Republic of Iraq v. First National City Bank, No. 102

CourtUnited States Courts of Appeals. United States Court of Appeals (2nd Circuit)
Writing for the CourtFRIENDLY and KAUFMAN, Circuit , and HERLANDS
Citation353 F.2d 47
PartiesREPUBLIC OF IRAQ, Appellant, v. FIRST NATIONAL CITY BANK, as Administrator of the Goods, Chattels and Credits of His Majesty King Faisal II Ibn Ghazi Ibn Faisal I of Iraq, deceased, Appellee.
Decision Date08 November 1965
Docket NumberNo. 102,Docket 29817.

353 F.2d 47 (1965)

REPUBLIC OF IRAQ, Appellant,
v.
FIRST NATIONAL CITY BANK, as Administrator of the Goods, Chattels and Credits of His Majesty King Faisal II Ibn Ghazi Ibn Faisal I of Iraq, deceased, Appellee.

No. 102, Docket 29817.

United States Court of Appeals Second Circuit.

Argued October 1, 1965.

Decided November 8, 1965.

Certiorari Denied January 31, 1966.


353 F.2d 48
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353 F.2d 49
Leo C. Fennelly, New York City (Fennelly, Douglas, Eagan, Nager & Voorhees, New York City; Edward P. F. Eagan, New York City, of counsel), for appellant

Woodson D. Scott, New York City (Lord, Day & Lord, New York City), for appellee.

Before FRIENDLY and KAUFMAN, Circuit Judges, and HERLANDS, District Judge.*

Certiorari Denied January 31, 1966. See 86 S.Ct. 648.

FRIENDLY, Circuit Judge:

King Faisal II of Iraq was killed on July 14, 1958, in the midst of a revolution in that country which led to the establishment of a republic, recognized by the United States in August. On July 19, 1958, the new government issued Ordinance No. 23 which decreed that "all property of the dynasty * * * whether moveable or immoveable * * should be confiscated."1 At the time of his death King Faisal had a balance of $55,925 and 4,008 shares of Canada General Fund, Ltd., a Canadian investment trust, in deposit and custody accounts with Irving Trust Company in New York. In October 1958, the Surrogate's Court for New York County issued to the defendant letters of administration with respect to King Faisal's New York assets.

353 F.2d 50
During that month the Consul General of the Republic of Iraq notified Irving Trust that the Republic claimed all assets of King Faisal by virtue of Ordinance No. 23. Notwithstanding the notice, Irving Trust subsequently transferred to the administrator the balance in the account and certificates for the shares, which were later sold

In March 1962, the Republic brought this action against the administrator in the District Court for the Southern District of New York to recover the bank balance and the proceeds of the shares. From a judgment dismissing the complaint, 241 F.Supp. 567 (1965), the Republic appeals. We affirm.

The District Court properly held that it had jurisdiction of the action. Under 28 U.S.C. § 1332(a) the district courts are vested with original jurisdiction of all civil actions "where the matter in controversy exceeds the sum or value of $10,000, exclusive of interest and costs, and is between * * * (2) citizens of a State, and foreign states or citizens or subjects thereof." Although this general language does not grant jurisdiction to probate a will or administer an estate, it has been established by a long series of decisions "that federal courts of equity have jurisdiction to entertain suits `in favor of creditors, legatees and heirs' and other claimants against a decedent's estate `to establish their claims' so long as the federal court does not interfere with the probate proceedings or assume general jurisdiction of the probate or control of the property in the custody of the state court." Markham v. Allen, 326 U.S. 490, 494, 66 S.Ct. 296, 298, 90 L.Ed. 256 (1946), citing Waterman v. Canal-Louisiana Bank & Trust Co., 215 U.S. 33, 43, 30 S.Ct. 10, 54 L.Ed. 80 (1909), and other cases.

The principal questions raised in this appeal are the proper definition of the act of state doctrine and its application to foreign confiscation decrees purporting to affect property within the United States. Although difficulty is sometimes encountered in drawing the line between an "act of state" and more conventional foreign decrees or statutes claimed to be entitled to respect by the forum, the Ordinance involved in this case is nowhere near the boundary. A confiscation decree, which is precisely what Ordinance No. 23 purported to be, is the very archetype of an act of state. See ALI, Restatement of Foreign Relations Law of the United States § 41c (Proposed Official Draft, 1962) hereinafter cited as Restatement.

The Supreme Court has declared that a question concerning the effect of an act of state "must be treated exclusively as an aspect of federal law." Banco Nacional de Cuba v. Sabbatino, 376 U.S. 398, 423-427, 84 S.Ct. 923, 939, 11 L.Ed.2d 804 (1964). We deem that ruling to be applicable here even though, as we conclude below, this is not a case in which the courts of the forum are bound to respect the act of the foreign state. Like the traditional application of the act of state doctrine to preclude judgment with respect to another government's acts concerning property within its own territory at the time, see Underhill v. Hernandez, 168 U.S. 250, 18 S.Ct. 83, 42 L.Ed. 456 (1897); Oetjen v. Central Leather Co., 246 U.S. 297, 38 S.Ct. 309, 62 L.Ed. 726 (1918); Ricaud v. American Metal Co., 246 U.S. 304, 38 S. Ct. 312, 62 L.Ed. 733 (1918), the exercise of discretion whether or not to respect a foreign act of state affecting property in the United States is closely tied to our foreign affairs, with consequent need for nationwide uniformity. It is fundamental to our constitutional scheme that in dealing with other nations the country must speak with a united voice. See United States v. Belmont, 301 U.S. 324, 331, 57 S.Ct. 758, 81 L.Ed. 1134 (1937); United States v. Pink, 315 U.S. 203, 233-234, 62 S.Ct. 552, 86 L.Ed. 796 (1942). It would be baffling if a foreign act of state intended to affect property in the United States were ignored on one side of the Hudson but respected on the other; any such diversity between states would needlessly complicate the handling of the foreign relations of the United States. The required uniformity can

