Summary
In Quandt Brewing Co. v. United States (C.C.A.) 47 F.2d 199, 201, it was claimed that the agents searched and seized not only the premises described in the affidavit and warrant, but premises adjoining those described.
Summary of this case from Rising Sun Brewing Co. v. United StatesOpinion
No. 50.
January 5, 1931.
Appeal from the District Court of the United States for the Northern District of New York.
Suit by the United States against the Quandt Brewing Company, Inc., and others, under National Prohibition Act tit. 2, §§ 21, 22, and 23 (27 USCA §§ 33, 34, and 35) to abate a liquor nuisance. From a decree granting a permanent injunction ordering the premises closed, and ordering certain property destroyed, defendants Quandt Brewing Co., Inc., Louis D. Levey, and Nathan Ross appeal.
Modified, and, as modified, affirmed.
This suit was brought on June 27, 1929, against Quandt Brewing Company, Inc., Elkwood Trading Realty Corporation, Louis D. Levey, Frederick H. Zimmerman, Peter Snyder, Oris Wagner, Martin Steinhlber, Nathan Ross, and Thomas Collins. Service was had upon all the defendants except Zimmerman, Wagner, and the Elkwood Trading Realty Corporation, as to all of whom the cause was dismissed. It was alleged that certain premises in Troy, N.Y., whose description was set forth in detail, were on June 11, 1929, being used and had been used, together with a large amount of machinery and equipment, for the manufacture of beer "containing more than one-half of one percentum of alcohol by volume fit for use for beverage purposes and intended for use for beverage purposes." It was also alleged that on that date about "four thousand one hundred and ten (4,110) barrels of beer containing approximately 4.51% of alcohol by volume, was manufactured and in process of manufacture and was stored and kept on said premises for the purpose of sale unlawfully without a permit and in violation of the National Prohibition Act." The defendants were all charged with being interested in or assisting in or conducting and aiding in the transaction of a brewery business conducted without a permit on the premises described and in violation of the National Prohibition Act. It was further alleged that a common nuisance as defined in section 21 of title 2 of the act (27 USCA § 33) existed on said premises, and that, unless restrained, the defendants would continue to maintain and assist in maintaining such nuisance. There were prayers for a temporary and permanent injunction against the defendants, for the closing of the premises for one year, the summary abatement of the nuisance, and for the taking possession by the marshal of all liquor, fixtures, and other property on the premises used in maintaining the nuisance, and, upon a hearing for "a decree directing that all intoxicating liquor now on said premises shall be destroyed, and that all property in or on said premises, possessed, intended, or designed for the unlawful manufacture, sale or disposition of intoxicating liquor shall be destroyed or confiscated, and sold for the benefit of the complainant as provided in section 25 title 2 of the said National Prohibition Act (27 USCA § 39)."
On June 28, 1929, the day following the commencement of the suit in equity, the government brought its petition against all the defendants, setting forth that they were interested or assisting in or conducting and aiding in the transaction of a brewery business without a permit and in violation of the National Prohibition Act on the premises described; that on June 7, 1929, two prohibition agents had appeared before a United States commissioner and made affidavit that liquor was being unlawfully manufactured and possessed on premises described as "the Quandt Brewery, on the east side of River Street, south of Glen Avenue, and one-story brick garage in the rear of and attached to such premises and facing on Fifth Avenue, same being known as 3267-3269 Fifth Avenue, situate in the City of Troy, and State and Northern District of New York, which premises consist of three and four story brick buildings and one story brick building, cellar and outbuildings," and that a search warrant had been issued under which the premises had been searched and property seized as shown by the return on the search warrant attached to the petition; that at the time of the search the agents found a brewery in operation on the premises; and that ever since the property seized and the premises themselves had been in the possession of the government.
Although the descriptions are not identical, the premises described in the bill of complaint, in the search warrant, and in the petition are the same. The part on the west side of River street was owned by Quandt Brewing Company and leased to defendant Levey. The part on the east side of that street was owned by Levey and subject to a mortgage held by Quandt Brewing Company. All of the premises, except the office building, were leased by Levey to defendant Zimmerman for three months beginning May 1, 1929, and Zimmerman was permitted to use the office building. Defendant Ross was president of Quandt Brewing Company, and held a mortgage on a portion of the real estate; defendants Snyder, Collins, Steinhbler, and Wagner were found in possession of the brewery when it was searched. An order to show cause was issued on the petition. It was served on all defendants except Zimmerman. The owners of the property appeared specially by counsel and put in issue the jurisdiction of the process. The court was of the opinion that procedure by way of a libel in rem was alone appropriate, and that it was without power to act on the order to show cause. It was dismissed, and that action is no part of this appeal.
Following this decision, the suit in equity came on to be heard. The defendants produced no witnesses and no evidence except documents showing the title to and incumbrances upon the property. On ample evidence for that purpose, the court found that the premises as well as the property later ordered destroyed were used for the unlawful manufacture of intoxicating liquor in violation of the National Prohibition Act, that the nuisance alleged to exist on said premises did exist, and that defendant Levey knew or should have known it. It thereupon entered a decree providing for a permanent injunction against the defendants, closure of the premises, and destruction of the personal property seized. Only the defendants Quandt Brewing Company, Inc., Levey, and Ross appealed.
Barkhuff Conway, of Albany, N.Y., for appellants Quandt Brewing Co., Inc., and Nathan Ross.
James M. Noonan, of Albany, N.Y., for appellant Louis D. Levey.
