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But this is only one method of never receving this unwanted offer, and while it has some practical shortcomings, I assure you that there are lots of ways that can be used, and no broker's office need be confined to any particular scheme.
The important thing here is what title IV has done to the Negro. The seller in our illustration had no objection to selling to Negroes. In the absence of title IV, he would have had no objection to seeing them or selling to any one of them who otherwise met with his approval. But now the danger of litigation that has been forced upon him is going to force him into searching for devious ways to avoid ever receiving the offers that he would have otherwise been happy to receive and possibly have been happy to accept.
Or let's take another illustration. There is the university professor who takes a year's leave of absence, in order to accept a temporary appointment at another institution as a visiting professor. He plans to move his family to the new location for 1 year. He would like to rent his house, and he has no objection to renting it to a Negro. But he wants to be reasonably sure that he can trust the tenant to take reasonably good care of his furniture.
He also knows that if he rejects a prospective tenant who happens to be a Negro, he might be called upon for the same kind of proof that was demanded of the seller in our previous illustration. But here the real reasons are likely to be even more subjective and less susceptible of proof than they were when a sale was involved.
As a result, the professor is likely to employ some scheme similar to that used by the seller, or he might decide to avoid the difficulty by leaving his house vacant for the year.
If he chooses the former, a prospective Negro tenant has been deprived of the opportunity to bid on an accommodation that was actually on the market. If he chooses the latter, there will be one less housing unit in that city that year than would otherwise have been the case. In one instance, Negro tenants are the losers, and in the other, all tenants, both Negro and white, are losers.
Someone might ask "what about the seller who refuses to sell for no reason other than the race of the buyer?” We must assume that some sellers of that type do exist, but I would suggest that any estimate of their number is likely to be based more on emotion than it is on fact.
It should be pointed out, however, in order for them to exist at all, there will have to be a seller who is more concerned about the race of his buyer than he is for the purchase price that he receives. I doubt if there are very many sellers who are that oblivious to the power of the dollar. But even if they exist in large quantities, they will always have available to them all the devious subtleties employed by the nonprejudiced sellers who are merely trying to avoid exposure to litigation. Their apprehension will be next to impossible.
If title IV becomes law, it is going to have two significant effects, in my judgment. It is going to discourage building, and it will deprive the members of minority groups of opportunity to compete for the housing that remains available. The entire bill, gentlemen, should be rejected.
Senator HRUSKA. Thank you, Professor Sparks, for your statement. It represents a fine addition to our record on this very important legislation.
You have gone into some of the situations where, by devious routes, a seller, a potential seller or one who wants to sell, could probably circumvent the law. You have also outlined some of the unfairnesses that might be thrust upon him in certain specific situations.
One situation which has been called to our attention, and discussed in some detail is this: Where a price will be asked let us say for the purposes of convenience, a price of $20,000. All of us know what happens when a house is offered for sale. A price of $20,000 is quoted, and perhaps it will be a price that the owner at that time would be willing to accept.
A potential buyer appears and says, “I will buy it.” He will offer $18,000 rather than the $20,000. And the offer is refused.
Time goes on. The owner must sell for some reason. The man who bid the $18,000 disappears. He is not there to renew his offer. Eventually the house is sold for $17,000.
Now, under those circumstances, if that prospective buyer who bid $18,000 can come along and show that the actual sale was for $17,000 to a white man, and he himself was colored, what do you think the court will do under circumstances of that kind by way of entertaining proof? What would be the situation with reference to the owner of that house in a legal way?
Mr. Sparks. It is very difficult to predict precisely what would happen there, but what I would expect to happen, if I understood you correctly, it is the Negro buyer who offered at one time $18,000 for a house that is now sold for $17,000!
Senator HRUSKA. That is right.
Mr. SPARKS. Once he has shown that fact, I think that there is going to be such a presumption against that seller in most of our courts that he is going to be in real trouble, and I think what is an even greater danger is that when he is about to sell it for $17,000, but he hasn't really sold it yet, and our Negro buyer who offered $18,000 will come into court asking for injunctive relief.
The court will enjoin our seller from selling it at all. And now let's suppose that our seller can go on through with his proof, and that he can convince the court that his reason was not racial. By the time he is through with his litigation, it is likely that both buyers will have faded away, and he still has an unsold house. I think that is really likely to be the result.
Senator HRUSKA. That was in the thinking of those who have advanced that type of situation. The restraining order, even the temporary restraining order provided for is a pretty severe remedy.
Mr. SPARKS. Yes; it is.
Senator Hrtska. A pretty severe remedy, and one in which normally there is required the posting of a bond.
Mr. SPARKS. Ånd unfortunately we have the specific provision in this bill as it now stands that not only will he not have to post a bond, he will not have to be responsible for attorney's fees. He can do it purely for annoyance, with nothing to lose.
