Petition for Writ of Certiorari — City of Chicago v. Thiele (No. 729)

BLPRE VE COURT. U. FILED

JAN 1 ¢@ 1958

————————————== =, Clerk

Office - Supreme Com: US. |

aay |

Supreme Court of the United States

Octoper Term, 1957.

No. 729.

FRED THIELE ann EUGENE PANGER, Co-Partners,

p/p/A TWIN TOWERS COMMISSARY,

Respondents,

US.

CITY OF CHICAGO, a MUNICIPAL CORPORATION, AND

MARTIN H. KENNELLY, Mayor or tHe Ciry or Cut-

caco; TIMOTHY J. O’CONNOR, Commissioner oF

PoLice oF THE (ity or Cxicaco; anp ROY T. CHRIS-

TIANSEN, CoMMISSIONER oF BUILDINGS OF THE CITY OF

CHiIcaco,

| Petitioners.

PETITION FOR WRIT OF CERTIORARI TO THE

SUPREME COURT OF ILLINOIS.

Joun C. MELANIPHY,

Corporation Counsel of the City of Chicago,

511 City Hall, Chicago 2, Illinois,

Attorney for Petitioners. —

Sypney R. Dresin,

Assistant Corporation Counsel,

Ropert J. Cours,

Special Assistant Corporation Counsel,

Of Counsel.

INDEX. |

PAGE

Citations te Opinions Below .. ygeteeees ‘ges Ca 2

Pig ae ee Pe Ser ree ee mr eer eae! 2

Questions Presented for Review .................... 2

Constitutional and Statutory Provisions Involved .... 3

es Sar SE EN k=) Wa da bu bbeux Geass Fhaa kA 4

Reasons for Granting the Writ:

I. The court below has decided a federal question

of sabstance not heretofore determined by this.

eee [SKEET od 6

II. The court below had decided a federal question

not in accord with the applicable decisions of

Se EE ove oer acceaccden ee eee 10

NR ae re Wh os ow eee be ee ae ii

Appendices:

A. Judgment Order of the Superior Court of Cook

MI Sc aeieaces. wear a e 13

B. Opinion of the Supreme Court of Illinois ..... 15

C. Article 1, Section 8, Clause 17, Constitution of

the United Miatee . .. 5... 062s. Ayr yee 20

D. Military Leasing Act of 1947 (10 U.S. C. See- |

tions 1270, 1270d) ..... Fa kena a Kies Spans oe 21

E. Wherry Military Housing Act of 1949 (12

Ci. a GAINED div wkd oc cck wkcakcuada 23

F. Municipal Code of Chicago, Sections 130-11 |

Se vininiakech pastors ee eae “24

CITATIONS.

Cases.

Alabama v. King & Boozer, 314 U.S.1...............

American Motors Corp. v. City of Kenosha, 80 N. W.

2a ( Wise.) 363 ........ Terre ee eee eve ee eerie

Carnegie-Il]linois Steel Corp. v. Alderson, 127 W. Va.

807, 34 S. E. 2d 737 (Certiorari denied, 326 U. S.

Dee RRA ay oman eC ment ae eras

Chicago, R. I. & Pacific Railway Co. v. Me Glinn, 114

Collins v. Yosemite Park Co., 304 U.S. 518 2.0.0.0...

Conley Housing Corp. v. Coleman, 89 8S. E. 2d (Ga.)

ie eh nek ERLE & do oa

Fort Dix Apartments Corp. v. Borough of Wrights-

town, 225 Fed. 2d 473 (Certiorari denied, 351 U. S.

SE Sak ira vse & op ee bee Nek boo ak dd Od cd ey

Graves v. N. Y. ex rel. O’Keefe, 306 U. S. 466 ........

Herkens v. Glynn, 101 P. 2d (Kans.) 946 ............

Howard v. Commissioners, 5 ios | GRRE?

James Stewart & Co. v. Sadrakula, 309 U.S. 94 ......

Mayor and City Council of Baltimore v. Linthicum,

Se a bee ees odes nda Oe ee

Meade Heights Inc. v. State Tax Commission, 95 A.

PI oS h as clei soca wu tn ha kos FAR es Kwa

Murray v. Joe Gerrick & Co., 291 U.S. 315 ...........

Offutt Housing Co, v. Sarpy County, 351 U. S. 253 ....

Paambor ¥. Teerrett, B62 TU. B. GOO oon ene

Penn Dairies, Ine. v. Milk Control Commission of Penn-

CI lc ON ON ink ni ee awiheeie scsi cde

11

11

lil

People v. Vendome Service, Ine., Xs . Y. S. 2d 183

(Affirmed, 19 N. Y. S. 2d 195) .N...............5. 10

a .

S. R. A., Ine. v. Minnesota, 327 US. 558... 2.2.2... 11

Thiele v. City of Chicago, 12 Ill. 2d 218 145 N. E

TSS 66 6 TNR6 EN SEAE SOO MES DSL i 6 60 bes <'okcwee 1

Statutes.

Constitution of the United States, Article 1, Section

I ery eta g Me ad ve Cog al 2, 3, 5, 9, 20

Military Leasing Act of 1947 (10 U. S. C. Sections

ram OS SPA er ere are » 3, 11, 21

Wherry Military Housing Act of 1949 (12 U. S. C.

Section 1748d) ............. SP i Oe eS, ee 4, 23

Municipal Code of Chicago, Section 130-11 to 130-14. . .4, 24

IN THE

Supreme Court of the United States

OcToBER TERM, 1957.

ar eee

FRED THIELE ann EUGENE PANGER, Co-Partners,

p/B/A TWIN TOWERS COMMISSARY,

Respondents,

vs.

