Before MARIS, GOODRICH and KALODNER, Circuit Judges.
This case is again before us upon remand from the Supreme Court which upon certiorari vacated our prior judgment and remanded the case to us for consideration of the effect of Section 209 of the Housing and Rent Act of 1947 as amended by Section 206 of the Housing and Rent Act of 1949*fn1 and the regulations of the Housing Expediter issued pursuant thereto.*fn2 336 U.S. 941, 69 S. Ct. 809. The facts of the case are stated in our former opinion. It is sufficient here to recall that the defendant landlord, desiring to withdraw her property from the rental market and to secure possession of it in order that she might sell it to a purchaser who would occupy it as his home, brought suit in a New Jersey state court for the eviction of her tenant, whereupon the plaintiff Housing Expediter brought the present action in the United States District Court for the District of New Jersey to enjoin the prosecution of the eviction suit. Our previous holding was that Section 209(a) of the Housing and Rent Act of 1947 as it then stood as the result of amendments made by Section 204 of the Housing and Rent Act of 1948 did not prohibit the defendant from prosecuting her eviction suit and we accordingly affirmed the judgment of the district court dissolving the preliminary injunction which it had granted and dismissing the complaint. 3 Cir., 170 F.2d 976.
Section 206 of the Housing and Rent Act of 1949 amended Section 209 of the Housing and Rent Act of 1947 by completely eliminating the statutory provisions with which we were concerned when the case was here before. Instead of expressly prohibiting eviction proceedings by landlords of controlled housing accommodations unless they come within the statutory exceptions, Section 209 as amended by the 1949 Act now provides that:
"Whenever in the judgment of the Housing Expediter such action is necessary or proper in order to effectuate the purposes of this Act, he may, by regulation or order, regulate or prohibit speculative or manipulative practices or renting or leasing practices (including practices relating to recovery of the possession) in connection with any controlled housing accommodations, which in his judgment are equivalent to or are likely to result in rent increases inconsistent with the purposes of this Act."
At the same time the 1949 Act included in Section 301, 50 U.S.C.A.Appendix, § 1907, the provision that:
"Nothing in this Act or in the Housing and Rent Act of 1947, as amended, shall be construed to require any person to offer any housing accommodations for rent."
It will thus be seen that by the Housing and Rent Act of 1949 Congress has returned, with respect to the regulation of evictions, to the statutory scheme of the Emergency Price Control Act of 1942.*fn3
By Amendment 77*fn4 to the Controlled Housing Rent Regulation the Housing Expediter, inter alia, exercised the authority with respect to the regulation of evictions conferred upon him by amended Section 209 by adding to the regulation a new section, § 825.6, relating to eviction proceedings. Briefly summarized the new eviction regulations provide that so long as the tenant of a controlled housing accommodation continues to pay the rent to which the landlord is entitled he shall not be evicted by legal action or otherwise unless the case either comes within one of the six categories set out in paragraph (a) in which eviction is authorized without a certificate or the landlord petitions for and obtains from the Housing Expediter a certificate authorizing him to pursue his remedies in accordance with the requirements of the local law.
Paragraph (c) of § 825.6 provides that an eviction certificate shall be issued if the Expediter "finds that removals or evictions of the character proposed are not inconsistent with the purposes of the act or this regulation and would not be likely to result in the circumvention or evasion thereof." The paragraph then proceeds to describe five specific classes of cases in which it is made mandatory for the Expediter to so find. Among these is class (2) - "Occupancy by contract-purchaser" - which is restricted to the situation in which the landlord has actually entered into an enforceable contract to sell his housing accommodations to a purchaser who seeks possession for the personal use of himself or members of his immediate family, and class (5) - "Withdrawal from rental market" - which is restricted to cases in which the landlord seeks in good faith to recover possession of his housing accommodation for the purpose of making a permanent conversion of it to commercial use or of personally making a permanent use of it for non-housing purposes or of permanently withdrawing it from both the housing and non-housing rental markets without any intent to sell it.
The regulations further provide that certificates of eviction shall only authorize the pursuit of a landlord's remedies at the expiration of the waiting period specified in paragraph (d). That paragraph prescribes the waiting periods for various classes of cases and further provides in clause (3) that in "any case where the Expediter finds that by reason of exceptional circumstances extreme hardship would result to the landlord, he may waive all or part of the waiting period."
The defendant attacks the validity of Section 209 of the Housing and Rent Act of 1947 as amended by the Housing and Rent Act of 1949 and of § 825.6 of the Controlled Housing Rent Regulation issued thereunder. Before we consider her specific grounds of attack, however, we are confronted with the preliminary question whether Section 209 and the regulations issued under it may under any circumstances be made applicable to an eviction proceeding, such as that brought by the defendant, which had been instituted prior to the amendment of the section and the issuance of the regulations. Since the effect of the Act and Regulations is merely to regulate and to the extent provided in the regulations prohibit in the future the eviction of the defendant's tenant we think, upon the authority of Fleming v. Rhodes, 1947, 331 U.S. 100, 67 S. Ct. 1140, 91 L. Ed. 1368, that the act and regulations, if otherwise valid, may be applied to the defendant's pending eviction suit. We pass, therefore, to the consideration of the defendant's other contentions with respect to the validity of the act and the regulations issued thereunder.
Amended section 209, the statutory provision under attack, so far as we are here concerned merely authorizes the Housing Expediter by regulation or order to regulate or prohibit those speculative or manipulative practices relating to recovery of the possession of controlled housing accommodations which in his judgment are equivalent to or likely to result in rent increases inconsistent with the purposes of the Housing and Rent Act. It thus appears that the eviction practices which the act authorizes the Housing Expediter to regulate or prohibit are limited to those which he finds to be speculative or manipulative and which are equivalent to or are likely to result in undue rent increases, in other words, those practices which are likely to result in the circumvention or evasion of the act. Moreover his power in this connection is limited by the provision of Section 301 that nothing in the act shall be construed to require any person to offer any housing accommodations for rent. These statutory provisions, as we have seen, are substantially equivalent to those which were contained in the Emergency Price Control Act of 1942. The latter provisions have been sustained as constitutional*fn5 and since the Housing and Rent Act of 1947 has itself also been sustained*fn6 we see no basis for holding that the provisions of amended Section 209 of the 1947 Act as modified by Section 301 of the 1949 Act are not likewise valid.
We accordingly turn to the consideration of § 825.6 of the regulation. The scheme of that new section of the regulation is to prohibit in all but six clear classes of cases the eviction of a tenant except upon application by the landlord to the Housing Expediter for a certificate authorizing eviction, the issuance of such a certificate, and the expiration of the specified waiting period. The defendant asserts that she desires in good faith to withdraw her property from the rental market for the sole purpose of selling it to a purchaser for his own occupancy. This she says is neither speculative or manipulative nor equivalent to or likely to result in a rent increase. On the contrary it is, she asserts, merely the exercise of her statutory right to withdraw her housing accommodation from the rental market and cease to offer ...