Kondo v. Katzenbach, 19282-19284.

• Decision Date: 13 January 1966
• Docket Number: No. 19282-19284.,19282-19284.
• Citation: 123 US App. DC 12,356 F.2d 351
• Parties: Masae KONDO et al., Appellants, v. Nicholas deB. KATZENBACH, Attorney General of the United States, Appellee. Masaru OKAMOTO et al., Appellants, v. Nicholas deB. KATZENBACH, Attorney General of the United States, Appellee. Ayako HONDA et al., Appellants, v. Nicholas deB. KATZENBACH, Attorney General of the United States, Appellee.
• Court: U.S. Court of Appeals — District of Columbia Circuit

123 US App. DC 12, 356 F.2d 351 (1966)

Masae KONDO et al., Appellants, v. Nicholas deB. KATZENBACH, Attorney General of the United States, Appellee.

Masaru OKAMOTO et al., Appellants, v. Nicholas deB. KATZENBACH, Attorney General of the United States, Appellee.

Ayako HONDA et al., Appellants, v. Nicholas deB. KATZENBACH, Attorney General of the United States, Appellee.

Nos. 19282-19284.

United States Court of Appeals District of Columbia Circuit.

Argued October 12, 1965.

Decided January 13, 1966.

Petition for Rehearing Denied February 24, 1966.

Mr. John Silard, Washington, D. C., and Mr. Fred Okrand, Los Angeles, Cal., of the bar of the Supreme Court of California, pro hac vice, by special leave of court, with whom Messrs. Joseph L. Rauh, Jr., Washington, D. C., and A. L. Wirin, Los Angeles, Cal., were on the brief, for appellants.

Mr. David L. Rose, Attorney, Department of Justice, for appellee. Mr. John W. Douglas, Asst. Atty. Gen., and Messrs. Sherman L. Cohn, Anthony L. Mondello and Armand B. DuBois, Attorneys, Department of Justice, were on the brief, for appellee.

Before DANAHER, WRIGHT and TAMM, Circuit Judges.

Petition for Rehearing En Banc Denied February 24, 1966.

TAMM, Circuit Judge:

I

Presented to us in these cases, consolidated for hearing, is a precise question: Did the District Court correctly dismiss the appellants' complaints on the ground that the court lacked jurisdiction of the subject matter of the actions because the complaints were not filed within the 60-day limitation period prescribed by section 34(f) of the Trading with the Enemy Act (60 Stat. 925, 50 U.S.C. App. § 34(f))? (See Appendix A at 359-360.)

The three actions under review were filed in the District Court in May and July of 1964 and seek to set aside the dismissal by the Attorney General of appellants' debt claims based upon their deposits of yen in the American branches of the Yokohama Specie Bank, Ltd. Except for the claimant internees or parolees in No. 19,283, appellants are several thousand Americans of Japanese ancestry who, residing in the United States, had, prior to December 7, 1941, made deposits in the American branches of the Yokohama Specie Bank, Ltd. The property in the United States of this Japanese bank was vested as Japanese Enemy Property under the Trading with the Enemy Act, 50 U.S.C. App. § 1 et seq. After liquidation by state superintendents of banks, there remained approximately $17 million, which was turned over to the Office of Alien Property.

Congress, on August 8, 1946, enacted section 34 of the Trading with the Enemy Act, which authorized the Alien Property Custodian¹ to pay from the proceeds of vested property the debts of former owners of the vested property that were due and owing on the vesting date. Congress excluded from the benefits of this statute, among others, individuals and their successors who had been interned or paroled as potentially dangerous alien enemies under the Alien Enemy Act, 50 U.S.C. § 21.

Acting under section 34(b) of the Trading with the Enemy Act, the Alien Property Custodian fixed November 18, 1949, as the final date for filing debt claims with the Custodian against the funds of the Yokohama Specie Bank, Ltd. Approximately ten thousand debt claims were timely filed, of which some seven thousand, five hundred were based on yen deposits. Appellants in the present cases all filed claims in the amount of their deposits during this period. The aggregate of the claims exceeded the seized assets of the bank, necessitating a processing of the claims under section 34 (f) of the Act relating to insolvent debtors' estates. Claims of persons who had been interned or paroled under the Alien Enemy Act (50 U.S.C. § 21) were dismissed because of the express provision of section 34(a) of the Trading with the Enemy Act (see Appendix A at 359), which excluded such persons from the status of eligible debt claimants. This action constituted the final disposition under the Act of the claims of the appellants in case number 19,283.

