Motion — Washington v. WC Dawson & Co.
Supreme Court brief1924
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Supreme Court of the United States
October Term, 1922.
THE MATTHEW ADDY COMPANY,
Petitioner.
vs.
UNITED STATES OF AMERICA,
Respondent.
Motion and Petition for Writ of Certiorari
and Supporting Brief.
NELSON B. CRAMER,
JULIUS R. SAMUELS,
Cincinnati, Ohio.
Counsel for
The Matthew Addy Company,
Petitioner.
et Si
No.
Supreme Court of the United States
October Term 1922,
THE MATTHEW ADDY COMPANY,
Petitioner,
vs.
UNITED STATES OF AMERICA,
Respondent.
MOTION FOR WRIT OF CERTIORARI.
Comes now The Matthew Addy Company by Nelson
B. Cramer and Julius R, Samuels, its counsel, and moves
this Honorable Court that it shall by certiorari or by
other proper process, directed to the Honorable Judges
of the United States Cireuit Court of Appeals for the
Sixth Circuit, require said court to certify to this court
for its review and determination that certain cause in
said Cireuit Court of Appeals lately pending, in which
The Matthew Addy Company was plaintiff in error and
the United States of America was defendant in error.
and petitioner herein to that end, now tenders herewith
its petition and brief with a certified copy of the en-
tire record in said cause pending in said Cireuit Court
of Appeals for the Sixth Circuit.
Netson B. Cramer,
Jutius R. Samve.s,
Counsel for The Matthew Addy Company,
Petitioner
oo _ Se ee ee ae ee ee ee eee
No. ———.
Supreme Gourt of the United States
October Term 1922.
THE MATTHEW ADDY COMPANY,
Petitioner,
vs,
UNITED STATES OF AMERICA,
Respondent.
PETITION FOR A WRIT OF CERTIORARI TO
THE UNITED STATES CIRCUIT COURT OF
APPEALS FOR THE SIXTH DISTRICT.
The petition of The Matthew Addy Company for a
writ of certiorari directed to the Cireuit Court of Ap-
peals for the Sixth Cireuit, requiring it to certify to the
Supreme Court of the United States the case of The
Matthew Addy Company v. United States of America,
lately pending in said Cireuit Court of Appeals for the
Sixth Circuit.
To the Honorable the Chief Justice and the Associate
Justices of the Supreme Court of the United States:
Said petitioner respectfully shows to the court as fol-
lows:
I. That it is and at all times hereinafter mentioned
Was, a corporation organized and existing under and by
virtue of the laws of the State of Ohio, with its princi-
pal place of business at Cincinnati, in said State of Ohio.
4
Il. That the grand jurors for the United States of
America, impanelled and sworn in the District Court of
the United States for the Western Division of the South.
ern Judicial District of Ohio, at the Ovrtober, 1919, tern
thereof, to-wit, on November 17, 1919, presented an in.
dictment against petitioner, which indictment was in
twenty-three counts, and which alleged under the Act of
Congress of August 10, 1917 (40 Stat., 278), commonly
known as ‘‘The National Detense (Lever) Act’? and
especially sections 1, 2, 3, 4 and 25 thereof, and_ the
executive order of the President of the United States,
dated August 23, 1917, that the President being author.
ized by the terms of said Act to establish rules for the
regulation of and to regulate the method of production,
sale, shipment, distribution, apportionment and storage
thereof among dealers and consumers, on August 23,
1917, issued an executive order in which it was provided
among other things that:
‘*1. A coal jobber is defined as a person (or other
agency) who purchases and re-sells coal to coal deal-
ers or to consumers without physically handling i
on, over or through his own vehicle, dock, trestle
or yard.
‘*2. For the buying and selling of bituminous
coal a jobber shall not add to his purchase pric
a gross margin in excess of 15¢ per ton of 2,000 lbs,
nor shall the combined gross margins of any nun-
ber of jobbers who buy and sell a given shipment
or shipments of bituminous coal, exceed 15e¢ per tou
of 2,000 Ibs.’’
5
The indictment then alleged that during the month:
of September, October and November, 1917, a state of
war then existing between the United States and the Im-
perial German Government, and the law, orders and reg-
ulations above stated being then in foree, defendant, The
Matthew Addy Company, was engaged, in the business
in the City of Cincinnati, Hamilton County, Ohio, as a
wal jobber, as defined in said executive order.
That said The Matthew Addy Company, acting in its
eapacity as a coal jobber as aforesaid, wilfully, unlawful-
ly, knowingly and feloniously did ask, demand and re-
ceive of divers persons named in the various counts for
certain quantities of bituminous coal, certain prices,
which prices included a profit or gross margin to it, said
The Ma.iew Addy Company, as such coal jobber as
aforesaid of 20¢ per ton, and which said profit or margin
of 25¢ per ton was, and was well known by said The Mat-
thew Addy Company to be in excess of the profit or gross
margin of 1loe per ton of 2,000 lbs. permitted by the law,
executive order, and regulations above referred to, to
he added to the purchase price of said jobber; and that
said The Matthew Addy Company did not have any
contract with said parties named, made in good faith,
prior to the 23d day of August, 1917, in which said con-
tract the price for the purchase and sale of said coal!
was fixed, ete. (R., 4).
Ill. Motion to quash the indictment (R., 29) and de-
murrer to the indictment (R., 33) were overruled prior
to the trial.
IV. A trial was had before the court and a jury on
June 2, 1920, and a verdict of guilty was rendered in the
manner and form as charged in counts Nos. 2, 5, 7, 9,
10, 11, 12, 13, 15, 16, 17, 18 and 20, and not guilty as
a
6
charged in the remaining counts thereof, 1 and 4 (R,
38); counts 3, 6, 8, 14, 19, 21, 22, and 23 were withdrawy
from the jury. The case of The Matthew Addy Com.
pany and that of Benjamin N. Ford, Vice-President of
said Company who was separately indicted, were tried
together before the court and a jury and separate ver.
diets rendered by the jury in each case,
V. In the course of the trial, petitioner called as a
witness on its own behalf, one Frank C. Deckebach, who
qualified as a Certified Public Accountant (R., 75). Pe.
titioner proffered in evidence a ‘‘statement of tonnage
and expense of cua! sales and cost in cents per ton”? for
the calendar years, 1917, 1918, and 1919 (defendant's
Exhibit ‘‘C,’’ R., 116-123), in order that the witness
might explain the same; to which counsel for the goy.
ernment objected and which objections were sustained
by the court and exceptions noted (R., 78, 79 and 80).
VI. Motions for a new trial and in arrest of judg.
ment were overruled (R., 37 and 40) and sentence pro-
nounced on June 24, 1920, fining petitioner the sum of
One Thousand ($1,000) Dollars and costs (R., 38).
VII. A writ of error was allowed from the United
States Cireuit Court of Appeals for the Sixth Circuit,
and a transcript of the record filed in said court.
