Opinion ID: 1479224
Heading Depth: 1
Heading Rank: 2

Heading: Gold Reserve Act of January 30, 1934.

Text: If we should assume, for the purposes of argument, as did the court below, that the Emergency Act of 1933 did not apply to an owner of gold who was without the United States, yet the complainant was precluded from exporting or hoarding the gold by the Gold Reserve Act of January 30, 1934. That act contains the following provisions: Sec. 3. The Secretary of the Treasury shall, by regulations issued hereunder, with the approval of the President, prescribe the conditions under which gold may be acquired and held, transported, melted or treated, imported, exported, or earmarked: (a) for industrial, professional, and artistic use; (b) by the Federal Reserve banks for the purpose of settling international balances; and, (c) for such other purposes as in his judgment are not inconsistent with the purposes of this Act [section 441 and this section]. Gold in any form may be acquired, transported, melted or treated, imported, exported, or earmarked or held in custody for foreign or domestic account (except on behalf of the United States) only to the extent permitted by and subject to the conditions prescribed in, or pursuant to, such regulations. (31 U.S. C.A. § 442). Sec. 4. Any gold withheld, acquired, transported, melted or treated, imported, exported, or earmarked or held in custody, in violation of this Act [sections 441 and 442] or of any regulations issued hereunder, or licenses issued pursuant thereto, shall be forfeited to the United States, and may be seized and condemned by like proceedings as those provided by law for the forfeiture, seizure, and condemnation of property imported into the United States contrary to law; and in addition any person failing to comply with the provisions of this Act [said sections] or of any such regulations or licenses, shall be subject to a penalty equal to twice the value of the gold in respect of which such failure occurred. (31 U.S.C.A. § 443). Sec. 11. The Secretary of the Treasury is hereby authorized to issue, with the approval of the President, such rules and regulations as the Secretary may deem necessary or proper to carry out the purposes of this Act [sections 441-443 and 822a of this title]. (31 U.S.C.A. § 822b). In section 16 of the act it is provided that: If any provision of this Act [said sections], or the application thereof to any person or circumstances, is held invalid, the remainder of the Act [said sections], and the application of such provisions to other persons or circumstances, shall not be affected thereby. (31 U.S.C.A. § 445). However doubtful may be the applicability of the Emergency Act of 1933 to complainant's gold, there can be no question that the Gold Reserve Act of 1934 covers it. The unqualified use of the word gold in section 3 (31 U.S.C.A. § 442), and the provision in that section that gold in any form may be    exported    or held in custody for foreign or domestic account    only to the extent permitted by, and subject to the conditions prescribed in, or pursuant to, such regulations, show the all-inclusive character of the enactment. The provisions of section 4 (31 U.S.C.A. § 443), which penalize holding in custody any gold, further warrant a construction of the act which renders it applicable to complainant's coins. If, as was thought, our financial system was in peril by reason of withdrawals of gold, it is hard to see why legislation should be enacted which did not apply to the gold of nonresident aliens as fully as to that of our own citizens or to discover upon what ground the rights of foreign citizens should be privileged. Nor is it easy to suppose that the gold supply of the United States would have been allowed to leak out to other countries at a time when it was the policy of Congress to accumulate gold in the Treasury for governmental use. We can attach little weight to the argument that, if the forfeitures and penalties provided in the act apply to the gold in question the law is invalid as an ex post facto enactment, and that therefore the statute should be construed to relate only to future transactions. The forfeitures provided for in section 4 manifestly are aimed at any persons who continue to hold or who export gold after the passage of the act. Complainant would only be doing this if it adhered to its position after the act of 1934 went into effect. We think the act is in no respect an ex post facto law or objectionable as such. It is further contended that the act is unconstitutional because it involves an invalid delegation of legislative powers to the Secretary of the Treasury. In general it prohibits holding in custody or exporting gold in any form except to the extent permitted. The exceptions which the Secretary is authorized to make in respect to holding in custody or exporting certain gold are specifically set forth in section 3 (31 U.S.C.A. § 442). They relate to gold held (a) for industrial, professional, and artistic use, (b) by the Federal Reserve banks for the purpose of settling international balances. In formulating these two classes which may be excepted from the general prohibitions of the statute, Congress set up sufficient standards and effected a lawful delegation. If subdivision (c) (31 U.S.C.A. § 442(c), which enabled the Secretary also to except gold held for such other purposes as in his judgment are not inconsistent with the purposes of this Act, involves a delegation so broad as to be invalid, the remainder of the act is separable and is saved from criticism because of any invalidity of subdivision (c), for the reason that section 16 (31 U.S.C.A. § 445), which we have quoted, so provides. A letter from the Acting Secretary of the Treasury, T. J. Coolidge in May, 1935, denied the application of complainant for license to export the gold and ordered the applicant and Ladenburg, Thalmann & Co. to deliver the gold to the Federal Reserve Bank of New York for the account of the Treasurer of the United States against payment as provided by the instructions issued by the Secretary of the Treasury on January 17, 1934. The instructions referred to in the letter of Mr. Coolidge provided for payment for the gold coin at the dollar face amount. They were ratified and approved by section 13 of the Gold Reserve Act of 1934 (31 U.S.C.A. § 824). Ladenburg, Thalmann & Co. were attempting to comply with this order when stopped by a restraining order in this suit. It is entirely clear from the decision of the Supreme Court in Nortz v. United States, 294 U.S. 317, 55 S.Ct. 428, 79 L. Ed. 907, 95 A.L.R. 1346, that the payment proposed in the Coolidge letter would be lawful compensation and that the gold, as it could not be sold here or exported to a country where it would be worth more in the market, cannot be said to have had a unique value. Consequently a bill in equity based upon the unconstitutionality of the act and the unique value of the gold must fail, since there is an adequate remedy at law to recover its value in legal tender. Accordingly, we think that there was no ground for bringing a suit in equity. Nor do we see that there can be a recovery at law, since Ladenburg, Thalmann & Co. are bound to deliver the gold pursuant to the order of the Secretary of the Treasury. We fully concur in the reasoning and the result reached by Judge Caffey in the court below, and have only dealt somewhat fully with the case because of the earnest argument on behalf of the complainant upon the appeal to this court. As we view the situation, complainant has shown no basis for a preliminary injunction, and the facts alleged in the bill fail to set forth any cause of action. The order and decree are affirmed.