Thank you, sir.

Senator ERVIN. On behalf of the subcommittee, I wish to thank all of you gentlemen for making your appearance here for the purpose of giving the Subcommittee your views on title IV.

Mr. DUTTON. It is our honor to be here, sir.

Mr. Chairman and members of the subcommittee, I am John W. Dutton, a realtor engaged in the business of real estate brokerage in Wayne, Pa. I appear here today as president of the Pennsylvania Realtors Association. Accompanying me are Warren G. Morgan, Esq., the association's counsel, from Harrisburg, and Paul H. Rittle of Pittsburgh, president of the Greater Pittsburgh Board of Realtors. We wish to testify in opposition to title IV of S. 3296.

The Pennsylvania Realtors Association represents more than 3,500 relators engaged in the real estate profession. It consists of 49 member boards from all parts of the State, and is affiliated with the National Association of Real Estate Boards.

May I begin by saying that we share with many members of the Congress a desire to find a meaningful solution to the problem of "open occupancy" in housing. We believe that the future happiness of our children, as well as the continued greatness of this country, in no small way depend upon finding such a solution. In our considered opinion title IV of S. 3296 will not provide the desired solution.

This legislation would unnecessarily and imprudently supersede State and local ordinances governing fair housing in Pennsylvania. In addition-as others who have preceded me have testified-this legislation would supplant voluntary effort with naked compulsion. It would inject Federal police powers into an area of private domain; and would destroy that prerequisite to the establishment of a binding contract, mutual assent of both parties.

In our judgment, title IV would retard rather than enhance the progress that has been made in the general area of interracial relations in the State of Pennsylvania.

We would like to make it unmistakably clear that we do not oppose open occupancy, or equal opportunity for all to obtain housing. We believe that our association in Pennsylvania has demonstrated this by the degree with which we have cooperated with the Pennsylvania Human Relations Commission, which has been in operation since

1961.

We oppose the intervention of Federal power and force in private relations and the use of legal compulsion to force a pattern of housing that we believe can be accomplished only through education, mutual understanding, and voluntary effort.

We are opposed to the use of Federal power to force a contract between buyer and seller which, in the absence of such force, would not be executed. We can think of no proposal that is more destructive of individual freedom and personal liberty than title IV.

We further believe that the enforcement of title IV would result in confiscation of personal rights by the Federal Government.

It would deprive a property owner of his right to "freedom of contract" and also, the traditional right to dispose of his property in accordance with his own desires.

We are gravely concerned over the inequities which run through this legislation. For example, allowing a complainant the services of

Federal attorneys, at no cost and with no financial responsibility, invites flagrant misuse of the legal apparatus of the Department of Justice to harass and exploit property owners with all the taxpayers bearing the cost.

The constitutional questions raised against this proposal have been effectively dealt with by others much more competent in this field. We will not touch on this area except to state that we share the opinion that this proposal exceeds the powers granted the Congress by the Constitution.

We believe it is necessary, however, to direct specific criticism to the enforcement procedures set forth in title IV of the bill, and their potential for gross injustice, harassment, and multiplicity of actions. Section 406, which provides for suit by private persons through civil actions in the U.S. district courts, demonstrates a striking disregard for the rights of defendants. In addition to equitable remedies, a prevailing plaintiff may recover punitive damages and compensation for humiliation as well as mental pain and suffering, and counsel fees. No provision whatsoever is made for a vindicated defendant who, in addition to costs of the suit, may well have suffered substantial inconvenience and financial loss by reason of restraint on the fight to dispose of his property.

It is important to understand that apart from judicial restraint the mere filing of a suit could well affect the stability of title to property, so as to effectively inhibit disposition of the property during pendancy of the suit.

Experience reveals that the subject matter of title IV generates extreme emotional reactions by potential complainants. Even if we choose to ignore the inherent possibilities of fraudulent claims to coerce settlements, the provisions of section 406 for court-appointed counsel and exemption from fees and costs amounts to an open invitation to irresponsible and unfounded suits. It would place in the hands of extremists a potent weapon for harassment of innocent property owners.

