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Congressional Record by Senator Reed, of Pennsylvania. Each reaches the conclusion that there is nothing in the statute which disqualifies Mr. Mellon from holding the office of Secretary of the Treasury because of his ownership of corporate stocks. They are based upon judicial decisions which support the principle, now well established, that the ownership of stock in a corporation does not constitute carrying on the business of the corporation. Among them are In re Deuel, 127 App. Div. 640, holding that Judge Deuel was not disqualified to hold the office of Justice of the Court of Special Sessions of the State of New York under a statute which forbade such a Justice to " carry on any business." Judge Deuel was vice president of a publishing corporation, but the court held that this did not offend the statute, as the term carrying on business implied "such a relation to the business as identifies the person with it, and imposes upon him some duty or responsibility in connection with its management."

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A similar case is In re Levy, 198 App. Div. 326, which held that Judge Levy, a stockholder but not a director or officer of any corporation, had not offended against a statute which said that no Justice shall " engage in any other business or profession."

In the case of Cooper Manufacturing Co. v. Ferguson, 113 U. S. 727, 734, the Supreme Court, in construing the phrase "to carry on," said:

"The meaning of the phrase 'to carry on' when applied to business is well settled. In Worcester's dictionary the definition is: To prosecute, to help forward, to continue, as to carry on business.' The definition given to the same phrase in Webster's dictionary is: To continue, as to carry on a design; to manage or prosecute, as to carry on husbandry or trade.'"

There are other cases which need not be mentioned. Any doubt which might exist seems to be solved by the decision of the Supreme Court in United States v. Delaware & Hudson Co., 213 U. S. 366, which arose under the so-called commodities clause of the Hepburn Act of June 29, 1906 (ch. 3591, 34 Stat. 584), which made it unlawful for any railroad company to transport in interstate or foreign commerce-

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any article or commodity, other than timber and the manufactured products thereof, manufactured, mined, or produced by it, or under its authority, or which it may own in whole or in part, or in which it may have any interest direct or indirect except such articles or commodities as may be necessary and intended for its use in the conduct of its business as a common carrier."

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The Court held that this statute did not prohibit a railroad company from transporting articles or commodities manufactured, mined, produced, or owned, etc., by a bona fide corporation in which the railroad company is a stockholder." (213 U. S. 415.) In reaching that conclusion Mr. Justice White, delivering the opinion of the Court, analyzed at length the purpose of the statute as shown by its language and construed in the light of the circumstances existing at the time of its passage, and held that its object was to prevent carriers engaged in interstate commerce from being associated in interest at the time of transportation with the commodities transported. Such being its purpose, he held that the ownership of stock in a producing company by a railway company did not establish a legal interest in the commodity manufactured by the producing corporation, and therefore did not offend against the statute. Any doubt which might exist seems to me to be laid at rest by this decision. The purpose of the statute as declared by the Court, and the holding of the Court in the light of the purpose as thus declared, when compared make it plain that the effect of the decision is that stock ownership in a corporation does not in contemplation of law give the stockholder any interest direct or indirect in the business which the corporation is carrying on.

While the forms of corporate investment familiar at the present time were comparatively uncommon in 1789, there were classes of people who derived an income from invested funds in contrast to those whose income was derived from operations of trade and commerce. I think we can say with assurance that the words of the statute would not be deemed by those who wrote it as appropriate words to describe one who simply received dividends from stocks which he owned and took no active part in the management or control of the corporations which issued them.

My conclusion is that Secretary Mellon is not disqualified from holding the office of Secretary of the Treasury by reason of the fact that he owns stock in business corporations. To give the statute any other construction would be to sacrifice the spirit to the letter, and under modern conditions would probably exclude from the office a great majority of the men most competent to hold and administer it efficiently without accomplishing any good.

Congress has not found occasion to amend the Act we are now considering by inserting any provision prohibiting stock ownership. In 1913, however, in enacting the Federal Reserve Act, it provided specifically that no member of the Federal Reserve Board should hold stock in any bank, banking institution, or trust company. (38 Stat. 261.) When, however, it enacted the Federal Farm Loan Act (in 1916; 39 Stat. 360) it provided that no member of the Federal Farm Loan Board should be an officer or director of any other institution, association, or partnership engaged in banking or in the business of making land-mortgage loans or selling land mortgages, but did not mention stock ownership. This may not be important, but it shows that Congress has had in mind the question of stock ownership as affecting a man's eligibility to hold certain offices, and, when it has deemed such ownership improper, has prohibited it.