Oliver D. Burden, U.S. Atty., of Syracuse, N Y
Before MANTON, AUGUSTUS N. HAND, and CHASE, Circuit Judges.
The validity of the search warrant is attacked on the ground that it was issued without probable cause, and, as much of the evidence in this case was obtained by means of the search under it, that question must be decided. It was based on an affidavit executed by two prohibition agents, which showed that at about 9 p.m. on June 4, 1929 again at about 9:30 p.m. on June 5, 1929, and again at about 6:40 p.m. on the following day they visited the neighborhood of the premises and each time heard machinery in operation, smelled a strong odor of fermenting mash and alcohol of an alcoholic content of more than one-half of 1 per cent. unmistakably emanating from the inside of the premises, and that for several years they had "been familiar with spirituous, malt and other liquors and alcohol and fermenting mash, by reason of drinking, tasting, smelling, handling and testing the same." The warrant definitely described the premises to be searched, set forth that there was reasonable cause to believe that intoxicating liquors containing more than one-half of 1 per cent. by volume were manufactured and unlawfully possessed on said premises for sale and distribution; and commanded a diligent search for "said alcohol, liquor and property, vessels, bottles, glasses and other containers of said liquids, and apparatus and materials for manufacturing liquor." The return on the warrant shows that some property not within its scope was seized, but none of that was ordered destroyed.
The grounds for probable cause for the issuance of the warrant rested wholly on knowledge gained through the senses of sight, hearing, and smell. The buildings they saw were suitable for use as a brewery, the noise of the machinery they heard was, so their affidavit shows, like that made by machinery "such as is usually utilized in the operation of a brewery," and the smell of alcohol coming from the premises was strong. In Lee Kwong Nom et al. v. United States (C.C.A.) 20 F.2d 470, knowledge of the commission of a crime gained through smelling the fumes of smoking opium was held sufficient to enable officers to search a laundry without a search warrant. United States v. Borkowski (D.C.) 268 F. 408, holding that the commission of a crime may be detected by the sense of smell, was approved. So here the facts known to the affiants could but lead to the conclusion that a brewery making illegal beer was in operation. The argument that there was no reasonable cause for the issuance of the search warrant cannot be sustained without disregarding common knowledge and common sense. See, also, Dumbra v. United States, 268 U.S. 435, 45 S. Ct. 546, 69 L. Ed. 1032. The warrant confined the search to adequately described premises and for property described as specifically as the circumstances required. Steele v. United States No. 1, 267 U.S. 498, 504, 45 S. Ct. 414, 69 L. Ed. 757. Nor was the search unlawful in respect to the property seized within the scope of the warrant because the officers who executed it exceeded their authority as to other property. McGuire v. United States, 273 U.S. 95, 47 S. Ct. 259, 71 L. Ed. 556. Consequently we hold the search warrant valid.
As the property ordered destroyed was all lawfully seized and lawfully in the custody of officers of the court, it was subject to forfeiture in proceedings had under the search warrant. United States v. Franzione, 52 App. D.C. 307, 286 F. 769. This case holds that such procedure is exclusive, but we are already committed to the view that a libel of information lies also. Avignone et al. v. United States (C.C.A.) 12 F.2d 509. See The Ng Ka Py Cases (C.C.A.) 24 F.2d 772, and Daeufer-Lieberman Brewing Co. v. United States (C.C.A.) 8 F.2d 1, 3.
Where, however, there has been a lawful search and seizure under a valid warrant, the procedure outlined in United States v. Franzione, supra, is certainly an appropriate, though not an exclusive, way to proceed. But the attempt of the government to procure an order for the disposition of the property before this suit in equity was heard met with an adverse decision, and apparently no further steps to proceed under the search warrant have been taken.
In this suit the court could grant only such relief as would conform to the case made by the bill of complaint. Finefrock v. Kenova Mine Car Co. (C.C.A.) 22 F.2d 627; Miller v. Hamner (C.C.A.) 269 F. 891, 896. The bill contained no allegations whatever to the effect that any search warrant had issued or that any search and seizure had been made. It was confined solely to allegations to show that a liquor nuisance existed, and in no way put in issue anything which would give the court power to act under the search warrant provisions of section 25 of title 2 of the National Prohibition Act (27 USCA § 39). Since the nuisance was established by the evidence, the closure of the premises was lawful against Levey, who knew or had reason to know of their unlawful use. The mortgagees stand no better than the owner. Section 22 of title 2 of the act (27 USCA § 34) contains no provisions for the protection of mortgagees as is found in title 2, section 26 (27 USCA § 40).
The part of the decree providing for the destruction of property, however, was neither within the inherent power of a court of equity acting to abate a liquor nuisance under section 22 of title 2 of the act (27 US CA § 34), Hassel v. United States (C.C.A.) 34 F.2d 34, or within the scope of the bill of complaint. So it cannot now be treated as incidental relief properly granted on allegations showing the search and seizure under a warrant in a case where the jurisdiction of a court of equity had been rightly invoked to abate a liquor nuisance. In so far as the decree relates to destruction of property, the power of the court was so limited by the scope of the bill of complaint that it had nothing on which to act. In view of this, we find it unnecessary to consider other questions raised on this appeal or whether on proper allegations in the bill the decree could have included relief under section 25 of title 2 of the act (27 USCA § 39). The property seized has never been ordered returned, and may well await such action as is lawful.
The decree is modified by striking therefrom that part providing for the destruction of property, and, as so modified, is affirmed.