CITY OF CHICAGO, a MUNICIPAL CCRPORATION, AND

MARTIN H. KENNELLY, Mayor or tue City or Cut-

caco; TIMOTHY J. O’CONNOR, Commissioner oF

Pouice or THE City. oF Curcaco; anp ROY T. CHRIS-

TIANSEN, Commissioner oF BUILDINGS OF THE CITry OF

CHICAGO,

Petitioners.

Sd

PETITION FOR WRIT OF CERTIORARI TO THE

SUPREME COURT OF ILLINOIS.

Ce

To the Honorable Chief Justice and Associate Justices of

the Supreme Court of the United States:

Come now the Petitioners, City of Chicago, a municipal

corporation, and the Mayor, Police Commissioner and Com-

missioner of Buildings of said City of Chicago, and pray

that a writ of certiorari issue to review the judgment of

the Supreme Court of Illinois, entered in the above-entitled

cause on September 20, 1957, rehearing denied November

19, 1957. |

2

Citations te Opinions Below.

The judgment of the Superior Court of Cook County,

Illinois is unreported, appears in the Transcript of Record

at p. 3-B (Add. Abst. 14-16) and is attached hereto as

Appendix A. The opinion of the Supreme Court of IIlinois

is reported in 12 Ill. 2d 218, appears in the Transcript of

Record at pp. 6-9, and is attached hereto as Appendix B.

Jurisdiction.

The judgment of ihe Supreme Court of Illinois was en-

tered September 20, 1957.

Petition for rehearing was denied November i9, 1957.

The jurisdiction of this Court is invoked under 28 U.S. C.

Section 1257 (3). :

Questions Presented for Review.

1. Are the licensing and zoning ordinances of the City

of Chicago unenforceable against the respondents by virtue

of the provisiens of Article 1, Section 8, Clause 17 of the

Constitution of the United States?

2. Is the principle of sovereign immunity applicable to

respondents?

3. If exclusive legislation over condemned land is vested

in the Congress of the United States under Article 1, Sec- .

tion 8, Clause 17 of the Constitution of the United States

and if Congress passes an act giving the Army the powe®

to lease, subject to ‘‘local tagation’’, does a lease of such |

iand requiring compliance with local laws permit enforce-

ment of such local laws by municipal authorities against

private parties who operate such land and improvements

thereon for their own profit?

4. Is the power of ‘‘local taxation’’ provided for in Sec-

3

tion 6 of the Military Leasing Act of 1947 (10 U.S. C. See-

tion 1270d) limited to the assessment of taxes or does it

also include the power of a municipality to tax and regulate

a.private business having a direct relationship to the public

health, safety and welfare?

on§, Does Paragraph 7 of the lease which provides (Rec.

— a rm

3-B; Add. Abst. 8):

‘That the Lessee shali comply with all applicable laws,

ordinances, and regulatioyjs of the State, County, and

municipality whereinnthé said demised. premises are

located, with regard to consiruction, sanitation, licenses

or permits to do business, and all other matters.”’

inure to the benefit of a municipaliiy, where the apartment

building (in which respondents’ commissary is Jocated) is

situated on the ‘‘naked land’’ of the Federal Government,

covering only a square block (Rec. 3; Abst. 13) and en-

tirely within the borders of the municipality ?

6. Is a commissary (owned and operated by a private

individual for personal profit), located in an apartment

building (owned and operated by a private individual for

personal profit), but erected on the ‘‘naked land’? owned

by the Federal Government, a ‘‘Federal enclave”? not sub-

ject to a regulatory municipal ordinance, where the ‘‘naked

land’’ is not more than a square block in size and entirely

within the boundaries of the municipality, ayd where the

resideyts of the municipality are at liberty to patronize the

commissary ?

Constitutional and Statutory Provisions.

The constitutional provisions involved are contained in

Article 1, Section 8, Clause 17 of the Constitution of the

‘United States (Appendix C); the statutory provisicns in-

volved are the Military Leasing Act of 1947, 61 Stat. 774-

176, 10 U. S. C. Sections 1270, 1270d (Appendix D), the

4

Wherry Military Housing Act of 1949, 63 Stat. 570, 12

U. S. C. Section 1748d (Appendix E), and Sections 130-10,

130-11, 130-12, 130-13, 130-14 of the Municipal Code of Chi-

cago (Appendix F).

Statement of the Case.

The respondents operate a food store in an apartment

building in the City of Chicago. Exclusive legislative juris-

diction over the land on which the building. stands has been

ceded to the United States by the State of Illinois. The

land was acquired by condemnation at which time a statute

of Illinois (since repealed) ceded to the United States ex-

clusive jurisdiction over land that it acquired in Illinois,

reserving only the right to serve civil and criminal process

(Ree. 6). After the United States secured title, the Secre-

tary of War advised the Governor of Illinois that the United

States accepted the ceded jurisdict.on.

Pursuant to congressional authority, the Secretary of the

Army thereafter leased the property to Herbert S. Green-

wald for a term of 75 years at a rental of $100 a year. By

the terms of the lease the lessee undertook to build and

maintain a housing project of 253 units, the lease providing

for pyority of occupancy by military and civilian personnel

of the Armed Forces, but in default of such occupancy the

lessee was authorized to lease to other persons (Rec. 6).

The plans for the building included space for a food store

and the space so provided was leased by Greenwald to the

respondents. The food store is not operated for the exclu-

sive benefit of residents of the premises, but sales are made

to the general public which has access thereto (Rec. 3, Abst.