VIII. Said cause came on for hearing on error pro-
ceedings before the United States Cireuit Court of Ap-
peals for the Sixth Cireuit, on March 7, 1922, and was
submitted to the court, and on May 4, 1922, the said
United States Cireuit Court of Appeals for the Sixth
Circuit, affirmed the judgment of the trial court (R., 128).
IX. Your petitioner believes that the said Circuit
Court of Appeals for the Sixth Circuit erred in affirming
7
the judgment of the District Court, and should have re-
versed the said District Court and discharged the de-
fendant.
X. And your petitioner further avers that the pres-
ent ease is one in which it is proper for this court to
issue a writ of certiorari for the following reasons,
among others, to-wit:
1. The questions of law involved in this case are
yuestions involving the constitution and laws of the
United States, and especially involving the validity of
the Act of Congress of August 10, 1917 (40 Stat., 278),
which was one of the most important of the war legisla-
tion passed by Congress during the late war.
2. The construction of the Act of Congress of August
10, 1917, affects the coal industry which is national and
international in scope.
3. The Cireuit Court of Appeals was in error
in affirming the judgment of the District Court in con-
struing the Act of Congress of August 10, 1917, and the
rules and regulations of the President and the United
States Fuel Administrator as it did.
4. The Cireuit Court of Appeals was in error
in affirming the judgment of the District Court in up-
nolding the validity of the Act of Congress of Augnst
10, 1917, and the rules and regulations of the President
and the United States Fuel Administrator.
5. The Court of Appeals was in error in affirm-
ing the judgment of the District Court in holding that
“public danger warrants the substitution of executive
process for judicial process,’’ and in so doing in substance
held that the existence of a state of war suspends the
operation upon the power of Congress of the guarantees
and limitations of the fifth amendment to the constitu-
tion.
6. The decision of the Court of Appeals affirm.
ing the District Court is at variance with the principles
laid down by this court in the case of United States y,
Cohen Grocery Company, 255 U. S., 81-89.
Wherefore, your petitioner prays that this honorable
court will grant a writ of certiorari directed to the Cir.
cuit Court of Appeals for the Sixth Circuit, requiring
that the record of said case in said court, and its judg.
ment be certified to this court, and that this court will
thereupon proceed to correct the errors complained of,
reverse said judgment, and enter final judgment and dis.
charge petitioner, and for such further proceedings as
to this honorable court may seem just and proper in the
premises.
Tue MatrHew Appy Company,
By Netson B. Cramer,
Junius R. SaMve.s,
Its Counsel.
United States of America, State of Ohio, County of
Hamilton, ss.:
Nelson B. Cramer, being first duly sworn, deposes and
says that he is counsel for The Matthew Addy Con-
pany, the petitioner herein; that he has read the fore-
going petition, and is familiar with its contents and that
the allegations contained therein are true as he verily
believes; and further that in his opinion said petition
is well founded and that the case is one in which the
prayer of the petitioner should be granted by this court.
Netson B. CRraMer,
Sworn to before me and subscribed in my presence,
this 3rd day of July, 1922.
Artuvur W. Gorpon,
(Seal)
Notary Public, Hamilton County, Ohio.
My commission expires November 26, 1923.
REO 0s kana oS
Supreme Court of the United States
October Term, 1922.
THE MATTHEW ADDY COMPANY,
Petitioner.
against
UNITED STATES OF AMERICA,
Respondent.
Brief in Support of Petition for
Writ of Certiorari
NELSON B. CRAMER,
JULIUS R. SAMUELS,
Cincinnati, Ohio.
Counsel for
The Matthew Addy Company,
Petitioner.
a
3
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hy
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5
Be tN tA TO ei cir Rie SOON AD abe Sk wi DACRE ae ei
Index of Brief.
Page
Statement of Case ..... PCy Ter eee TO Tt Tere 1
Specifications of Error ...... VOL EV TERE EE Te ae oe
Outline of Argument ...... LaeKa OMEN ey Vibe x x 4 i
§
Argument— i
. . §
The Court misconstrued the executive order upon
which the indictment was based, as applied to
the undisputed facts ......... ce. ee. vans 8 -
(a) The conviction was not for violation of the ‘
order of August 23, 1917, hut of a subse-
quent order of October 6, 1917) ......... 10 :
:
(b) Retrospective operation was given to the ¢
order of August 23,1917 ...... meres ai i
s
The Court erred in not permitting defendant te &
show its costs profits and losses .......... 12 :
The Court erred in overruling the motion of de- iy
fendants to quash the Indictment ......... 17 e
(a) The Indictment and each count was in-
sufficient in law and fact) ............ oe a
° q
The Court erred in overruling the Demurrer to
the Indictment, on the ground that the Act of
Congress and the Executive Order upon whieh j
the Indictment was hased was uneonstitu- 4
| i RL OA cymat es ia We iega ae oath i
(a) Due process of law was not afforded the
defendant, because no provision for a hear-
ing was made in the Act or in the Executive
WUE kkaadacaswi deni seecnecebeeevics
(b) 'The Court erred in construing the law in
holding that it did not obligate the Presi-
dent to exercise his Agency through the Fed-
eral Trade Commission .................
(c) Cases defining ‘‘ Due Process of Law’’
(d) Cases holding that the Constitution is not
eer TT Ter oer
(e) The Act, as construed by the Court below,
delegated powers to the President not con-
ferrd on him by the constitution .........
93
a4
9°
al
ed
=!
24
Index of Cases.
Page
Boyd vs. United States, 1483 ULS. 649 2.0.2... 29
Chieago, M. & St. P. Ry. vs. Minn,, 184 U.S.418 2.) 27
City of Knoxville vs. Knoxville Water Co., 212 U.S.1 29
Pema We, Commis BO 0 Un cc cacnnccacccccvas 29
Hamilton vs. Ky. Distilleries, 251 U.S. 1460 ...... .3-27
Holter Hardware Co. vs. Boyle, 263 Fed. 134 ....0 0 27
Interstate Commerce Commission vs. Cincinnati,
New Orleans and Texas Pacifie Ry. Co.. 167
ee) Nuns ck AGC Gah neeakiuaceknaccuns 29
Lodeetter we. U.S. 176 1. B. GG knee cass 21
Moyer vs. Peabody, 212 U.S. 78 . we cee ees 27
Minnesota Rate Cases, 230 U.S. 3520 0... eee. 27-29
pee, Cte wee, 4 WM, Bhi sec las ckewdse sans 3-27
Okla, Operating Co. vs. Love, 252 U.S. 381 ...... 27
Sternback vs. U. S., 143 U.S. G49... 29
Schwab vs Doyle, 42 Sup. Ct. Rep. 8910 2... 0.0... 11
os ee A ere per er er 21
U.S. vs. Cohen Grocery Co., 255 UL S.81 2.2... 6... 3-27
U.S. vs Heth, 3 Cranch 399 ...... Sas eeecnaness 1]
U.S. vs. Lexington Mill Co., 232 U.S. 899) 2.20... 17
Ill
No
Supreme Court of the United States
October Term 1922,
THE MATTHEW ADDY COMPANY,
Petitioner.
vs.
