New Jersey Dept. of Environmental Protection v. South Camden Citizens in Action Brief Amici Curiae
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August 2, 2001

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Brief Collection, LDF Court Filings. Heyward v. Public Housing Administration Appellants' Brief, 1956. 5848e41d-b89a-ee11-be36-6045bdeb8873. LDF Archives, Thurgood Marshall Institute. https://ldfrecollection.org/archives/archives-search/archives-item/6d3522a7-e697-4c5c-8dab-dfc39bad2f55/heyward-v-public-housing-administration-appellants-brief. Accessed July 01, 2025.
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IN T H E Itttteii States dmtrt rtf Appeals For the Fifth Circuit No. 16040 PEINCE HEYWARD, et al, v. Appellants, PUBLIC HOUSING ADMINISTRATION, et al, Appellees. APPELLANTS’ BRIEF Constance B aker Motley, T htjrgood Marshall, 107 West 43rd Street, New York 36, N. Y. A. T. W alden, 200 Walden Building, Atlanta 3, Georgia. P rank D. R eeves, 473 Florida Avenue, Washington, D. C. Attorneys for Appellants. Supreme P rinting Co., I nc., 114 W orth Street, N. Y. 13, BEekman 3 - 2320 « “49 I N D E X Statement of the Case ............................................. 1 Specification of E r ro r s ............................................. 5 Argument ................................................................... 6 I. Jurisdiction.................................................... 6 II. V enue............................................................. 10 III. Justiciable Case or Controversy ................ 15 A. Nature and Extent of PH A Participation In The Limitation of Certain Projects to White Occupancy.................................... 15 B. By Placing Requirement of Title 42, United States Code, §§ 1410(g) and 1415(8) (c) in its Contract with SHA, PHA Has Not Discharged Its Obligation 22 C. Plaintiffs Have Sufficient Legal Interest in Expenditures of Funds By PHA To Give Them Standing To Challenge Vali dity of Such Expenditures .................... 24 1. Nature and Extent of PHA’s Financial Assistance................................................. 24 2. Nature of Plaintiffs’ Interest in PHA Expenditures ............................................ 26 IV. The Separate But Equal Doctrine ............. 28 Tabe of Cases Armstrong v. Townsend (S. D. Ind. ), 8 F. Supp. 953 7 Bitterman v. Louisville & N. R. Co., 207 U. S. 205 .. 7, 8 Bolling v. Sharpe, 347 U. S. 497 ............................... 6 Buchanan v. Warley, 245 U. S. 60 ........................... 28, 29 PAGE 11 Chesapeake & Del. Canal. Co. v. Glring (C. A. 4th), 159 F. 662, cert, den., 212 U. S. 571 .................... 7 City of Birmingham v. Monk (C. A. 5th), 185 F. 2d 859, cert, den., 341 U. S. 940 .................................. 29 City of Memphis v. Ingram (C. A. 8th), 195 F. 2d 338 ............................................. ............................ 9 Crabh v. Weldon Bros. (S. D. Iowa), 65 F. Snpp. 369 rev. on other grds., 164 F. 2d 797 ........................ 23 Detroit Housing Commission v. Lewis (C. A. 6th), 226 F. 2d 180 ........................................................ 28 Doremus v. Board of Education, 342 U. S. 429 . . . . 27 Downs v. Wall (C. A. 5th), 176 Fed. 657 ................ 11 Ebensherger v. Sinclair Refining Co. (C. A. 5th), 165 F. 2d 803, cert, den., 335 U. S. 816........................ 7,8 Federal Housing Administration v. Burr, 309 U. S. 242 .......................................................................... 10 Federal Trade Commission v. Winsted Hosiery Co., 258 U. S. 483 ...................................................... 26 Giles v. Harris, 189 U. S. 475 .................................. 6 Glenwood Light & Power Co. v. Mutual Light, Heat and Power Co., 239 H. S. 121............................... 7 Hague v. C. I. O., 307 U. S. 496 ............................... 6 Heard v. Ouachita Parish School Board (W. D. La.), 94 F. Supp. 897 .................................................... 11 Heyward v. PHA (C. A. D. C.), 214 F. 2d 222 . . . . 4,16 Housing Authority of San Francisco v. Banks, 120 Cal. App. 2d 1, 260 P. 2d 668, cert, den., 347 H. S. 974 .......................................................................... 28 Hurd v. Hodge, 334 U. S. 2 4 .................................... 6 International Shoe Co. v. Washington, 326 U. S. 310 11,14 Joint Anti-Fascist Refugee Comm. v. McGrath, 341 U. S. 123 PAGE 26 I l l Jones v. City of Hamtramek (S. D. Mich.), 121 F. Supp. 123 ............................................................... 28 Jones v. Fox Film Corp. (C. A. 5th), 68 F. 2d 116 .. 11 Kelley v. Lehigh Nav. Coal Co. (C. A. 3d), 151 F. 2d 743, cert, den., 327 U. S. 779 ............................... 7 Keifer v. Reconstruction Finance Corp., 306 U. S. 381 .......................................................................... 10 .Lansden v. Hart (C. A. 4th), 180 F. 2d 679 ............. 7 Lisle Mills, Inc. v. Arkay Infants Wear (E. D. N. Y.), 84 F. Supp. 697 ..................................................... 11 Lone Star Package Car Co. v. Baltimore & Ohio R. Co. (C. A. 5th), 212 F. 2d 147....................... 11 Massachusetts v. Mellon, 262 U. S. 447 .................... 27 Mississippi & Missouri R. R. v. Ward, 67 U. S. (2 Black) 485 .......................................................... 7 Nixon v. Condon, 286 U. S. 7 3 .............................. 6 Nixon v. Herndon, 273 U. S. 536 ................................. 6 Nueces Valley Townsite Co. v. McAdoo (W. D. Tex.), 257 Fed. 143 ............................................................ 9 Perkins v. Benquet Consol. Min. Co., 323 U. S. 437 .. 11 Pollack v. Public Utilities Commission (C. A. I). C.), 191 F. 2d 450 ............................................................ 20 Public Utilities Commission v. Pollack, 343 U. S. 451............................................................... 18,19,20 Roberts v. Curtis, 93 F. Supp. 604 ........................... 6 Scott v. Donald, 165 U. S. 107.................................... 7 Seawell v. McWhithey, 2 N. J. Super. 255, 63 Atl. 2d 542, rev. on other grds., 2 N. J. 563, 67 Atl. 2d 309 29 Seven Oaks Inc. v. Federal Housing Administration (C. A. 4th), 171 F. 2d 947 ...................................... 10 Shelley v. Kraemer, 334 U. S. 1.................................. 29 PAGE XV Sigora v. Slusser (D. C. Conn.), 124 F. Supp. 327 .. 10 Smith v. Adams, 130 U. S. 167.................................. 7 Smith v. Allwright, 321 U. S. 649 ............................... 6 Smith v. Merrill (C. A. 5th), 81 F. 2d 609 .................. 11 Swafford v. Templeton, 185 XL S. 487 ....................... 6 Taylor v. Leoxxard, 30 N. J. Super. 116, 103 Atl. 2d, 633 .......................................................................... 29 Travelers Health Assoc, v. Com. of Va., 339 IT. S. 643 .......................................................................... H Vann v. Toledo Metropolitan Housing Authority (N. D. Ohio), 113 F. Supp. 210 ........................... 28 Wiley v. Sinkler, 179 U. S. 5 7 .................................. 6 Young v. Kellex Corp. (E. D. Tenn.), 82 F. Supp. 953 .......................................................................... 23 Statutes Title 5, United States Code, 113y-113y-16................... 10 Title 28, United States Code, § 1331......................... 1, 6 Title 28, United States Code, § 1343(3) .................... 1 Title 28, United States Code, § 1391(c).................... 10 Title 28, United States Code, § 1392 ......................... 