Crowley v. Allen, 22563-G.

Decision Date17 November 1943
Docket NumberNo. 22563-G.,22563-G.
Citation52 F. Supp. 850
CourtU.S. District Court — Northern District of California
PartiesCROWLEY, Alien Property Custodian, v. ALLEN et al.

Frank J. Hennessy, U. S. Atty., and Thos. C. Lynch, Asst. U. S. Atty., both of San Francisco, Cal., A. Matt Werner, Gen. Counsel, Office of Alien Property Custodian, Geo. A. McNulty, Chief Alien Property Unit, War Division, Department of Justice, and Wallace H. Walker, Chief Trial Atty., Alien Property Unit, War Division, Department of Justice, all of Washington, D. C., and Harry LeRoy Jones, Sp. Asst. to Atty. Gen., for plaintiff.

S. C. Masterson, of Richmond, Cal., for defendants Alvina Allen and others.

Jackson Maddux, of San Francisco, Cal., for defendant San Francisco Bank.

Robert W. Kenny, Atty. Gen., and T. A. Westphal, Jr., Deputy Atty. Gen., amici curiae for State of California.

Matt Wahrhaftig, Atty. at Law, of Oakland, Cal., and H. W. Falk, Jr., Atty. at Law, of Ukiah, Cal., amicus curiae.

GOODMAN, District Judge.

Alvina Wagner, a resident of California, died June 6, 1942. By her last will and testament, dated December 23, 1941 and admitted to probate in the Superior Court of the State of California June 26, 1942, she bequeathed all her property (several parcels of real property in San Francisco California and some personal property of minor value) to two brothers, one sister and one niece, all nationals and residents of Germany. Six nieces and nephews, residents of California, petitioned the Superior Court as heirs of decedent for distribution of the estate to them, claiming that the German legatees were ineligible as beneficiaries under Section 259, 259.1 and 259.2 of the California Probate Code (effective July 1, 1941) which in substance provides that the right of aliens abroad to take real or personal property in the United States by will or descent, is conditioned upon the existence of a reciprocal right of Americans abroad and that such reciprocal right being absent, American heirs take. No determination of heirship has been made by the Superior Court.

On January 23, 1943, the plaintiff Alien Property Custodian, under the authority of Section 5 (b) of the Trading with the Enemy Act, as amended by Title III of the First War Powers Act, 1941, 50 U.S.C.A. Appendix, § 616, and Executive Order 9095 of July 6, 1942, 50 U.S.C.A.Appendix, § 6 note, by vesting order 762, vested in himself for the use of the United States all the right, title and interest of the German legatees in the estate of Alvina Wagner.

On April 6, 1943, plaintiff as Alien Property Custodian filed this action against The San Francisco Bank as executor of the Wagner will and the six claimant heirs, for a judgment vesting ownership of the property of the estate, subject to the payment of administration expenses, inheritance and estate taxes and debts of decedent, in plaintiff and determining that defendant heirs have no right or claim thereto and ordering defendant executor to deliver over the net estate to plaintiff.

By separate answers, the defendant executor and the individual defendants claim lack of jurisdiction of this court and allege that the individual defendants are entitled to inherit the property of the estate under California law. Defendants move to strike the complaint for lack of jurisdiction. Plaintiff moves for summary judgment in favor of plaintiff.1 Both motions have been argued and submitted. All parties agree that no question of fact is involved and that the cause may be determined on the motions submitted.

The issues presented for determination are:

1. Has this court jurisdiction of the subject matter?

2. Is the cited California probate statute constitutional? If it is not, the property in probate should vest in plaintiff.

Plaintiff invokes the jurisdiction of this court under 36 Stat. 1091, 28 U.S.C.A. § 41(1) being a suit "of a civil nature * * * in equity, brought by the United States, or by any officer thereof authorized by law to sue," and the Trading with the Enemy Act (40 Stat. 411) 50 U.S.C.A. Appendix, § 17, (40 Stat. 425) whereby the District Courts "are given jurisdiction to make and enter * * * all such orders and decrees, and to issue such process as may be necessary and proper in the premises to enforce the provisions of this Act."

Defendants and amici curiae claim lack of jurisdiction asserting the action is in rem to determine title to property and would oust the state court of previously acquired jurisdiction of the res. Citing United States v. Bank of New York Co., 296 U.S. 463, 56 S.Ct. 343, 80 L.Ed. 331.

Section 5(b), the pertinent provision of the Trading with the Enemy Act, provides as follows:

"During the time of war or during any other period of national emergency declared by the President, the President may, through any agency that he may designate, or otherwise, and under such rules and regulations as he may prescribe, by means of instructions, licenses or otherwise—

* * * * * *

"B. Investigate, regulate, direct and compel, nullify, void, prevent or prohibit, any acquisition holding, withholding, use, transfer, withdrawal, transportation, importation or exportation of, or dealing in, or exercising any right, power, or privilege with respect to, or transactions involving, any property in which any foreign country or a national thereof has any interest, by any person, or with respect to any property, subject to the jurisdiction of the United States; and any property or interest of any foreign country or national thereof shall vest, when, as, and upon the terms, directed by the President, in such agency or person as may be designated from time to time by the President, and upon such terms and conditions as the President may prescribe such interest or property shall be held, used, administered, liquidated, sold, or otherwise dealt with in the interest of and for the benefit of the United States, * * *."