Senator HRUSKA. What about the man who does come along and buy a house from a seller? What assurance will he have that there are no clouds against the title of that house on account of dealings of that seller with someone else which were not successful and not fruitful toward the sale?
Mr. SPARKS. I have thought of that very thing here, and so far as anything I can find in the bill, it doesn't specifically cover it, but in view of this provision for injunctive relief, for equitable relief of all kinds, it is almost a completely blanket clause, I assume that the sale might be set aside, and if it is, well, then all real estate titles are going to be uncertain.
Senator HRUSKA. And there is a period of 6 months within which suit may be brought. Mr. SPARKS. Right.
Senator HRUSKA. And until that time has run there would be a cloud as we lawyers like to call it, a cloud on the passage of title.
Mr. SPARKS. And once we have a decision to that effect in court, we have immediately clouded titles everywhere. Even assuming that some lawyers are not afraid of the bill itself. As soon as we have the decision we do have that cloud, and real estate transactions are going to be in a state of turmoil that they have not been in in this country heretofore.
Senator Hruska. Of course, we could require that the money be put in escrow for 6 months and the transaction be consummated 6 months later, but that would represent a real impediment in the ordinary course of commerce, wouldn't it?
Mr. Sparks. More than that. Usually when you are buying a house, if it is a house for a home, it is because you are moving to that community and you need to get in it. And if it is for business purposes, which could be equally covered here, the situation is equally bad. If I am ready to go into business, Í am either going to go into business or I am not. I can't wait 6 months for the determination of this title before I do any building on it.
Senator HRUSKA. Mr. Counsel, have you any questions?
Professor, it has been called to the subcommittee's attention that successful voluntary projects have been assumed around the country in integrated communities whereby neighbors get together and establish arbitrary quotas and maintain an integrated community.
Since these actions are by definition based upon sale according to race and color, this would be absolutely outỉawed by this bill, wouldn't it?
Mr. SPARKS. I would assume that it would. You asked for my opinion. If it is at all relevant further, I think that kind of arrangement is extremely unwise in any event, because what you are doing then, you are laying down racial or national origin patterns for housing and for living and for business. You are really establishing the very thing which we thought we were wanting to get away from.
Mr. AUTRY. Professor, the Attorney General, as you may know, advanced two theses to justify this legislation: first, humanitarianmore housing should be available to Negroes; and secondly, that the absence of a title IV provision nationally provides us with an adverse impact on interstate commerce.
I think your conclusion is that title IV would have exactly the opposite effect of that which the Attorney General professes.
Mr. SPARKS. That is my position. I cannot conceive of how you are going to increase the quantity of housing available by making it more difficult to build a house, and you are not going to increase the amount of housing available by imposing extra burdens upon the man who sells a house. You are making it more difficult for him to sell.
You are making it more difficult for him to get rid of it. You are complicating his building. You are imposing added burdens upon his ownership. If he decides to rent it, he is at the same disadvantage, only even more so.
Mr. AUTRY. Thank you, Mr. Chairman.
Senator HRUSKA. Thank you, Professor Sparks, for your appearance before this subcommittee.
Mr. SPARKS. Thank you.
Senator HRUSKA. We stand in recess until 10:30 tomorrow morning in this same chamber.
(Whereupon, at 1:15 p.m., a recess was taken until 10:30 a.m., Wednesday, June 15, 1966.)
WEDNESDAY, JUNE 15, 1966
Washington, D.O. The subcommittee met, pursuant to recess, at 10:35 a.m., in room 2228, New Senate Office Building, Senator John L. McClellan presiding.
Present: Senators McClellan and Javits. Also present: George Autry, chief counsel; H. Houston Groome, Lawrence M. Baskir, and Lewis W. Evans, counsel; and John Baker, minority counsel.
Senator McCLELLAN. The committee will come to order.
Senator Ervin is chairman of this subcommittee. He is unable to be present today but he had hearings scheduled and some witnesses were advised they could testify today, and in order not to inconvenience them, and with the view of also proceeding expeditiously with these hearings, he asked if I would preside in his absence, which I agreed to do. I am advised that other members of the subcommittee may be able to attend during the morning. Some of them will be late. There is no one else present as of now but I see no reason why we cannot proceed.
Our first witness this morning is Mr. Charles J. Bloch, attorney, of Macon, Ga., who is appearing, as I understand it, at the invitation of the chairman of the subcommittee, Senator Ervin.
Mr. Bloch, we are very glad to have you. I notice you have a prepared statement, do you?
STATEMENT OF CHARLES J. BLOCH, ATTORNEY AT LAW,
Mr. Bloch. I would prefer to read from the statement, skipping parts of it.
Senator McCLELLAN. I direct the reporter that any part of the statement that Mr. Bloch may not read will be inserted in the record as if read at the proper place.
Very well, Mr. Bloch, you may proceed.
Mr. Bloch. I am here, Senator McClellan, at the invitation of my dear friend, Senator Ervin, and I have used as a basis of the proposed