311 U.S. 494 (1941), 75, Jackson v. Irving Trust Co.

Docket Nº:No. 75
Citation:311 U.S. 494, 61 S.Ct. 326, 85 L.Ed. 297
Party Name:Jackson v. Irving Trust Co.
Case Date:January 06, 1941
Court:United States Supreme Court

Page 494

311 U.S. 494 (1941)

61 S.Ct. 326, 85 L.Ed. 297

Jackson

v.

Irving Trust Co.

No. 75

United States Supreme Court

Jan. 6, 1941

Argued December 19, 1940

CERTIORARI TO THE CIRCUIT COURT OF APPEALS

FOR THE SECOND CIRCUIT

Syllabus

1. An award of a District Court under the Trading with the Enemy Act cannot be attacked for alleged fraudulent collusion by a motion on affidavits made to that court after payment has been made and the time for appeal has expired. Semble that the remedy would be by bill of review. P. 499.

2. Years after the rendition and payment of an award under § 9(a) of the Trading with the Enemy Act, from which no appeal was taken, the Attorney General, on behalf of the United States and as successor to the Alien Property Custodian, by a motion to the District Court supported by affidavits, sought to have the judgment set aside for want of jurisdiction on the ground that the beneficial owner of the claim was an "enemy" as defined by that Act, and that therefore the suit was not authorized by the Act, but was a suit against the United States without its consent.

Held:

(1) That the complaint in the suit stated a case within the terms of the Act, and the District Court had jurisdiction to determine every issue necessary to the establishment of the claim. P. 500.

(2) That the status, enemy or nonenemy, of the alleged beneficial owner, upon which was based the "jurisdictional" question of the motion, having been an issue raised by the pleadings and proceedings in the case, was determinable by the District Court, however labeled. P. 502.

(3) Whether the particular issue was actually litigated is immaterial in view of the necessary conclusion that there was full opportunity to litigate it and that it was adjudicated by the decree. P. 503.

(4) If the District Court had erred in dealing or in failing to deal with any issue involved, the remedy was by appeal. P. 503.

109 F.2d 714 affirmed.

Page 495

Certiorari, 310 U.S. 621, to review the reversal of a decree of the District Court, 27 F.Supp. 44, setting aside, on motion, for want of jurisdiction, a former decree which had been rendered under § 9(a) of the Trading with the Enemy Act.

Page 496

HUGHES, J., lead opinion

MR. CHIEF JUSTICE HUGHES delivered the opinion of the Court.

In a suit brought in the District Court of the United States for the Southern District of New York under

Page 497

Section 9(a) of the Trading with the Enemy Act,1 a decree was entered on December 30, 1929, directing payment to the plaintiffs of a stated amount out of the property of a German corporation which had been seized by the Alien Property Custodian. There was no appeal, and the amount awarded was paid.

In 1938, the United States moved upon affidavits to set aside the decree, contending that the court had been without jurisdiction. The District Court granted the motion upon that ground. Soreason v. Sutherland, 27 F.Supp. 44. The Circuit Court of Appeals reversed, and reinstated the original decree. 109 F.2d 714. Certiorari was granted. Jackson v. Irving Trust Co., 310 U.S. 621.

It appears that the suit had been brought in 1927 by John S. Soreason and Thorlief S.B. Nielsen, as surviving partners of the firm of Crossman & Sielcken. The bill of complaint alleged that plaintiffs and Hermann Sielcken, the deceased partner, were citizens and residents of the United States; that the partnership had its principal place of business in New York City, and had not at any time been a "resident" in enemy territory and had not been an enemy or ally of enemy within the meaning of the Trading with the Enemy Act; that Zentral-Einkaufs-Gesellschaft, m.b.H., a German corporation described as Z.E.G., was indebted to Crossman & Sielcken for cargoes purchased by the latter for Z.E.G. during 1915 and consigned to neutral ports [61 S.Ct. 328] where they had been seized and condemned by the British Government, and that the Alien Property Custodian had assets of Z.E.G. which had been seized under the Trading with the Enemy Act. The bill prayed for a decree establishing the debt claimed by the plaintiffs and ordering its payment to them out of the property so held. The bill declared that it was filed pursuant to Section 9(a) of the Trading with

Page 498

the Enemy Act, and that the court had jurisdiction to entertain it by virtue of the express terms of that provision.

The defendants, the Alien Property Custodian and the Treasurer of the United States appeared generally. They moved to dismiss the bill on the grounds (1) that it appeared affirmatively therefrom that no debt was owing to the plaintiffs from any enemy whose property had been seized and was then held, (2) that it appeared affirmatively that no debt was owing to the plaintiffs by Z.E.G., and (3) that the plaintiffs had not stated facts sufficient to entitle them to equitable relief under the provisions of the Act. The defendants also answered denying knowledge as to the averments of the bill which set forth the citizenship and residence of the plaintiffs and Sielcken and the locus of the partnership, and those concerning the transactions said to have given rise to the debt. As an affirmative defense, it was alleged that there were prior claims to the seized property of Z.E.G. The latter, being joined as defendant, also answered putting in issue allegations relating to the claim and setting up various affirmative defenses. One of these asserted that plaintiffs did not have title to the cause of action, since the Alien Property Custodian was alleged to have seized the assets of Crossman & Sielcken as an enemy firm because Sielcken resided in Germany and became an enemy. Other defenses of Z.E.G. averred that the partnership of Crossman & Sielcken had been dissolved through the outbreak of the war, and that the claim thereupon had passed to Sielcken, and, upon his death, to his German executors, who had entered into an arbitration agreement with Z.E.G., and that the arbitrators had found no liability on its part.

On the trial at the close of the evidence on both sides, defendants moved to dismiss upon the ground that plaintiffs had failed to prove their case. The District Court denied the motions, and held that the partnership had

Page 499

not been dissolved by the outbreak of...

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