Opinion
As Modified on Denial of Rehearing Oct. 4, 1946.
Hearing Granted Oct. 31, 1946.
Appeal from Superior Court, San Joaquin County; M. G. Woodward, Judge.
Action for declaratory relief by Emil Palermo against the Stockton Theatres, Inc., a corporation. From a judgment in favor of the plaintiff, the defendant appeals.
Judgment reversed.
See also 172 P.2d 109.
Freed & Freed, Eli Freed, William F. Cleary, and Guy C. Calden, all of San Francisco, for appellant.
Honey & Mayall and Forrest E. Macomber, all of Stockton (Garrett H. Elmore, of San Francisco, of counsel), for respondent.
OPINION
PEEK, Justice.
This is an appeal by the defendant corporate lessee from a judgment in favor of the plaintiff lessor in an action for declaratory relief.
The record discloses substantially the following facts:
On January 3, 1930, respondent’s predecessor leased to appellant’s predecessors, who were nationals of Japan, certain premises situated in the City of Stockton, California, for theater purposes for a term of ten years, commencing January 1, 1931 under the provisions of the Alien Land Act of this state, Deering’s General Laws, Act 261, and in accordance with the provisions of the commercial treaty which had been concluded between the United States and Japan on April 5, 1911, 37 Stat. at L. 1504. On December 22, 1934, respondent’s predecessor gave the lessees an option for a term of ten years longer than the term of the original lease. Said option recited that it was given for a valuable consideration, and that it was attached to and became a part of the condition of said lease. On January 16, 1935, the lessees, with the consent of the lessor, transferred all their right, title and interest in said lease and option to the appellant, a corporation, the capital stock of which was almost wholly owned by nationals of Japan. On January 26, 1940, the treaty between the United States and Japan was abrogated. On February 14, 1940, appellant served respondent’s predecessor with a written notice of its election to exercise said option for an additional term of ten years, commencing January 1, 1941, and on September 13, 1940, pursuant to said option the parties entered into a written agreement of lease for the additional term of ten years. On October 27, 1941, respondent’s predecessor died, and respondent became the legal owner of the premises in question. The record further discloses that on October 19, 1944, respondent, who had been employed by appellant in the operation of the theater from 1936 to the time the present action was filed, served on appellant a demand that the latter vacate the premises forthwith, on the ground that the occupancy thereof by appellant was illegal under the provisions of the Alien Land Act of California. On November 20, 1944, the present action was brought by respondent to have the rights of the parties adjudicated.
The trial court found generally in favor of respondent, and particularly that the lease of September 13, 1940, was ‘partially a new Lease and partially an extension of the pre-existing Lease,’ that no notice of appellant’s election to exercise the option was served on respondent’s predecessor until February 14, 1940, which was subsequent to the termination of the treaty between the United States and Japan, and that, while there was no proof of a conspiracy to violate the law, the said lease was void and of no force or effect whatsoever. In a written memorandum of decision the trial court predicated its holding on the ground that the treaty removed the lease from the operation of the California statute and that in the absence of a treaty, a Japanese alien cannot enter into a lease of commercial property in the State of California.
While other issues were raised in the proceedings in the trial court and are argued in the briefs on appeal, the basic question on which the correctness of the judgment herein turns is the effect of the abrogation of the treaty between the United States and Japan on the permissive provisions of the Alien Land Act with respect to the right of a corporation in which a majority of the issued capital stock is owned by noneligible aliens of Japanese nationality to acquire or enjoy an interest in real property in this state which could have been acquired or enjoyed under the terms of said treaty.
The pertinent provisions of the act in question, sections 1, 2 and 3 of the Alien Land Law, Deering’s General Laws, Act 261, as adopted by the electorate of this state in 1920, and thereafter amended by the act of the legislature approved June 20, 1923, Stats.1923, p. 1021, and as they read at the time herein involved, provided as follows:
‘1. All aliens eligible to citizenship under the laws of the United States may acquire, possess, enjoy, use, cultivate, occupy, transfer, transmit and inherit real property, or any interest therein, in this state, and have in whole or in part the beneficial use thereof, in the same manner and to the same extent as citizens of the United States, except as otherwise provided by the laws of this state.
‘2. All aliens other than those mentioned in section one of this act may acquire, possess, enjoy, use, cultivate, occupy and transfer real property, or any interest therein, in this state, and have in whole or in part the beneficial use thereof, in the manner and to the extent, and for the purposes prescribed by any treaty now existing between the government of the United States and the nation or country of which such alien is a citizen or subject, and not otherwise.
