideration of a par-
ticular stipulation in a treaty has been
voluntarily withdrawn by one party, so that
it is no longer obligatory on the other: whether
the views and acts of a foreign sovereign,
manifested through his representative, have
given just occasion to the political depart-
ments of our Government. to withhold the
execution of a promise contained in a treaty,
ro to act in direct contravention of such
promise? I apprehend not.
48
In Foster v. Neilson, 2 Pet., 253, at page 306, Chief
Justice Marshall said:
The judiciary is not that department of the
Government to which the assertion of its
interests against foreign powers is confided;
and its duty commonly is to decide upon
individual rights, according to those _prin-
ciples which the political departments of the
Nation have established. If the course of
the Nation has been a plain one, its courts
would hesitate to pronounce it erroneous.
We think, then, however individual judges
might construe the treaty of St. Ildefonso, it
is the province of the court to conform its
decisions to the will of the legislature, if that
will has been clearly expressed.
In Barker v. Harvey, 181 U.S. 481, 488, Mr. Justice
Brewer said:
This court, in a class of cases like the present,
has no power to set itself up as the instru-
mentality for enforcing the provisions of a
treaty with a foreign nation which the Govern-
ment of the United States as a sovereign
power chooses to disregard.
In Thomas v. Gay, 169 U. S. 264, 271, Mr. Justice
Shiras said:
It is well settled that an act of Congress
supersedes a prior treaty, and that any ques-
tions that may arise are beyond the sphere of
judicial cognizance and must be met by the
political department of the Government.
And see also: Head Money Cases, 112 U. 8. 580;
Whitney v. Robertson, 124 U.S. 190; Chinese Exclusion
Tein ae DONE bgster ee — ee ganna corms __ i
49
Cases, 130 U.S. 581 ; Botelier v. Dominguez, 130 U.S.
238; United States v. Lee Yen Tai, 185 U. S. 213.
5. If Article X XIX was not abrogated in the manner
described, then so far as it relates to sh ipments of liquor
it was abrogated by the national prohibition act.—The
conflict between Article XXIX of the treaty, as
applied to the shipment of intoxicating liquor for
beverage purposes, and section 3, Title II, of the
national prohibition act, is plain and irreconcilable,
(A) As applied to such shipments Article XXIX
provides, in effect, that intoxicating liquor for bev-
erage purposes may be conveyed in transit through
the United States to or from Inglish possessions in
North America; whereas ;
(B) Section 38, Title II, of the Volstead Act pro-
vides that “‘no person shall * * * manufacture,
sell, barter, transport, import, export, deliver, fur-
nish, or possess any intoxicating liquor except as
authorized by this act.”
It is, of course, well settled that in all cases of
conflict between a treaty and a subsequent act of
Congress, the latter will control. Rainey v. United
States, 232 U.S. 310 ; Sanchez v. United States, 216
U.S. 167; Barker vy. Harvey, 181 U.S. 481; Ward v.
Race Horse, 163 U.S. 504; Lenn Moon Sing v. United
States, 158 U.S. 538; Fong Yue Ting v. United States,
149 U.S. 698; Horner v. United States, 143 U.S. 570;
Botelier v. Dominguez, 130 U.S. 238; Chae Chan Ping
v. United States, 130 U.S. 581; Whitney v. Robertson,
124 U.S. 190.
It follows, therefore, that Article X XIX, even if in
force at the time the Volstead Act went into effect,
was necessarily repealed by the latter in so far as
it applied to the possession and transportation of
liquor.
IV.
SECTION 3005 OF THE REVISED STATUTES CONFERRED
NO AFFIRMATIVE RIGHTS WITH RESPECT TO THE TRANS-
SHIPMENT OF MERCHANDISE: ASSUMING THAT IT DID,
IT WAS SUPERSEDED BY THE NATIONAL PROHIBITION
ACT SO FAR AS SHIPMENTS OF LIQUOR ARE CONCERNED.
1. Section 3005 conferred no affirmative righis.—
This provision was originally enacted as section 5 of
the act approved July 28, 1866 (c. 298, 14 Stat. 328).
That act was entitled “ An act to protect the revenue,
’
aid for other purposes,”’ and was purely a revenue
measure. It provided, among other things, the
customs duties to be collected on importations of
cigars, cigarettes, distilled spirits, cotton, salt, ete.,
and contained several measures for the protection
of the revenue. Section 5 read as follows:
That from and after the passage of this act,
all goods, wares, or merchandise arriving at
the ports of New York, Boston, and Portland,
or any other port of the United States which
may be specially designated by the Secretary
of the Treasury, and destined for places in the
adjacent British Provinces, or arriving at the
port of Point Isabel, Texas, or any other
port of the United States which may be
specially designated by the Secretary of the
Treasury, and destined for places in the
Republic of Mexico, may be entered at the
customhouse, and conveyed, in transit, through
ITU ma ; . 2 parse
51
the territory of the United States, without
the payment of duties, under such rules,
regulations, and conditions for the protection
of the revenue as the Secretary of the Treasury
may prescribe.
