Source: https://www.legalcrystal.com/case/95217/campbell-vs-galeno-chemical-co
Timestamp: 2019-09-19 11:22:06
Document Index: 213589079

Matched Legal Cases: ['§ 4', '§ 6', '§ 4', '§ 5', '§ 4', '§ 6', '§ 4', '§ 6', '§ 4', '§ 5', '§ 5', '§ 4', '§ 218', '§ 218', '§ 5', '§ 5', '§ 1', '§ 4', '§ 6', '§ 6', '§ 5', '§ 5', '§ 6', '§ 4', '§ 4', '§ 5', '§ 5', '§ 6']

Campbell Vs Galeno Chemical Co - Citation 95217 - Court Judgment | LegalCrystal
Campbell Vs. Galeno Chemical Co. - Court Judgment
LegalCrystal Citation legalcrystal.com/95217
Case Number 281 U.S. 599
Respondent Galeno Chemical Co.
.....of december next succeeding the issuance thereof." p. 281 u. s. 606 . 2. such a basic permit issued under § 4, to be in force until "revoked, suspended or renewed as provided by law or regulations," sufficiently complies with the provision of § 6 (assuming but not deciding it to be applicable) that every permit shall designate the time when the permitted acts may be performed. p. 281 u. s. 608 . 3. such a basic permit issued under § 4 to remain in force "until revoked, suspended or renewed as provided by law or regulations" is not subject to be revoked by a subsequent regulation fixing a time limit for unexpired permits, but is revocable only for cause as provided in §§ 5 and 9, upon notice and hearing, with a right to judicial review. p. 281 u. s. 609 .....
Campbell v. Galeno Chemical Co. - 281 U.S. 599 (1930)
U.S. Supreme Court Campbell v. Galeno Chemical Co., 281 U.S. 599 (1930)
1. A basic permit granted under § 4, Title II, of the Prohibition Act, to manufacture articles such as toilet, medicinal, and antiseptic preparations, containing intoxicating liquor but unfit for beverage purposes, is not within the provision of § 6 that "permits to manufacture, prescribe, sell or transport liquor . . . shall expire on the 31st day of December next succeeding the issuance thereof." P. 281 U. S. 606 .
2. Such a basic permit issued under § 4, to be in force until "revoked, suspended or renewed as provided by law or regulations," sufficiently complies with the provision of § 6 (assuming but not deciding it to be applicable) that every permit shall designate the time when the permitted acts may be performed. P. 281 U. S. 608 .
3. Such a basic permit issued under § 4 to remain in force "until revoked, suspended or renewed as provided by law or regulations" is not subject to be revoked by a subsequent regulation fixing a time limit for unexpired permits, but is revocable only for cause as provided in §§ 5 and 9, upon notice and hearing, with a right to judicial review. P. 281 U. S. 609 .
4. Regulations issued under a statute may not extend or modify its provisions. P. 281 U. S. 610 .
"is not in good faith conforming to the provisions of this chapter, or has violated the laws of any state relating to intoxicating liquor," and subjects the action of the Commissioner to judicial review as provided in § 5. Compare Ma-King Products Co. v. Blair, 271 U. S. 479 .
