Markham v. Cabell

Decision Date10 December 1945
Docket NumberNo. 76,76
Citation90 L.Ed. 165,326 U.S. 404,66 S.Ct. 193
PartiesMARKHAM, Alien Property Custodian, et al. v. CABELL
CourtU.S. Supreme Court

The Trading with the Enemy Act automatically went into effect again at outbreak of Second World War. Trading with the Enemy Act § 2, 50 U.S.C.A.Appendix § 2; § 5(b), as amended by First War Powers Act 1941, § 301, 50 U.S.C.A.Appendix § 616 and § 302, 50 U.S.C.A.Appendix § 617; § 9(a, e) amended in 1920 and 1928, 50 U.S.C.A.Appendix § 9(a, e).

Subdivision (e) of section 9 of Trading with the Enemy Act, providing that no debt shall be paid by Alien Property Custodian unless it was owned by claimant before October 6, 1917, nor unless notice thereof was filed before enactment of settlement of War Claims Act of 1928, was limited to seizures made during First World War and does not apply to seizures made in Second World War. Trading with the Enemy Act § 9(a, e), amended in 1920 and 1928, 50 U.S.C.A.Appendix § 9(a, e).

Mr. Paul A. Freund, of Washington, D.C., for petitioners.

Mr. Hartwell Cabell, pro se.

Mr. Justice DOUGLAS delivered the opinion of the Court.

Respondent, an American citizen, brought this suit against the Alien Property Custodian and the Treasurer of the United States to recover from the assets of the Assicurazioni Generali di Trieste e Venezia, an Italian insurance company, the unpaid portion of a claim for legal services rendered that company. The assets of the company had vested in the Alien Property Custodian in 19421 and the vested assets had been delivered to him. The suit was sought to be maintained under § 9(a) of the Trading with the Enemy Act (40 Stat. 411, as amended 41 Stat. 977, 50 U.S.C.A.ppendix § 9(a), 50 U.S.C.A.Appendix § 9(a) which allows 'Any person not an enemy or ally of enemy * * * to whom any debt may be owing from an enemy or ally of enemy whose property or any part thereof shall have conveyed, transferred, assigned, delivered, or paid to the Alien Property Custodian' to sue the Custodian or the Treasurer of the United States in the federal courts. Petitioners moved to dismiss on the ground that the claim did not qualify under § 9(e) of the Act. Sec. 9(e) which was added to the Act in 1920 (41 Stat. 980) and amended in 1928 (45 Stat. 271) provides that no debt shall be allowed under § 9 'unless it was owing to and owned by the claimant prior to October 6, 1917' nor 'unless notice of the claim has been filed, or application therefor has been made, prior to the date of the enactment of the Settlement of War Claims Act of 1928.' In view of those provisions of § 9(e) the District Court dismissed the complaint. The Circuit Court of Appeals reversed. 148 F.2d 737. The case is here on a petition for a writ of certiorari which we granted because of the public importance of the question presented.

If § 9(e) is applicable here, the suit may not be maintained since the debt was not in existence on October 6 1917, nor had notice of the claim been filed or application therefor been made prior to the date of the enactment of the Settlement of War Claims Act of 1928, 45 Stat. 254. We would have quite a different case if § 9(a) and (e) had been enacted after the outbreak of the recent war. For we may assume that Congress could set up such barriers as it chose to the enforcement of the claims of an alien's creditors against the seized property. But the doubt as to the applicability of § 9(e) to the present situation arises because that provision was part of the legislation enacted after the outbreak of World War I to deal with the claims against property seized during that period. That legislation was not reenacted when the recent war broke out. It automatically went into effect again at that time.2 Hence the argument that these provisions of § 9(e) are limited to claims against property seized during World War I. Our conclusion is that they are so limited.

