Clapp v. United States

• Decision Date: 05 January 1954
• Docket Number: No. 314-52.,314-52.
• Citation: 127 Ct. Cl. 505,117 F. Supp. 576
• Parties: CLAPP v. UNITED STATES.
• Court: U.S. Claims Court

117 F. Supp. 576

127 Ct. Cl. 505

CLAPP v. UNITED STATES.

No. 314-52.

United States Court of Claims.

January 5, 1954.

C. F. Rothenburg, Washington, D. C., for plaintiff. Charles D. Hamel, James P. Jones, and Hamel, Park & Saunders, Washington, D. C., on the brief.

George S. Leonard, New York City, with whom was Warren E. Burger, Asst. Atty. Gen., for defendant. Donald D. Webster, Washington, D. C., on the brief.

Before JONES, Chief Judge, and LITTLETON, WHITAKER and MADDEN, Judges.

MADDEN, Judge.

The plaintiff was, in May 1951, the owner of a vessel, the steamship Empire Consequence, which he was anxious to sell, he having in 1949 taken the vessel in partial payment of a debt owed him by the Alaska Transportation Company, a corporation in which the plaintiff had been interested.

On May 2, 1951, the plaintiff entered into a contract to sell the vessel to a Finnish corporation for $325,000, subject to the approval of the sale by the United States Maritime Administration, as required by section 9 of the Shipping Act of 1916, as amended, 46 U.S.C.A. § 808. On May 15 the plaintiff presented to the Maritime Administration his application for approval of the sale. The Maritime Administration thereupon requested the comments of the State Department, the Department of Defense, and the Office of International Trade, with regard to the proposed sale. In due course the Department of Defense replied that the proposed sale would not be harmful to the national defense, the State Department replied that it would not be inconsistent with the foreign policy of the United States and the Office of International Trade replied that the sale of the vessel for use in the Baltic trade would not adversely affect the foreign commerce of the United States.

The Maritime Administration concurred in the views of the other departments, and also determined that the vessel was not necessary to the United States merchant marine. It thereupon approved the plaintiff's application, but conditioned the approval upon the payment by the plaintiff to the Maritime Administration of $7,500 as "consideration for release of obligation to operate vessel under United States laws."

The plaintiff regarded himself as having become unconditionally obligated to the Finnish purchaser, by reason of the Maritime Administration's approval of his application. If he had refused to pay the $7,500, he would have, he thought, been liable to the Finnish purchaser for breach of his contract of sale. He therefore paid the $7,500, advising the Maritime Administration that he did not understand why he had to pay it, and that he would expect to get it back if the law did not justify the charge. He thereupon completed the sale to the Finnish purchaser.

On October 11, 1951, the plaintiff filed a claim with the Maritime Administration for the refund of the $7,500 with interest. The claim was denied. He filed an application for reconsideration. It was denied. He appealed to the Secretary of Commerce, in whose Department the Maritime Administration was. The appeal was denied.

In this suit the plaintiff asserts that the Maritime Administration was not authorized to demand or receive the $7,500; that he paid the money involuntarily and under duress, and that he is entitled to its refund.

The Government asserts that this court does not have jurisdiction to entertain the suit. In the discussion of the question of jurisdiction, we assume that there was no legal authority in the Maritime Administration to demand or receive the $7,500. The plaintiff says that his claim is "founded upon any Act of Congress", and that we therefore have jurisdiction under 28 U.S.C. § 1491(2). The Government says that, assuming the illegality of the exaction, the claim is one sounding in tort, as to which 28 U.S.C. § 1491(5), denies our jurisdiction.

The vessel here in question had been purchased by the plaintiff's predecessor in title from the United States Maritime Commission in 1947. Section 9 of the Shipping Act of September 7, 1916, 46 U.S.C.A. § 808, provides that a vessel so acquired cannot be sold to an alien without the approval of the Maritime Commission. Section 41 of the same statute, 46 U.S.C.A. § 839, provides:

"Whenever by section 808 * * of this title the approval of the commission (Administration) is required to render any act or transaction lawful, such approval may be accorded either absolutely or upon such conditions as the commission (Administration) prescribes."

