FILIPINO AMERICAN VET. & DEP. ASS'N v. United States

• Decision Date: 14 November 1974
• Docket Number: No. 72 785 WTS.,72 785 WTS.
• Citation: 391 F. Supp. 1314
• Parties: FILIPINO AMERICAN VETERANS AND DEPENDENTS ASSOCIATION et al., Plaintiffs, v. UNITED STATES of America et al., Defendants.
• Court: U.S. District Court — Northern District of California

391 F. Supp. 1314

FILIPINO AMERICAN VETERANS AND DEPENDENTS ASSOCIATION et al., Plaintiffs, v. UNITED STATES of America et al., Defendants.

No. 72 785 WTS.

United States District Court, N. D. California.

November 14, 1974.

W. Urie Walsh and Peter J. Donnici, San Francisco, Cal., for plaintiffs.

James A. Browning, Jr., U. S. Atty., and Richard F. Locke, Asst. U. S. Atty., San Francisco, Cal., for defendants.

Before KILKENNY,^* Circuit Judge, and EAST and SWEIGERT, District Judges.

MEMORANDUM OF DECISION

SWEIGERT, District Judge.

This is a class action brought by a Filipino Veterans Association and certain named plaintiffs, formerly residents of the Philippines but all of them now residents of California and three of them now citizens of the United States, claiming to be World War II Veterans or spouses of World War II veterans, and as such entitled to veterans' benefits provided under the laws of the United States.

The action is brought against the Director of the Veterans Administration and other officials of the United States for the purpose of enforcing plaintiffs' claims and, as an incident thereto, to obtain a judgment declaring that a certain federal statute, Title 38 U.S.C. § 107, which purportedly prohibits or restricts veterans' benefits as to plaintiffs, is an unconstitutional denial of the law.

The case is now before the court on defendants' motion to dismiss and plaintiffs' motion for a partial summary judgment on the issue of constitutionality. The record consists of the Amended Complaint and an Agreed Statement of the Material Facts.

THE STATUTE

Title 38 U.S.C. § 107, provides (sub. (a)) that "service before July 1, 1946, in the organized military forces of the government of the Commonwealth of the Philippines while such forces were in the service of the Armed Forces of the United States pursuant to the military order of the President, dated July 26, 1941 . . . shall not be deemed to have been active military, naval or air service for the purposes of any law of the United States conferring rights, privileges, or benefits upon any person by reason of the service of such person or the service of any other person in the Armed Forces except benefits under "Chap. 11 (compensation for service-connected disability or death); except Sec. 412(a), Chap. 13 (compensation for dependents for service-connected disability or death); and Chap. 23 (burial benefits); also excepted were benefits under pre-1946 National Life Insurance contracts.

The statute also provides that payments of the allowed compensation for service-connected disability or death "shall be made at a rate in pesos as is equivalent to 0.50 for each dollar otherwise authorized."¹

This statute, Title 38 U.S.C. § 107, is essentially the same as certain 1946 predecessor legislation on the same subject matter (Title II of Public Law 301, 79th Congress, 60 Stat. 14, entitled First Supplemental Recision Act of 1946 (as to sub. (a)) and (as to sub. (b)) Public Law 391, 79th Congress, 60 Stat. 223, entitled Second Supplemental Recision Act of 1946) — to which 1946 legislation we will hereinafter make further reference.

The practical effect of the challenged legislation has been to limit the Filipino servicemen described in the legislation (and their beneficiaries) to compensation for service-connected disability or death (and payments under certain pre-1946 National Life Insurance contracts) and, further, to limit the allowed compensation for service-connected disability to 50% of the monetary amount to which veterans in the United States have been entitled. Denied to the Filipino veterans were other, additional veteran benefits available in 1946 and since to veterans in the United States, e.g., certain life insurance, medical, hospitalization, educational, vocational rehabilitation, civil service credit, longevity pay, retirement, pension and annuity benefits.

BACKGROUND OF THE PHILIPPINES

In order to understand this legislation we must bear in mind that the Philippine Islands had been ceded by Spain to, and became a territory of, the United States under the 1898 Treaty of Paris.

On March 24, 1934, the Congress had passed the Philippine Independence Act, Public Law 73-127, 48 Stat. 456, providing for eventual Philippine independence and creating, meanwhile, a Commonwealth of the Philippines vested with certain powers over its own internal affairs.