‘3. Any company, association or corporation organized under the laws of this or any other state or nation, of which a majority of the members are aliens other than those specified in section one of this act, or in which a majority of the issued capital stock is owned by such aliens, may acquire, possess, enjoy, use, cultivate, occupy and transfer real property, or any interest therein, in this state, and have in whole or in part the beneficial use thereof, in the manner and to the extent and for the purposes prescribed by any treaty now existing between the government of the United States and the nation or country of which such members or stockholders are citizens or subjects, and not otherwise. Hereafter all aliens other than those specified in section one hereof may become members of or acquire shares of stock in any company, association or corporation that is or may be authorized to acquire, possess, enjoy, use, cultivate, occupy and transfer real property, or any interest therein, in this state, in the manner and to the extent and for the purposes prescribed by any treaty now existing between the government of the United States and the nation or country of which such alien is a citizen or subject, and not otherwise.’
Likewise the pertinent provisions of Article I of the Treaty of April 5, 1911, between the United States and Japan, provided in part:
‘The citizens or subjects of each of the High Contracting Parties shall have liberty to enter, travel and reside in the territories of the other to carry on trade, wholesale and retail, to own or lease and occupy houses, manufactories, warehouses and shops, to employ agents of their choice, to lease land for residential and commercial purposes, and generally to do anything incident to or necessary for trade upon the same terms as native citizens or subjects, submitting themselves to the laws and regulations there established.’
It is a well established principle of statutory law that, where a statute adopts by specific reference the provisions of another statute, regulation, or ordinance, such provisions are incorporated in the form in which they exist at the time of the reference and not as subsequently modified, and that the repeal of the provisions referred to does not affect the adopting statute, in the absence of a clearly expressed intention to the contrary. Rancho Santa Anita, Inc., v. City of Arcadia, 20 Cal.2d 319, 322, 125 P.2d 475; Brock v. Superior Court, 9 Cal.2d 291, 297, 298, 71 P.2d 209, 114 A.L.R. 127; In re Burke, 190 Cal. 326, 327, 328, 212 P. 193; Don v. Pfister, 172 Cal. 25, 28, 31, 155 P. 60; Ramish v. Hartwell, 126 Cal. 443, 447, 58 P. 920; Ventura County v. Clay, 112 Cal. 65, 72, 44 P. 488; People v. Clunie, 70 Cal. 504, 506, 11 P. 775; People v. Whipple, 47 Cal. 592, 593, 594; Spring Valley Water Works v. City of San Francisco, 22 Cal. 434, 439; 59 C.J., p. 937, sec. 548.
This principle applies to the adoption of a statute of another jurisdiction (Brock v. Superior Court, supra, 9 Cal.2d at page 297, 71 P.2d 209, 114 A.L.R. 127; In re Burke, supra, 190 Cal. at page 328, 212 P. 193); and inasmuch as treaties have the force and effect of federal statutes (52 Am.Jur., pp. 807, 815, secs. 4, 17), it cannot be doubted that it applies to a treaty to the same extent that it would to an act of Congress.
It also may be noted that there is a cognate rule, recognized as applicable to many cases, to the effect that where the reference is general instead of specific, such as a reference to a system or body of laws or to the general law relating to the subject in hand, the referring statute takes the law or laws referred to not only in their contemporary form, but also as they may be changed from time to time, and (it may be assumed although no such case has come to our attention) as they may be subjected to elimination altogether by repeal. Kirk v. Rhoads, 46 Cal. 398, 399, 403; Bolton v. Terra Bella Irr. Dist., 106 Cal.App. 313, 322, 289 P. 678; Thoits v. Byxbee, 34 Cal.App. 226, 231, 167 P. 166; 50 Am.Jur., pp. 58-59; 59 C.J., pp. 1060-1061, sec. 624. And see, Vallejo, etc., R. Co. v. Reed Orchard Co., 177 Cal. 249, 254, 170 P. 426.
The question whether the reference to the treaty contained in the California Land Act should be deemed specific or general within the meaning of the foregoing rules might, as an abstract proposition, admit of different opinions. The language is ‘any treaty now existing between the government of the United States and the nation or country of which such alien is a citizen or subject.’ However, in view of the fact that there is grave doubt whether our legislature could constitutionally delegate to the treaty-making authority of the United States the right and power thus directly to control our local legislation with respect to future acts, Rancho Santa Anita, Inc., v. City of Arcadia, supra, 20 Cal.2d at page 319, 322, 125 P.2d 475; Brock v. Superior Court, supra, 9 Cal.2d at page 297, 71 P.2d 209, 114 A.L.R. 127; In re Burke, supra, 190 Cal. at pages 328, 329, 212 P. 193, we are constrained to hold that the reference is specific and not general, since such a construction is at least a reasonable one, see, In re Heath, 144 U.S. 92, 93-95, 12 S.Ct. 615, 36 L.Ed. 358, and therefore to be preferred to one of doubtful validity. 11 Am.Jur., pp. 729-730, sec. 97; Matthews v. Matthews, 240 N.Y. 28, 147 N.E. 237, 239, 38 A.L.R. 1079.
