Sorenson v. Sutherland

• Citation: 109 F.2d 714
• Decision Date: 19 February 1940
• Docket Number: No. 99.,99.
• Parties: SORENSON et al. v. SUTHERLAND et al.
• Court: United States Courts of Appeals. United States Court of Appeals (2nd Circuit)

109 F.2d 714 (1940)

SORENSON et al. v. SUTHERLAND et al.

No. 99.

Circuit Court of Appeals, Second Circuit.

February 19, 1940.

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Leonard B. Smith and Selden Bacon, both of New York City (Nathan L. Miller and Selden Bacon, both of New York City, of counsel), for appellant Irving Trust Co. as executor of Hermann Sielcken, deceased.

Francis M. Shea, Asst. Atty. Gen., John T. Cahill, U. S. Atty., of New York City, Francis J. McNamara, Sp. Asst. to Atty. Gen., and Frank C. Sterck and James A. Shipper, both of Washington, D. C., Attys., Department of Justice (David W. Wainhouse, of New York City, of counsel), for appellee and cross-appellant, Attorney General.

Before L. HAND, AUGUSTUS N. HAND, and CLARK, Circuit Judges.

AUGUSTUS N. HAND, Circuit Judge.

A decree of the District Court dated December 30, 1929 adjudged that Z. E. G. was indebted to the plaintiffs in the sum of $380,761.54 and interest, aggregating altogether $716,160.37, and that the Alien Property Custodian and the Treasurer of the United States should pay that amount to the plaintiffs as surviving partners of Crossman & Sielcken out of property of Z. E. G. which had been seized by the Alien Property Custodian. The aggregate with interest accrued since the date of the decree was paid to the plaintiffs by the Alien Property Custodian and Treasurer on April 17, 1930. About nine years after entry of the foregoing decree it was vacated on the application of the Attorney General upon the ground that the court had lacked jurisdiction to entertain the suit and make the decree because Hermann Sielcken, a member of Crossman & Sielcken, had resided in Germany since 1914 and had thus become an enemy alien after war was declared. In our opinion the various issues involved in the motion to vacate the decree were before Judge Caffey and his decision was binding on the later court. Chicot County Drainage District v. Baxter State Bank, 60 S.Ct. 317, 84 L.Ed. ___, decided by the Supreme Court on January 2, 1940; Stoll v. Gottlieb, 305 U.S. 165, 59 S.Ct. 134, 83 L.Ed. 104.

The bill of complaint before Judge Caffey alleged that Sorenson, Nielsen and Hermann Sielcken were citizens and residents of the United States and were doing business under the name of Crossman & Sielcken up to the date of the death of Sielcken, that that firm had at all times been a resident of New York, had not been a resident within the territory of any nation with which the United States was at war and was not at any time an enemy or ally of enemy. Z. E. G. not only denied these allegations but also set up the separate defense that Sielcken resided in Germany when war was declared and that he became an enemy alien, that the firm of Crossman & Sielcken was dissolved by the declaration of war and that the claim asserted by the plaintiffs as surviving partners belonged to the estate of Sielcken and not to the plaintiffs as surviving partners. The government, likewise, attacked the bill both by way of demurrer and by answer and raised the same issues.

The adjudication by Judge Caffey that Z. E. G. owed the plaintiffs $716,160.17 and that they should recover that amount, necessarily involved findings that Sielcken resided in New York at the time of his death, that he was not an enemy alien within the meaning of the Trading with the Enemy Act and that the claim against Z. E. G. belonged to the plaintiffs as surviving and liquidating partners of Crossman & Sielcken. Section 9(a) of the Act provides that "any person not an enemy or ally of enemy claiming any interest, right, or title in any money or other property which may have been conveyed, transferred, assigned, delivered, or paid to the Alien Property Custodian or seized by him hereunder and held by him or by the Treasurer of the United States, or to whom any debt may be owing from an enemy or ally of enemy whose property or any part thereof shall have been conveyed, transferred, assigned, delivered, or paid to the Alien Property Custodian or seized by him hereunder and held by him or by the Treasurer of the United States may file with the said custodian a notice of his claim under oath". The section goes on to provide that such a claimant who has filed a notice of claim may "institute a suit in equity * * * in the district court of the United States for the district in which such claimant resides * * * to establish the interest, right, title, or debt so claimed, and if so established the court shall order the payment * * * to said claimant * * *".

By the decree of December 30, 1929 it was necessarily held that the plaintiffs had filed their claim as required by the Trading with the Enemy Act and that Z. E. G. was an enemy alien and owed moneys to the partnership to the amount of $716,160.37 adjudged to be due.

The statement in the opinion of the court below (D.C., 27 F.Supp. 44, 51) that Article "Second" of the bill "as to non-enemy status" did not allege facts sufficient to confer jurisdiction on the court seems to have disregarded the allegation in Article "First" that Sorenson, Nielsen and Sielcken were "all * * * citizens and residents of the United States" and that of Article "Second" itself that the partnership of Crossman & Sielcken "was not, nor at any time has it been, an enemy or ally of enemy." These allegations were to the effect that each member of the firm was at all times a resident and citizen of the United States and the answers put them directly in issue.

In addition to the alleged defect in pleading the court was apparently of the belief that if it found Sielcken to have been in fact a resident of Germany the issues raised by the original bill and answers and necessarily determined in favor of the plaintiffs by Judge Caffey could be disregarded because his decision was based on erroneous findings affecting jurisdiction. But whatever may have been the trend of the earlier authorities the decisions of the Supreme Court in Chicot County Drainage District v. Baxter State Bank, supra, decided January 2, 1940, and Stoll v. Gottlieb, 305 U.S. 165, 59 S.Ct. 134, 83 L.Ed. 104, make the decree of December 30, 1929, res judicata as to the issues involved in the motion to vacate. In rendering that decree Judge Caffey was obliged to resolve disputed questions of fact on which his jurisdiction depended and his decision that the jurisdictional facts were established cannot be collaterally attacked. In Chicot County Drainage District v. Baxter State Bank, supra, the Supreme Court he...