11 Title 42, United States Code, § 1401, et seq................. 3 Title 42, United States Code, § 1403a........................ 10 Title 42, United States Code, § 1404a........................ 10,19 Title 42, United States Code, § 1405a........................ 10 Title 42, United States Code, §1409, § 1410(a), § 1410(c) ................................................................. 24 Title 42, United States Code, § 1410(g) .............1, 6,19, 22 Title 42, United States Code, § 1411(a), 1413........... 25 Title 42, United States Code, § 1415(7) (a) ............... 24 Title 42, United States Code, § 1415(7) ( b ) .............. 18 Title 42, United States Code, § 1415(8) (c) . . . .1, 6,19, 22, 23 PAGE V Title 42, United States Code, § 1421a....................... 26 Title 42, United States Code, § 1982 ......................... 1, 6, 28 Title 42, United States Code, § 1983 ......................... 1 Housing Authorities Law of Georgia, 99 Ga. Code Annotated, 1101 et seq............................................ 3 Other Authorities Annotation 30 A. L. R. 2d, 602, 621 (1953) ............ 7 Annotation 30 A. L. R. 2d, 602, 619 (1953) ............. 7 Form PHA-1954, Rev. July 1950 ....... ...................... 15 HHFA-PHA Low Rent Housing Manual, Feb. 21, 1951, § 102.1 ........................................... ................ 15 Journal of Housing Yol. 13, No. 4, April 1956, p. 134 8 Restatement of Torts, § 876 ...................................... 27 Sen. Rep. No. 84, 81st Cong. 1st Sess., 2 U. S. Code Congressional Service 1569 (1949) ........................ 22 Sen. Rep. No. 84, 81st Cong. 1st Sess., 2 U. S. Code Congressional Service 1566, 1570 (1949) ............. 23 PAGE Terms and Conditions Constituting Part II of Annual Contributions Contract Between Local Authority and Public Housing Administration, Form No. PHA-2172, Rev. Sept. 1, 1951, 107-110, 115, 118, 123(B), 124, 204, 205, 214, 215, 305(D), 308, 404, 407 .......................................................................... 13 Terms and Conditions Constituting Part II of Annual Contributions Contract Between Local Authority and Public Housing Administration, Form No. PHA-2172, Rev. Sept. 1, 1951, § 106(B) .............. 12 IN T H E Huttefc States Court of Appeals For the Fifth Circuit No. 16040 ----------------o---------------- P rince H eyward, et al., Y. Appellants, P ublic H ousing A dministration, et al.. Appellees. — -------------------------------------o — ----------------------------------- -- APPELLANTS’ BRIEF Statement of the Case The gravamen of the Complaint is that defendants, as governmental officials, are enforcing a policy of racial segregation in public housing projects in the City of Savannah, Georgia, in violation of rights secured to plain tiffs by the 5th and 14th Amendments to the Federal Con stitution and by Federal Statutes, i.e., Title 42, United States Code, § 1982 (formerly Title 8 U. S. C. 42) and Title 42, United States Code, §§ 1410(g), 1415(8)(c) (R. 9-10). The jurisdiction of the court below was invoked pursuant to Title 28, United States Code, §§1331 and 1343(3) and Title 42, United States Code, § 1983 (formerly Title 8 U. S. C. 43) (R. 3). Relief sought is 1) a declaration that defendants may not pursue a policy of racial segregation in public housing and a declaration regarding the legality of numerous prac tices and procedures inherent in the enforcement of such 2 a policy, 2) an injunction enjoining all defendants from enforcing the segregation policy and the practices inherent therein, 3) an injunction also enjoining defendant Public Housing Administration and its field office director, defend ant Hanson, from giving federal financial aid and other federal assistance to the Savannah Housing Authority for the planning, construction, operation, or maintenance of any project which excludes plaintiffs, solely because of race and color, and 4) an award of $5,000 damages to each plaintiff against each defendant (EL 11-14). Plaintiffs-appellants, hereinafter referred to as plain tiffs, are all adult Negro citizens of the United States and of the State of Georgia, residing in Savannah, Georgia. Each plaintiff has been or will be displaced from the site of his or her residence to make way for construction of a public housing project in Savannah known as Fred Wessels Homes. Although each plaintiff meets all requirements established by law for admission to public housing, each was denied consideration for admission and admission to Fred Wessels Homes and certain other public housing projects limited by defendants to occupancy by white families (R. 6, 9-10). Each plaintiff has a statutory preference for admission to public housing as a displaced and needy family. Plaintiffs bring this action on behalf of themselves and all other Negroes similarly situated (R. 5-7). Defendant-appellee, Public Housing Administration, hereinafter referred to as defendant PHA, is a corporate agency and instrumentality of the United States. Its principal office is in the District of Columbia and the Com missioner of PHA resides there. However, pursuant to authority vested in it, PHA has established branch offices in various states. It has a branch office in Atlanta, Georgia known as the Atlanta Field of the PHA. Defendant- appellee, Arthur R. Hanson, hereinafter referred to as 3 defendant Hanson, is the director of said office. PHA administers the Federal low-rent housing program involved in this case. United States Housing Act of 1937, as amended, Title 42, United States Code, § 1401, et seq. (R. 8). Defendant-appellee,, Savannah Housing Authority, here inafter referred to as defendant SHA, is a public body corporate which administers the low-rent housing program of the City of Savannah, Georgia. Housing Authorities Law of Georgia, 99 Ga. Code Annotated 1101 et seq. The other defendants in this case are the members and the executive director of the SHA (R. 8). Pursuant to provisions of the United States Housing Act of 1937, as amended, and the Housing Authorities Law of the State of Georgia, six low-rent projects have been built in Savannah and are presently in operation: Fellwood Homes (Ga-2-1) with 176 units, Yamocraw Village (Ga-2-2) with 480 units, Garden Homes Estate (Ga-2-3) with 314 units, Fred Wessels Homes (Ga-2-4) with 250 units, Fellwood Annex (Ga-2-5) with 127 units and Garden Homes Annex (Ga-2-6) with 86 units (R>. 41). At the time of the filing of the Complaint in this action, May 20, 1954, there were at least three remaining public defense housing projects in Savannah. These projects were built pursuant to provisions of various Federal enact ments. Title to these projects was in the United States. They were operated by the SHA under lease from the United States acting through the Federal Public Housing Authority or its successor PHA (PHA Exhibit 7). Since the filing of the Complaint, PHA has conveyed title to two of these projects to the SHA for use as low-rent projects; these are Nathanael Green Villa, consisting of 250 units (conveyed March 31, 1955) and Francis Bartow Place, consisting of 150 units (conveyed June 1, 1955). A third project, Deptford Place, was conveyed on June 17, 1953 for the purpose of eventually removing the dwelling units 4 thereon and conveyance of the land to the city for industrial purposes (R. 35, 43-44). With the exception of three of the above-named projects, i.e., Yamocraw Village, Fellwood Homes and Fellwood Annex, containing a total of 783 unite, all other public low- rent housing projects in Savannah, i.e., Garden Homes Estate, Fred Wessels Homes, Garden Homes Annex, Nathanael Greene