18; Ree. 6).

Under th terms of the lease to Greenwald, title to all im-

provements constructed upon ‘he land by the lessee would

remain in the lessee during the term of the lease, but, upon

4)

expiration or termination of the lease, all improvements

thereon would become the property of the Federal Govern-

ment without compensation unless the lessee elected tu re-

move the improvements and restore the premises to their

original condition (Ree. 3-B; Add. Abst. 9,10). The lease

also provided that (Rec. 3-B; Add. Abst. 8):

*«* * * the lessee shall comply with all applicable laws,

ordinances and regulations of the State, County and

municipality wherein the demised premises are located,

with regard to construction, sanitation, licenses or per-

mits to do business, and all other matters.’’

Paragraph 13 of the Lease further provided (Rec. 3-B;

Add. Abst. 10):

‘** * * the Lessee shall observe and perform all the

laws, ordinances, rules and regulatiens relating to

health and sanitation * * * and will indemnify and save

harmless the Government against all actions, suits,

claims and damages by whomsoever brought or made by

reason of the failure to keep said buildings and im-

provements in good order, condition and repair, or by

reason of the non-observance or non-performance of

the said laws, ordinances, rules and regulations * * *.’’

The respondents failed to comply with the licensing and

zoning ordinances of the City of Chicago and instituted this

action for deciaratory judgment contending that such ordi-

nances were either inapplicable to respondents or unconsti-

tutional as being in contravention of Article I, Section 8,

Clause 17 of the United States Constitution.

- The federal questions were, therefore, raised by the com-

plaint (Ree. 3; Abst. 1-7). The trial court held that the

United States had exclusive jurisdiction over respondents’

food store and that the municipal ordinances of the City

of Chicago were inapplicable to such premises (Ree. 3-B;

Add. Abst. 14596). The Supreme Court of Illinois affirmed

the decree of the Tal court (Kec. 6-9).

Reasons for Granting the Writ.

bY

The court below has decided a federai question of substance

not heretofore determined by this Court. ,

The United’ States holds ‘‘naked title’’ to certain vacant

land in the City of Chicago. ‘This land has been. leased to

Greenwald, a private individual, who cofstructed a- huge

apartment building on the land. The Jease provides that

$100 per ygar be paid by Greenwaldgto the United States

for the use of such land and that title to the apartment

buildjng remain in Greenwald for the 75 year term of the

lease. Upon the expiration of the leese, Greetfwald may:

remove the improv ements from the land and retain. them.

If he fails to do so, the improvements become the property

of the United States without compensation to Greenwald.

Greenwald operates such apartment building for profit, no

part of which iures to the: henetit of the United States.

Greenwald: sttb-leased a portion of the premises to the-re-

spondents, priv ate indiv iduals, who operate a commissary

therein for profit. Respondents operate the commissary

for the benefit of the general public, not restricting access

thereto to o¢cupants of the apartment building.

. The courthelow arehied upon Collins v. Yosemite Park Co.

(1987), 304 U.S. 51%,-as being controlling. The facts jn the

ca. at bar are easily distinguishable from the Collins ease. .

In, pe Cc ollins case, the United States acquired the land

there eoncerned by Treaty in 1848. In 1850, when California

became a State, the United States reserved its proprietary

interest in such land. Later it ‘was given to California, but

subsequently again ceded to the United States. Today the

United States exercises control.over stich land and operates

- itas a Nativaal-Park. In the case at bar, the United States

is not in active. control of the apartment building operated

«

7

by Greenwald. In the Collins case, a portion of the iand

was leased to the Yosemite Park Co. which was given the

right to seli aleoholic beverages to visitors. In the case at

bar, ail of the land hag been leased and the United States

has no joint interest in its control or operation. In the

Collins case, the contract provided that the Yosemite Park

Co. should retain profits up to a cértain amount. In excess

of this amount, the Park Co. was required fo pay a per-

centage of the profits to the United States. In the case at

bar, of course, the United States derives no benefit trom

the operation of the apartment building and is not an active

‘‘partner’’ sharing in the profits as in the Collins case.

‘Greenwald‘and the respondents retain all profits. no matter

how sizeable, and are solely responsible for operating and

controlling the premises concerned.

In the Collins case, prices charged by the Yosemite Park

Co. vere to be approved by the Secretary of the Interior

and, in determining profits'for sharing with the United

States, no Allowance was made for the payment of local

taxes. _Any Joca) taxes paid would not be,considered a part

of the operating expenses under the contract.

» The Yosemite Park Co, brought suit to enjoin the ‘State

of California from-enforcing its laws requiring.a license to

sell liquor and providing for regulatory measures for the

tiquor business. This Court held that California was power-

less to regulate the activities of the Yoseiiite Park Co.

~The reasons are obvious. First of all, the United States

was actively in charge of the entire Yosemite National Park

and local governments could not interfere with such opera-

tion. Secondly, the United States was a “partner”? in a

profit-making enterprise in connection with the portion of

the park leased to the Yosemite Park Co. Enforcement of

local laws would permit regulation cf a business operated~

within an area controlled by the United States Government

and from which it received profits.

8.

In the case at bar, the United States leased al! of its land;

it derives no pecuniary benefit from the operation of the

land and the improvements thereon; it holds ‘naked title”

as ‘owner oe Greenwald holds title to the building and

may remove it at the termination of the lease. We perceive

no analogy between the Collins case and the case at bar.

