Z. & F. Assets Realization Corp. v. Hull
Opinion of the Court
delivered the opinion of the Court.
Petitioners, Z. & F. Assets Realization Corporation and American-Hawaiian Steamship Company, are holders of awards of the Mixed Claims Commission, United States and Germany. ' These awards have been certified by the Secretary of State and are thus payable out of the fund established by the Settlement of War Claims Act of 1928.
Defendants, the Secretary of State and the Secretary ■ of the Treasury, moved to dismiss petitioners’ bills for want of jurisdiction and for failure to state a claim upon which relief could be granted. The intervener defendant filed an answer and moved for summary judgment. The District Court dismissed the bills (31 F. Supp. 371) and its judgment was affirmed by the Court of Appeals. 114 F. 2d 464. We granted certiorari, post, p. 632.
The Mixed Claims Commission, United States and Germany, was set up pursuant to an agreement of August 10, 1922,
The Settlemént of War Claims Act of 1928 created in the Treasury a “German Special Deposit Account.” Section 2 provided that the Secretary of State should certify from time to time to the Secretary of the Treasury the awards of the Mixed Claims Commission, and the Secretary of the Treasury was directed to pay out of the amounts placed in the account the principal of each award so certified, with interest as stated.
The claims covered by the awards attacked by petitioners arose out of the destruction of property caused by explosions at Black Tom and Kingsland, New Jersey, in 1916 and 1917. These claims were dismissed by the Commission in 1930, and petitions for rehearing were denied in 1931 and 1932. In the following year the American agent sought to reopen the cases upon the ground that in its decision of 1930 the Commission had been misled by “fraudulent, incomplete, collusive and false evidence” on the part of witnesses for Germany. The German Government denied the power of the Commission to reopen and the Umpire, Mr. Justice Roberts, finding that there was a disagreement upon the question between the Commissioners, decided, in December, 1933, that the Commission was competent to determine its own jurisdiction by the interpretation of the Agreement creating it. ■ The Umpire ^further decided that, while the Com
Thereafter, the German agent filedvan answer denying the .^allegations of fraud and evidence was presented. After argument, the Commission, in June,. 193b, rendered a decision, the German Commissioner concurring, by which the ruling ‘of 1932 denying a rehearing was set aside; and the question whether there should be a rehearing was reserved for a hearing which should be separate and distinct from an argument on the merits unless Germany should consent to a different course.
Efforts to obtain a settlement of the claims were unsuccessful and, after much additional evidence had been introduced, the Commission,- in January, 1939, heard extended arguments , by the agents of the respective Governments. The American agent had requested that the Commission should not only set aside the original decision of. 1930 but should also proceed -'to a final decision on the merits, as-it was contended that the evidence presented to support the application for rehearing also established the responsibility of Germany for the destruction of the property as' claimed. It also appears’ that the German .Commissioner insisted that, before the motion for rehearing should be granted, the Commission should examine- the proofs tendered by the United States to determine whether the claims had been made good. This, as stated by the Umpire, was upon the ground: that even though the Commission had been misled by false and
During the course of that investigation, on March 1, 1939, the German Commissioner withdrew from the Commission. At the time of his withdrawal, the two Commissioners, according to the contention of the American Commissioner and as found by the Umpire, were in disagreement upon the points in issue. On receiving notice of a meeting of the Commission to be held on June 15, 1939, the German agent said that he would not appear and the German Embassy advised the Secretary of State that, since the withdrawal of the German Commissioner, the Commission was incompetent to 'make decisions.
At the meeting held pursuant to the notice, the American Commissioner filed a certificate of disagreement with an opinion sustaining ■ the jurisdiction of the Commission. The Umpire thereupon decided that there did exist a disagreement between the two Commissioners, — á disagreement of which he was personally cognizant and which was also shown by the certificate and opinion of the American Commissioner; that the jurisdiction of the Commission was not ousted by the withdrawal' of the German Commissioner “after submission by the parties, and after the tribunal, having taken the cases under advisement, pursuant to its rules, was engaged in the' task of deciding the issues^ presented”; that the United States “had proved its allegation that fraud in the evidence presented by Germany misled the Commission and affected its decision in favor of Germany”; and that upon
Thereupon, the American agent moved for awards in favor of the United States on behalf of the sabotage cl'aimanté. An order was entered setting aside the decision of 1930, and determining that the liability of Germany had .been established and that, as it appeared that Germany did not intena to take part in further proceedings of the Commission, awards should be made upon the Commission’s findings and opinion.