UNITED STATES OF AMERICA,
Respondent.
BRIEF IN SUPPORT OF PETITION FOR WRIT OF
CERTIORARI.
STATEMENT OF CASE.
Petitioner prays for a writ of certiorari to the Circuit
Court of Appeals for the Sixth Cirenit, requiring that
said cause in said court, and its judgment be certified
to this court, to secure reversal of the judgment of said
court affirming the judgment of the District Court of
the United States for the Southern District of Ohio,
Western Division, wherein a verdict of guilty was re-
turned by a jury in said court against petitioner on an
indictment based on the Act of Congress of August 10,
——
i ile ae
POL NE, AG
ETSI WOE LE LE LT ROL LT
MOE, ALAS LE NING BEN ELE LOONIE
—
Ee a
2
1917 (40 Stat. =78) commonly known as ‘‘The Na.
tional Defense (Lever) Act’? and the executive order
of the President of the United States, dated August 23,
1917 (compilation of Rules, Regulations and Promulga.
tions of the United States Fuel Administrator, Harry A,
Garfield.)
The facts of the case are sucecintly but comprehen-
sively stated in the petition for a writ of certiorari set
out in the forepart of this pamphlet.
Petitioner invokes the exercise by this court of its
power to issue a writ of certiorari herein for the follow.
ing reasons, among others, to-wit:
(a) The questions of law involved in this case are
questions involving the constitution and laws of | the
United States, and especially involving the validity of
the Act of Congress of August 10, 1917 (40 Stat. 27s)
and the rules, regulations and promulgations ofthe Pres.
ident of the United States and the United States Fue!
Administrator acting under the direction of the Presi-
dent, which were among the most important of all the war
legislation passed by Congress during the late war,
(b) The proper construction of the Act of Congress of
: August 10, 1917 and the rules and regulations of the
President of the United States and the Fuel Adminis-
: trator will serve as a landmark in the development of the
constitutional law of this country, and as a guide to Con-
gress and executive and administrative officers of the
United States, as to the powers that may be exercised by
them during an emergency consistent with the consti-
tutional limitations upon their powers.
(ec) The decision of the Court of Appeals affirming the
District Court is at variance with the principles of con-
3
stitutional law laid down by this court in Ex Parte Mut-
gan, 4 Wall. 2, 121-127; Hamilton v. Kentucky Distilleries
Co., 251 U.S. 146, 156 and the very recent case of United
States v. Cohen Grocery Co. 255 U.S. 81, 88-89.
(d) The proper construction of the Act of Congress of
August 10, 1917 and the rules and regulations of the Pres-
ident of the United States and the Fuel Administrator
directly affect the coal industry of the United States,
which is both national and international in scope, as well
as the industries involving the production, distribution
and consumption of foods and fuel throughout the United
States.
SPECIFICATIONS OF ERROR.
The assignment of errors alleged to have been com-
mitted by the District Court appear at R. 93.
The first error and fundamental question is raised by
the seventh assignment which is as follows:
‘‘In charging the jury that defendant might be
found guilty for violation of the order of the Presi-
dent of August 23, 1917, although the undisputed
evidence showed that in respect to each transaction
covered by the indictment, the coal had been pur-
chased by The Matthew Addy Company prior to that
day, and prior to August 10, 1917.”’
Second, the court erred in not permitting defendant
to prove that the gross margin of 15 cents per ton
added to its purchase price, ‘‘was confiscatory and com-
pelled defendant to dispose of its product without allow-
ance for expense and a just compensation for its serv-
ices’? (See R. 79 and Assignments of Error, 3 and 6, R.
94),
| ah
LPR
Eta in tS
ee
FEILER PE LE ETE ait i aoa
ie Dene i
4
Third, the court erred in overruling the motion of
defendant to quash the indictment and each and every
count thereof, for the reasons urged.
Fourth, the court erred in overruling the claims of
defendant that the statute and the executive order, upon
which the indictment was based, was, as construed by
the court and applied to the undisputed facts, in viola-
tion of the several constitutional provisions specially
relied on.
Fifth, the court erred in not directing a verdict for
defendant, on the ground that the proof failed to sustain
the indictment.
BRIEF OF THE ARGUMENT.
I.
The court misconstrued the executive order upon
which the indictment was based as applied to the undis-
puted facts.
IT.
The court erred in not permitting defendant to show
what were its costs and profits.
ITI.
The court erred in overruling the motion of defendant
to quash the indictment and each and every count there-
of, for the reasons that—
(a) The indictment and each of its several counts
is insufficient in law and fact.
(b) The allegations of the indictment are in-
definite as to material matters and were not sus-
tained by the evidence.
5
IV.
The court erred in overruling the demurrer of defend-
ant to the indictment, which attacked the constitution-
ality of the Act of Congress of August 10, 1917, com-
monly known as the ‘‘National Defense’’ (Lever) Act
(40 Stat. 278), and the executive order of the President,
dated August 23, 1917, for the reasons, that—
(a) They violate the fifth amendment to the Con-
stitution of the United States in that, defendant is
deprived of its property without due process of law.
(b) The Act of Congress violates Section 1, of
Article 1; Section 1 of Article 2, and Section 1 of
Article 3 of the Constitution of the United States,
in that it delegates legislative and judicial powers
to the President of the United States, to the United
States Fuel Administrator appointed by the Presi-
dent, and the Federal Trade Commission.
ARGUMENT.
I.
The court misconstrued the executive order upon which
the indictment was based, as applied to
the undisputed facts.
By Section 25 of the National Defense (Lever) Law,
approved August 10, 1921, it was provided:
“That the President of the United States shall be,
and he is hereby, authorized and empowered, when
ever and wherever in his judgment necessary for the
ellicient prosecution of the war, to fix the price of
coal and coke, whenever and wherever sold, either
by producer or dealer, to establish rules for the
regulation of, and to regulate the method of pro.
duction, sale, shipment, distribution, apportionment,
or storage thereof among dealers and consumers,
6
domestic or foreign; said authority and power may
be exercised by him in each case through the agency
of the Federal Trade Commission during the war
or for such part of said time as in his Judgment may
be necessary.”’
By an order issued August 21, 1917, effective that day,
the President fixed a seale of prices for bituminous coal
at the mines in most of the coal producing districts,
The price fixed for the kind of coal involved in this case,
to-wit: West Virginia run-of-mine, was $2.00 per ton
of 2,000 Ibs. f. 0. b. mines.