We believe the court below was griev ously -aLerror in ryling

that the Collins case was controlling. ‘

In leasing its land to Greenwald, the United States speci-

fically provided that he would comply with all laws of the

City of Chicago. with regard -to construction, sanitation, —

licenses or permits to do business, and all other matters. |

What possible justification can the respondents have for

failing to so comply? The fees chargeable by the City of

Chicago for a Food Purveyors’ license are nominal, almost

negligible. But, before the license will issue, the Chicago

Board of Health must inspect such premises and examine

the employees engaged in employment there. Why are the

respondents averse to such inspection and examination!

The mere fact that they are averse makes them suspect.

Petttioner is concetned with residents .of the City of Chi-

cago who may avail themselves of respondents’ commissary,

as well as with inilitary and civilian personnel living in

the building.

\ e know of no foed purvegor anywhere who may oper-

ate without health inspections, preliminary ‘to the’ issuance

of a license. Under the opinion of the Tlinois Supreme

Court, the respondents in the case at bar are at liberty to

_ maintain their premises in any condition they please. They

may hire empleyees in any condition of health. Who is

‘there to enforce normal safeguards over a business selling

* food to the general public? It is unconscionable, and in-

conceivable; that respondents may be permitted to continue —

this operation. Are refrigeration facilities adequate? Is.

contaminated food being sold? Are persons suffering from

ida a

cf

7

f

9

contagious diseases employed there? No one knows. Re-

spondents hide behind sovereign immunity in the assump-

tion that the Federal Government is disinterested in such

matters. We do not believe so. The rigid health regula-

tlons enforced by the military services for their own

personnel is the answer to the Government’s viewpoint tn

this regard. But neither the military, nor the United

States, has any control over Greenwald’s premises. The

building is his and the lease so states. The respondents

are in a similar position. The respondents are answerable

“to no one, not even to the government of the United States.

The precise reason for the. provision in the lease requiring

respondents to comply with local laws was because the

United States thereby relieved itself of supervisory inspee-

tions and regulatory duties in an area where it had no

active control. e

The very purpose of paragraph 13 of the Lease re-

quiring the respondents to observe and perform all ordi-

nances ‘relating to health and sanitation and to indemnify

the Government against all actions by whomsoever brought »

. by reason of non-performance of said ordinances, was to

compel enforeemant by local authorities. - Respondents

must save the Government harmless from -this action as

Well as any other. They cannot avoid it by cloaking them-

- Selves in, so-called ‘sovereign immunity,’’ because their

lease wifh the Sovereign insisted upon observance of local

ordinances, :

Article 1, Section 8, Clause 17 of the Constitution vests

exclusive legislation in the Congress of the United States

over all land purchased for.the erection of needful buildings.

In the case at bar, it is not apparent that the land in

question was purchased ‘‘for the evection of needful build-

ings.’’ However, all of such land was leased by the United

States to private individuals for a negligible rental. The

building erected upon such land is the sole property . of

10

such private individuals and operated by them for profit.

The respondents ‘are further removed from “the United

States in that they are sub-lessees of a part of the premises

concerned and their operation is completely removed from

control or supervision by the United States or the military.

They are engaged in a business enterprise at prices estab-

lished by them. They deal with citizens of the City of

(‘hicago who: have access to respondents’ commissary as

well as with occupants of the building. If the positive

provisions of the lease requiring compliance with local laws

may be flouted by the respondents, then the lease itself has

heen violated and respondents have no legal er equitable

standing in court.

IT.

The court below has decided a federal question not in

accord with the applicable decisions of this Court.

This Court, and many state courts, have consistently

sustained the right of local authorities to enforce municipal

ordinances and state statutes against private parties in

possession of businesses or buildings within f2deral areas.

The case at bar is strengthened and distinguishable from

most (if not all) such cases by the fact that the Tease under

which respondents operate specifically provides that ‘they

shall comply with local laws. ;

In Offutt Housing Co. v. Sarpy County (1956), 351 U. S.

2593, this Court was confronted with a lease practically

identical with the one involved in the case at bar, except

that in the case at bar the lease additionally provided that

compliance with local laws was necessary: In the Offutt

case, this Court sustained the enforcement of local taxa- |

tion against the lessee there involved.

In People v. Vendome Service, Inc., 12 N. Y. 8. 2€ 183

(Affirmed, 19 N. Y. S. 2d 195), land was purchased for the

P

il :

construction of a post-office. Prior to construction, the

United States leased a portion of the premises to private

individuals. Although New York had consented to the

purchase, the United States had not as yet applied for

exclusive jurisdiction. In finding the defendant guilty of

failure to obtain a permit, the court said.(p. 187):

ce * * where, * * * the government leases the prop-

erty to a private person to carry ona non-governmental

function, such property is subject to the legislative

authority and control of the State * * *.”

In numerous other instances this Court and the various

State courts have made similar rulings (Palmer vy. Barrett,

162 U. S. 399; Carnegie-Illinois Steel Corp. v. Alderson,

127 W. Va. 807, 34S. E. 2d 737 (Certiorari denied, 326 U. S.

164); Chicago, R. 1. & Pacific Railway Co. v. MeGlinn, 114

U.S. 542; Herkens vy. Glynn, 101 P. 2d (Kans.) 946: Fort

Dix Apartments Corp. v. Borough of Wrightstown, 225

Fed. 2d 473 (Certiorari denied, 351 U. S. 962); Conley

Housing Corp. v. Coleman, 89 §. E. 2d (Ga.) 482: Meade

Theights Inc. v. State Tax Comm ission, 95 A. 2d (Md.) 280;

Howard v. Commissioners, 344 U. 8. 624; Penn Dairies,

.v. Milk Control Commission of Pennsylvania, 318 U.S.