The provision was carried into the Revised Statutes
in substantially the same language. By act of
February 27, 1877 (c. 69, 19 Siat. 240), entitled ‘‘ An
act to perfect the revision of the statutes of the
United States and of the statutes relating to the
District. of Columbia,’’ section 3005, R. S., was
amended by striking out the words “Point Isabel’?
and inserting the word ‘ Brownsville.’’ By act of
May 21, 1900 (¢. 487, 31 Stat. 181), entitled “An act
to amend section three thousand and five of the
tevised Statutes of the United States,’’ the pro-
vision was amended to its present form, viz:
All merchandise arriving at any port of the
United States destined for any foreign country
may be entered at the customhouse, and
conveyed, in transit, through the territory
of the United States, without the payment
of duties, under such regulations as to ex-
amination and transportation as the Secre-
tary of the Treasury may prescribe.
The reason for the last amendment is stated in
the report of the Committee on Ways and Means of
the House of Representatives, as follows:
The changing conditions of commerce and
the establishment of new transportation routes
demand the enlargement of the privileges
52
given by this statute to all foreign merchan-
dise arriving for transit through the United
States, whether to or from Canada, Mexico,
or any other foreign country. The proposed
change wiil tend to facilitate the carriage of
foreign merchandise in bond through the
United States by our own _ transportation
companies, and will not in any way endanger
the revenues * * ¥,
This section, as it now stands, provides only
for the carrying and transit of merchandise
from foreign countries destined to either
some place in Canada or in Mexico. At the
time the section was passed (July 28, 1866)
this answered all the requirements of com-
merce. Since that time a large trade has
grown up with oriental countries, much of
which seeks transportation through the United
States.
We are losing much of the benefit of this
transportation because we can not pass these
goods through the country in bond. This
amendment is offered in order to give a fair
share of this trade to our transportation.
* * * (33 Cong. Rec. 1736.)
Clearly, therefore, section 3005, R. 8., is purely a
revenue measure enacted in the interest of American
transportation companies and confers no affirmative
right to transport merchandise into and through the
United States. It merely exempts from payment of
customs duties shipments into and through the
United States which, under the tariff laws, would
otherwise be dutiable as imports.
I tae RNS tl on RC nant nh PT Ar RMRar A Sa Machin ee
53
Title XXXIV of the Revised Statutes, in which
section 3005 is contained, is entitled “Collection of
Duties upon Imports.” Section 2766, R.S., a part
of the same title, provides:
The word “merchandise,” as used in this
title, may include goods, wares, and chattels
of every description capable of being im-
ported. (Italics ours.) 7
Therefore, section 3005 has no possible applica-
tion to the present cases, since intoxicating liquor
may not be imported into the United States and is
not “goods,”’ “wares,” or “merchandise” within the
meaning of that section and is not subject to duty.
On this point Judge Mayer said:
In the cases at bar, the liquor was not
subject to duty. It could not be imported.
The introduction into this country from some
foreign port of liquor for beverage purposes
has no relation to revenues. Such liquor
could not be lawfully introduced into this
country because of the change in the national
policy. (Rec. No. 639, p. 55.)
2. Assuming that the section did confer the right
claimed, it was repealed by the national prohibition act
so far as shipments of liquor are concerned.—It is
true that repeals by implication are not favored, but
it is further true that when a later statute is clearly
inconsistent with a prior one, the latter must be
deemed to have been repealed to the extent of such
inconsistency. That section 3005, R.S., and section
3, Title II, of the national prohibition act are hope-
lessly antagonistic as regards the transportation of
d+
liquor will appear from a brief comparison of their
respec tive provisions:
Section 3005 R.S.
All merchandise arriving
at any port of the United
States destined for any for-
eign country may be entered
at the customhouse, and con-
veyed in transit through the
territory of the United States
without the payment of du-
ties under such regulations as
to examination and transpor-
Section 3, Title II, of the
national prohidition act.
No person shall on or after
the date when the eighteenth
amendment to the Constitu-
tion of the United States goes
into effect manufacture, sell,
barter, transport, import, ez-
port, deliver, furnish, or pos-
sess any intoxicating liquor
except as authorized in this
tation as the Secretary of the act. * * *
Treasury may prescribe.
Ascribing to section 3005, R. S., the effect con-
tended for by opposing counsel, viz, that it conferred
an affirmative right to transport merchandise through
the United States, we have the following situation:
The old law, as it applies to intoxicating liquors, says
that they may be “conveyed’’ under regulations
governing “transportation” ; while the new law also-
lutely prohibits such “transportation”? and even
“possession.” It is difficult to conceive of two more
flatly contradictory provisions.