On August 23, 1917, the President issued an order
fixing the price on anthracite coal throughout the anthra.
cite producing regions, to become effective September
1, 1917. The same order contained the ‘‘Jobber’s Mar-
gin,’’? and provided:
“1, A eoal jobber is defined as a person (or
other agency) who purchases and resells coal to coal
dealers or to consumers without physically hand-
ling it on, over, or through his own vehicle, dock,
trestle or yard.
2. For the buying and selling of bituminous coal
a jobber shall not add to his purchase price a gross
margin in excess of 15e per ton of 2,000 pounds, nor
shall the combined gross margins of any number
of jobbers who buy and sell a given shipment or ship-
ments of bituminous coal exeeed 15¢ per ton of
2,000 pounds.
3. For buying and selling anthracite coal a job-
ber shall not add to his purehase price a gross mar.
gin in excess of 20c¢ per ton of 2,240 pounds when
delivery of such coal is to be effected at or east of
Buffalo. For buying and selling anthracite coal
for delivery west of Buffalo a jobber shall not add
to his purchase price a gross margin in excess of
7
30c per ton of 2,240 pounds. The combined gross
margins of any number of jobbers who buy and sell
a given shipment or shipments of anthracite coal
for delivery at or east of Buffalo shall not exceed
20¢ per ton of 2,240 pounds, nor shall such combined
margins exceed 30e per ton of 2,240 pounds for the
delivery of anthracite coal west of Buffalo. Pro.
vided that a jobber’s gross margin realized on a
given shipment or shipments of anthracite coal] may
be increased by not more than 5e per ton of 2,240
pounds when the jobber incurs the expense of re.
screening it at Atlantie or lake ports for trans-
shipment by water.’’
The evidence shows without dispute that defendant
bought the coal July 31, 1917, for $3.25 per ton f. 0. b.
mines, or $1.25 per ton more than the price f. 0. b, mines
fixed by the President’s order of August 21, 1917; and
that it sold it in August and September for $3.50 per ton.
The plain meaning of the executive order of August
25, 1917, is, that after the going into effect of that order,
a jobber is prohibited from adding to his purchase price
2 eross Margin in exeess of 15e per ton “for the buying
ind selling of bituminous coal’? and the order has no
application to a transaction whereby a jobber, having
honght coal prior to August 23, 1917, sells it thereafter.
In other words, the order must be construed as prospee-
tive only, and prospective in respect to all of its ele-
ments; that is to say, to both the buying and selling of a
given lot of coal.
It appears from the several orders of the President,
which were judicially noticed by the court (R. 81) that
on August 23, 1917, the President, under authority of
the law, had adopted a comprehensive scheme, fixing
the prices at the mines throughout the country, for both
bituminous and anthracite coals, and in connection
therewith, provided the jobbers’ margins for **the buy-
ing and selling’? of both classes of coal.
The court below either treated the words ** buying
und,’’ in the phrase ‘for the buying and selling of,”
as if they were not included in the order; or else the
court has given to the order a retroactive operation, by
holding that the ‘‘buying’’ of a particular shipment by
a jobber, which is an essential part of the offense and
necessary to constitute it, may be punishable, although
it occurred prior to the enactment of the law.
By the order of August 23, in the first section thereof,
the President carefully defined coal jobbers, in a clause
inserted oniy for the purpose of so defining those words
and complete in itself. Having thus defined, or de.
scribed the persuns (descriplio personae) who are cap-
able of committing the specific offense, the President
proceeded to define the acts which constitute the offense.
Soth in respect to the dealings in bituminous coal by
a single jobber, or several jobbers; and in respect to
dealings in anthracite at or cast of Buffalo and anthra
cite west of Buffalo, in each case, by a single jobber, or
several jobbers, he separately and distinetly provided
that it was ‘‘for the buying and selling”’ that the jobber
should add to his purchase price not more than a particu.
lar ‘‘ gross margin.’’
In doing so the President must be supposed to have
iad in mind the nature of a jobber’s business, and his
necessary relationship to a given transaction. A_ job-
ber does not produce coal and sell it, but buys it and
sells it. The transactions, whereby he purchases, nec-
OC east _
9
essarily involve an expense to him just as much as do
the transactions whereby he sells with the additional
intermediate expense which results from carrying un-
sold coal, equal in any event to the loss of interest on
the money invested. In respect to his business of pur-
chasing and earrying he is entitled to his cost and com-
pensation for his services,
Having these faets in mind, the President wisely and
fairly treated the relationship between a jobber and
a particular transaction, or to use the words of the
order, his relation to ‘‘a given shipment or shipments’’
as a unit. No permissible legal construction of the or-
der can be adopted, which attributes to the President
an intention to limit a jobber to a gross margin in the
selling of a particular shipment, which might well be
less than the expense already ineurred by him in the
purchase thereof, prior to the promulgation of the or-
der.
In the present case and in many possible cases there
might be shipments of coal in the hands of jobbers on
August 25, 1917, theretofore purchased by them, in re-
spect to which their expense connected with the purchase
and carrying already exceeded the gross margin of 15¢
permitted by the order of that day. If the order of
that day had the effect of compelling sueh jobbers to
dispose of such shipments at a loss, or in the alternative,
subject themselves to the penalties against ‘‘hoarding’’
provided in Section 26 of the law, the law itself would
be open to grave constitutional objections. Whereas,
no such objections could be raised, if the order is pros-
pective only, and to be applied only to such jobbers as
might see fit after the promulgation of the order, to en-
gage in the business ‘‘of buying and selling.’’
RL i CNS Be Pf Ea lg IO
10
We have already referred to the fact that by the
two orders of August 21st and August 23rd, the Presi.
dent adopted a comprehensive schedule of prices for
coal, both bituminous and anthracite, at the mines,
throughout the country. We submit that the adoption
of such a sehedule of prices, taken in connection with
the clear wording of clauses 2 and 8 of the order of
August 23rd, shows that it was for the buying and sell.
ing thereafter of coal, the price of which at the mines
was that day fixed, that the jobbers’ margins were fixed,
This construction indicates .a comprehensive, intel-
ligible purpose, and gives effect to all the words of the
order according to their plain English significance.
All of the sales by defendant, covered by the indict-
ment were in the months of August and September,
but the offense of which defendant was convicted was
not the offense charged in the indictment or defined by
any order in force in August and September, but was,
if anything, an offense in violation of a subsequent
order of October 6, 1917, of which Paragraph 9 pro-
vided:
‘*\ jobber who, at the time of the President’s
order fixing the price of the coal in question at
the mine (the order of August 21), had con-
tracted to buy coal at or below the President’s
price, and at that time had no contract to sell
such coal, shall not sell the same at a price higher
than the purchase price plus the proper jobber’s
commission as determined by the President’s regu-
lation of August 23, 1917.’’
The issuance of the order of October 6 shows con-
clusively that prior to that day it was not considered an
11
offense for a jobber who had purchased coal prior to
August 23 to sell the same at any price obtainable on
the market.