For some years prior to October 1, 1927, the plaintiffs in these two cases had been engaged in the business of manufacturing medicinal preparations, and held basic permits issued under § 4 of the Act. Each permit authorizes the use of whisky in the manufacture of a particular product in accordance with a special formula, was issued pursuant to regulations in force at the time of issuance, and declares that it shall remain in force "until revoked, suspended or renewed as provided by law or regulations." [ Footnote 1 ] On September 2, 1927, the Treasury Department, Bureau of Prohibition, issued Regulations 2, effective October 1, 1927, in which it is provided by § 218 that
and that thenceforth only annual permits shall be issued. [ Footnote 2 ] The provision was made applicable
These suits were then brought by the permittees in the federal court for Southern New York against the Prohibition Administrator, the Commissioner of Prohibition, and the Secretary of the Treasury to enjoin them from enforcing § 218 of Regulations 2; from proceeding with the proposed hearings concerning the use of whisky, and from otherwise interfering with the permits held by them. The plaintiffs alleged that their permits contained no date of expiration, and had never been revoked, cancelled, or surrendered; that they were entitled to have their permits remain in force until they should be revoked pursuant to proceedings under §§ 5 and 9, and that no proceeding for such revocation had been brought. They charged that, insofar as Regulations 2 purported to revoke, limit, or suspend, without the hearing provided for in §§ 5 and 9, permits theretofore granted to the plaintiffs, it is void as in violation of the Act, that the proposed hearings are without legal warrant, and that the threatened action of denying the further use of whisky is unauthorized and illegal. The trial court granted an injunction in each case. [ Footnote 3 ] The decrees were affirmed by the United States Circuit Court of Appeals for the Second Circuit. [ Footnote 4 ] Lion
First. The government contends that § 1, Title II, of the Act defines the word "liquor" as meaning not only the beverages specifically named, but also any liquids "containing one-half of 1 percentum or more of alcohol by volume which are fit for use for beverage purposes;" that liquids which are not immediately fit for use as beverages are yet "fit for use for beverage purposes" if they can be made potable by a simple process; that plaintiffs' preparations are of that character; [ Footnote 5 ] that they are expressly excluded from the Act only "after having been manufactured and prepared for the market;" that,
at the time of manufacture and before preparation for the market, they fall within the term "liquor" as used in the Act; that permits to manufacture the "articles" enumerated in § 4 of the Act are therefore permits to manufacture "liquor" within the meaning of the provision in § 6 that "permits to manufacture, prescribe, sell, or transport liquor . . . shall expire on the 31st day of December next succeeding the issuance thereof," and that, although by their own terms the plaintiffs' permits are to be in force "until revoked, suspended, or renewed as provided by law or regulations," they have expired ere this by the operation of § 6. Cywan v. Blair, 16 F.2d 279; Chicago Grain Products Co. v. Mellon, 14 F.2d 362. [ Footnote 6 ]
It is true that permits for short periods terminating upon definite dates would leave the Bureau much freer in the exercise of its discretion than it could be under indeterminate permits revocable only for cause, established pursuant to §§ 5 or 9. Every permittee applying for a renewal has the burden of establishing his fitness, whereas, if permits are terminable only by revocation pursuant to the provisions in §§ 5 and 9, the burden to justify closing the business because of some violation of the Act or of the regulations is put upon the government. But § 6, as well as the rest of the Act, draws an obvious distinction between the manufacture, etc., of intoxicating liquor and that of industrial alcohol and the preparations enumerated in § 4. The former is forbidden except for certain specified purposes for which liquor is deemed necessary. The latter is ordinarily lawful, and it is the express purpose of the Act to encourage it. United States v. Katz, 271 U. S. 354 , 271 U. S. 359 . Regulations are imposed only for the purpose of guarding against the diversion of this lawful business into the unlawful business of supplying intoxicating liquor. [ Footnote 7 ] It is entirely consistent with the avowed purposes of the Act that the restrictions on the one business should be more severe than those on the other.
Third. Finally, the government contends that, even if Congress did not provide for the termination on some definite date of permits issued under § 4, it left the matter continuously open to control by regulations to be issued from time to time, that §§ 5 and 9 are not limitations upon this quasi -legislative police power, that the express provisions of the permits cannot have the effect of bargaining away such later exercise of that power as may be deemed appropriate, and that the regulation of
The limits of the power to issue regulations are well settled. International Ry. Co. v. Davidson, 257 U. S. 506 , 257 U. S. 514 . They may not extend a statute or modify its provisions. The regulation of October 1, 1927, purports to revoke unexpired permits as of December 31, 1928, without resort to the proceedings prescribed by §§ 5 and 9. It thus attempts to deprive permittees of rights secured to them by these sections of the Act. As was said in Higgins v. Foster, 12 F.2d 646, 648: "We cannot see that the Commissioner, under the guise of legislation, may do in gross what he had no power to do in detail." Whether or not the power to make regulations, or the provision in § 6, authorizes the Bureau to fix expiration dates for permits when issued, it does not authorize the revocation of existing permits in violation of the express provisions of the Act.