Villa, Francis Bartow Place, with a total of 1050 units., are barred to qualified Negro families, solely because of race and color. In addition, Deptford Place is limited to white occupancy (R. 27, 31, 35). Qualified Negro families are permitted to occupy a certain specified percent of the units determined by applica tion of an administrative formula known as the PH A Racial Equity Formula (R. 33, 37). The determination made as a result of application of this formula forms a part of the contracts between PHA and SHA, Heyward v. PHA (C. A. D. C.) 214 F. 2d 222. As of August 30, 1955, 73 white families, whose applica tions for admission have been reviewed and whose eligibility for public low-rent housing has been determined, were awaiting admission. As of the same date, 319 Negro families similarly situated were awaiting admission (R. 36). Not one of the 250 families now living in Fred Wessels Homes is a displaced family (R. 36). A motion for summary judgment was filed on behalf of PHA and Hanson (R. 38). A motion to dismiss and an answer were filed on behalf of SHA and the other- defendants (R. 15, 21). Both motions were heard on Sep tember 30, 1955 (R, 74). The court below granted the motion for summary judg ment on the following grounds: 1) the complaint fails to show that the matter in controversy as to each plaintiff exceeds $3,000.00; 2) PHA and Hanson are not acting under color of any state law; 3) court lacks venue of the 5 action under Title 28, United States Code, § 1391(b) in that PHA is not a corporation doing business in the judicial district within the meaning of Title 28, United States Code, § 1391(c) ; 4) plaintiffs lack sufficient legal interest in the expenditure of Federal funds by PHA to give them stand ing to challenge the validity of such expenditures; 5) that PHA by placing in its annual contributions contract with SHA a requirement that the latter shall extend preferences in occupancy required by Title 42, United States Code, § 1410(g) has fulfilled its obligation under that statutory provision; 6) in view of the fact that PHA has not pre scribed any policy as to whether low-rent housing in Savannah shall be occupied by any particular race but has left the determination of that policy to the SHA, there is no justiciable controversy between plaintiffs and PHA and Hanson; and 7) since Hanson as Field Office Director of PHA has no official function or duty with respect to dis pensing or withholding of Federal funds to SHA, plaintiffs fail to make out a claim on which any relief can be granted against defendant Hanson (R. 47). The court below granted the motion to dismiss on the ground that “ the legal doctrine of separate but equal facilities is still the law of the land and controls this case” , 135 F. Supp. 217 (R. 51, 52). From the orders entered granting the above motions, plaintiffs appeal (R. 57). Specification of Errors The court below erred in granting the motion of defend ants PHA and Hanson for summary judgment on the grounds set forth in its order of October 15, 1955. The court below erred in granting the motion to dismiss on the ground that the doctrine of separate but equal facilities is still the law of the land and controls this case. 6 ARGUMENT I. Jurisdiction One of the grounds upon which the court below granted the motion of defendants PHA and Hanson for summary judgment is that the complaint fails to show that the matter in controversy as to each plaintiff exceeds $3,000. as re quired by 28 IT. S. C. § 1331. In this action, plaintiffs allege they have been denied admission to Fred Wessels Homes, and certain other pub lic housing projects, by these defendants, solely because of race and color (R. 10). Plaintiffs’ right not to be deprived of a public housing unit by these defendants solely because of race and color is secured by the provi sions of 42 H. S. C. § 1982, the requirements of 42 H. S. C. §§ 1410(g) and 1415(8) (c), the due process clause of the Fifth Amendment to the Federal Constitution and by the public policy of the United States. Cf. Hurd v. Hodge, 334 U. S. 24; cf. Roberts v. Curtis, 93 F. Supp. 604; cf. Bolling v. Sharpe, 347 U. S. 497. In civil rights actions at law, as in other actions at law, the amount necessary for jurisdiction under § 1331 is deter mined by the sum claimed in good faith by the plaintiff seeking to redress the violation of his civil rights, Giles v. Harris, 189 U. S. 475; Swafford v. Templeton, 185 U. S. 487; Wiley v. Sinkler, 179 U. S. 57. See, Hague v. C.I.O., 307 U. S. 496, 507; cf. Smith v. AUwright, 321 U. S. 649; cf. Nixon v. Condon, 286 U. S. 73; cf. Nixon v. Herndon, 273 U. S. 536. In the Wiley case, supra, plaintiff sought redress against election officials claiming that they had denied him the right to vote in a congressional election. He sought damages which he alleged were $2500. At that time, $2000. was the required jurisdictional amount. The Supreme 7 Court held that since plaintiff alleged that his damages exceeded $2000., the jurisdictional requirement had been met. In this case, plaintiffs allege that the amount in con troversy as to each plaintiff exceeds $3000. exclusive of interest and costs (R. 3) and pray damages in the amount of $5000. for each plaintiff against each and all defend ants (R. 13). These allegations, as indicated by the Wiley case, clearly meet the jurisdictional requirements of § 1331. In civil lights cases, as in other cases, when injunction is sought to restrain defendant from interfering with plain tiff’s right, there are two criteria which have been estab lished by the courts for determining amount or matter in controversy: 1) the value of that which the plaintiff seeks to gain or protect, and, 2) the value of what defendant will lose should requested relief be granted, Smith v. Adams, 130 U. S. 167; Armstrong v. Townsend (S. D. Ind.), 8 F. Supp. 953; Cheseapeahe <& Del. Canal Co. v. Gring (C. A. 4th), 159 F. 662, cert, den., 212 U. S. 571. See Annot. 30 ALR 2d 602, 619 (1953). The result of applying either criterion need not be the same. See Mississippi <& Missouri R.B. v. Ward, 67 U. S. (2 Black) 485, where the defendants’ criterion was adopted. See Kelley v. Lehigh Nav. Coal Co. (C. A. 3d), 151 F. 2d 743, cert, den., 327 U. S. 779, where plaintiffs’ criterion was employed. But the overwhelming majority of eases have employed the plaintiffs’ criterion, Scott v. Donald, 165 U. S. 107; Bitterman v. Louisville & N. B. Co., 207 U. S. 205; Glen- wood Light <& Power Co. v. Mutual Light, Heat and Power Co., 239 U. S. 121; Ebensberger v. Sinclair Refining Co. (C. A. 5th), 165 F. 2d 803, cert, den., 335 U. S. 816; Lans- den v. Hart (C. A. 4th), 180 F. 2d 679. See also Annot. 30 8 ALR 2d 602, 621 (1953) for collection of cases employing the plaintiffs’ point of view criterion. Employing plaintiffs’ criterion to the instant case, each plaintiff here seeks to gain a public housing family unit. The value of such a unit, per se, as well as to each plaintiff, clearly exceeds $3,000. The record shows that maximum cost of construction and equipment per room in Fred Wes- sels Homes is to be $1,750. (See Exhibit 1. pg. 1, at tached to Slusser Affidavit and sent up to the court in original form.) A family unit would obviously consist of at least three rooms (R, 35). Thus construction cost of even the smallest family unit exceeds the jurisdictional amount.1 The group of cases which are perhaps most closely analogous to the instant case are those in which plaintiff has sought specific performance of a contract for the sale of real property. In these cases the courts have said that the test of jurisdiction is the value of the property which plaintiff seeks to acquire, and have rejected claims that plaintiff failed to meet the requisite jurisdictional amount because he did not show that his damages would exceed $3,000 if defendant failed to perform his contract. Eb'ens- berger v. Sinclair Refining Co., supra. It should be noted at this point that no formal plea to the jurisdiction was made by defendants PHA and Hanson. Bitterman v. Louisville & N. R. Co., 207 U. S. 205, 224. The motion filed by them was a motion for summary judgment on the ground that there is no genuine issue as to any material fact (R. 38). Their motion is supported by an affidavit which does not challenge the jurisdictional amount (R. 39). These defendants raised a question re garding jurisdictional amount by brief and oral argument (R. 79). 