261; James Stewart & Co. vy. Sadrakula, 309 U. S. 94:

Alabama v. King & Boozer, 314 U. S. 1; Graves v. N. Y.

—er rel. O "Keefe, 306 U. S. 466; Mayor and City Council of

Baltimore v. Linthicum, 183 A. (Md.} 531; 8. R. A., Ine. v.

Minnesota, 327 U..S. 558: Murray v. Joe Gerrick & Co.,

291 U.S. 315; American Motors Corp. v. City of Kenosha.

80 N. W. 2d (Wise.) 363.)

Conclusion. ©

This is a ease of first impression relative to the following

issues: |

‘1. Whether the provisions of Section 6 of the Military

Leasing Act of 1947 as to ‘‘local taxation” are exclusive of

i

12

¢ ° . . .

regulatory features which are inseparable from licensing

ordinances.

2. Whether the express provisions of the lease involved

requiring compliance with local laws are unenforceabie by -

municipal authdrities.

3. Whether the inherent right of governmental bodies

to enforce measures for the protection of the health, safety

and welfare of the community is inapplicable to respond-

ents’ commissary merely because the ‘‘naked land’’ upon

which it is located is the property of the United States

Government.

4. Whether the doctrine of ‘‘governmental immunity”’

can be asserted by a private individual who owns and

operates for personal profit a commissary located in an

apartment building (owned and operated by a private indi-

vidual for personal profit) but erected on the ‘‘naked land”’

owned by the Federal Government and leased under the

provisions of the Military Leasing Act of 1947.

Important public interest, national and local, requires

that this matter should be heard, considered and decided

on the merits by this Court.

For the foregoing reasons, this petition for writ of cer-

tiorari should be granted.

Respectfully submitted,

Joun C. MELANIPRY,

Corporation Counsel of the City of Chicago,

511 City Hall, Chicago 2, Illinois,

Attorney for Petitioners.

Sypney R. Dresin,

Assistant Corporation Counsel,

Rosert J. Coins,

Special Assistant Corporation Counsel,

Of Counsel.

13

APPENDIX A.

Judgment Order of the “Superior Court of Cook County,

Illinois.

DECLARATORY se acaiatanilan

This matter coming on to be heard on the plaintiffs’

Motion for Summary Judgment, the court having consid-

ered the affidavits filed in support of said Motion, the

affidavits filed by defendants in opposition to said Motion,

the pleadings and the Briefs filed’by the parties, and the

Court having heard argument of counsel and now being

fully advised in the premises,

The Court hereby finds that:

1. This Court has jurisdiction of the parties and of the

subject matter hereof.

2. This is an action for declaratory judgment in a case

_ of actual controversy instituted pursuant ‘to the statutes

of the State of Illinois in such case made and provided.

3.- The plaintiffs are residents of the City of Chicago

and. engaged in business therein under the name and style

of ‘‘Twin Towers Commissary’’ and operate a commissary,

or food shop, in the building known as Twin Towers located

~in-the City of Chicago in the bleck bordered by Fiftieth

Street on the north, Leif Erickson Drive on the east, Fifty-

first Street on the south, and East End Avenue on the

west.:

4.. Title to the land on which the said Twin Towers

huilding is located and on which the plaintiffs operate their

afuresaid commissary is vested in the United States of

America, said land having been ceded to the United States

14

of America by the State of Illinois pursuant to the laws

of the United States and the State of Illinois.

5. The United States of America has sole and exclusive

jurisdiction over the land on which the Twin Towers and

the said commissary of the plaintiffs are located, except

for the rights to service of process and making arrests,

which rights were specifically reserved by the State of

Illinois at the time of the said cession.

6. The municipal ordinances of the City of Chicago have ~

no application or effect within the confines of the aforesaid

land on which the plaintiffs operate their commissary and

neither the City of Chicago nor any of its agencies, officers,

agents or employees have any power, right or jurisdiction

to enforce or seek to enforce the said ordinances against

the plaintiffs, their agents or employees, in the operation

of their said business on the said land.

7. The plaintiffs have substantially sustained and

proven the allegations contained in their Complaint for

Declaratory Judgment. -

IT IS THEREFORE ORDERED, ADJUDGED AND DECREED that:

(a) The licensing and zoning ordinances of the City of

Chicago are not applicable to the operation of the said

Twin Towers Commissary, |

(b) The plaintiffs, Fred Thiele and Eugene Panger,

and either of them, and their agents and employees, may

operate and conduct their aforesaid business known as the

~~ Twin Towers Commissary” without regard-to the licens- -

ing and zoning ordinances of the City of Chicago, and

(c) Neither the City of Chicago nor any of its agencies,

officers, agents or employees have the right, power or

jurisdiction to enforce or seek to enforce the said building

and zoning ordinances of the City of Chicago against the

plaintiffs, or either of them, their agents or employees, in

the operation of their aforesaid business.

15

v) APPENDIX B.

OPINION OF THE SUPREME COURT OF ILLINOIS.

Mr. Justice Scuaerer delivered the opinion of ihe court:

The plaintiffs operate a fool” store in an apartment

building in the Hyde Park area. on the south side of Chi-

cago. Exclusive legislative jurisdiction over the land on

which the building stands has been ceded to the United

States by the State of Illinois, and the question is whether

under the Federal constitution. the licensing and zoning

ordinances of the city apply to the plaintiffs’ activities.

The land in question was acqnired by the United States

by condemnation. At that time a statute of Illinois, sinee

repealed, ceded to the United States exclusive jurisdiction

over land that it acquired within Illinois, reserving only

the right to serve civil and criminal process. (III. Rev. Stat.