This provision was the basis on which the Maritime Administration levied its charge upon the plaintiff, and is the basis on which the Government justifies the charge in this suit. The plaintiff asserts that this statutory provision does not authorize a money charge to be imposed as a condition upon the grant of permission to sell a ship to an alien purchaser. We are, in this discussion of the question of jurisdiction, assuming that the plaintiff is right in this regard. We have, then an assumed situation in which officials authorized by a statute to attach to their grants conditions other than money payments, misinterpret the statute to permit the imposition of a money charge which they collect and the Government keeps. Is the claim for the refund of the money unlawfully collected a claim "founded upon any Act of Congress"?

In Cohens v. Virginia, 6 Wheat. 264, 5 L.Ed. 257, Chief Justice Marshall, in construing the Judicial Article of the Constitution and the 25th Section of the Judiciary Act said:

"A case in law or equity consists of the right of the one party, as well as the other, and may truly be said to arise under the constitution or a law of the United States whenever its correct decision depends on the construction of either."

The instant case, then, if we have jurisdiction to entertain it, would be a case "arising under a law of the United States." Is it a case "founded upon" a law of the United States?

In Dooley v. United States, 182 U.S. 222, 21 S.Ct. 762, 764, 45 L.Ed. 1074, Mr. Justice Brown said, for the court:

"In the cases under consideration the argument is made that the money was tortiously exacted; that the alternative of payment to the collector was a seizure and sale of the merchandise for the nonpayment of duties; and that it mattered not that at common law an action for money had and received would have lain against the collector to recover them back. But whether the exactions of these duties were tortious or not, whether it was within the power of the importer to waive the tort and bring suit in the court of claims for money had and received, as upon an implied contract of the United States to refund the money in case it was illegally exacted, we think the case is one within the first class of cases specified in the Tucker act, of claims founded upon a law of Congress, namely, a revenue law, in respect to which class of cases the jurisdiction of the court of claims, under the Tucker act, has been repeatedly sustained."

In Christie-Street Commission Co. v. United States, 136 F. 326, Judge Sanborn, for the Circuit Court of Appeals for the Eighth Circuit, considered in detail the pertinent decisions down to the year 1905, and followed what he concluded to be their trend. He said, 136 F. at page 331:

"It is said that there is a wide distinction between a claim which arises under, and one which is founded upon, a Constitution or a law. But after patient deliberation this distinction proves too subtle and elusive for the density of our perception. A claim is both founded upon, and it arises under, a provision of a Constitution or of a law which conditions and determines its validity. * * *"

In 1911 in United States v. Emery, Bird, Thayer Realty Co., 237 U.S. 28, 35 S.Ct. 499, 500, 59 L.Ed. 825, Mr. Justice Holmes said, for the Court:

"* * *. The jurisdiction over suits against the United States under § 24 of the Judicial Code extends to `all claims not exceeding ten thousand dollars founded upon the Constitution of the United States or any law of Congress.' However gradually the result may have been approached in the earlier cases, it now has become accepted law that claims like the present are `founded upon' the revenue law. The argument that there is a distinction between claims `arising under' (Judicial Code, § 24, first) and those `founded upon' (id. § 24, twentieth) a law of the United States rests on the inadmissible premise that the great act of justice embodied in the jurisdiction of the court of claims is to be construed strictly and read with an adverse eye. * * *"

In Carriso, Inc. v. United States, 9 Cir., 106 F.2d 707, 712, the plaintiff sued to recover surveyors' fees which the Collector of Customs had collected from it under the supposed authority of a statute which had, in fact, been repealed. The Court of Appeals, in reversing the District Court's dismissal of the complaint, said:

"Appellee contends that this is a case sounding in tort, within the meaning of § 24(20) of the Judicial Code, 28 U.S.C.A. § 41(20), and that, therefore, the District Court had no jurisdiction. This contention, which the District Court upheld, must be rejected. It appears from the complaint that the surveyors' fees in question were exacted of appellant under and pursuant to § 4186 of the Revised Statutes and were, in fact, the fees therein prescribed. Appellant's claim is that the fees were exacted, not tortiously, but illegally, in that they were exacted after § 4186 had been repealed.

"Thus, in effect, appellant claims that the Collector misconstrued and misapplied § 4186, that is to say, construed it as remaining in effect after it had been

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