We submit that the enforcement procedures of section 406 are unreasonable and contrary to traditional concepts of the administration of justice.

Representing a State which has had a "Human Relations Act" since 1961, we wish to state that our association at that time, as well as today, opposed the enactment of such legislation. We believe that this is moral legislation and that no law-State or Federal—will achieve by force what can be attained only through education, understanding, and voluntary effort.

In the 5 years of its existence this State law has by no means brought about open occupancy housing. On the contrary, we witness almost daily innumerable threats of intimidation, designed to force the property owner to submit to demands which are not even required by the law.

We feel that the injustices inherent in the proposed title IV are far greater than those which flow from the Administration of our State

act.

Without compromising our position, we would like to state for the record that our members are complying with the State law, and many

go much further than this in their cooperation with Pennsylvania's Human Relations Commission.

We further oppose title IV on the grounds that its enactment would have a devastating effect on voluntary neighborhood patterns. The neighborhood is the basic pattern for the American way of life. It brings together people because of common interests, congeniality, and acceptance.

We believe that if there is any one factor basic to a neighborhood it is the "pride of ownership." By depriving the property owner of his freedom and contract, and injecting the use of force by Federal stat ute to compel him to sell to a buyer not of his own choosing, the Congress, in enacting title IV would destroy this most important attribute of private property ownership.

As we stated earlier, we share with the Congress the concern that an appropriate solution to this problem must be found.

We believe that time-not force-will bring about an orderly solution.

We urge the subcommittee to reject title IV.

I thank you, Mr. Chairman, and the members of the subcommittee, for giving us this opportunity to appear before you today.

Senator ERVIN. I would like to ask Mr. Morgan one or two questions. Mr. MORGAN. Yes, sir.

Senator ERVIN. Mr. Morgan, is it not your understanding that the Constitution of the United States was drafted and ratified in order to commit to the National Government the solution of national problems, and to leave to States and local governments the solution of local problems?

Mr. MORGAN. That is emphatically my understanding.

Senator ERVIN. Can you imagine anything more local than real estate and transactions relating to real estate within the borders of a State?

Mr. MORGAN. I cannot, sir.

Senator ERVIN. Has it not always been a fundamental principle in our law that the owner of real estate not only has dominion over the physical property itself, but also has certain rights which may be called attributes of the right of property-namely, the right to use his property as he sees fit, and the right to sell his property to whom he pleases, and the right to lease his property to whom he pleases?

Mr. MORGAN. These are basic philosophies as far as I am concerned, Senator.

Senator ERVIN. In addition to that hasn't it been the basic philosophy of our Government that the making of individual contracts between individuals is a matter of regulation for State law rather than Federal law?

Mr. MORGAN. Yes, sir.

Senator ERVIN. Now, title IV of this bill would curtail to a very substantial degree the right of private property, would it not, in that it would deprive the owner of the right to determine to whom he should sell his property, or to whom he should lease his property?

Mr. MORGAN. Precisely-that is our objection.

Senator ERVIN. And by so doing it would destroy two of the great attributes of private property, would it not?

Mr. MORGAN. Yes, sir.

Senator ERVIN. And has it not been generally held throughout the United States when you destroy or seriously curtail one of the attributes of private property, you are taking private property without due process of law?

Mr. MORGAN. That is my understanding of the law.

Senator ERVIN. Now, the fifth amendment has a provision that no private property shall be taken for public use without the payment of just compensation.

Is there not a fundamental principle of interpretation of a written document, whether it is the Constitution or a statute or a contract, that the expression of one thing is the exclusion of other things?

Mr. MORGAN. I think that is a proper statement of law, sir.

Senator ERVIN. And would you not construe that provision of the fifth amendment which I have summarized to exclude the idea that there can be under any circumstances the taking of private property for private use?

Mr. MORGAN. This is my construction.

Senator ERVIN. Now, isn't one of the fundamental objects of this bill to take private property for private use?

Mr. MORGAN. That is certainly my impression.