The third question arises under Section 63 of Title XXVI, United States Code, as follows:

"6 SEC. 63. Interest in certain manufactures or production of liquors by revenue officers prohibited. Any internal-revenue officer who is or shall become interested, directly or indirectly, in the manufacture of tobacco, snuff, or cigars, or in the production, rectification, or redistillation of distilled spirits, shall be dismissed from office; and every officer who becomes so interested in any such manufacture or production, rectification, or redistillation, or in the production of fermented liquors, shall be fined not less than $500 nor more than $5,000. The provisions of this section shall apply to internal-revenue agents as fully as to internal-revenue officers."

The essential facts are set forth in the statement which Senator Reed, of Pennsylvania, made in the Senate on

March 31, 1924 (65 Cong. Rec., pt. 5, pp. 5243-5249), and in an open letter by Mr. Mellon to Senator Caraway, dated October 2, 1928. It appears that at one time he held a partnership interest in a firm which distilled whisky, but that the operation of that firm ceased completely on December 15, 1916, and before March 4, 1921, the entire property of the firm was conveyed to a trustee under an irrevocable trust, with full authority in the trustee to dispose of the property, free from any control by those who were members of the partnership, but without power to operate the distillery. At the time Senator Reed made his statement the trustee had in its possession a considerable quantity of whisky, but the letter of October 2, 1928, to Senator Caraway states:

"The trustee executed the trust by disposing of the real estate, stock in hand, and other property in its entirety."

It is therefore clear that even if the Secretary of the Treasury is an "internal-revenue officer" or an "internalrevenue agent" within the meaning of the statute, he has not been at any time since he became Secretary of the Treasury interested directly or indirectly in the “production, rectification, or redistillation of distilled spirits." This question does not call for further discussion. Even if Mr. Mellon had continued to own the whisky, the mere ownership of it in a warehouse could hardly be called production, rectification, or redistillation.

It is my opinion, therefore, and I so advise you: First, that the head of an Executive Department, with the exception of the Postmaster General, may legally continue to hold his office after the expiration of the term of the President by whom he was appointed at the pleasure of the President for the time being; and, second, that Secretary Mellon is not disqualified from holding the office of Secretary of the Treasury under the statutory provision set forth in the Senate Resolution by reason of any facts within my knowledge. Respectfully,

To the PRESIDENT.

WILLIAM D. MITCHELL.

COPIES OF TELEGRAMS AND CABLEGRAMS RELATING TO INTERNATIONAL TRANSACTIONS IN NARCOTIC DRUGS

The Secretary of the Treasury has no power to require by regulation telegraph and cable companies to deliver to the Federal authorities for transmission to foreign countries copies of telegrams and cablegrams which are suspected of being prepared in connection with illicit international transactions in narcotic drugs. The Attorney General is not authorized to render an opinion upon the question whether there would be any constitutional objection to the enactment by Congress of legislation requiring telegraph and cable companies to furnish to the Government for transmission to foreign countries copies of telegrams and cablegrams relating to the smuggling of narcotic drugs, because the question is hypothetical; and also because the Secretary is not required to determine the constitutional power of Congress in such legislative field.

DEPARTMENT OF JUSTICE,
April 19, 1929.

SIR: I have the honor to respond to your request of February 15 for my opinion with respect to the power of your Department to require by regulation or under appropriate legislation “privately owned telegraph and cable companies in this country to deliver to the Federal authorities copies of telegrams and cablegrams filed with them for transmission when such telegrams or cablegrams are suspected of being prepared in connection with an illicit international transaction in narcotic drugs." You call attention to your communication requesting an opinion of your Solicitor, as furnishing "in detail the circumstances which have given rise to the questions propounded." That communication, so far as pertinent here, reads as follows:

"Your attention is invited to the fact that under the International Opium Convention of 1912 which together with final protocol thereto was ratified by the United States and proclaimed March 3, 1915, this country has assumed obligations together with some 52 other powers to pursue progressive suppression of the abuse of opium, morphine and cocaine as well as drugs prepared or derived from these substances giving rise or which may give rise to analogous abuses. Since the creation and functioning of the League of Nations, the duties imposed upon the Netherlands Government under the said Convention have almost wholly been transferred to

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