1943, chap. 143, pars. 23-25; see Laws of 1953, p. 1073)

After the United States secured title, the Secretary of ar

advised the Governor of Illinois that the United States

accepted the ceded jurisdiction.

Pursuant to congressional authority, the See: etary of

the Army thereafter leased the property to Herbert S.

Greenwald for a term of 75 years at a rental of $100 a

year. By the terms of the lease the lessee undertook to

build and maintain a housing project of 253 units in accord.

ance with plans approved by Federal authorities. The lease’

provides for priority of occupaney by military and civilian

personnel of the Army, Navy, Marine Corps, or Air Force.

but in default of such occupancy the lessee is authorized to

lease to other persons.

16 4

The plans for the building included space for a food

store. The space so provided was leased by Greenwald to

the plaintiffs. After the plaintiffs-had been arrested for

operating the food store without the license required by

the city’s ordinance, this action was instituted for an in-

junction restraining the officials of the city from enforcing

its licensing, building and zoning ordinances against the

plaintiffs in the operation of their food store. A decree for

the plaintiffs was entered upon their motion for a summary

judgment, and the city appeals.

The constitution of the United States gives the Congress

* e s

power ‘‘To exercise exclusive Legislation over

all Places purchased by ¢he Consent of the Legislature of

the State in which the Same shall be, for the Erection of

Forts * * * and other needful Buildings.’’ (Art. 1,

see. 8, clause 17.) The parties agree that exclusive juris-

diction under this provision was vested in the United States

when the Secretary of War notified the Governor of Illinois’

that jurisdiction was accepted. 40 U.S. C. 255.

Areas so situated are known as Federal enclaves, : or,

more picturesquely, as ‘‘ Federal islands’’ within the States.

They present many problems. Persons who reside in such

an area, although they live within the borders of a State, are

not regarded as its residents. Absent special legislation or

intergovernmental agreement, they may not vote, hold pub-

lie office or serve on juries, and their children are not en-

titled to attend public schools. {U. S. Interdepartmental

Committee For the Study of Jurisdiction over Federal

Areas within the States, Report pt. 1, U. S. Govt. Printing

Office, 1956; 101 U. of Pa. L. R. 124.) The Federal As-

similative Crimes Act (18 U. S. C. 13) has made State

criminal law applicable within the enclaves, but enforee-

ment of that law is a Federal and not a State responsibility.

(See, e.q., United States v. Unzeuta, 281 U. 8. 138; Benson

v. United States, 146 U. S. 325.) By Federal statute State

17

income, sales and use taxes have been made applicable '

within Federal enclaves. (4 U.S. C. 104-110.) There have

been other similar accommodations. But State and local

fire and police protection, garbage removal and other serv-

ices are not available within Federal enclaves’ except by

agreement, and even if there is agreement serious questions

remain as to the status of State or municipal officers while

performing these services.

The dominant fact in this case is that exclusive juris-

diction over the area in question has been ceded by Illinois

to the United States. The city argues, however, that juris-

diction has been retroceded by the lease between the Secre-

tary of the Army and Greenwald, and that the present plain-

tiffs are bound by the provisions of that lease. We agree

that the plaintiffs, as sublessees, are bound by the provisions

of the fease between the government and Greenwald. But

we are unable to agree that the lease is effective to relin-

quish Federal jurisdiction. The clause relied upon is para-

graph 7: ‘‘That the lessee shall comply with all applicable

laws, ordinances and regulations of the State, County and

municipality wherein the said demised premises are located,

with regard to construction, sanitation, licenses or permits

to do business, and all other matters.’’

There are several reasons why this provision of the

lease does not vitalize the city’s ordinances. The lease

is a contract to which the city is not a party, and enforce-

ment of its provisions is a matter between lessor and

lessee. Even if the city might be regarded as a third

party beneficiary, that status could hardly authorize it

to invoke penal sanctions for the violation of its ordi-

nances. Moreover, we are not aware that Congress has

authorized the Secretary of War to retrocede any por-:

tion of the exclusive jurisdiction of the United States,

‘and either action or authorization by Congress is essen-

tial to retrocession so long as the United States retains

the land. Finally, it has been held that similar provisions

<3

18

thn

in Federal contracts do not make local ordinances effec- -

tive in greas over which the Federal government has

exclusive jurisdiction. State v. Blair, 238 Ala. 377, 191.

So. 237; City of Birmingham v. Thompson, 290 F. 2d (5)

. 505. a

The city correctly points out that the present lease is

similar to that involved in Offutt Housing Co. v. County

of Sarpy, 351 U. S. 253, and that both leases were made

under the authority of the same Federal statutes. It was

there held that the lessee’s interest in a military housing

project located in a Federal e®clave was subject to local

taxation. That decision was not based, however, upon the

terms of the lease, but rather upon the ground that Con-

gress had consented to State and local taxation. The court

expressly stated that it was not holding that Congress had

relinquished its exclusive jurisdiction over these areas.

‘‘We hold only that Congress, in the exercise of this power,

has permitted such state taxation as is involved in the

present case.’’ 351 U.S. at 260-1.