Extensive hearings before an Examiner were conducted, and ultimately, in 1957, the Alien Property Custodian ruled that the claims were allowable at the post-war rate of exchange of 361.55 yen to the dollar under the "Judgment Day" rule of Die Deutsche Bank v. Humphrey, 272 U.S. 517, 47 S.Ct. 166, 71 L.Ed. 383 (1926), since the deposits were payable in yen in Japan. Thereafter, identical registered letters were sent to all eligible claimants,² numbering some seven thousand, five hundred, stating that their claim could be allowed at the 361.55 rate and requesting that the claimants' original yen certificates be submitted to the Office of the Alien Property Custodian. This letter was received by all appellants represented in cases number 19,282 and 19,284. The claims of appellants in case number 19,283 had been rejected initially, as heretofore indicated, and they were not recipients of the letter. A copy of the registered letter appears in Appendix B of this opinion.

Some further summation of the contents of the letter received by the claimants is essential to a consideration of the contentions of appellants in the Honda (No. 19,284) and Kondo (No. 19,282) cases. The letter, in addition to the provisions set forth above, informed these appellants that they might, if they wished, file a statement of their objections to the application of the 361.55, or post-war, rate of exchange. The letter informed claimants that if their original certificates were not submitted within the designated period, or if an explanation of why the certificates could not be submitted was not timely submitted, the claim would be dismissed as having been abandoned. The letter also set forth that a schedule of claimants would be drawn up from the names of persons submitting their original deposit certificates or explanations. Included in the letter was the statement that "within sixty days after the issue of the schedule any aggrieved claimant may file in the District Court of the United States for the District of Columbia a complaint for review of such schedule, naming the Attorney General as defendant. If no complaint for review is filed, payments will be made in accordance with the schedule."

Thereafter, one thousand, eight hundred seventeen deposit claims against the Yokohama Specie Bank, for which either original certificates of deposit or satisfactory evidence of loss had been submitted, were allowed at the rate of 361.55 yen to the dollar. Carrying out the provision of section 34(f) of the Act (see Appendix A at 359-360, the Alien Property Custodian prepared and served by registered mail on all claimants (id est, allowed and dismissed claims and including claimants in cases 19,282, 19,283 and 19,284) a Final Schedule of all debt claims allowed and the proposed payment to each claimant. Claimants whose claims had been dismissed, including appellants in the Okamoto case (No. 19,283) were not listed on the Final Schedule. Included with the notice transmitting the Final Schedule to each claimant was the statement:

"Pursuant to Section 34(f) of the Trading with the Enemy Act, as amended, any claimant considering himself aggrieved by this Final Schedule may, within sixty (60) days from the date of the mailing of the Schedule, file in the United States District Court for the District of Columbia a complaint for review of this Schedule, naming the Attorney General as defendant. A copy of such complaint must be served on the Attorney General and on each claimant named in the Schedule. If no such complaint for review is filed within the sixty-day period, payments to claimants will be made by this Office as specified in the Final Schedule."

A timely complaint for review of the award was brought in the United States District Court for the District of Columbia in 1961 asserting that the claims should have been allowed by the Custodian at the pre-war dollar rate of exchange for yen. This action (Abe v. Kennedy, C.A. 2529-61) was pursued in behalf of all Yokohama Specie Bank yen deposit claimants whose claims had been allowed on the Final Schedule. Proceedings in the Abe case were postponed, however, pending the outcome of a companion case, Aratani v. Kennedy, C.A. 3164-58, which had been filed in 1958 and which related to the yen deposit claims which had been asserted against vested funds of the Sumitomo Bank, Ltd. The chronology and disposition of this case are set forth in the court's opinion published in 115 U.S.App.D.C. at page 97 and in 317 F.2d at page 161. The opinion affirming summary judgment in favor of the Government certainly invited certiorari, and on October 21, 1963, the Supreme Court granted certiorari, 375 U.S. 877, 84 S.Ct. 147, 11 L.Ed.2d 110. Before disposition by the Supreme Court, however, the Attorney General settled the Sumitomo Bank, Ltd. case on an exchange rate much more favorable to the claimants and simultaneously, or virtually so, settled the yen deposit claims on the Final Schedule of the Yokohama Bank case at a rate approximating a net return to the claimants of 49 per cent of the amount claimed. The settlements were approved in the United States District Court for the District of Columbia on May 18, 1964,³ 228 F.Supp. 706. After payment of the settlement sums, about $10 million remains in the Yokohama Specie Bank, Ltd. account in the Office of Alien Property.

Against this background, the identity of the appellants in our present cases comes into sharper focus. In the Kondo (No. 19,282) and Honda (No. 19,284) cases, we have before us several thousand depositors in the Yokohama Specie Bank who, although recipients of the notices heretofore described as issuing from the Alien Property Custodian, declined or failed to file their original deposit certificates with the Custodian. Whatever reasons may have prompted or caused this action, these depositors were not listed on the Final Schedule for payment, were not represented in the court action...