The Trading with the Enemy Act was originally enacted October 6, 1917, c. 106, 40 Stat. 411, was twice amended in 1918 (40 Stat. 459; 40 Stat. 1020); again amended in 1919 (41 Stat. 35); again amended in 1920 (41 Stat. 977); again amended in May 1940 (54 Stat. 179) and once more on December 18, 1941 by the First War Powers Act (55 Stat. 839). It is strictly a war measure, finding its authority in Art, 1, § 8, cl. 11 of the Constitution. Brown v. United States, 8 Cranch 110, 3 L.Ed. 504; Miller v. United States, 11 Wall. 268, 20 L.Ed. 135. By its terms, the President is granted wide authority to sequester, administer and dispose of alien enemy property in the United States and to proceed summarily and promptly to that end.

The judicial power, when properly invoked, under the statute, should function in like manner.

Art. 1, § 8, cl. 11 of the Constitution, empowers the Congress: "to declare War, grant Letters of Marque and Reprisal and makes Rules concerning Captures on Land and Water." The powers granted to the President in the Trading with the Enemy Act include the power to make "captures" on land. The sequestering of alien enemy property under vesting orders by the Alien Property Custodian, who is the President's agent, is in the nature of a "capture" under Art. 1, § 8, cl. 11 of the Constitution. Stoehr v. Wallace, 255 U.S. 239, 242, 41 S.Ct. 293, 65 L.Ed. 604.

The important question here presented is whether federal jurisdiction in aid of the enforcement of this war statute, cannot be invoked because the property, sought to be vested, is in course of probate in the State court.

The jurisdiction of the federal courts is derived from the Constitution and congressional enactments. It is not subject to restriction or ouster by state legislation e. g. state probate procedural statutes. Miami County Natl. Bank v. Bancroft, 10 Cir., 121 F.2d 921; Payne v. Hook, 7 Wall. 425, 19 L.Ed. 260.

It is clear to me that the Congress intended that alien property in the United States should be "frozen" wherever found and held and administered only in the interest of and for the benefit of the United States. A complete federal dominance in every respect over alien rights and property, to the exclusion of state or local agencies, was obviously purposed. Economic warfare, as an aid to the defeat of the enemy, can only be effective if it is centralized and possesses over-all control.

It follows that the federal courts, granted by the Congress the power to issue decree and process in aid of the statute, have jurisdiction to enforce by decree, vesting orders of the Alien Property Custodian.

If it appeared that the property bequeathed was unquestionably vested in United States citizens resident in California, then obviously there would be no basis for claiming federal jurisdiction. Here, however, the validity of the state statute under which the California heirs make claim, is in issue and this, itself, furnishes the grounds for federal jurisdiction.

The California statute (Probate Code 259, 259.1 and 259.2) reads:

§ 259. "Aliens residing abroad; Dependence of rights upon reciprocity. The rights of aliens not residing within the United States or its territories to take either real or personal property or the proceeds thereof in this State by succession or testamentary disposition, upon the same terms and conditions as residents and citizens of the United States is dependent in each case upon the existence of a reciprocal right upon the part of citizens of the United States to take real and personal property and the proceeds thereof upon the same terms and conditions as residents and citizens of the respective countries of which such aliens are inhabitants and citizens and upon the rights of citizens of the United States to receive by payment to them within the United States or its territories money originating from the estates of persons dying within such foreign countries. (Added by Stats.1941, Ch. 895 § 1; effective July 1, 1941.)

§ 259.1. Same: Burden of establishing that rights are reciprocal. The burden shall be upon such nonresident...

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7 cases
  • Zschernig v. Miller, 21
    • United States
    • U.S. Supreme Court
    • January 15, 1968
    ...of the statute was to prevent American assets from reaching hostile nations preparing for was on this country. Crowley v. Allen, 52 F.Supp. 850, 853 (D.C.N.D.Calif.). But when the case reached this Court, petitioner contended that the statute was invalid, not because of the legislature's mo......
  • Markham v. Allen
    • United States
    • U.S. Supreme Court
    • January 7, 1946
    ...strike the complaint, and on petitioner's motion for judgment on the pleadings, the district court gave judgment for petitioner, Crowley v. Allen, 52 F.Supp. 850. The court held that it had jurisdiction to enforce the vesting order of petitioner; that its jurisdiction is derived from the Co......
  • Tait v. Anderson Banking Company
    • United States
    • U.S. District Court — Southern District of Indiana
    • March 5, 1959 pages 491, 496, 66 S.Ct. at pages 297, 299. In that case, the custodian brought the suit in a United States district court Crowley v. Allen, 52 F.Supp. 850 seeking a judgment determining that the resident claimants had no interest in the estate, and that the custodian, by virtue of his v......
  • Clark v. Allen
    • United States
    • U.S. Supreme Court
    • June 9, 1947
    ...after payment of administration and other expenses. The District Court granted judgment for the Custodian on the pleadings. Crowley v. Allen, 52 F.Supp. 850. The Circuit Court of Appeals reversed holding that the District Court was without jurisdiction of the subject matter. Allen v. Markha......
  • Request a trial to view additional results

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