The city also strongly emphasizes that under the lease

the title to the building is in Greenwald and that both

Greenwald and the plaintiffs, his sfiblessees, ‘are privdte

individuals engaged in business for private profit. The

affidavit of a city investigator, submitted in opposition to

the plaintiffs’ motion for summary judgment, is to the

effect that plaintiffs do not restrict their sales to military

personnel or civilian employees of the Federal govern-

ment, but sell promiscucusly to anyone who is willing to

buy. These considerations may raise doubts as to the wis-

dom of the cession and acceptance of exclusive jurisdiction,

but for our purposes they are irrelevant. Private opera-

tions within an area over which the United States has ex-

clusive jurisdiction do not become subject to State or local

regulation because they are private. Collins v. Yosemite —

Park & Curry Co., 304 U. S. 518; Pacific Coast Dairy,

Inc. v. Dept. of Agriculture of California, 318 U. S. 285;

Be

ee 49

cf., Penn Dairies, Inc. v. Milk Control Com. of Pennsyl-

vania, 318 U.S. 261.

The city’s remaining contention rests upon a principle

of international law. When jurisdiction over territory is

transferred from one sovereign to another, the laws of the

old sovereign governing private rights, so far as they are

not incompatible with those of the new, remain in effect

until they are altered or repealed. by the new sovereign.

This principle has been applied to the relations between

State and nation with respect to Federal enclaves. Chi-

cago, Rock Island and Pac ific Railway Ce. v. McGlinn,

114 U.S. 542; Arlington Hotel Co. vy. Fant, 278 U. S. 439;

James Stewart & Co. v. Sadrakula, 309 U.S. 94. |

The cases refied upon, however, show the limitations of

the doctrine. They concerned disputes between private par-

ties, and those disputes were held to be governed by the

State law as it existed before the U nited States acquired

jurisdiction. None of them involved a direct assertion of

governmental power by the superseded government, as does

this ease. More closely in point is Collins v.sYosemite Park

& Curry Co., 304 U.S. 518. There California had ceded

exchisive jurisdiction to the United States, reserving only

the right to tax. California’s Aleohol Beverage Control

Act contained regulatory provisions, and also imposed ex-

cise and license taxes. The excise taxes were sustained as

to the company, which opertegd hotels, camps and: stores

in the park under contract with the Secretary of the In-

terior. But Califotnia’s regulatory and licensing provi-

sions were held to be unenforceable. The court said: ‘‘As

there is no reservation of the right to control the sale or

use of alcoholic beverages, such regulatory provisions as

are found in the Act under consideration are unenforce-

able in the Park.”’ 304 U. §. at 530.

The decree of the superior court of Cook County was

correct and it is affirmed.

Decree affirmed.

APPENDIX C.

Constitution of the United States, Article 1, Seetion §.

Clause 17.

eo * >.

The Congress shall. have Power

exclusive Legislation * * * over all Places pur.

chased by thé Consent of the Legislature of the State

in which the Same shall be, for the Erection of * * *

needful buildings ;

to exercise

i

APPENDIX D.

Military Leasing Act of 1947, 61 Stat. 774-776, 10 U.S. C.

Sections 1270, 1270d:

$1270. Lease of real or personal property; period

of lease; terms and conditions; reveeation; disposi-

tion of receipts; report to Congress

Whenever the Secretary of the Army shall deem

it to be advantageous to the Government he is au-

thorized to lease such real or personal property un-

der the control of his Department as is not surplus

to the needs of the Department within the meaning

of the Act of October 3, 1944 (58 Stat. 765), and is

not for the time required for public use, to such lessee

or lessees ‘and upon such terms and conditions as in

his judgment will promote the national defense or

will be in the public interest. Each such lease shall

be for a period not exceeding five vears unless the

Secretary shall determine that a longer period will

promote the national defense or will be in the public

interest. The Secretary may include, among other

terms and conditions in the lease, a right of first re-

fusal in the lessee to purchase the property in the

event of the revocation of the lease in order to per-

mit sale thereof by the Government, but this section

shall not be construed as authorizing the sale of any

property unless the sale thereof is otherwise author-

ized by law Each such lease shall contain a pro-

vision permitting the Secretary to revoke the leage

at any time, unless the Secretary shall determine that

the omission of such provision from the lease will

promote the natiqnal defense or will be in the publie

interest. In any event each such lease shall be re-

vocable by the Secretary during a national emergeney

declared by the President. Notwithstanding section

303b of Title 50, c~ any other provision of law, any

/ . such lease may provide for the maintenance, protec.

«9

22

tion, repair, or restoration by the lessee, of the prop-

erty leased ‘or of the entire unit or installation where a

substantial part thereof is leased, as a part or all of

the consideration for the lease of such property. In

the event utilities or services shall be furnished by

the Department to the lessee in connection with any

_ lease, paynients for utilities or services so furnished

“may be covered into the Treasury to the erdit of the

appropriation or appropriations from Which the costs

of furnishing Any such utilities or‘services to tké les-

- see was paid. Except as otherwise hereinabove pro-

vided, any money rentals receive@*y the Government

. directly under any such lease shall be deposited and

‘ covered into the “Treasury as miscellfneous receipts.

The authority hereim granted Shall not apply to oil,

mineral, or phosphate dands. Jv 26, 1947, ¢. 343,

Title II, § 205(a), 61 Stat, 501; Augo451947, ec. 493,

$1, 61 Stat. 774; Sept. 28, 1951, ¢. 434, Title VI, § 605,

65 ‘Stat. 366, 5 Ree

Repealed by Act Aug. 10, 1956, c. 1041, § 5 V0A

Stat. 641. See § 2667 of Title 10, Armed Forces.

$ 1270d. Same; State or local taxation; reneggtia-

tion of leases

The lessee’s interest, made or created pursuant te

the provisions of sections 1270-1270b, 1270d of this title,

shail be-made subject to State or local taxatron. Any -

lease of property authérized-under the ‘provisions of

said sections shall contain a prov ision that if and to

the éxtent that such property, is made taxable by State |

and local governments by Act of Congress, in suck

event the terms of. Kud h lease shall be en dames

Aug.. 5. 1947, c. 493, § 6, 61 Stat. 775.