1 See Journal of Housing, Vol. 13 No. 4 April 1956 p. 134 where it is stated that construction costs of Fred Wessels Homes were $1538 per room, or about $7234 per unit. 9 While it is true that where challenged the burden is on plaintiff to show that the amount in controversy exceeds $3,000, to justify dismissal where there is an adequate formal allegation of amount, it must appear to a legal certainty that the claim is for less than the jurisdictional amount. City of Memphis v. Ingram (C. A. 8th), 195 F. 2d 338. Here, on the contrary, it seems clear that the amount in controversy exceeds the requisite $3,000. Applying the defendants’ point of view, there appears to be still another basis for jurisdiction. One form of relief sought here is an injunction enjoining PHA and Hanson from giving federal financial and other federal assistance to 8HA for projects from which plaintiffs are excluded solely because of race and color (R. 13). By the admission of these defendants at least three of these proj ects are limited to white occupancy (R. 78). The financial assistance given by PHA to the SHA is in the form of a loan and a subsidy (R. 78). The loan which PHA agreed to make to finance Fred Wessels Homes (GA-2-4), Yama- craw Village (GA-2-5) (Negro), and Garden Homes An nex (GA-2-6) (white) as of May 8, 1953 was $3,337,019.00 (Exhibit 1, Amendatory Agreement No. 3 attached thereto). The rate of interest charged by PHA on this loan to SHA appears to be 2%% per annum (Exhibit 1, pg. 1). It thus appears that if plaintiffs succeed in enjoining these defendants from giving such financial aid in the future (R. 36), PHA would lose the interest it would earn on such loans which is clearly in excess of $3,000 per annum on a single project loan. In Nueces Valley Townsite Co. v. McAdoo (W. D. Tex.), 257 Fed. 143, the plaintiff sought to enjoin acts of a Fed eral governmental official, alleging that if the injunction was granted, the government would save $400 per month for 21 months. The court held that this constituted the requisite jurisdictional amount. Thus another view of the 10 amount in controversy may be expressed in terms of the amount of money which PHA would save by being enjoined from furnishing loans and subsidies for the construction of segregated projects. From the Annual Contributions Contracts it is clear that the amount so saved would exceed $3,000 (Exhibit 1). II. Venue PHA, being successor to the United States Housing- Authority, is a public body corporate which Congress has authorized to sue and to be sued with respect to its func tions under the United States Housing Act of 1937 and the National Defense Housing Projects Acts [42 U. S. C. 1403a, 1404a, 1405a; 5 U. S. C. 133y-133y-16, Reorganization Plan No. 3 effective July 27, 1947]. It may, therefore, be sued in the same manner as any other corporation. Sigora v. Slusser, (D. C. Conn.), 124 F. Supp. 327; cf. Keifer v. Reconstruction Finance Corp., 306 U. S. 381; cf. Federal Housing Administration v. Burr, 309 U. S. 242; cf. Seven Oaks Inc.'Y. Federal Housing Administration (C. A. 4th), 171 F. 2d 947. The court below ruled that venue was improper as to PHA since it is not doing- business in the judicial district within the meaning of 28 U. S. C. § 1391(c). There is no question raised as to the residence of defend ants SHA, its members, and executive director. They reside in the southern judicial district of Georgia. There is no question that defendant Hanson resides in Atlanta or the northern judicial district of the state. There is apparently no question that PHA is doing business in Atlanta where its Field Office is located. By virtue of an amendment to the Judicial Code in 1948, 28 U. S. C. 1391(c), the judicial district in which a corporation is doing busi ness “ shall be regarded as the residence of such corpora tion for venue purposes.” The question raised by the 11 ruling of the court below is whether it is necessary to find that P ITA is doing business in the southern district before it can become amenable to suit there. In this action, suit is brought against different defend ants “ residing” in the same state but in different judicial districts thereof. In such case, the Judicial Code provides, in language too clear to be misunderstood, that suit may be brought in any of such districts, except where the suit is one of a local nature. 28 U. S. C. § 1392; Jones v. Fox Film Corp. (C. A. 5th), 68 F. 2d 116; Smith v. Merrill (C. A. 5th), 81 F. 2d 609; Downs v. Wall (C. A. 5th), 176 Fed. 657; Lisle Mills, Inc. v. Arkay Infants Wear (E. D. N. Y.), 84 F. Supp. 697; Heard v. Ouachita Parish School Board (W. D. La.), 94 F. Supp. 897. Therefore, in deciding whether venue is proper as to PHA, appellants are not limited to a determination whether, under the facts of this case, PHA is doing business in the southern district of Georgia. If PHA was doing business anywhere in Georgia at the time this suit was instituted, then venue is properly laid in the southern district where other defendants reside. In this case, appellants assert rights secured by the Constitution and laws of the United States (R. 3). This is therefore not a case in which federal jurisdiction is founded solely upon diversity of citizenship. In such a case, determination as to what constitutes doing business by a corporation for venue purposes is to be governed “ by basic principles of fairness.” Lone Star Package Car Co. v. Baltimore & Ohio R. Co. (C. A. 5th), 212 F. 2d 147; International Shoe Co. v. Washington, 326 U. S. 310; Travelers Health Assoc, v. Com. of Va., 339 U. S. 643; Perkins v. Benquet Consol. Min. Co., 323 U. S. 437. Under the basic principles of fairness established by the United States Supreme Court in the International Shoe Co. case and followed by this Court in the Lone Star Package Car case, the facts of this case require that the court below exercise jurisdiction over PHA. 1 2 PHA has established in the City of Atlanta, Georgia, a Field Office, the director of which is defendant Hanson. The record in this case discloses that this office has been in existence at least since March 19, 1952 when an Annual Contribution’s Contract between SHA and PHA was en tered into regarding the planning, construction, operation and maintenance of Fred Wessels Homes and other projects. The agreement is signed by the then Director of the Atlanta Field Office for PHA, and an amendment thereto dated March 18, 1953 was signed by defendant Hanson (Exhibit 1). The record also discloses that con tracts between PHA and SHA have existed since November 25, 1940 and that the latest contract between SHA and PHA entered into on January 21, 1954 regarding the opera tion of existing projects which were the subject of a 1940 contract, was signed by the Acting Director of the Atlanta Field Office (Exhibit 1). It is thus clear that the function of the Atlanta Field Office of PHA is to enter into con tracts with local public housing agencies in Georgia cover ing planning, construction, operation and maintenance of low-rent projects. Part I of the Annual Contributions Contract reveals the nature and extent of PHA financial involvement in the housing involved in this controversy (Exhibit 1). Part II of the Annual Contributions Contract reveals the detailed involvement of PHA in planning, construction, operation and maintenance of these projects (Exhibit 1). Examination of this latter document demonstrates that SHA is subject to complete regulation and control by PHA. Under the terms of this agreement, for example, PHA approves the plans and specifications of the local authority for construction of the project,2 all construction contracts 2 Term and Conditions Constituting Part II of Annual Contri butions Contract Between Local Authority and Public Housing Administration. Form No. PHA-2172, Rev. Sept. 1, 1951, § 106(B). 