The principle is well established that laws, especially
laws creating crimes, are not to be given a retroactive
effect unless the legislative intention that they shall
have such effect is clear, This is especially true when
the retroactive construction throws doubt upon the con-
stitutionality of the law.
The very recent case of Schirab vy. Doyle, Collector of
Internal Revenue, 4. Supreme Court Reporter 391, de-
cided May 1, 1922, involved the question of the retroac-
tive construction of a law of the United States, and this
court held:
“1. Laws are not to be construed as applied to
eases which arose before their passage, unless that
intent be clearly declared, since there is absolute
prohibition against such law when their purpose is
punitive, and the situation which impels; pro-
hibition in such eases exacts clearness of declaration
in other cases.”’
Ue eRe
ets
fi i en
At page 392 of the opinion this court said:
“The act of September 8, 1916, is within the econdem-
nation.
There is certainly in it no declaration of retroactivity,
“clear, strong, and imperative,’’ which is the condition
expressed in United States v. Heth, 8 Cranch, 399, 413
ete,
If the absenee of sueh determining declaration leaves
to the statute a double sense, it is the command of the
eases that that which rejects retroactive operation must
he selected.”’
b
Pe Se, Oa SN See
Se UCU OOO
echt DA tae BEE MA TORS RR TEES ee eT. Bit, OL ra, FS Le eels
12
The learned District Judge was of opinion (see Rul
ing on Motion for a New Trial, R. 36) that because jt
Was stated as a recital of fact in one of the orders of
the Fuel Administration (Order of November 8, 1917)
that the ‘‘coal mine output was largely contracted to
be sold in advance,’’ that the order of August 23, if not
construed so as to penalize the sale by jobbers there
after, of coal previously purchased by them, would
leave it ‘open to the jobber to demand what he could
get for his coal, and to thus carry on the injurious spee.
ulation, manipulation and private control of the supply
which the Act was designed to prevent.”’
We submit that this is not a permissible method of
legal reasoning for the construction of a law creating
a criminal offense. There is nothing to indicate that
when the order of August 23 was issued, the President
had any information concerning the amount of coal at
the mines already contracted for, or whether the condi-
tion in fact existed on August 23. In any event, and
even assuming that the condition did exist, by reason
of the fact that only eleven days had elapsed since the
passage of the Lever Law, and there had been no inter:
vening investigation, it seems clear that he was not in
possession of any such information.
II.
The Court Erred in Not Permitting Defendant to Show
What its Costs and Profits Were.
If we are right in our first contention, the judgment
should have been reversed and it would be unnecessary
for the court to consider the other assignments of error.
If we are not correct in that argument, the question
13
remains whether the defendant was not entitled’to show
that 15¢ per ton added as its commission to its purchase
price resulted in loss or inadequate compensation.
The order of August 23, 1917, provides in terms that
“For the buying and selling of bituminous coal, a job-
ber shall not add to his purchase price a gross margin
in excess of 15¢ per ton.’? But the question is whether
the President had power under the law to limit the
“gross margin’? or commission of the jobber to a com-
mission which resulted in no compensation acequate to
the jobber’s services, or as in this case to a loss because
the selling price averaged less than the cost. The ques-
tion was raised at the trial by the request for Special
Charge No. 2. (R. 82):
“Tf you find from the evidence that the gross mar-
gin of 15e per ton for jobbers as fixed by the Presi-
dent on August 23rd, 1917, does not include defend-
ant’s costs of doing business and a just and reason.
able sum for profit, then I charge vou as a matter of
law that you must return a verdict of ‘not guilty.’ ”’
9?
This charge was refused and exception reserved and is
preserved by the third assignment of error (R. 94):
“In sustaining the objection of counsel for the
government to the defendant’s offer to prove that the
profit of The Matthew Addy Company, upon each and
every transaction upon which the indictment and the
several counts thereof were based was not in excess
of 15e per ton of 2,000 Ibs.’’
and in the sixth assignment (R. 95):
“Tn charging the jury that the word ‘profit’ in the
. See en ee eee cs PORE RM Al “IR Rie ad a UR EI
BFR E ete
14
indictment, at each of the places where said word
appears, was the equivalent of the words ‘gross mar.
gin,’ and in charging the jury that they might returm
a verdict against defendant in the absence of proof
that The Matthew Addy Company made a profit per
ton on the coal covered by the indictment, in excess
of 15ce.’’
The Government offered no evidence to show that any
part of the commission or margin of 25c, added by defend.
ant to its purchase price, was profit.
The defendant offered to show and had incorporated
into the record in connection with the evidence of Frank
C. Deckebach (R., 75), a certified public accountant, com-
prehensive tabulations from its books showing the cost
and expense of its business in cents per ton, not only for
the months covered by the indictment, but prior and sub.
sequent thereto. In the nature of things it was impos-
sible to distribute and allocate to the particular ship-
ments involved in the indictment, the proper proportion
of the company’s total expenses rightly allowable as
selling cost. But by a distribution of all costs against
all sales, it was shown that for the month of July, 1917,
the cost of selling a ton of coal was $.3425, or more than
9c over the total commission of 25¢ which the company
added to its selling price of the coal purchased by it from
Bluefield Coal and Coke Company for $3.25 per ton on
July 31, 1917 (Government Exhibits 1 and 2, R., 102).
For the month of August, 1917, the company’s selling
cost per ton was $.1457, or a fraction of a cent less than
the 15e per ton commission allowed by the executive or-
der. For the month of September the company’s selling
S7~””™ APATITE il NS DRAENEI ANIA TRAST ONG UA A i 2h
15
cost per ton was $.1790, or nearly 3c in excess of the com-
mission allowed. The evidence was rejected, the spe-
cial charge refused, and the jury instructed that the re-
sults of the purchases and sales by defendant by way of
profit or loss were immaterial.
We have already quoted, at page —, the section of the
Act which authorizes the President to fix the price of
coal and coke, and provides that such ‘‘authority and
power may be exercised by him in each case through the
agency of the Federal Trade Commission,’’ ete. In over-
ruling a motion to quash the indictment the District
Judge held that the word ‘‘may’’ in this clause is permis- :
sive, and that the President is not required to exercise
his authority to regulate the prices through the Federal
Trade Commission; and the judgment below was a con-
viction upon the order of the President of August 23, not
concurred in or promulgated by the Federal Trade Com-
mission,
In order to properly construe the law it should be
noted that where the Federal Trade Commission under-
takes to fix prices, it must, under Paragraph 11 of Sec-
tion 25, ‘‘make full inquiry, giving such notice as it may
deem practicable, into the cost of producing,’’ ete., and
that having completed such inquiry it shall (Par., 14):
‘In fixing maximum prices for producers * * *
allow the cost of production, including the expense
of operation, maintenance, depreciation, and deple-
tion, and shall add thereto a just and reasonable
profit.’’
and in Paragraph 15 it is further provided that:
16
‘‘In fixing such prices for dealers, the Commis.
sion shall allow the cost to the dealer and shall add
thereto a just and reasonable sum for his profit in
the transaction.”’