8. The prohibition act supersedes all licensing and
permissive statutes.—The eighteenth amendment and
the Volstead Act being absolute prohibitions on the
manufacture, sale, transportation, etc., of intoxi-
cating liquor, it is not within the power of Congress
to license or permit the doing of any of those acts,
and all licensing and permissive statutes in force on
the effective date of the amendment and act were by
. na eh cuir.
5)
necessary implication repealed. In the National
Prohibition cases (253 U. 8. 350, 386-387) this court
laid down the following propositions:
6. The first section of the amendment—the
one embodying the prohibition—is operative
throughout the entire territorial limits of the
United States, binds all legislative bodies,
courts, public officers, and individuals within
those limits, and of its own force invalidates
every legislative act—whether by Congress, by
a State legislature, or by a Territorial assem-
bly—which authorizes or sanctions what the
section prohibits.
7. The second section of the amendment—
the one declaring “The Congress and the
several States shall have concurrent power to
enforce this article by appropriate legisla-
tion’’—does not enable Congress or the several
States to defeat or thwart the prohibition, but
only to enforce it by appropriate means.
In United States v. Yuginovich (No. 523) decided
June 1, 1921, this court had before it an indictment in
four counts, based on the revenue provisions of the
Revised Statutes and charging (a) defrauding the
United States of the tax on distilled spirits; (b) failing
to display in a distillery the words ‘Registered dis-
tillery”’ ; (¢) operating a distillery without giving the
required bond ; (d) making mash fit for distillation in
a building not a_ registered distillery. The acts
charged having been committed after the effective
date of the eighteenth amendment and the Volstead
Act, a demurrer and a motion to quash were filed on
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tae
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at ec
56
the ground that the statutes under which the indict-
ment was found had been repealed.
This court in affirming the action of the District
Court in quashing the indictment, said:
These statutes have long been part of the
lederal internal revenue legislation, and were
passed under the authority of the taxing
power conferred upon Congress by the Con-
stitution of the United States. At the time
of their enactment it was legal, so far as the
Federal Government was concerned, to manu-
facture and sell ardent spirits for beverage
purposes. The Government derived large revy-
nue from taxing the business, which it sought
to realize and protect by the system of laws
of which the sections in question were a part.
This policy was radically changed by the
adoption of the eighteenth amendment to the
Federal Constitution, and the enactment of
legislation to make the amendment effective.
The eighteenth amendment in comprehensive
and clear language prohibits the manufacture
or sale of intoxicating liquors in the United
States for beverage purposes, and confers upon
Congress the power to enforce the amendment
by appropriate legislation. To this end, Con-
gress passed a national prohibition law known
as the Volstead Act (41 Stat. 305). It isa
comprehensive statute intended to prevent
the manufacture and sale of intoxicating
liquors for beverage purposes.
* * * * *
Section 35 in its first sentence repeals all
prior acts to the extent of their inconsistency
- sates aes mth We
oT
with the national prohibition act, to that
extent and no more.
* * * * *
It is, of course, settled that repeals by im-
plication are not Javored. It is equally well
settled that a later statute repeals former ones
when clearly inconsistent with the earlier
enactments. (United States vy. Tynen, 11
Wall. 88.) In construing penal statutes, it is
the rule that later enactments repeal former
ones practically covering the same acts but
fixing a lesser penalty. The concluding phrase
of section 35 by itself considered is strongly
indicative of an intention to retain the old
laws. But this section must be interpreted in
view of the constitutional provision contained
in the eighteenth amendment and in view of
the provisions of the Volstead Act intended to
make that amendment effective.
Having in mind these principles and consid-
ering now the first count of the indictment
charging an attempt to defraud and actually
defrauding the Government of the revenue
tax, we do not believe that the general lan-
guage used at the close of section 35 evidences
the intention of Congress to inflict for such an
offense the punishment provided in section
3257 with the resulting forfeiture, fine, and
imprisonment, and at the same time to au-
thorize prosecution and punishment under sec-
tion 35 enacting lesser and special penalties for
failing to pay such taxes by imposing a tax in
double the amount provided by law, with an
additional penalty of $500 on retailers and
$1,000 on manufacturers. Moreover, the con-
oe
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SSAA EN ee oer etl RR NN ETE AREA LTD Ni AOR TRENDS LI a ta ok REAR RNR
fe aeee! «
58
cluding words of thé first paragraph of section
35, as to all the offenses charged, must be read
in the light of established legal principles gov-
erning the interpretation of statutes, and in
view of the provisions of the Volstead Act
itself making it unlawful to possess intoxicating
Liquor for beverage purposes, or property de-
signed for the manufacture of such Liquor, end
providing for is destruction. We agree with
the court below that while Congress manifested
an intention to tax liquors illegally as well as
those legally produced, which was within its
constitutional power, it did not intend to pre-
serve the old penalties prescribed in section
3257 in addition to the specific provision for
punishment made in the Volstead Act.
