Albert v. McGrath
| Decision Date | 12 May 1952 |
| Docket Number | No. 8352-Y.,8352-Y. |
| Citation | 104 F. Supp. 891 |
| Court | U.S. District Court — Southern District of California |
| Parties | ALBERT v. McGRATH, Atty. Gen. of United States. |
Bodkin, Breslin & Luddy, Henry G. Bodkin, and Leonard S. Janofsky, Los Angeles, Cal., Shearman & Sterling & Wright, Walter K. Earle, Freidin & Littauer, and Rudolph M. Littauer, New York City, for plaintiff.
Walter S. Binns, U. S. Atty., Arline Martin, Asst. U. S. Atty., Los Angeles, Cal., and Harold Ungar, Atty., Department of Justice, Washington, D. C., for defendant.
In an amended complaint which the Court allowed to be filed on April 16, 1952, the plaintiff, Irene Albert, seeks to recover from the Attorney General of the United States, as successor to the Alien Property Custodian, certain stocks claimed to be owned by her, and accumulated dividends, the title to which was vested by the Alien Property Custodian by four orders dated August 28, 1942, March 11, 1943, September 30, 1943 and September 18, 1944.1
The plaintiff has been, since February 28, 1938, a citizen of the United States. She is unmarried and is not an enemy of the United States or a citizen or national of a designated enemy country. She claims to be the owner of 4,933 1/3 shares of the common stock of Resinous Products and Chemical Company, to be referred to as "Resinous." These shares were registered in the name of Chemie Holding A. G., to be referred to as "Chemie". Chemie was a corporation of the Duchy of Luxembourg, which the complaint alleges was dissolved in accordance with the law of Luxembourg on December 9, 1940.
Upon the merger of the two corporations, on September 15, 1948, the shares in Resinous were exchanged for 67,627.01 shares of common and 1,463.72 shares of preferred stock of Rohm and Haas Corporation, to be referred to as "Rohm and Haas". The exchanged shares were turned over to the Attorney General as successor to the Alien Property Custodian.
Under the first cause of action, the plaintiff claims the entire ownership of the shares of stock of Resinous and the exchanged shares. Under the alternative second cause of action, she claims an undivided one-half interest in them. Accumulated and cash dividends in the sum of $658,840.96 and rights to certain scrip resulting from the merger are also asserted in the complaint.
Other facts will appear in the discussion to follow.
The defendant has moved for summary judgment.2
The object of the rule permitting summary judgments is to allow summary disposition of cases which, on the face of the complaint and of additional facts appearing from supporting documents show there is no genuine issue as to any material fact to be tried.3 In determining the matter, resort is had to extrinsic facts through affidavits, admissions and the like. This implies that a finding of absence of a genuine issue as to any matter of fact will be made, despite the fact that the pleadings, as they stand, present such issue.4 For this reason, the sufficiency of the complaint does not stand in the way of a motion on behalf of the defendant.5
If an issue of fact is present, it is not the function of the court on a motion for summary judgment, to determine it. Once the court determines that there is an issue of fact, it must deny summary judgment.6 However, when the factual issue is simple and can be determined by the court without choosing between conflicting views, summary judgment is proper.
And, in a border-line case, in an action for breach of contract to sell lumber, where the breach was admitted and the damage flowing from non-performance could be determined without trial, summary judgment was sustained.8
In an action on a policy of life insurance, where it appeared that the deceased had not made full disclosure that she had consulted physicians, which failure would bar recovery, summary judgment was held justified.9
And where, in the action for personal injury by an employee of a railroad, it appeared that the injury was unconnected with the employment and occurred on property not under the control of the railroad, summary judgment for the defendants was ruled proper.10
A similar conclusion was reached in the Court of Appeals for the Ninth Circuit, in an action by a seaman brought against the owners of a vessel, where it appeared that the defendant did not own the vessel and was not responsible for its unseaworthiness or any negligent act committed on it to which the injury could be traced.11
Although the courts are loath to interfere with administrative bodies, where it appeared that certain claimed premises were decontrolled by the Housing and Rent Act of 1947,12 and no administrative remedy existed for securing an adjudication to that effect, the court entertained an action for declaratory relief, and, it appearing that the building was exempt, summary judgment against the Housing Expediter was sustained.13
The case before us comes within the purview of these cases. For the facts before the court present the question whether the plaintiff has "any interest, right, or title" in the property to enable her to bring the action under the Trading with the Enemy Act.14 The admitted facts which show the source of her title are these:
Prior to December 9, 1940, the legal ownership of the shares here involved was in Chemie. On May 4, 1940, the plaintiff and her brother, Alexander Albert, who were the owners in equal shares of all the stock of Chemie entered into an agreement in anticipation of its dissolution and liquidation, in which it was provided that upon dissolution and liquidation of Chemie, its assets would be divided in kind between the plaintiff and her brother, the plaintiff to receive the Resinous stock and the brother to receive the balance of the company's assets. On December 9, 1940, Chemie was dissolved according to the laws of Luxembourg. The plaintiff claims that upon dissolution, she automatically became the owner of the shares pursuant to the agreement of May 4, 1940.
The alternative claim of one-half ownership is grounded on the contention that if the agreement with her brother was not definite enough to confer ownership rights, she was joint owner by virtue of the act of dissolution of the corporation. For the purpose of the dissolution, a written agreement between the plaintiff and her brother was entered into on December 1, 1940, at Berlin, Germany, assigning her shares in Chemie to the brother. This agreement, in translation, recites, among other things:
"We consider it advisable before carrying out this decision to again set forth in writing that this assignment of the property rights of the undersigned, Irene Albert, has been given solely and exclusively for the purpose of the dissolution of the company and its cancellation in the mercantile register and in no way affects the property rights to the assets of the Chemie Holding which we have already divided between ourselves by another agreement."
The prior agreement of which this agreement speaks, was oral.
An act of dissolution was executed on December 9, 1940. The plaintiff made timely claim for the return of the property on May 5, 1947. Her claim set forth the facts substantially as outlined.
The question to be determined is whether the plaintiff has an interest, right or title in the property sufficient to enable her to bring this action under the Act.15
It is conceded that, at no time, did the plaintiff have a license under the Act.16 And the effect of the absence of such license nullifies any transfer of the type forbidden by the Act.17 The only seeming deviation from the explicit language of the statute, as interpreted in the case just cited, relates to transactions which are given a definite status by state law. When this occurs, the transactions are recognized, subject to the custodial rights. Such was the situation where judgment had been rendered in a state court upon a claim entitled to preference under the New York banking law,18 and where claims had been reduced to judgments and attachments levied.19
So we come to the crucial question whether the plaintiff had, at any time, any interest in the claimed stocks permitting her to institute this action.
Before answering it, two other facts should be adverted to. One is that on February 28, 1940, the Government of Luxembourg promulgated a decree which became effective on March 2, 1940. Among other things, it forbade the executives of corporations to dispose of the property or the rights of the corporation located outside the territorial limits of the country.20
The effect of this order was to prohibit any change of title to the property.24
In the light of these facts, what, if any, title would the plaintiff have? At the time of the transaction she was not a...
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