The purpose and intent of the law as a whole was no!
to confiscate, during a public emergency, either the prod-
uct of the producer or the good will or services of the
dealer or jobber, but to regulate prices after inquiry, and
under the ordinary constitutional limitations. And even
if it be true that the immediate emergency justified the
President in fixing jobbers’ prices, instead of adopting
the slower method of submitting them to the Federal
Trade Commission to be fixed upon investigation, we
submit that the President, in exercising such power in
emergency, was not free from the limitations imposed
upon the Federal Trade Commission in the event that it
should exercise the same powers by direction of the Pres-
ident.
We submit that where the President, without investi-
gation, fixed a dealer’s or jobber’s price, without allow-
ing ‘‘the cost to the dealer and adding thereto a just and
reasonable sum for his profit,’ the dealer or jobber may
show upon an indictment based upon Paragraph 17, for
violation of an order of the President, that the price fixed
by the order did in fact not allow ‘‘a just and reasonable
sum for his profit in the transaction,’’ but actually re-
sulted in a loss.
ee ananiean ; eee
17
IIL.
The court erred in overruling the motion of defendant to
quash the indictment and each and every count thereof.
(a) The indictment and each of its several counts,
is insufficient in law and fact.
The District Judge, in his opinion of February 26, 1920,
overruling defendant’s motion to quash the indictment
(R., 28), disposed of our first contention on this point in
the following language :
‘*The indictment is sufficient. The word ‘may’ in
the last clause of the first paragraph of Section 25
of the National Defense (Lever) Act (40 Stat., 276)
is permissive. The President is thereby empowered,
not required, to exercise his authority to regulate
the prices and production of coal through the Fed-
eral Trade Commission in each instance. This is
the ordinary significance of the word. U. S. v. Lev-
ington Mill Co., 232 U. S., 399, and that it was so in-
tended is clear from the context. It may be noted
that the third paragraph vests in the President a
similar optional discretion to act through the Com-
mission or otherwise.’’
We submit that this construction of the law is not
correct.
Paragraph one, which authorized and empowers the
President to fix the price of coal and coke, and to estab-
lish rules for the regulation of and to regulate the method
of production, sale, shipment, distribution, apportion-
ment or storage, is a startling innovation in legislative
18
action, due to the exigencies of war. If Paragraphs |
and 17 had stood alone, without the inclusion of the jp.
termediate paragraphs, the construction adopted by the
District Court might have been necessary, but reading
the section as a whole we submit that there was no in.
tention on the part of Congress to authorize the Presi.
dent to fix, without investigation or appeal, either prices
or jobbers’ commissions on the sale of coal and coke,
This is apparent from the provisions of the sections other
than 1 and 17.
Paragraphs 2, 3 and 4 relate to the requisition of ‘‘th:
plant, business and all appurtenances * * *
to such producer as a going concern,’
tion during the period of the war.
belonging
’
and their opera-
Paragraph 3 provides that in case of such requisition
**a just compensation for the use thereof’’ shall be paid,
which compensation the President shall fix or cause to
be fixed by the Federal Trade Commission, and Para.
graph 4 provides that in case of requisition, if the com.
pensation fixed be not satisfactory to the owner, he shall,
upon payment to him of 75 per cent. of the amount fixed,
‘*he entitled to sue the United States ‘o recover sueh
further sum as, added to said seventy-five percentun,
will make up such amount as will be just compensation.”
Paragraphs 6, 7 and 8 provide an altemative to requi-
sition of the plants of producers and dealers. That is.
‘*an agency to be designated by the Presilent,’’ to whiel
producers shall sell their products, the prices to be fixed
and regulated by such agency.
By Paragraph 8 it is provided that:
‘‘The prices to be paid for such products so pur-
chased shall be based upon a fair and just profit over
19
and above the cost of production, including proper
maintenance and depletion charges, the reasonable-
ness of such profits and costs of production to be de-
termined by the Federal Trade Commission,”’
with further provision that in case the owners are dis-
satisfied with the prices so fixed, they shall be paid sev-
enty-five percentum of the amount, with the right to
bring suit to recover the actual value of their product,
to be determined by the courts.
Paragraphs 11, 12, 13, 14 and 15 prescribe the pro-
cedure whereby the Federal Trade Commission, when
directed by the President, is to make inquiry into the cost
of producing coal and coke, and Paragraph 13 provides
that “If the President has decided to fix the prices at
which any such commodity shall be sold by producers
and dealers generally’? the Federal Trade Commission
shall ‘‘fix and publish maximum prices for both pro-
ducers of and dealers in any such commodity,”’ ete.
Paragraph 17 provides a punishment for any one who,
with knowledge that the prices of any such commodity
have been fixed as herein provided, violates them.
The Federal Trade Commission is required by See-
tions 14 and 15, in fixing maximum prices, both for pro-
ducers and dealers, to allow the cost of production, or
service, and ‘‘add thereto a just and reasonable sum for
the profit in the transaction.’’ We submit that Para-
graph 1, properly construed, and considered as a part
of the entire statute, cannot be casually disposed of by
merely defining ‘‘may’’ therein as permissive; that the
proper construction of Paragraph 1, conferring unusual
powers upon the executive, also defined the only manner
in which such powers could be exercised, and that the
— " . ‘ é tl
&
iy
Ly
b
.
&
Rt ee <SDA a ORE
20
word ‘‘may”’ is equivalent, as it frequently is, to the
v.ord ‘‘shall,’’ and refers to the special requirements of
Paragraphs 11, 12 and 13, inclusive, in providing the
method whereby the President is authorized to fix price:
for ‘‘producer or dealer.”’
Paragraph 16 strongly enforces our contention as to
the proper construction of the statute. It reads:
‘*The maximum prices so fixed and published shal
not be construed as invalidating any contract in
which prices are fixed, made in good faith, prior to
the establishment and publication of the maximun
prices by the commission.”’
During the course of the trial it was recognized that
this paragraph was applicable to the maximum comnis.
sion fixed by the President, for violation of which de.
fendant was indicted. But the paragraph did not under-
take to preserve the inviolability of the contracts as
against prices fixed by the President, but only as against
prices fixed by the commission. If the Government’:
construction of Paragraph 1 is correct, there would ap-
pear to be no sound rule of construction which would per
mit Paragraph 16 to make an exception to the unlimited
power conferred on the President by Paragraph 1.
If our construction of the statute is correct it follows
that—
The indictment should allege the passage of the Ac
and the principal provisions thereof and then that the
President having decided to fix prices at which coal and
coke might be sold, that the Federal Trade Commission
fixed and published maximum prices for dealers in such
commodities and that after such prices were fixed and
published, defendant, with knowledge thereof violated
same by asking, demanding and receiving higher prices
than those fixed.