13 including bids for same,3 prevailing wages to be paid by local authority to all architects, technical engineers, drafts men, and technicians employed in the development of the projects;4 PHA prescribes the forms to be used by con tractors and subcontractors in preparing their payrolls and instructions with respect to same; 5 6 PHA approves form of contractor’s release from liability to local agency f PHA approves salaries paid to local agency personnel,7 develop ment cost,8 budgets,9 income limits and rent schedules; 10 PHA approves acceptance of work done under construction or equipment contract,11 insurance coverage,12 settlement for damaged or destroyed project,13 and sale of excess property.14 On the question whether PHA does business in Savan nah, it should be noted that Section 121 of Part II of the Contract requires that “ The local authority shall provide and maintain or require that there shall be provided and maintained, during the construction of each Project, ade quate facilities at the site for the use of PHA’s representa tives who may be assigned to the review of such Project.” It should also be noted that the affidavit of PHA Com missioner Slusser, which supports the motion for summary judgment, admits that by virtue of the contracts existing between PHA and SHA, PHA has control over the projects here in controversy to the extent indicated and that this 3 Id., §§ 107. 108, 109, 110. *Id., § 115. 6 Id., § 118. 6 Id,., § 123(B). 7 Id., §215. 8 Id., § 404. 9 Id., § 407. 10 Id., §§ 204, 205. 11 Id., § 124. 12 Id., § 305(D). 13 Id., § 214. 14 Id., §308. u control extends to the occupancy of such projects as re quired by the United States Housing Act of 1937, as amended, and the regulations promulgated by PHA pur suant thereto (E. 41). And finally, it should be noted that PHA’s Eacial Equity Formula is the basis for the limitation of Fred Wessels Homes and certain other projects to white occu pancy (E. 27, 31, 33, 36-37). In short, the record clearly exhibits that there are six projects which have been built in Savannah pursuant to contracts entered into by PHA and SHA (Exhibit 1); that since the filing of this suit PHA has turned over to SHA two former defense public housing projects located in Savannah for use as low-rent projects (E. 43); that the planning, construction, operation and maintenance of projects entails financial involvement on the part of PHA amounting to millions of dollars; that the PHA interest in these projects is substantial and continuing; that PHA exercises control over these projects, including occupancy; and that the limitation of certain projects to white occu pancy is a PHA determination. In International Shoe Co. v. Washington, supra, the Supreme Court said at 317: “ ‘Presence’ in the state . . . has never been doubted when the activities of the corporation there have not only been continuous and systematic, but also give rise to the liabilities sued on, even though no consent to be sued or authorization to an agent to accept service of process has been given.” 15 III. Justiciable Case or Controversy A. Nature and Extent of PH A Participation In T he Lim itation O f Certain Projects To W hite O ccupancy. PHA’s racial policy is as follows: “ The following general statement of racial policy shall be applicable to all low-rent housing projects developed and operated under the United States Housing Act of 1937, as amended: 1. Programs for the development of low-rent housing in order to be eligible for PHA assistance, must reflect equitable provision for eligible families to all races determined on the approximate volume and urgency of their respective needs for such hous ing. 2. While the selection of tenants and assigning of dwelling units are primarily matters for local determination, urgency of need and the preferences prescribed in the Housing Act of 1949 are the basic statutory standards for the selection of tenants.” 15 16 In accordance with this policy, the Development Pro gram., 1S< which is a form prepared by PHA for use by SHA in malting application for federal assistance and federal approval of its program, required SHA to indicate the racial composition of each federally-aided project and each proposed federally-aided project and to show, by the number of units alloted or to be alloted to white and non-white families, that equitable provision for eligible families of both races have been or will be provided, determined on the approximate volume and urgency of their respective needs for such housing. This determination must be based 15 HHFA PHA Low-Rent Housing Manual, Section 102.1 February 21, 1951. 16 Form PHA-1954 Rev. July 1950, referred to in Exhibit 1, Part I, Section 2. 16 solely on the volume of substandard housing occupied by each group. The Development Programs submitted by SHA for approval, and which constitute the basis upon which federal financial assistance is being given to Savan nah, indicated that Fred Wessels Homes and two other projects would be limited to white families and that three others would be limited to Negro occupancy. They also indicated that equitable provision for both races, determined on the approximate volume and urgency of their respective need, would require an allocation of 63.7% of the dwelling units to non-white families and only 36.7% of the dwelling units to white families. Before any federal financial assist ance was granted, PHA, as required by law and its own rules and regulations, approved these Development Pro grams clearly indicating these limitations and indicating that PHA’s racial equity requirements would be met by the above-percentage allocations. These Development Pro grams became a part of Part One of the Annual Contribu tions Contracts entered into between PHA and SHA. Heyward v. PHA (C. A. D. C.) 241 F. 2d 222. The nature of the role played by the PHA with respect to local racial policies can be pinpointed in the following manner: If a local authority is interested in securing approval for a Development Program, it has two alterna tives. First, it can agree to make all low-rent housing projects to be constructed by it available for occupancy to all racial groups without discrimination or segregation of any kind. However, if such a plan is unacceptable to the local authority, it has a second alternative. It can agree to provide a specified number of units for the occupancy of white families and a specified number for the occupancy of Negro families, the families to be housed on a racially segregated basis. If the percentage for