Reconstruction Finance Corporation v. Menihan Corporation
| Decision Date | 03 February 1941 |
| Docket Number | No. 200,200 |
| Citation | 312 U.S. 81,61 S.Ct. 485,85 L.Ed. 595 |
| Parties | RECONSTRUCTION FINANCE CORPORATION v. J. G. MENIHAN CORPORATION et al |
| Court | U.S. Supreme Court |
Messrs. Robert H. Jackson, Atty. Gen., and Clifford J. Durr, for petitioner.
Mr. Arthur E. Sutherland, Jr., of Rochester, N.Y., for respondents.
Petitioner, Reconstruction Finance Corporation, took mortgages and assignments of real and personal property of a corporation, including its trade-marks and trade names, as security for a loan. On a sale by the trustee in bankruptcy of the debtor, petitioner purchased the property. A new corporation undertook to use the trade-marks and petitioner sought an injunction. Decree went against petitioner. Defendants' application for costs and additional allowance was denied. D.C., 29 F.Supp. 853. This order was reversed by the Circuit Court of Appeals, 2 Cir., 111 F.2d 940, and we granted certiorari, 311 U.S. 625, 61 S.Ct. 26, 85 L.Ed. —-, because of a conflict of decisions. See Federal Deposit Insurance Corporation v. Casaday, 10 Cir., 106 F.2d 784.
Rule 54(d) of the Rules of Civil Procedure, 28 U.S.C.A. following section 723c, provides that 'costs against the United States, its officers, and agencies shall be imposed only to the extent permitted by law'. This provision was merely declaratory and effected no change of principle.
The Reconstruction Finance Corporation is a corporate agency of the government, which is its sole stockholder. 47 Stat. 5, 15 U.S.C. 601 et seq., 15 U.S.C.A. § 601 et seq. It is managed by a board of directors appointed by the President by and with the advice and consent of the Senate. The Corporation has wide powers and conducts financial operations on a vast scale. While it acts as a governmental agency in performing its functions (see Pittman v. Home Owners' Loan Corporation, 308 U.S. 21, 32, 33, 60 S.Ct. 15, 17, 18, 84 L.Ed. 11, 124 A.L.R. 1263), still its transactions are akin to those of private enterprises and the mere fact that it is an agency of the government does not extend to it the immunity of the sovereign. Sloan Shipyards v. United States Fleet Corporation, 258 U.S. 549, 566, 567, 42 S.Ct. 386, 388, 66 L.Ed. 762. Congress has expressly provided that the Reconstruction Finance Corporation shall have power 'to sue and be sued, to complain and to defend, in any court of competent jurisdiction, State or Federal'. There is nothing in the statutes governing its transactions which suggests any intention of Congress that in suing and being sued the Corporation should not be subject to the ordinary incident of unsuccessful litigation in being liable for the costs which might properly be awarded against a private party in a similar case.
We have had recent occasion to consider the status, in relation to suits, of a regional corporation chartered by the Reconstruction Finance Corporation and we have set forth the general principles which we think should govern in our approach to the particular question now presented. Keifer & Keifer v. Reconstruction Finance Corporation, 306 U.S 381, 59 S.Ct. 516, 517, 83 L.Ed. 784. In the Keifer case we did not find it necessary to trace to its origin the doctrine of the exceptional freedom of the United States from legal responsibility, but we observed that 'because the doctrine gives the government a privileged position, it has been appropriately confined'. Hence, we declared that 'the government does not become the conduit of its immunity in suits against its agents or instrumentalities merely because they do its work'. Id., 306 U.S. page 388, 59 S.Ct. page 517, 83 L.Ed. 784. Recognizing that Congress may endow a governmental corporation with the government's immunity, we found the question to be 'Has it done so?' That is, immunity in the case of a governmental agency is not presumed. We sought evidence that Congress had intended that its creature, considering the purpose and scope of its powers, should have the immunity which the sovereign itself enjoyed, and we noted the practice of Congress as an indication 'of the present climate of opinion' which had brought governmental immunity from suit into disfavor. Accordingly, being unable to find that Congress had intended immunity from suit we denied it.
It was with a similar approach that we decided in Federal Housing...
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