Nowhere in the indictment does it appear that the
Federal Trade Commission fixed and published maxi-
mum prices and that defendant had notice thereof. If
the Federal Trade Commission did not in fact fix and
publish maximum prices and defendant did not in fact
know or could not have known of any fixing of prices by
it, then the defendant has violated no law and should not
have been compelled to plead to any such indictment.
It is a well recognized rule in criminal pleading, that
no material allegation may be omitted, for without it,
a criminal offense is not described.
In the case of United States v. Hess, 124 U. S., 483,
at page 486, it was held:
‘The general, and, with few exceptions, of which
the present is not one, the universal rule on this
subject, is, that all the material facets and circum-
stances embraced in the definition of the offense must
be stated, or the indictment will be defective. No
essential element of the crime can be omitted with-
out destroying the whole pleading. The omission
cannot be supplied by intendment, or implication,
and the charge must be made directly and not in-
ferentially, or by way of recital.’’
See also Ledbetter v. United States, 170 U. S., 606.
The rule just quoted applied equally to common law
offenses as to statutory offenses. In an indictment for
a purely statutory offense, the reason for the rule is all
the more evident, for a common law crime may become
PPR SA BBR RE A ree he SURE ARETE ME ES BE ATES BA 8 ret Se weeded SN ener ee cor. ot
oo»
defined through legislative and judicial interpretation,
besides the influence of public opinion expressed regard.
ing the law, during many years of its effectiveness.
IV.
The court erred in overruling the demurrer of defendant
to the indictment, which attacked the constitutionality
of the Act of Congress of August 10, 1917, commonly
known as the ‘‘National Defense (Lever) Act’’ (4
Stat. 278), and the executive order of the President,
dated August 23, 1917.
(a) The Act of Congress and the rules, regula-
tions, promulgations and publications of the Presi-
dent and the United States Fuel Administrator vio-
late the fifth amendment to the Constitution of the
United States, in that defendant is deprived of its
property without due process of law.
The first clause of Section 25 of the Act, gives the
President authority to fix the price of coal and coke.
The eleventh clause provides that when directed by the
President, the Federal Trade Commision is required to
inquire as to the costs of production of coal and coke.
The thirteenth clause provides that if the President has
decided to fix prices and the Federal Trade Commission
has completed its inquiry, the Federal Trade Commission
shall fix and publish maximum prices, which prices shall
be observed by all producers and dealers (black type
ours).
Then in the fourteenth and fifteenth clauses, it is pro
vided how maximum prices shall be arrived at. The
seventeenth clause preserihed the penalty for not com-
plying with the prices as fixed.
23
There is nothing in the Act of Congress nor in the
regulations of the President thereunder, as they were
construed and applied by the District Court, which pro-
vide for a hearing with regard to the fixing of prices.
There is not even any semblanec of a hearing either
before the President or the Federal Trade Commission
or a court. The President by himself or through the
Federal Trade Commission may arrive at a price to he
fixed, no matter how arbitrary or unreasonable, and
every one within the meaning of the Act must comply
therewith. This is a taking of one’s property or serv-
ices without compensation and is purely confiseatory
and within the prohibtion of the amendment to the Fed-
eral Constitution. Assuming that the President has
power to act without action by the Federal Trade Com-
mission, there is nothing in the Act of Congress which
provides for the machinery to arrive at the costs of pro-
duction. It is true the President may, if he sees fit,
exercise his power through the ageney of the Federal
Trade Commission and the Federal Trade Commission
may make inquiry as to the costs of production, but how
they shall arrive at such costs of production, is not
stated except that the Act in Clauses fourteen, fifteen
and sixteen of Section 25 provides, ‘‘that in fixing maxi-
mum prices for producers, the commission shall allow
the costs of prodnetion, inelnding the expense of opera-
tion, maintenance, depreciation and depletion and shall
add thereto a just and reasonable profit.’’
That in fixing such prices for dealers, the commission
shall allow the costs to the dealer and shall add thereto
a just and reasonable sum for his profit in the trans-
action,
That the maximum prices so fixed and published shall
not be construed as invalidating any contract in which
prices are fixed, made in good faith prior to the estab-
lishment and publication of maximum prices by the
commission,
In the motion to quash the indictment (R. 29), which
was overruled by the court, we contended that the word
SP RT ALE
CVS IE CI
A er a a NO a ene
24
‘‘may’’ as used in the first paragraph of Section 25, of
the Act of Congress in question should be read as
‘*shall.’’ That it was obligatory upon the President jy
all cases to exercise his authority therein vested in him,
through the ageney of the Federal Trade Commission,
The court below construed the phrase mentioned qs
being permissive on the part of the President, to exer.
cise his authority through the agency of the Federal
Trade Commission.
If the court’s ruling on the motion to quash the indict.
ment is correct, and as the Act of Congress in question
nowhere provides for an investigation by the Presiden:
nor for any semblance of a hearing before him, the Ae
of Congress in question is clearly invalid, as depriving
defendant of its property without due process of law,
and besides, the fact remains that the President has not
exercised his authority through the Federal Trade Com.
mission, which might have the machinery to provid
for a hearing.
While the President is given the power to exercise his
authority through the Federal Trade Commission, it is
very apparent from his rulings and regulations, begin.
ning with the first one under date of August 21, 1917, tha’
he has not seen fit to use the agency of the Federal Trad:
Commission and that he has arbitrarily arrived at the
maximum prices which he fixed in exercising that author.
ity himself.
Nowhere in the Act of Congress nor in any of the rul-
ings and orders of the President, or the United States
Fuel Administrator, is there a remedy provided for de-
fendant, in the event that the prices as fixed were found
not to include the cost of doing business, together wit)
a fair profit, which the Federal Trade Commission is en-
joined to allow dealers, when it (The Federal Trade Con:
ee ee ee re eee ee se oes Ais
25
mission) investigates the cost of doing business and pub-
lishes maximum prices after the President has decided
io fix prices of coal and coke.
Unlike the provision made in the Act of Congress, for
producers, Who, in the event that their properties and
cutput are commandeered by the President, may sue the
United States, the defendant as a jobber, is entirely with-
out remedy and if it exercises the privilege of charging
a price which covers the cost of doing business, plus a
fair profit, as the law intended for it to have, it is amen-
sble to criminal proceedings, which impose a very heavy
penalty.
If the Law authorizes the President, by mere execu-
tive order without previous investigation to finally fix
the jobber’s compensation for his services without pro-
vision for appeal, and does not permit the defendant to
show upon the trial that the compensation so fixed is un-
fair and inadequate, the law is unconstitutional. Due
process of law, as granted by the constitution, is not de-
pendent upon the form of procedure, but there must be
provided some fair method, either in advance or after-
wards, for compensating the person whose property is
taken, or Whose service is compelled, for publie uses.