On October 3, 1939, the German Charge d’Affaires ad-, dressed an elaborate communication to the Secretary of State making a detailed statement supplementary to a note of. July 11, 1939, with respect to the allegedj-illegal acts of the Umpire, -and protesting against all further measures by the Umpire, the American Commissioner and the American agént, which were aimed at securing awards in the Black Tom and Kingsland cases. The Secretary of State replied, on October 18, 1939, that it would be highly inappropriate for thé Department to endeavor to determine the course of the proceedings of the Commission; that thé Secretary had entire confidence in the ability and integrity of the Umpire and the Commissioner appointed by the United States despite the severe'
Notice was given of a meeting of the Commission to be held on October 30, 1939, which the German Commissioner did not attend, and awards were then made in fayor of the claimants. The Umpire stated that he
The awards were certified by the Secretary of State to the Secretary of the Treasury on October 31, 1939, pursuant to the Settlement of War Claims Act of. 1928.. On the same day, this suit was brought, the complaint being filed before, and process being served on the Secretary of State after, his certification of the awards.
The Court of Appeals has held that the question with respect to the validity of- the awards in favor of the sabotage claimants is political in its nature and that the District Court was without jurisdiction to entertain it.
There are, however, certain preliminary questions which are indubitably appropriate/for judicial consideration, and we think that the proper answer to these-questions is determinative of the whole case.
The first question is whether petitioners have standing to bring this suit. Except for the situation created by the Settlement of War Claims Act of 1928, they would have no such standing. They could not be heard to complain of action upon claims other than their own. And Congress, with or without awards, could provide for the payment of the claims in question without let or hindrance by petitioners. But petitioners contend that the Settlement of War Claims Act created a fund in the Treasury, known as the “German Special Deposit Account”; that petitioners with othér earlier award-holders are entitled by the Act to payment out of that fund; that the fund is insufficient to pay petitioners’ claims in full if payments are permitted to be made.to the sabotage claimants; and hence that petitioners have standing to complain of an unlawful depletion of the fund to their injury by means of such payments.
We-think that in these circumstances as shown by the bills petitioners are entitled to sue to protect such inter
The next question is with respect to the effect that should be given under the terms of the statute to the action of the Secretary of State in certifying the awards. Congress has authorized and.required the Secretary of the Treasury to pay out of the special account the awards which the Secretary of State has certified. There is no question that the Secretary of State has given his certificate in this instance.- It is. adequate in form and substance under the terms of the Act.
Petitioners contend that the certification is a mere ministerial act. " It is said to mean merely that the award is a genuine document, in the same sense that a notary public authenticates the signature of axgrantor in a deed. We think that this construction of the Act is inadmissible. The notarial conception of the function of the Secretary of State in this matter ignores his role in the conduct of foreign affairs as the right hand of the Executive and in particular his relation to proceedings for the determination of claims of the United States against foreign governments. There can be no doubt of the constitutional authority of Congress to lodge with the Secretary of State the authority to consider ai|d pass upon the regularity and validity of the awards made by the Mixed Claims Commission for the statutory purpose of qualifying them for payment out of the account in the Treasury. Congress had complete power to decide what payments should be made from that account and to attach such conditions as it saw fit. Congress not only had this power but it was natural and appropriate that Congress should entrust to the Secretary of State the decision
We are of the opinion that for the purpose of payment under the statute the certificate of the Secretary df' State must be deemed to be conclusive. We do . not need to consider whether Congress could commit to the judiciary the determination of the validity of the challenged, claims (See La Abra Silver Mining Co. v. United States, 175 U. S. 423), for Congress has not done so but has made payment out of the fund depend upon the Secretary’s certificate. The question in this relation is simply one .of the intent of Congress as disclosed by the Act. Congress has expressly directed payments to be made from the special account of the awards “so certified.” The literal and natural import of this provision is that finality is to be accorded to the certificate of the Secretary of State and we.perceive no ground for limiting the terms of the Act by construction. On the contrary, the ■nature of the questions presented and their relation.to the conduct of foreign affairs within the province of the Secretary of State support the conclusion that the statute should have effect according to its explicit terms.
In view of, the statutory provisions governing this case,we have no occasion to consider the circumstances in which an international agreement, of action thereunder, may-be deemed to vest rights in private persons, or the. scope of such rights in particular cases: See Comegys v. Vasse, 1 Pet. 193; Mellon v. Orinoco Iron Co., supra. Petitioners must claim solely by virtue of their interest, in ' the fund created by the statute and under its terms they are not entitled to complain of payments out. of that'., fund of awards which the Secretary-of State has certified
The judgment of the Court of Appeals is
Affirmed.
[Over.]
