Campbell v. Chase Nat. Bank

• Decision Date: 18 June 1934
• Docket Number: No. 317.,317.
• Citation: 94 ALR 708,71 F.2d 669
• Parties: CAMPBELL v. CHASE NAT. BANK OF CITY OF NEW YORK.
• Court: U.S. Court of Appeals — Second Circuit

94 ALR 708, 71 F.2d 669 (1934)

CAMPBELL v. CHASE NAT. BANK OF CITY OF NEW YORK.

No. 317.

Circuit Court of Appeals, Second Circuit.

June 18, 1934.

Frederick B. Campbell, of New York City (Paul C. Whipp and Lounsbury D. Bates, both of New York City, of counsel), for appellant.

Mudge, Stern, Williams & Tucker, of New York City (James F. Sandefur, of New York City, of counsel), for appellee.

Before MANTON, L. HAND, and SWAN, Circuit Judges.

MANTON, Circuit Judge.

The appellant in October, 1932, and January, 1933, owned marked bars of gold bullion which he delivered to the appellee for safe-keeping. On September 13, 1933, appellee notified appellant that it was required to surrender such gold bullion because of and pursuant to an executive order of the President of the United States. On September 16, 1933, appellant, in writing, demanded forthwith delivery of the gold to him, which demand was refused. Whereupon this suit was started asking an injunction pendente lite. After answer, a motion for judgment on the pleadings was made by the appellant. Judgment went against appellant, and the complaint was dismissed for want of jurisdiction.

Congress passed an Act March 9, 1933 (48 Stat. 1) under section 2 of which (50 USCA appendix § 5) the President promulgated executive orders dated, respectively, April 5, 1933 (No. 6102 12 USCA § 248 note) and August 28, 1933 (No. 6260 12 USCA § 95 note). The Act of March 9, 1933, amended section 5 of the Act of Congress of October 6, 1917 (Trading with the Enemy Act), and declared an emergency to exist, making it imperatively necessary and authorizing the President, during such national emergency to "investigate, regulate, or prohibit, under such rules and regulations as he may prescribe * * * hoarding, melting, or earmarking of gold or silver coin or bullion * * * by any person within the United States; * * * and the President may require any person engaged in any transaction referred to in this subdivision to furnish under oath, complete information relative thereto. * * *" For a willful violation of the statute, fine or imprisonment or both might be imposed.

The President's Executive Order of April

5, 1933, declared the national emergency still in existence and prohibited the hoarding of gold coin or gold bullion within the continental United States, and prescribed regulations for carrying out the purposes of that order. By the Executive Order of August 28, 1933, it was declared "that a period of national emergency exists," and provisions were prescribed for the regulation of the hoarding of gold bullion by any person within the United States. Section 3 thereof required a return to the Secretary of the Treasury to be made under oath by every person having gold bullion, the same to be filed with the collector of internal revenue in the district where the individual resided within fifteen days. The time for making the return was later extended to September 18, 1933. Section 10 provided for a fine and punishment for willful violation of this provision. The prior order of April 5, 1933, was revoked. The appellant never complied with this order, for he filed no return but on the contrary demanded delivery and return to him of the bars of gold.

The appellee on January 2, 1934, surrendered the gold to the Treasurer of the United States pursuant to an order from the Secretary of the Treasury. Appellant maintains that the court continues to have jurisdiction. Wingert v. First Nat'l Bank, 223 U. S. 670, 32 S. Ct. 391, 56 L. Ed. 605. The District Court grounded its decision on the want of jurisdiction of the subject-matter and held the cause was not one arising under the Constitution and laws of the United States.

The complaint alleges the appellant's ownership of the gold bars and appellee's promise of safe-keeping. It further alleges:

"That there does not exist any market for gold bullion in the City of New York, nor in the United States; nor can gold bullion be obtained from the Federal Reserve Bank, the United States Assay Office, nor from the Government Mint Office, or elsewhere, except for limited purposes and pursuant to governmental license. That unless the relief herein asked for be granted, complainant will suffer irreparable injury and damage which cannot be recompensed at law, and for which complainant has no adequate remedy at law."

The prayer for relief asks for an injunction restraining the appellee from carrying out its threat to deliver the gold bullion to any Federal Reserve Bank.

The theory of the suit is asserted to be the inadequacy of a remedy at law because of threatened misappropriation and the practical disappearance of the complainant's opportunity to possess gold bullion due to the alleged unconstitutional governmental orders. The argument proceeds that the appellant is entitled to have his specific property returned to him. Money damages are said not to afford an adequate remedy because by the governmental regulations gold cannot be purchased or replaced because it is not obtainable. Moreover, it is said that the executive order cannot apply to appellant's gold, for he purchased it prior to March 9, 1933. It is claimed that, if gold is purchased subsequent to March 9, 1933, with money received as compensation, such gold would come within the ban of the...