According to the text of the former of these two last cited authorities, ‘the duty of the courts so to construe a statute as to save its constitutionality when it is reasonably susceptible of two constructions includes the duty of adopting a construction that will not subject it to a succession of doubts as to its constitutionality, for it is well settled that a statute must be construed, if fairly possible, so as to avoid not only the conclusion that it is unconstitutional but also grave doubt upon that score.’
In the case last cited, the New York Court of Appeals said: ‘A like duty requires us to avoid a construction which raises grave and doubtful constitutional questions if the statute can reasonably be construed so as to avoid such questions.’
The conclusion which this construction leads to, viz., that the Alien Land Act incorporated the then-existing provisions of the treaty and retained them after the treaty was abrogated, suggests a somewhat similar situation which apparently existed in some of the states when the Volstead Act, 27 U.S.C.A. § 1 et seq., the provisions of which many local prohibition laws either adopted or copied, was repealed. See, Annotation, 88 A.L.R., pp. 1365-1369. It seems that the general view was that the repeal did not automatically effect a termination of the local law. In our own state the question was not presented, for the Wright Act, St.1921, p. 79, was repealed prior to the repeal of the federal act; yet the decisions of our courts leave little doubt that had this not been done the state law would have remained unaffected by the repeal of the national law. People v. Pagni, 69 Cal.App. 94, 98, 99, 230 P. 1001; People v. Wood, 88 Cal.App. 621, 625, 264 P. 298; In re Volpi, 53 Cal.App. 229, 199 P. 1090. And see, In re Burke, supra, 190 Cal. at pages 328, 329, 212 P. 193.
Another interesting example of a reference statute is the so-called Assimilative Crimes Act which embodies section 468 of 18 United States Code, 18 U.S.C.A. § 468, and which, as enacted in 1898, 30 Stat. 717, provided in effect that a crime committed in a place over which the United States had exclusive jurisdiction was punishable in the same way and to the same extent as it was punishable under the law of the state, territory or district within the territorial limits of which it was committed, and that ‘every such State, Territorial, or District law shall, for the purposes of this section, continue in force, notwithstanding any subsequent repeal or amendment thereof by any such State, Territory, or District.’
In construing said section of the Act, the United States Supreme Court has held that the reference therein was to the law the state, territory, or district only as such law existed at the time of the passage of the Act, United States v. Press Publishing Co., 219 U.S. 1, 9, 10, 31 S.Ct. 212, 55 L.Ed. 65, 21 Ann.Cas. 942, that said section was designed and served to enforce federal law and not the law of a state, territory, or district, People of Puerto Rico v. Shell Co., 302 U.S. 253, 266, 58 S.Ct. 167, 82 L.Ed. 235, and that, inasmuch as the federal law would not be responsive to changes in the law of the state, territory, or district, whether they should occur by way of repeal or amendment, said section could not properly be deemed to constitute an unlawful attempt to delegate to local lawmakers the power to work a change in the federal law, Franklin v. United States, 216 U.S. 559, 568, 569, 30 S.Ct. 434, 54 L.Ed. 615.
Likewise, it may be said that the California Alien Land Act refers to treaties with the nations concerned only as such treaties existed at the time of the passage of the Act (or of the amendments containing the same reference), that said Act declares the law of the state and not the provisions of the treaty agreement between the United States and said nations, and that, being unaffected by the abrogation or amendment of a treaty, said Act does not unconstitutionally delegate to the treaty-making authority of the United States the power to terminate or change the law of our state.
It should be noted that the section mentioned was substantially amended in 1940. However, it was not such an amendment as would affect our discussion of the question here presented.
Of course if there were an express provision in the Alien Land Act which unmistakably made the duration of the local provisions coterminous with those of the treaty, such a provision would have to be given effect according to its tenor and validity. An example of that kind of a provision is found in section 71 of Title 8 of the United States Code, 8 U.S.C.A. § 71, dealing with the subject of alien ownership of land. The language in that section is:
‘The prohibition of this section shall not apply to cases in which the right to hold or dispose of lands in the United States is secured by existing treaties to citizens or subjects of foreign countries, which rights, so far as they may exist by force of any such treaty, shall continue to exist so long as such treaties are in force, and no longer.’
The fact that similar language was not used by our legislature may be thought to constitute some evidence of the fact that such a result was not intended.
