Rubert Hermanos, Inc. v. People

106 F.2d 754, 1939 U.S. App. LEXIS 3068
CourtCourt of Appeals for the First Circuit
DecidedSeptember 27, 1939
DocketNo. 3417
StatusPublished
Cited by3 cases

This text of 106 F.2d 754 (Rubert Hermanos, Inc. v. People) is published on Counsel Stack Legal Research, covering Court of Appeals for the First Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Rubert Hermanos, Inc. v. People, 106 F.2d 754, 1939 U.S. App. LEXIS 3068 (1st Cir. 1939).

Opinions

WILSON, Circuit Judge.

This is an appeal from a judgment of the Supreme Court of Puerto Rico in a complaint or information in the nature of a quo warranto proceeding against the appellant, Rubert Hermanos, Inc., brought in 1936 by the People of Puerto Rico through .its Attorney General, in which the petitioners seek to declare a forfeiture of the franchise of the appellant corporation and dissolve it, and to impose a statutory fine.

The reasons for the forfeiture assigned in the complaint are a violation of Sec. 3 of the Joint Resolution No. 23 of Congress approved May 1, 1900, 31 Stat. 716, 48 U.S. C.A. § 752; and of Section 39 of the Organic Law of Puerto Rico enacted March 2, 1917, known as the Jones Act, 48 U.S.C. A. § 752; and a violation of the appellant’s Articles of Association, together with an allegation that the defendant has violated the public policy of the Island of Puerto Rico as established by the acts above referred to and by Act No. 33 and Act No. 47 of the Puerto Rican legislature both enacted in 1935, all of which expressly limit the holding of land by a corporation organized under the corporation laws of Puerto Rico and engaged in agriculture to not exceeding 500 acres.

A motion to strike portions of the original complaint was allowed, but a motion to strike certain statements in the amended complaint was disallowed; and a demurrer to the amended information was filed by the respondent and overruled. The respondent then filed an answer in which was admitted certain of the allegations of the complaint, viz.: that it is a corporation organized under the laws of Puerto Rico; that it is engaged in the cultivation of sugar cane and the manufacture of sugar on the Island; that it owns over 12,000 acres of land devoted to that business; but it denies that the ownership of so large an acreage of land in Puerto Rico is contrary to the public policy of the Island as established by the Acts of Congress and the statutes of the Puerto Rican legislature above referred to; or that it conflicts with the economic welfare of the People of the Island; that the People of Puerto Rico have recognized this large ownership by the appellant by collecting taxes thereon with full knowledge of its extent ever since the organization of the corporation in 1927; and not until the year 1935 has any question been raised as to the illegality of the corporation’s real estate holdings, but it denies jurisdiction of the Supreme Court of Puerto Rico under Acts of the Puerto Rican legislature hereinafter referred to, since it contends that Acts No. 33 and No. 47 enacted by the Puerto Rican legislature in 1935 vesting jurisdiction of these proceedings in the Supreme Court of Puerto Rico are each null and void.

At the close of the plaintiff’s case the respondent corporation offered no evidence in support of the allegations of its answer, but moved to dismiss the information substantially on the same grounds on which its demurrer and answer were based.

The insular Supreme Court on the overruling of the defendant’s demurrer and denial of its motion to dismiss, entered [756]*756judgment in favor of the People of Puerto Rico, with the following pronouncements or reasons for its judgment:

“ * * * that the defendant corporation Rubert Hermanos, Inc., is engaged in agriculture and is guilty of owning and controlling 12,188 acres of land in violation of the provisions of Joint Resolution No. 23 of the Congress of the United States (31 Statutes at large 716, U.S.C.A., Title 48, sec. 752), of Section 39 of the Organic Law of Puerto Rico and of its own articles of incorporation, by all of which provisions the said defendant corporation is expressly limited and restricted to the ownership and control of lands not in excess of 500 acres.”

The insular Supreme Court is a statutory court. Its jurisdiction in a complaint that acts of a corporation are merely contrary to the public policy of the Island is not a sufficient allegation alone to warrant a forfeiture of the franchise of a corporation. If made a ground of jurisdiction of the insular Supreme Court in quo warranto proceedings, the complaint must be based specifically on the statutes which declare the public policy.

The Acts of Congress and of the Puerto Rican legislature applicable to these proceedings are as follows:

Sec. 3 of the Joint Resolution of Congress, No. 23, approved May 1, 1900, 48 U.S.C.A. § 752, provided that:

“No corporation' shall be authorized to conduct the business of buying and selling real estate or be permitted to hold or own real estate except such as may be reasonably necessary to enable it to carry out the purposes for which it' was created, and every corporation hereafter authorized to engage in agriculture shall by its charter be restricted to the ownership and control of not to exceed five hundred acres of land.”

Sections 34 and 39 of the Organic Act of 1917 provide:

“Sec. 34. That * * * all laws enacted by the Legislature of Porto Rico shall be reported to the Congress of the United States, as provided in section twenty-three [842] of this Act [title], which hereby reserves the power and authority to annul the same. * * * ”

“No bill, except' general appropriation bills, shall be passed containing more than one subject, which shall be clearly expressed in its title; but' if any subject shall be embraced in .any act which shall not be expressed in the title, such act shall be void only as to so much thereof as shall not be so expressed.”

“No law shall be revived, or .amended, or the provisions thereof extended or conferred by reference to its title only, but so much thereof as is revived, amended, extended, or conferred shall be reenacted and published at length.” 48 U.S.C.A. §§ 826, 832, 835.

“Sec. 39. [2d par.] That nothing in this Act contained shall be so construed as to abrogate or in any manner impair or affect the provision contained in section three of the joint resolution approved May first, nineteen hundred, with respect to the buying, selling, or holding of real estate. That the Governor of Porto Rico shall cause to have made and submitted to Congress at the session beginning the first Monday in December, nineteen hundred and seventeen, a report of all the real estate used for the purposes of agriculture and held either directly or indirectly by corporations,' partnerships, or individuals in holdings in excess of five hundred acres.” 39 Stat. 964, 48 U.S.C.A. § 752 note.

Act No. 30 of March 9, 1911, Sec. 3, Par. 4, referring to the powers of corporations organized under this Act provided:

* * * That the power of any agricultural corporation (The Act of 1902 reads ‘any corporation’, omitting the word ‘agricultural’, Rev.Stats. & Codes of 1902, supra, Civil Code, Sec. 32-(4), p. 759) organized under this act to hold real estate shall be subject to the prohibition contained in section three of the joint resolution of the Congress of the United States, of May first, nineteen hundred.”

Prior to 1935 exclusive jurisdiction of quo warranto proceedings was vested in the insular District Courts of Puerto Rico. It was not until the passage of Act No. 33 of July 22, 1935 (Laws of Puerto Rico, Special Session, 1935, p. 418), and Act No. 47 of .August 7, 1935 (Laws of Puerto Rico, Special Session, 1935, p. 539), that the legislature of Puerto Rico enacted several statutes, the common purpose of which was to provide the necessary remedial measures for curbing existing land monopolies and preventing further violations of the provisions of Sec.

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Related

Rubert Hermanos, Inc. v. People of Puerto Rico
118 F.2d 752 (First Circuit, 1941)
Puerto Rico v. Rubert Hermanos, Inc.
309 U.S. 543 (Supreme Court, 1940)

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Bluebook (online)
106 F.2d 754, 1939 U.S. App. LEXIS 3068, Counsel Stack Legal Research, https://law.counselstack.com/opinion/rubert-hermanos-inc-v-people-ca1-1939.