In the first place, § 9(e) disallows recovery 'to any person who is a citizen or subject of any nation which was associated with the United States in the prosecution of the war, unless such nation in like case extends reciprocal rights to citizens of the United States.' When it is recalled that § 9(e) was first added to the act in 1920, it seems tolerably clear that the words 'was associated with the United States in the prosecution of the war' refer to World War I. The use not only of the past tense but also of the concept of 'associate' is significant. As Judge Learned Hand speaking for the Court below said, the word 'associate' was used during World War I 'in sedulous avoidance of any implication' (148 F.2d 739) that we had 'allies.' In the second place, the time limitations contained in § 9(e) point the same way. As the United States says, some sections of the Act were explicitly restricted to situations growing out of World War I, as, for example, § 3(d), 50 U.S.C.A.Appendix § 3(d). But it seems to us that the provisions of § 9(e) with which we are now concerned carry almost as plain a hallmark. For the restriction of suits to debts which were owing to and owned by the claimant prior to October 6, 1917 and as respects which a notice of claim had been filed prior to the date of the enactment of the Settlement of War Claims Act of 1928 strongly suggests that Congress was dealing exclusively with World War I claims, not with claims which might arise in some future war. As of 1920 and 1928 the time limitations written into § 9(e) had no other relevancy. The Committee Reports,3 accompanying the legislation by which § 9(e) was added to the law, while not explicit on the precise point, show that Congress was concerned solely with the handling of claims which then existed. There is not the slightest suggestion that Congress was drafting a statute of limitations likewise applicable to claims which might be asserted in case the United States at some future time again went to war. These considerations indicate to us that it would be a distortion to read § 9(e), as if Congress in December 1941 decided that the statute of limitations applicable to World War I claims should likewise be applicable to World War II claims. If we gave § 9(e) that broad interpretation, we would, in the third place, deprive § 9(a) of all meaning so far as World War II claims were concerned. That we hesitate to do, for the Act was not only designed to operate in the first World War; it was also to become effective at the time of any future war unless repealed or superseded. Yet the remedy afforded by § 9(a) would be quite illusory and ineffective so far as it applies to World War II claims if § 9(e) were read literally without regard to its history. It was for this reason particularly that the court below refused 'to make a fortress out of the dictionary' and to read § 9(e) strictly and literally. The policy as well as the letter of the law is a guide to decision. Resort to the policy of a law may be had to ameliorate its seeming harshness or to qualify its apparent absolutes as Holy Trinity Church v. United States, 143 U.S. 457, 12 S.Ct. 511, 36 L.Ed. 226, illustrates. The process of interpretation also misses its high function if a strict reading of a law results in the emasculation or deletion of a provision which a less literal reading would preserve.

The United States, however, contends that such a construction of § 9(e) would gravely interfere with the efficient administration of alien property controls in accordance with policies adopted by Congress in relation to World War II. It points out that by virtue of amendments to § 5(b) of the Trading with the Enemy Act which were made on December 18, 1941 by the First War Powers Act (55 Stat. 839, 50 U.S.C.App., Supp. IV, § 616, 50 U.S.C.A.Appendix § 616), the Executive is now armed with far more comprehensive power over alien property and the property of other foreign interests than in World War I. Now there is the 'freezing' or 'blocking' of foreign funds aimed at the immobilization of foreign assets in the United States by prohibiting without a license, any transactions involving them—a program initiated after the invasion by Germany of Denmark and Norway and administered by the Treasury.4 If the Treasury refuses a license permitting payment of creditors out of blocked funds, neither the creditor nor the owner has any remedy as a matter of right under the Act. It is said that to allow creditors of certain aliens whose property has been vested in the Alien Property Custodian to maintain suits but to disallow suits by creditors of aliens whose funds are merely frozen is to destroy consistency in the position of creditors under the Trading with the Enemy Act. Moreover, § 9(a) permits suits on debt claims only if the debt is one 'owing from an enemy or ally of enemy' whose property has been taken. By the 1941 amendment to § 5(b) the vesting power has not been so limited but extends to 'any property or interest of any foreign country or national.' The argument is that to construe § 9(e) so as to permit creditors of an enemy to sue is to discriminate without warrant against creditors of non-enemy foreign nationals who are given no such remedy. Moreover, it is said that if § 9(e) is not a barrier to suits, a race of diligence would be started with no guarantee of any equitably ordered priority in the payment of the claims out of the seized property. It is also argued that if these suits are allowed the operations of the Custodian would be burdened with litigation.

We have concluded that however meritorious these considerations are, they raise questions of policy for Congress. We are concerned only with the right to sue on a debt under § 9. Congress granted that right to some claimants and withheld it from others. Whether its choice was wise or not is not for us to say. The right to sue, explicitly granted by § 9(a), should not be read out of the law unless it is clear that Congress by what it later did withdrew its earlier permission. We can find no indication in...

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