It was not until July 4, 1946, however, that this interim Philippine Commonwealth received its grant of independence by a Presidential Proclamation of that date in fulfillment of the promise contained in the Act of 1934.

During the 12-year interval between the Act of 1934 and final independence in 1946, the Philippines were in what has been described as a "unique" status. Although not in all respects a "foreign" territory, the Philippines were treated by the Act of 1934 as a foreign country for many purposes, e.g., Filipino citizens were treated as aliens for immigration purposes; also foreign service officers assigned to the Philippines were treated as if stationed in a foreign country; also the Act of 1934 defined "United States" as excluding the Philippines. See, Hooven v. Evatt, infra, 325 U.S. 677-8, 692, 65 S.Ct. 870.

Nevertheless, the United States retained plenary and unrestricted power over the Philippines until its sovereignty over them was formally withdrawn in 1946. (Id. p. 692, 65 S.Ct. 870).² Among other things, the Act of 1934 reserved to the United States the power (Sec. 2(a)(12)) to maintain military bases and armed forces in the Philippines and, upon order of the President of the United States, the right "to call into the service of such armed forces all military organized by the Philippine government."

It was under that authority that President Roosevelt, by an Executive Order of April 26, 1941, did call the then existing military of the Philippine government "into the service of the armed forces of the United States all military organized by the Philippine government" for the period of the imminent World War II emergency and placed that military under the command of general officers and commandants of the United States Army and Navy.

The named plaintiffs in this action, or their spouses, were among the Philippine military called into the service of our armed forces pursuant to that 1941 Executive Order and they served as such under United States generals and commandants in World War II.³

From April, 1941, the United States had assumed the responsibility for payment of the Philippine servicemen's army pay as previously established by the Philippine Commonwealth. That scale of service pay was less than the rate of pay for regular United States enlistees or inductees. Legislation was introduced in the United States Congress to increase the Filipino service pay scale to United States Army levels but no such legislation was ever enacted.

Soon after President Roosevelt's Executive Order of 1941 questions arose concerning the status of the Filipino veterans called up under that order with respect to their entitlement to veterans' benefits. As early as May 5, 1942, the then Director of the Veterans Administration, Frank T. Hines, approved and promulgated an opinion of the Solicitor of the Veterans Administration holding that they were in "active service of the land or naval forces of the United States" within the meaning of the Veterans National Life Insurance Act of 1940. (See, Hearings Before the SubCommittee of the Senate Committee on Appropriations, 79th Congress, 2d Session, "Attachment" to Agreed Statement herein, pp. 56-57). However, the Congress eventually determined otherwise, as will hereinafter appear.

LEGISLATIVE HISTORY

In October, 1945, after the end of World War II and while Congress was considering a 200 million dollar appropriation for the support of the Philippine Army in accordance with its practice during the War, the Chairman of the SubCommittee of the Senate Committee on Appropriations sent a letter to General Bradley, then Director of the Veterans Administration, requesting information concerning the status of the Filipino servicemen and the potential cost of their veteran benefit coverage. (See, Attachment to Agreed Statement, p. 49).

In his response (Attachment, pp. 49-54), General Bradley again expressed the administrative view of the Veterans Administration that veterans, i.e., "those who served in the active military or naval forces of the United States," did include "persons who were a part of the organized forces of the government of the Commonwealth of the Philippines called into service of the Armed Forces of the United States pursuant to military order of the President of the United States, July 26, 1941."

In his same 1945 letter, General Bradley gave to the subcommittee his estimate that the total cost of paying veterans' benefits to members of the Philippine Commonwealth Army and their dependents, under then existing veterans' laws, would amount in the long run to about 3 billion dollars. (Attachment p. 54).

Upon receipt of this response, the Chairman of the Senate SubCommittee made an important statement bearing on the reasons of the Congress for the then pending 1946 legislation, (Attachment, pp. 55, 57-59), a statement which we set forth as a note because of its length.⁴ (See Footnotes).

The Congress then enacted the 1946 legislation above set forth, appropriating 200 million dollars for the support of the Philippine Army but adding as a rider the 1946 legislation which plaintiffs now challenge.

When the appropriation, bearing this rider, came to President Truman, he approved it, stating that, although he believed the United States had a moral obligation to provide for the heroic Philippine veterans who sacrificed so much for the common cause during the war, he, nevertheless, recognized that there were certain "practical difficulties in making payments to Philippine Army veterans under the GI Bill of Rights" and that he was ...