Repealed by aot Aug. 10, 1956, c. 1041, § 53,

70A Stat: 641. See § 2667 of Title 10, Armed

Forces.

APPENDIX E.

. %

pais

Wherry Military Housing Act of 1949, 63 Stat. 570,

12 U. S. C. Section 1748d:

§$1748d. Lease of property; terms and conditions

Whenever the Secretary of the Army, Navy, or

Air: Force. determines that it is’ necessary to lease

any land held by the United States on or near a mili-

tary installation to effectuate ‘the purposes of this

subchapter, he may lease such land upon such terms -

and conditions as will, in, his opinion, best serve the

national interest.. The ®uthority conferred by this

section shall be in addition to and notin derogation

of any other power or authority of the Secretary of

the Army, Navy, or Air Fogeg. June 27, 1934, ec. 847,

Title VIII, § 805, as added “Aug. 8, 1949, ce. 403, § 1,

63 Stat. 570, and amended Aug. 11, 1955, ¢. 783, Title

TV, — 69 Stat. 651.

APPENDIX F.

Municipal Code of Chicago, Sections 130-10 to 130-14:

Food Purveyors (Retail).

130-10. The term ‘‘food purveyor’’. is hereby de-

fined as any person operating a retail food estab-

‘lishment that keeps for sale, sells, or offers for sale,

at retail, or is in the business™, delivering to con-

sumers, any cooked pr uncooked meats, agricultural

products, drinks, confections, condiments, or any other

materials or articles used as ‘ood for human con-

sumption, except live poultry or other live fowl, where

‘the same are not. served for consumption on the prem-

ises. [Amend. Coun. J. 12-1-50, p. 7251. ]

oes

eRe S >

130-11: It shall be unlawful for any person to en-

gage in the business of food purveyor without Jirst

having obtained a license so to do?

130-12. An application for a food purveyor’s li-

cense shall be made in conformity with the general

requirements of this code relating to applications for

licenses, Such application shall contain such ‘further

information as may be required by the board of health

in order to inform it fully as to the size and nature

of the place to be used for the purposes of the busi-

ness and the conditione, equipment, and facilities for

conducting the business therein, the health of per-

sons to be employed and the regulations and facili-

ties provided for them.

Before any license shal] issue, the board of health

shall cause an inspection to be made of the premises

to be o¢evnied hy the applicant as a food purvevor,

the equipment contained therein, the employes in-

tended fot the.same, and all other matters relating

to the business“which it considers necessary to inves-

tigate from a health or sanitary standpoint.

f

4

>

20

130-13. Food purveyors are hereby divided into

classes, and the annual license fee for each elass is

as follows: ~

Class 1. This class shall include establishments

which handle food and food products but do not sell

fresh or frozen fruit or vegetables, or raw, fresh,

frozen, smoked, salted, pickled, or cooked meats, fish,

poultry, or game, or any -products or preparations

thereof which are not contained and sold in air-tight

cans, bottles, or similar containers. The license fee

for this class, if not more than three persons are en-

gaged in such establishment, shall be six dollars.

Class II. This class shall include establishments

which handle raw, fresh or frozen meats, fish, poul-

try, or game, but shall not include the sale or slaughter

of live poultry or other live fowl. It shall include meat

markets, poulterers, fish mengers, and all establjsh-

ments operating on a ‘‘self-help’’ basis where the buyer

helps himself to his purchases. It shall also inelude

all food purveyors’ establishments not falling under

classes I or II]. The annual license fee for this class,

if not more than three persons are engaged in such

establishment, shall be twenty-five dollars.

Class III. This class shall imelude establishments

which handle fresh or frozen fruit or vegetables, or

smoked, salted, pickled, er cooked meats, fish, poultry,

or game, but do not sell any raw, fresh or frozen

meats, fish, poultry, or game. The annual license

fee for i if not more than tree: persons are

engaged in Yauch establishment, shall be twelve dollars.

Provided, however, that any additional persons en- |

gaged in any of the aforesaid classes of establish-

-ments shall be paid for at the rate of four dollars

~ each, such sums to be added to the license fees afore-

said, and provided further, that where a food pur-.

veyor conducts or operates more than one of the

three classes established hereunder he shall -be. re-

quired to procure but one license and such license shall

be of the class that requires the payment of the high-

est license fee under this section. .

a*

oo 26

.

The number of persons engaged shall be the num-

ber engaged in selling to the trade or in the making

or manufacture of products’ sold in such establish-

ments. .

A single or ‘‘combination’’ license may be issued

to an applicant to permit him to conduct or operate

the business of food purveyor and to sell milk and

milk preducts-at retail, not f= consumption on the

premises, in connection with such business of food

purveyor on the same premises. This provision shall

not apply fo licenses for milk plants or milk receiv-

ing station. The fee to be paid for single or ‘‘com-

bination’’ license shall equal the sum of.the fees which

_, the applicant would be required to pay if separate

~sdicenses for each business were issued to him. [Amend.

Coun. J. 4-2-41, p. 4556; 11-6-47, p. 1172; 12-1-50, p.

7251.]

130-14. All purveyors selling commercial cuts of

meats, or perishable meat food products, shall be

equipped with at least one refrigerator or cooling room,

of adequate size and capacity, so as to permit at all

times the free circulation of air therein, and so as

to maintain a temperature of forty-two degrees Fahren-

heit, or lower.

a