353 F.2d 51
be secured only by recognizing the expansive reach of the principle, announced by Mr. Justice Harlan in Sabbatino, that all questions relating to an act of state are questions of federal law, to be determined ultimately, if need be, by the Supreme Court of the United States.2

Under the traditional application of the act of state doctrine, the principle of judicial refusal of examination applies only to a taking by a foreign sovereign of property within its own territory, see Ehrenzweig, Conflict of Laws § 48 at 172 (1962); cf. Banco Nacional de Cuba v. Sabbatino, supra, 376 U.S. at 401, 428, 432, 84 S.Ct....

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  • Windbourne v. Eastern Air Lines, Inc., No. 76 C 237
    • United States
    • United States District Courts. 2nd Circuit. United States District Court (Eastern District of New York)
    • May 11, 1979
    ...1967) (emphasis added). At this juncture, heed must be given to Judge Friendly's remarks in Republic of Iraq v. First National City Bank, 353 F.2d 47 (2d Cir. 1965), cert. denied, 382 U.S. 1027, 86 S.Ct. 648, 15 L.Ed.2d 540 Although the general language of 28 U.S.C. § 1332 does not grant ju......
  • Alfred Dunhill of London, Inc v. Republic of Cuba, No. 73-1288
    • United States
    • United States Supreme Court
    • December 10, 1974
    ...confiscations without compensation of property located in the United States and because under Republic of Iraq v. First Nat. City Bank, 353 F.2d 47 (CA2 1965), cert. denied, 382 U.S. 1027, 86 S.Ct. 648, 15 L.Ed.2d 540 (1966), the situs of the accounts receivable was with the importer-debtor......
  • Bivens v. Six Unknown Named Agents of Fed. Bur. of Nar., No. 328
    • United States
    • United States Courts of Appeals. United States Court of Appeals (2nd Circuit)
    • April 10, 1969
    ...de Cuba v. Sabbatino, 376 U.S. 398, 423-427, 84 S.Ct. 923, 11 L.Ed.2d 804 (1964); see Republic of Iraq v. First National City Bank, 353 F.2d 47, 50-51 (2d Cir. 1965), cert. denied 382 U.S. 1027, 86 S.Ct. 648, 15 L.Ed.2d 540 (1966) See generally Hill, The Law-Making Power of the Federal Cour......
  • U.S. v. Williams, No. 78-5413
    • United States
    • United States Courts of Appeals. United States Court of Appeals (5th Circuit)
    • May 12, 1980
    ...1134 (1937); Oetjen v. Central Leather Co., 246 U.S. 297, 38 S.Ct. 309, 62 L.Ed. 726 (1918); Republic of Iraq v. First Nat'l City Bank, 353 F.2d 47 (2d Cir. 1965), cert. denied, 382 U.S. 1027, 86 S.Ct. 648, 15 L.Ed.2d 540 10 Cf. Katz v. United States, 389 U.S. 347, 351, 88 S.Ct. 507, 511, 1......
  • Request a trial to view additional results
80 cases
  • Windbourne v. Eastern Air Lines, Inc., No. 76 C 237
    • United States
    • United States District Courts. 2nd Circuit. United States District Court (Eastern District of New York)
    • May 11, 1979
    ...1967) (emphasis added). At this juncture, heed must be given to Judge Friendly's remarks in Republic of Iraq v. First National City Bank, 353 F.2d 47 (2d Cir. 1965), cert. denied, 382 U.S. 1027, 86 S.Ct. 648, 15 L.Ed.2d 540 Although the general language of 28 U.S.C. § 1332 does not grant ju......
  • Alfred Dunhill of London, Inc v. Republic of Cuba, No. 73-1288
    • United States
    • United States Supreme Court
    • December 10, 1974
    ...confiscations without compensation of property located in the United States and because under Republic of Iraq v. First Nat. City Bank, 353 F.2d 47 (CA2 1965), cert. denied, 382 U.S. 1027, 86 S.Ct. 648, 15 L.Ed.2d 540 (1966), the situs of the accounts receivable was with the importer-debtor......
  • Bivens v. Six Unknown Named Agents of Fed. Bur. of Nar., No. 328
    • United States
    • United States Courts of Appeals. United States Court of Appeals (2nd Circuit)
    • April 10, 1969
    ...de Cuba v. Sabbatino, 376 U.S. 398, 423-427, 84 S.Ct. 923, 11 L.Ed.2d 804 (1964); see Republic of Iraq v. First National City Bank, 353 F.2d 47, 50-51 (2d Cir. 1965), cert. denied 382 U.S. 1027, 86 S.Ct. 648, 15 L.Ed.2d 540 (1966) See generally Hill, The Law-Making Power of the Federal Cour......
  • U.S. v. Williams, No. 78-5413
    • United States
    • United States Courts of Appeals. United States Court of Appeals (5th Circuit)
    • May 12, 1980
    ...1134 (1937); Oetjen v. Central Leather Co., 246 U.S. 297, 38 S.Ct. 309, 62 L.Ed. 726 (1918); Republic of Iraq v. First Nat'l City Bank, 353 F.2d 47 (2d Cir. 1965), cert. denied, 382 U.S. 1027, 86 S.Ct. 648, 15 L.Ed.2d 540 10 Cf. Katz v. United States, 389 U.S. 347, 351, 88 S.Ct. 507, 511, 1......
  • Request a trial to view additional results

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