Senator ERVIN. Do you not think that in the practical operation of this bill, that a person who had property to sell or to lease, if he wanted not to be involved in controversy and litigation, where a person of his own race or a person of his own religion wanted to purchase the property, and a person of another race or another religion wanted to purchase the property on the same terms, would invariably yield to the temptation to discriminate against the man of his own race or his own religion in favor of the man of a different race or different religion? That would be the only way he could keep out of the danger of being involved in a lawsuit for an unlimited amount of damages, is it not?

Mr. MORGAN. I think this is of substantial concern.

Senator ERVIN. So you agree with me that legislation of this character is very well described as forced housing, because it does attempt to force a man to sell to persons other than his own race or own religion in preference to those of his own race or religion?

Mr. MORGAN. We think that language is entirely apt.

Senator ERVIN. Now, hasn't it always been a principle of our law that not only the title to real estate should be regulated by the State where the real estate is situated, but also that contracts relating to such real estate should also be regulated by the law of the State?

Mr. MORGAN. I personally regard this as fundamental.

Senator ERVIN. And does not this statute impair to a very considerable degree the right of people to make contracts, the freedom of contract with respect to real estate?

Mr. MORGAN. This is an ultimate concern.

Senator ERVIN. And it abolishes, as Mr. Dutton so well stated, the theory that contracts relating to real estate should be contracts made by mutual consent of the parties?

Mr. MORGAN. Precisely.

Senator ERVIN. Can you think of any legislative proposal which threatens more injury to freedom than title IV?

65-506-66-pt. 1- -57

Mr. MORGAN. Sir, I cannot. As a lawyer I am shocked by the text of this particular proposal.

Senator ERVIN. Mr. Dutton's statement pointed out I think very well the fact that title IV would have a tendency to promote fraudulent claims.

Is it not true that virtually all of the States of the Union, in an effort to prevent fraudulent claims concerning the title to real estate and contracts relating to the title of real estate, have statutes which are called statutes of fraud?

Mr. MORGAN. I am sure they all have.

Senator ERVIN. These statutes provide that contracts relating to real estate should be in writing to be enforcible.

Mr. MORGAN. Exactly.

Senator ERVIN. Would not title IV, if enacted into law, and upheld by the courts, destroy the purpose for which these statutes were passed in all the 50 States?

Mr. MORGAN. It introduces a whole new concept in my judgment. Senator ERVIN. Instead of having the requirement of written contracts where title to real estate is concerned, you would have all of a man's earnings, savings, and everything else of that nature put in jeopardy by a fraudulent claim of one party, who would merely orally assert that he attempted to purchase a man's property, and the man refused to sell it to him on account of his race or religion?

Mr. MORGAN. Precisely. It violates historically tested precedent. Senator ERVIN. And under the remedial provisions of title IV, the man would have a right to collect unlimited damages for mental anguish and humiliation-the sky would be the limit.

Mr. MORGAN. That is our understanding.

Senator ERVIN. Now, do you not believe, as a member of the bar, that procedure should be equally concerned with the rights of plaintiffs and defendants?

Mr. MORGAN. I do, and we stated that objection in Mr. Dutton's remarks.

Senator ERVIN. Yes, you stated it exceedingly well. Now, this law ignores that fundamental principle, and provides that the court can appoint an attorney to represent the plaintiff, but there is no provision for an attorney to represent the defendant, is there?

Mr. MORGAN. None that we can find, sir.

Senator ERVIN. And it also contains a provision that a prevailing plaintiff may recover counsel fees, but the prevailing defendant may not?

Mr. MORGAN. In the Commonwealth of Pennsylvania this is a complete departure from precedent.

Senator ERVIN. There is something in the Scriptures saying the devil travels to and fro seeking whom he may devour. Don't you think there may be some danger that a small segment of the bar would travel to and fro, to stir up litigation in which they would hope to have their fee paid by the defendant whom they did not represent?

Mr. MORGAN. It has been suggested that a small segment of the bar might be so inclined.

Senator ERVIN. Do you not consider that the best principle concerning counsel fees in litigation is that the lawyer should look to his own client for the payment of his fee, rather than his adversary?