It may be that where, upon investigation and hearing,
a jobber’s commission had been fixed for the trade in
general, a particular jobber could not complain because
of the faet that by reason of circumstances peculiar to
him, the commission so fixed did not afford him adequat»
compensation. (See remarks of the District Judge, R..,
78.) But in this case there was no hearing or investiga-
tion prior to the order fixing the jobber’s commission nor
any pretense of any. The arbitrary jobber’s commission
Caddie ©
De HO ry Re Re OT ORR A eth I WA RE: oe ele rt da , ~ a ei
26
embodied in the order of August 23, became effective thip.
teen days after the passage of the law itself. On Septem
ber 6 the United States Fuel Administrator, referring {:
the prices and commissions theretofore fixed, frankly
stated that they had been fixed without investigation, Hi
said: ‘**The prices fixed are provisional. They will stand
unless changed by order of the President for good eau
shown. The Fuel Administration will examine all appli
‘ations for revision of prices, accompanied by cost state
ments presented in writing.’’ In fact they were after.
wards changed several times and in many particulars.
The fixing of rates, charges or compensation for prop.
erty taken, is certainly not an executive function. Wher
compensation for property taken is fixed by judgment o!
a court, it is always after hearing and investigation,
where rates and charges are fixed by the Legislature it is
at least always presumed that investigation has bee
made.
If the President or other executive officer may ever.
cise such power without investigation as was done in the
present case, at least it must be open to the citizen ty
show upon the trial that the enforcement of the orde
was confiscatory or non-compensatory as to him. This
richt was denied the defendant in this case.
The District Judge in his opinion on demurrer to tle
indictment admitted that under ordinary conditions,
law such as the Act of Congress of August 10, 1917, would
be invalid because of want of due process of law ani
said:
‘It is true that the Act afforded no opportunity
for judicial review of the reasonableness of the price:
fixed by the President, and this has been determined
27
under ordinary circumstances, with reference (wo
railroad and other rates, to be want of due process
of law. Chicago, Milwaukee & St. Paul Ry. v. Min-
nesota, 134 U. S., 418, 10 Sup. Ct., 462, 702; Minne-
sota Rate Cases, 230 U.S., 352-484; Oklahoma Oper-
ating Co, v. Love, 252 U.S., 321; Holter Hardware
Co. vy. Boyle, 263 Fed., 134.”
But the learned District Court further said:
‘*Publie danger warrants substitution of execu-
tive process for judicial process. Moyer v. Pea-
body, 212 U. S., 78”? (R., 32).
In its opinion affirming the District Court, the Court
of Appeals quoted that part of the opinion of the Dis-
trict Court and concurred jin its views. In this respect,
we submit that both the District Court and the Court of
Appeals were in error, and that such a holding is in direct
variance with the salutary rule laid down by this court
in the early case of Ex parte Milligan, 4 Wall., 2, 121-
127; Hamilton v. Kentucky Distilleries Co., 251 U. S.,
146-156, and the very recent case of United States v.
Cohen Grocery Co,, 255 U. S., 81, 88-89.
In the Cohen case supra, this court speaking through
Mr. Chief Justice White, at page 88 of the opinion said:
‘We are of the opinion that the court below was
clearly right in ruling that the decisions of this court
undisputably establish that the mere existence of
a state of war would not suspend or change th er-
ation upon the power of Congress of the guaraiiees
and limitations of the fifth and sixth amendments
as to questions such as we are here passing upon
(citing cases). It follows that, in testing the oper-
iN i Pee TIA NRE APT NT
28
ation of the Constitution upon the subject here jy.
volved, the question of the existence or non-exis).
ence of a state of war becomes negligible, and w
put it out of view.’’ (Italies ours.)
While this court in the Cohen case held Section 4 oj
the Act of Congress of August 10, 1917, unconstitutional
beeause of indefiniteness, and notwithstanding that the
facts in that case were different than the facts in this
case, in that in the Cohen case no prices were fixed, ani
therefore the question of what were reasonable price
was too indefinuite and did not sufficiently inform the
defendant of the charge against him, while in the cas
at bar, definite prices were fixed, nevertheless, the prin.
ciple laid down by this court in the Cohen ease, viz,
that the existence or non-existence of a state of war or
using the words of the District Judge, the existence oy
9
non-existence of ‘‘publiec danger,’’ becomes negligible,
and should be put out of view, and the usual rules with
reference to the limitations of the Constitution upon the
power of Congress and the chief executive should be
applied. If as the Distriet Court and the Court of Ap-
peals admits, that under ordinary circumstances ther
is a want of due process of law, so far as this petitioner
is concerned, then by applying the rule laid down by this
court in the Cohen ease, petitioner has been deprived
of due process of law, notwithstanding this proceeding
grew out of, and was during the existence of a state of
war and based upon the Act of Congress passed during
such state of war.
Our principal objection to the statute on constitutional
grounds, as applied to the facts in this ease, is not 80
much that the President was without power to fix the
—,
broker’s commissions, but that Congress was without
power to authorize him to do so without investigation,
and subject the defendant to criminal punishment with-
out permitting it to show that the commission fixed was
non-compensatory. In other words, we insist thet prop-
erty can not be taken for a public use, or services com-
pelled for such use, without the right to have it deter-
mined somewhere and at some time, either in advance
or afterward, whether the compensation provided is ade-
quate.
(b) The Act of Congress violates Section 1 of
Article 1; Section 1 of Article 2 and Section 1 of
Article 3, of the Constitution of the United States,
in that it delegates legislative and judicial powers
to the President of the United States, to the United
States Fuel Administrator appointed by the Presi-
dent, and the Federal Trade Commission.
The courts have uniformly held that rate fixing or
price fixing is a legislative function. It has also been
recognized that if the subject is one over which the state
legislature or Congress has authority, it may regulate
the use or even the price of the use of private property.
Interstate Commerce Commission v. Cincinnati, New
Orleans & Texas Pacific Ry. Co., 167 U.8., 479, 505; City
of Knoxville vy. Knoxville Water Co., 212 U. S., 1; Min-
nesota Rate Cases, 230 U. S., 352; Field v. Clark, Boyd
v. United States, and Sternback v. United States, 143 U.
8., 649,
”
»
CONCLUSION.
We respectfully submit that upon the showing made
to this court, a writ of certiorari should be granted, &.
rected to the Cireuit Court of Appeals for the Sixth
Cireuit, requiring that the record of said cause in said
court and the judgment be certified to this court, and
that thereupon this court proceed to correct the error
complained of, reverse said judgment, enter final judg.
ment and discharge petitioner, and grant such further
relief as this court may deem just and proper in the
premises.
Netson B. Cramer, and
Juttus R. SaMveE.s,
Attorneys for Petitioner,
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