We have less difficulty with the other sec-
tions of the prior revenue legislation under
which the charges, already set forth, are made.
We think it was not intended to keep on foot
the requirement as to displaying the words:
“Registered distillery” in a place which could
no longer be lawfully conducted ; nor to require
a bond for the control of such production ; nor
to penalize the making of mash in a distillery
which could not be authorized by law. [Italics
ours. }
Sce also United States v. Two Thousand Cases
Whiskey, 277 Fed. 410; United States v. Stafoff, 268
Fed. 417; Ex parte Crookshank, 269 Fed. 980.
There is nothing in Vigliotti v. Pennsylvania, No.
530, decided April 10, 1922, inconsistent with this
proposition. In that case the court, in accordance
with the general rule, followed the Pennsylvania
—_—
59
courts’ construction of the State statute as being a
prohibitory and not a licensing measure, and held
that, as so construed, it constituted ‘appropriate
legislation” for the enforcement of the eighteenth
amendment.
4. The transshipments involved in case No. 639 are
not within the section.— Appellant Anchor Line has
asserted rights under section 3005, R. 8. (Ree. 15,
19, 20), but it is clear that the facts alleged do not
bring appellant within that section. The section in
terms provides that merchandise arriving at any
port of the United States may be “conveyed,” “in
transit,” “through the territory of the United States,”
without the payment of duties, ete. The object of
the section was to permit such in transit shipments
for the bene‘it of American transportation companies
(supra, p. 51). It clearly does not apply to the mere
transshipment of merchandise from one ship to
another in a single port (compare 27 Op. A. G. 440).
CONCLUSION.
It is respectfully submitted that the decree in No.
615 should be reversed and the cause remanded with
instructions to dismiss the bill, and that the decree in
No. 639 should be affirmed.
Guy D. Gorr,
Assistant to the Attorney General.
ABRAM FI. Myers,
Special Assistant to the Attorney General.
APRIL 17, 1922.
APR 94 1929
WM, R, STANSBURY
CLERK
IN THE SUPREME COURT OF THE UNITED STATES.
JOHN A. GROGAN, Collector of Internal
Revenue, et. al.,
Defendants and Appellants, Z AS
v.
HIRAM WALKER & SONS, LTD.,
Plaintiff and Appellee.
MEMORANDUM FOR APPELLEE.
Alfred Lucking,
Counsel for Appellee.
IN THE SUPREME COURT OF THE UNITED STATES.
JOHN A. GROGAN, Collector of Internal
Revenue, et. al.,
Defendants and Appellants,
v.
HIRAM WALKER & SONS, LTD.,
Plaintiff and Appellee.
MEMORANDUM.
On the hearing the question was asked from the bench:
‘Why should exportation of liquor from the United States
be prohibited and still the practice of ‘transit in bond’ be
permitted?
Two answers are suggested :
L. In the words of Judge Tuttle in his opinion (Ree., pp.
24, 25):
“Tt is urged by the government that the prohi-
bition in the statute against the exportation of i
toxicating liquor from the United States negatives
an intention to confine its application to the use of
such liquor within the United States. This argument
overlooks the close relation between manufacture and
exportation and the incentive to engage in the former
which is furnished by the right to engage in the
latter; and it was doubtless considered, and not with-
out reason, that to forbid the exportation of intoxi-
eating liquor from, would tend to make easier the
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2
enforcement of the prohibition against its manu-
facture and possession in, the United States. It can
not, however, be said that such a relation exists be-
tween the trans-shipments in question and the pre-
vention of the use of intoxicating liquor as a beve rage
within the United States. To hold otherwise would
be in effect to ignore the efficacy and effect of the
protection afforded such . ‘aus-shipment by the United
States customs officers and other Officials under whose
supervision they are couveyed
in transit through the
United States.’’
il. Another and to my mind 2 compelling reason is:
When our government forbids the exportation of liquors
from the United States, if is regulating and controlling the
conduct ef our own citizers—it is forbidding the traffic on
the part of our citizens. This is not at all the case in ‘‘eon-
veyanee in transit through the United States,’’ which is
simply permitting the British to conduct their business in
foreign countries as in the past. We are simply extending
ordinary international comity, in sending across our terri.
tory, in the most convenient way, their merchandise, without
hurt to ourselves—and which practice is reciprocated in
kind, in much larger measure. The commerce in question
is legitimate under their laws and customs, which we do
not seek or wish to control or regulate.
Respectfully submitted,
Alfred Lucking,
Counsel for Appellee.
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