45 Stat. 254.
42 Stat. 2200.
42 Stat. 1939.
45 Stat. 254.
Concurring Opinion
concurring:
Mr. Justice Douglas and I concur in the judgment of affirmance but on the ground that the petitioners set up no justiciable controversy which the court had power to determine. The questions raised by the petitions involve relations between the United States and Germany, which we believe are constitutionally committed exclusively to the legislative and executive departments.
The sole ground upon which petitioners prayed relief in the District Court was that awards made by the Mixed Claims Commission Were “wholly null and void and without jurisdiction on the part of the alleged Commission.” A declaratory judgment was sought to have the awards declared null and void, and to enjoin the Secretary of State from certifying and the Secretary of the Treasury from paying such awards made by the Commission. ■ In addition petitioners asked a mandatory injunction to require the Secretary of the Treasury to pay petitioners without regard to other awards of the Commission certified by the Secretary of Sta,te.
The Secretary of State and the Secretary of the Treasury moved to dismiss on the grounds,' among others, that the complaint stated no cause of action; the court had no jurisdiction, to review the action of the Mixed Claims Commission; the court was without power,to pass-upon the jurisdiction of the Mixed Claims Commission; and the court had no jurisdiction to restrain the Secretary of State from certifying awards of the Commission or to enjoin the Secretary of the Treasury from paying the claims so certified. The District Court dismissed and the Circuit Court of Appeals affirmed on the ground that the actions of théQdixed Claims Commission .in making awards and the Secretary of State in certifying
The fundamental questions raised by the petitions as . presented to the District Court, were: Who can challenge the propriety of the Commission’s awards? Does the judicial branch of government, rather than the political,-possess the power finally to determine the propriety of the awards? And the fact that petitioners sought to challenge the Commission’s power by proceedings against the Secretaries of State and the Treasury, and not by direct suit against the Commission, is immaterial. If petitioners cannot directly attack the Commission in„ the courts, neither can they, in the absence of Congressional consent, assail the propriety of its awards through the expedient of suits against others charged with responsibility for executing the final determination of the Commission.
The Mixed Claims Commission was set up pursuant to an agreement between the United States and Germany. The agreement gave the Commission full power to hold hearings to determine “the amount to be paid by Germany in satisfaction of Germany’s financial obligations” under two treaties previously made between the two countries. The agreement further, provided that “the decisions of the Commission, and those of the Umpire (in case there may be any) shall be accepted as final and binding upon the two governments.” The Commission was set up with an Umpiré and all of the awards
While petitioners contend that they have the right to challenge the certification of the Secretary of State, it is to >be remembered that their petitions ultimately rest solely upon the premise that it is his duty to refuse to carry out the Commission’s awards because of alleged impropriety of the proceedings of the Commission. They say that the Commission was without jurisdiction and power to make awards to certain claimants other than themselves; payment of these awards out of a fund that is limited in amount will result in diminishingj paypiepts>, to them below the full amount of their award with interest; since the Commission was without power— as tfhey charge — to make these other awards, the Secretly of State should not have certified them for payment; and for the samé reason the Treasury should not pay them. They assert a right through court procedure to challenge piayment to the other claimants by reason of an Act of Congress of 1928?
. But the 1928 Act provides that the Secretary shall from time to .time certify to the Secretary of the Treasury the awards of the Mixed Claims Commission of the United States,,, and that the Secretary of the Treasury is authorized anjd directed to pay “the principal of each award so certified, plus the interest thereon, in accordance with the'award, . . .” Nowhere in the Act is there any language which either expressly or by fair implication indicates! a purpose of Congress to permit some claimants to resort to the courts — as petitioners here have done — to determine the propriety of awards by the Mixed Claims <3ommission to other claimants.
The exact .challenge made by petitioners against the awards of the ¡Commission is the subject of a diplomatic
The controversy here bears all the' earmarks of that type of controversies which our Constitution has confided exclusively to the executive or political departihents of government, and concerning which this Court has many times repeated “that the action of the political branches of the government in a matter that belongs to them, is conclusive.”
Williams v. Suffolk Insurance Co., 13 Pet. 415, 420; United States ex rel. Boynton v. Blaine, 139 U. S. 306, 320, 321, 322-6; Frelinghuysen v. Key, 110 U. S. 63. No good purpose would be served by setting out the numerous decisions of this Court to the same effect. For a collection of such cases see Digest of the U. S. Supreme Court Reports, vol. 4, Courts, §§ 49^63.
Reference
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- Z. & F. ASSETS REALIZATION CORP. v. HULL, SECRETARY OF STATE, Et Al.
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- 46 cases
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