white families and the percentage for Negro families meet the standards for achieving racial equity determined by the PHA, then the Development Program is approved insofar as this aspect is concerned. Once it is approved, it becomes a part of the 17 contractual relationship between PHA and SHA. There ie, of course, logically a third possible alternative. The local authority could conceivably have complete freedom of choice. But a local housing authority has no such free dom, and it is the determination of PHA which deprives local authorities of such freedom. In the instant case, SHA was obviously unwilling to agree to the first alternative noted above—i.e., open oc cupancy. Therefore, it was required by PHA to agree to the second alternative plan, i.e., segregated housing with a specified percentage allocation to white families and to Negro families. For short-hand reference, we shall term the second plan the “ segregation-quota” plan. Once the SHA agreed to the “ segregation quota” plan, and once the number of units for white and the number of units for Negroes was agreed upon and thus made a part of the contractual relationship between the parties, SHA has no contractual right to deviate. SHA obviously has no right to lease to white persons all units in all projects including those units designated exclusively for Negroes. Similarly, it has no right to lease all units in all projects to Negroes. In other words, SHA has no right to deviate in any way from the quota system agreed upon. If SHA decided to integrate projects designated exclusively for whites, while leasing projects designated exclusively for Negroes in conformance with the overall plan, then Negroes in Savannah would be securing a disproportionate number of units in violation of PHA’s racial equity formula. Such action by SHA would be in violation of its contract. A hypothetical situation may help clarify the above analysis. Assume that a local housing authority chooses the “ segregation-quota” plan of development. Assume further that the local authority agrees with PHA’s deter mination that an allocation of 200 units for whites and 200 units for Negroes will provide racial equity. This agree ment of course becomes a part of the contractual relation ship between the local authority and PHA. Assume further 18 that the Negro project is completed first and that 200 Negro families were given occupancy. If 50 additional Negroes were to apply to the local housing authority and were able to prove that they were more qualified and had a higher priority than 50 white families who were scheduled to be given occupancy in the 200 unit white project, could the local housing authority admit those 50 Negro families along with 150 white families to the project originally designated for whites? Plaintiffs submit that the local authority would have no contractual right to admit these 50 Negroes because such an act on the part of the local authority would be in violation of the racial equity formula agreed upon, and required by PHA. Thus, it is the PHA which determines whether any given Negro family can be admitted to Fred Wessels Homes. Aside from PHA’s racial equity formula which resulted in the racial limitations complained of here, there is still another basis upon which this Court may find that the racial limitations are a result of PHA action. There is, as demonstrated above, a sufficiently close relationship between PHA and SHA to make it necessary for this Court to consider whether PHA has violated rights secured to plaintiffs by the Constitution and laws of the United States, cf. Public Utilities Commission v. Pollack, 343 U. S. 451. Here we have a public corporation which has a monopoly on all decent, safe and sanitary housing available in Savannah at rents charged for public housing. [There must be a gap of at least 20 per cent between the upper rental limits for admission to public housing and the lowest rents at which private enterprise unaided by public subsidy is providing housing. Title 42 U. S. C. 1415(7)(b)]. This monopoly position is made possible by financial assistance from the federal govern ment [annual contributions are given to SHA by PHA to help maintain the low rent character of the projects]. This public corporation is closely regulated by a federal agency, 19 as demonstrated, supra. It is closely regulated by PHA in order to assure that this housing is made available only to qualified low income families. The federal agency in this case has the duty, imposed upon it by the federal act, to protect eligible low income families, e.g., it must insert in its contract with SHA a provision requiring SHA to abide by the statutory preferences for admission [Title 42 U. S. C. 1410(g), 1415(8) (c)]. The federal agency in this case has the power to make all rules and regulations neces sary to carry out its functions, powers and duties [Title 42 U. S. C. 1404(a)], Finally, the federal agency is under a duty, imposed by the Constitution, laws, and public policy of the United States, to prevent discrimination wherever the federal authority extends. It is under a duty imposed by Congress to enforce the requirements of 42 U. S. C. §§ 1410(g) and 1415(8) (c). Yet, despite this relationship, PHA has permitted, and has specifically approved the racial segregation policy. Plaintiffs contend that under these circumstances, the action of PHA in permitting and approv ing this policy must be regarded as the action of PHA. cf. Public Utilities Commission, v. Pollack, supra. The Pollack case arose out of the practice of Capital Transit Co., a street railway company, in receiving and amplifying radio programs through loud-speakers in its passenger vehicles. Capital Transit is a privately owned public utility owning an extensive railway and bus system which it operates in the District of Columbia under a franchise from Congress. Its services and equipment are subject to the regulation of the Public Utilities Commis sion of the District of Columbia. On its own motion, the Commission ordered an investigation of Capital Transit’s practice in order to determine whether the use of such receivers was “ consistent with public conveniences, public comfort and safety.” Two protesting passengers were allowed to intervene. The Commission found that the use of these radios was not inconsistent with public conveni 20 ence, comfort, etc., and dismissed its investigation. The two protesting passengers appealed. The District Court denied relief, but on appeal the Court of Appeals reversed. The latter court held that this forced listening deprived passengers of liberty without due process of law in viola tion of the Fifth Amendment. In order for the court to reach such a conclusion, however, it was necessary for it to find governmental action rather than mere private action. The Court of Appeals found the necessary gov ernmental action in the action of Congress in giving Capital Transit a franchise to use the streets and a virtual mon opoly of the entire local business of mass transportation of passengers in the District of Columbia. In this way, Congress was really forcing persons dependent on Capital Transit to listen to the radio. In addition, the Court of Appeals found governmental action in the fact that the Commission had sanctioned the conduct of Capital Transit by dismissing its investigation and failing to take action to prohibit the broadcasts. Pollack v. Public Utilities Com mission (C. A. D. C.), 191 F. 2d 450. On certiorari, the Supreme Court reversed on the ground that no constitutional right of the passengers had been violated. From plaintiffs