Neither is this a case of temporary or emergency legislation the operative effect of which, by reason of changed conditions, must be deemed to have terminated of its own limitations or which should be declared obsolete because to enforce it would be inequitable. See for example Nashville, etc., R. Co. v. Walters, 294 U.S. 405, 415, 55 S.Ct. 486, 79 L.Ed. 949; Chastleton Corp. v. Sinclair, 264 U.S. 543, 547, 548, 44 S.Ct. 405, 68 L.Ed. 841. The treaty of April 5, 1911, was not of a temporary character, particularly at the time it was readopted in sections 2 and 3 of the Alien Land Act by the amendment of 1923. The duration provisions of the treaty were contained in Article XVII, which read as follows:
‘The present Treaty shall enter into operation on the 17th of July, 1911, and shall remain in force twelve years or until the expiration of six months from the date on which either of the Contracting Parties shall have given notice to the other of its intention to terminate the Treaty.
‘In case neither of the Contracting Parties shall have given notice to the other six months before the expiration of the said period of twelve years of its intention to terminate the Treaty, it shall continue operative until the expiration of six months from the date on which either Party shall have given such notice.’
It is apparent that the treaty considered as municipal law must be deemed to have been permanent or perpetual. 25 R.C.L. 765, secs. 10 and 11.
Nor is there anything in the situation here which would deprive the respondent of any constitutional right if the law as it originally read were deemed to have been continued in effects subsequent to January 26, 1940. And in the absence of a constitutional objection it is generally held that the courts have no right to declare a statute obsolete by reason of a supervening change in the conditions under which it was enacted. Benson v. Hunter, 23 Ariz. 132, 202 P. 233, 234; McKeown v. State, 197 Ark. 454, 124 S.W.2d 19, 22, 23; Corn Exchange Sav. Bank v. Smith, 59 S.D. 182, 239 N.W. 186, 189; Gulf Refining Co. v. City of Dallas, Tex.Civ.App., 10 S.W.2d 151, 159. See also, Painless Parker v. Board of Dental Exam., 216 Cal. 285, 299, 14 P.2d 67.
Finally, the fact that, when amending the Alien Land Act in 1943 and again in 1945, the legislature was silent on the question of the effect of the abrogation of the treaty on corresponding provisions of the statute, seems to indicate in the opinion of that body that no change was effected. This is particularly true in view of the fact that this act is a definite exercise of the police power expressed by the people and the legislature of this state. State of California v. Tagami, 195 Cal. 522, 530, 531, 234 P. 102. However reluctantly such power may have been exercised in favor of non-eligible aliens, once it was exercised its intended scope and effect within the defined limits were given liberal interpretation by our courts. See State of California v. Tagami, supra, 195 Cal. at pages 529-532, 234 P. 102. This accords also with the general view expressed in the decisions that particularly in respect of matters within the police power the action of the state is ordinarily independent of that of the federal government. People v. Pagni, supra, 69 Cal.App. at page 99, 230 P. 1001; People v. Wood, supra, 88 Cal.App. at page 625, 264 P. 298.
Since we have concluded that the abrogation of the treaty had no effect on the provisions of the Alien Land Act, it is obvious that the lease of September 13, 1940, was valid irrespective of such abrogation. It is unnecessary, therefore, to consider what effect on vested or contingent rights the repeal or annulment of those provisions would have had, nor the extent to which a private individual as distinguished from the state would have had the right to take advantage of such repeal or annulment, or questions concerning estoppel on the part of this respondent to attack the validity of the lease.
We may notice, however, one other reason assigned by respondent for holding the lease invalid, viz., the fact that said lease contains an option provision permitting the lessee to purchase the property demised. While no doubt this provision is void insofar as it purports to confer any such right on a non-eligible alien, it is clearly a severable part of the lease and its invalidity could not affect the remaining and valid portions thereof. Mott v. Cline, 200 Cal. 434, 450, 253 P. 718.
The judgment is reversed.
ADAMS, P. J., concurs.
THOMPSON, Justice (concurring).
I concur in the judgment. When the lease was executed in 1930, the treaty with Japan was in force. It accorded reciprocal rights to ‘lease land for * * * commercial purposes.’ The California statute then provided that all aliens and corporations or associations composed of a majority of stockholders who are entitled to citizenship in the United States may acquire land ‘in the manner and to the extent and for the purposes prescribed by any treaty now existing between that government of the United States and the nation or country of which such members or stockholders are citizens or subjects.’ The lease was executed originally for a term of ten years. In 1935 that term was extended for ten more years by a written document attached to the lease and signed by both parties. It was not a renewal of the lease, but, on the contrary, it was an extension only of the term. It therefore constituted a grant of title from its inception. 35 C.J. 1024, secs. 159 and 160. No new lease was required to convey title for the extended term. The treaty with Japan was not abrogated until January 26, 1940, after the extension of the lease. The abrogation of the treaty did not, and could not, affect the valid lease then in force. To do so would be impairing the obligations of a valid contract. For that reason the trial court erred in holding that the extended term of the lease was invalid.