point the important part of the opinion is that dealing with the presence of govern mental action. The Supreme Court agreed with the con clusion of the Court of Appeals that there was a sufficiently close relationship between the Federal Government and the radio services to make it necessary to consider whether the 1st and 5th Amendments had been violated. The perti nent part of the Supreme Court’s opinion is set forth below: “ We find in the reasoning of the court below a sufficiently close relation between the Federal Gov ernment and the radio service to make it necessary for us to consider those Amendments. In finding this relation we do not rely on the mere fact that 21 Capital Transit operates a public utility on the streets of the District of Columbia under authority of Congress. Nor do we rely upon the fact that, by reason of such federal authorization, Capital Transit now enjoys a substantial monopoly of street railway and bus transportation in the District of Columbia. We do, however, recognize that Capital Transit operates its service under the regulatory supervision of the Public Utilities Commission of the District of Columbia which is an agency author ized by Congress. We rely particularly upon the fact that that agency, pursuant to protests against the radio program, ordered an investigation of it and, after formal public hearings, ordered its inves tigation dismissed on the ground that the public safety, comfort and convenience were not impaired thereby” (at 462). A close reading of the above passage yields the follow ing interpretation: The Court gave either no considera tion or minimal consideration to the fact that Capital Transit used the streets of the District of Columbia under authority of Congress and the fact that, by reason of such authorization, Capital Transit enjoyed a substantial mon opoly. Substantial consideration, however, was given to the fact that Capital Transit operates under the regulatory supervision of a governmental commission. And greatest weight was given to the fact that a governmental agency, with power to prohibit or to permit this activity, permitted it to continue. 22 B. By Placing- Requirem ents o f T itle 42, U nited States Code, §§ 1 4 1 0 (g ) and 1 4 1 5 (8 ) (c ) in its Contract w ith SHA, PH A H as Not D ischarged Its O bligation. PHA contended in the court below that its only obliga tion under Title 42, United States Code, §§ 1410(g) and 1415(8) (c) is to insert these provisions in its contract with SHA. This contention, although contrary to the state ments made by PHA Commissioner Slusser in his affidavit in support of motion for summary judgment (R. 41, 44) and the regulations promulgated by PHA itself (R. 37), was sustained by the Court below (R. 47). Title 42 U. S. C. 1410(g) provides that every contract made by PHA with a local agency for annual contributions shall require that the local agency, as among eligible low income families for occupancy, shall extend first preference to displaced families, with priority among such families to disabled veterans. PHA argued below that Congress in tended nothing by this requirement except a mere direc tive to PHA as to the expenditure of federal funds, and it was not intended by Congress to create any legal rights in third persons such as plaintiff. Not only was it the express intention of Congress by this requirement to give first preference for admission to displaced families, but it was the express intention of Congress that PHA have the duty to see to it that this requirement is complied with by the local authority. With respect to this requirement the Senate Committee said: “ Families who are displaced or are about to be displaced by public slum-clearance or redevelopment projects will be given a first preference for admis sion to low-rent housing.” 17 17 Sen. Rep. No. 84, 81st Cong., 1st Sess., 2 U. S. Code Con gressional Service 1569 (1949). 23 With respect to this requirement and PHA’s duty the Committee said: “ The prime responsibility for the provision of low-rent housing is thus in the hands of the various localities. The role of the Federal Government is restricted to the provision of financial assistance to the local authorities, the furnishing of technical aid and advice, and assuring compliance with statutory requirements.” 18 (Emphasis added.) Title 42 U. S. C. § 1415(8)(e) requires that PHA’s contract with SHA provide that in initially selecting ten ants, SHA shall be required to give preference to families with the most urgent housing needs and that thereafter consideration must be given to the urgency of such needs. With respect to this requirement the Senate Committee had this to say: “ Moreover, in the initial selection of tenants for a project, the local authority will be required to give preference to families with the most urgent housing needs. Thereafter, consideration must be given to the urgency of such needs.” 10 Therefore, it is clear that Congress intended to confer a right on displaced and needy families, i.e., a right to a first preference to admission to low-rent housing. It se cured this right by requiring that it be made a part of PHA’s contract with every local agency. The legal sig nificance of this is that by so requiring, the plaintiffs and other displaced families could sue as third party bene ficiaries of the provision. In this case PHA had admittedly inserted this requirement in its contract with SHA. cf. Young v. Kellex Corp. (E. D. Tenn.), 82 F. Supp. 953; cf. Crahb v. Weldon Bros. (S. D. Iowa), 65 F. Supp. 369, rev. on other grds., 164 F. 2d 797. 18 19 18 Id. at 1566. 19 Id. at 1570. 24 C. Plaintiffs H ave Sufficient Legal Interest In Ex penditure O f Funds By PH A To G ive Them Standing To C hallenge V alid ity o f Such Expenditures. 1. N ature and Extent o f P H A ’s Financial A ssistance. PHA’s financial assistant to a project in Savannah may precede the actual construction of a project and continue for as long a period as sixty years after its construction. PHA is authorized to make loans to local public housing agencies.20 These loans may be made for the purpose of assisting the local agency in defraying the costs involved in developing, acquiring or administering a project.21 PHA may therefore commence involving the federal government financially by making a preliminary loan to the local agency in order that it may have the funds with which to proceed to make plans for the proposed project and to conduct any necessary surveys in connection therewith.22 PHA may then make a further loan which enables the local agency to meet the cost of construction and to repay the prelimi nary loans.23 It may even loan money to pay any costs in administering the project.24 PHA is authorized by the basic enactment to specify in a contract with a local agency that it will contribute a fixed sum annually over a predetermined period of years “ to assist in achieving and maintaining the low-rent char acter” of the project.25 PHA may therefore commit the federal government to financially subsidizing a project, after it is constructed, for a period as long as sixty years.26 20 Title 42 U. S. C. § 1409. Loans may not exceed 90% of development or acquisition cost. 21 Ibid. 22 Title 42, U. S. C. § 1415(7) (a). 23 Ibid., and Title 42, U. S. C. §1409. 24 Id., § 1409. 25 Id., § 1410(a). 20 Id., § 1410(c). 25 From this subsidy the local agency may presumably repay any monies loaned to it by the federal government for construction of the project or in connection with its admin istration. The annual contribution made by PHA is one of two methods provided whereby the federal government may subsidize a public housing project. The alternate method of effecting a federal subsidy provided for in the act pro vides for a capital grant to a local agency in connection with the development or acquisition of a project which will thereby enable it to maintain the low rent character of the project.27 PHA may make a capital grant in any amount which it considers necessary to assure the low rent character of the project.28 It may, therefore, make a capi tal grant to a local agency which will pay the entire cost of development or acquisition of a project. In addition to this financial assistance which may be given to a local agency, PHA is further authorized to in volve the federal government financially in the event of any foreclosure by any party on, or in the event of any sale of, any project in which the federal government has a financial interest.29 In the event of foreclosure, PHA may bid for and purchase such project, or it may acquire and take possession of any project which it previously owned or in connection with which it has made a loan, annual contribution or capital grant. In such case it may com plete the project, administer the project, pay the principal of and interest on any obligation issued in connection with the project, thus further involving the federal government financially. Finally, in the event of any substantial contractual default on the part of the local agency, PHA may involve 27 Id., § 1411(a). 28 Ibid. 28 Id., § 1413. 26 the federal government to the extent of taking title or possession of a project as then constituted and must involve the federal government further financially by continuing to make annual contributions available to such projects to pay the principal and interest on any obligation for which these contributions have been pledged as security.30 2. Nature o f P laintiffs’ Interest In PH A Expenditures. There can be no doubt that Fred Wessels Homes and the other all-white projects involved here were made pos sible by PHA expenditures and by PHA agreements to make further expenditures (Exhibit 1). A part of the relief against PHA and Hanson which is sought is a pro hibiting injunction against the use of federal funds for the construction and maintenance of such projects. The court below ruled that plaintiffs do not have standing to challenge such expenditures (B. 47). The expenditures by PHA constitute more than minor assistance—the expenditure of federal funds makes the illegal projects possible. By these expenditures, PHA knowingly supplies the state agency with the means whereby the latter can effectively discriminate in violation of the Fourteenth Amendment. In doing so, PHA flagrantly vio lates plaintiffs’ rights and the public policy of the United States. There is a firm basis in the common law to support plaintiffs’ contention that a justiciable case or controversy exists. See Joint Anti-Fascist Refugee Comm. v. McGrath, 341 U. S. 123, 159. For example, it has long been the law of unfair competition that one who furnishes another with the means of consummating a fraud is also guilty of unfair competition. See, Federal Trade Commission v. Wins ted Hosiery Co., 258 U. S. 483, 494. Section 876 of the Bestate- ment of Torts expresses general principles which are firmly imbedded in the common law. 30 Id., § 1421a. 27 “ Section 876. Persons Acting in Concert For harm resulting to a third person from the tortious conduct of another, a person is liable if he * * * “ (b) knows that the other’s conduct constitutes a breach of duty and gives substantial assistance or encouragement to the other so to conduct himself, or “ (c) gives substantial assistance to the other in accomplishing a tortious result and his own conduct, separately considered, constitutes a breach of duty to the third person.’’ The above principles can be used by analogy to demon strate that even if the injury which plaintiffs receive origi nates from the unlawful conduct of the SHA, PHA’s par ticipation nevertheless can be considered a legal cause of plaintiffs’ injury. As a result of the expenditure of funds for an all-white housing project in Savannah, plaintiffs are deprived of federally-aided housing solely because of their race and color. Plaintiffs can therefore show “ a direct dollar s-and- cents injury” from the mere disbursement of federal funds. Dorewms v. Board of Education, 342 U. S. 429, 434. If plaintiffs were suing here as mere taxpayers, then it might be said that their interest in the expenditures are too con tingent and infinitesimal to be the subject of judicial action. Massachusetts v. Mellon, 262 U. S. 447. But plaintiffs do not sue as mere taxpayers here. They bring this action on behalf of themselves and on behalf of all other qualified low-income Negro families similarly situated. Their in terest is that of families who would suffer a direct pecuni ary loss by the improper expenditure of federal funds which Congress intended be used to provide housing for the class which plaintiffs represent, i.e., qualified low in come families. In addition, this deprivation of federally- 28 aided housing, solely because of race and color, violated rights secured to these plaintiffs by Constitution and laws of the United States. The fact that the funds involved are not actually dis pensed by defendant Hanson or his office, but by the Wash ington office of PHA is not a material. The fact is that defendant Hanson must approve all requests made by SHA before the Washington office will pay (Exhibit 2 attached to Slusser affidavit and sent up to this Court in original form). IV. The Separate But Equal Doctrine The court below ruled that the complaint be dismissed as to defendants SHA, its officers and members on the ground that “ the legal doctrine of separate but equal facilities is still the law of the land and controls this case.” This ruling is clearly erroneous. The separate but equal doctrine has never been extended to property rights. Buchanan v. Warley, 245 U. S. 60, 81. Application of the separate but equal doctrine here deprives plaintiffs of the right to lease certain units of public housing, which are leased to qualified applicants by public officials, solely because of plaintiffs’ race and color. The right to lease real property free from govern- mentally imposed racial restrictions is a right not only secured by the due process and equal protection clauses of the Fourteenth Amendment to the Federal Constitution but is secured by a specific Federal Civil Rights Statute, Title 42 U. S. C. § 1982. Detroit Housing Commission v. Lewis (C. A. 6th), 226 F. 2d 180; Jones v. City of Ham- tramck (S. D. Mich), 121 F. Supp. 123; Vann v. Toledo Metropolitan Housing Authority (N. D. Ohio), 113 F. Supp. 210; Housing Authority of San Francisco v. Banks, 120 Cal. App. 2d 1, 260 P. 2d 668, cert, den., 347 U. S. 974; 29 Seawell v. McWhithey, 2 N. J. Super. 255, 63 Atl. 2d 542, rev. on other grds., 2 N. J. 563, 67 Atl. 2d 309; Taylor v. Leonard, 30 N. J. Super. 116, 103 Atl. 2d 633. Cf. Buchanan v. War ley, 245 U. S. 60; City of Birming ham v. Monk (C. A. 5th), 185 F. 2d 859, cert, den., 341 U. S. 940; Shelley v. Kraemer, 334 U. S. 1. CONCLUSION For the foregoing reasons, a p p e llan ts subm it that the judgments below granting m otion fo r sum m ary ju d g ment and motion to dism iss shou ld be rev ersed . Respectfully submitted, Constance B aker M otley, T hurgood Marshall, 107 West 43rd Street, New York 36, N. Y. A. T. W alden, 200 Walden Building, Atlanta 3, Georgia. F rank D. R eeves, 473 Florida Avenue, Washington, I). C. Attorneys for Appellants.