United States v. National City Bank of New York

• Decision Date: 18 April 1922
• Docket Number: 186.
• Citation: 281 F. 754
• Parties: UNITED STATES v. NATIONAL CITY BANK OF NEW YORK.
• Court: U.S. Court of Appeals — Second Circuit

281 F. 754

UNITED STATES v. NATIONAL CITY BANK OF NEW YORK.

No. 186.

United States Court of Appeals, Second Circuit.

April 18, 1922

William Hayward, U.S. Atty., of New York City (John Holley Clark Jr., of New York City, of counsel), for the United States.

Shearman & Sterling, of New York City (Carl A. Mead and Philip A Carroll, both of New York City, of counsel), for defendant in error.

Before ROGERS, HOUGH, and MANTON, Circuit Judges.

ROGERS Circuit Judge.

This proceeding is brought to recover 'just compensation' for 20,000 bags of coffee requisitioned by the government of the United States for the use of the navy on November 21, 1918.

The petitioner, the National City Bank of New York, hereinafter called the Bank, held the coffee in the city of New York 'for the account' of the owners on the day of its requisition. The market value of the coffee in New York on the day of its requisition is alleged in the petition to have been $585,146.87. No part of the just compensation for the coffee has been paid by the United States, except the sum of $313,356.77, that sum having been paid to the Bank on August 22, 1919. The petitioner therefore prays for judgment in the sum of $271,790.10, with interest from November 21, 1918. The court below, on May 25, 1921, entered judgment in favor of the Bank and against the United States in the amount of $291,573.33, which includes interest and costs and disbursements as taxed.

The petition is filed under section 10 of the Act of August 10 1917 (Comp. St. 1918, Comp. St. Ann. Supp. 1919, Sec. 3115 1/8ii), commonly known as the Lever Act, which was passed to provide for the national security and defense. 40 Stat.at L.c. 53, p. 276. The provisions of section 10 of that act may be found in the margin. ^[1] Under the section referred to the President was authorized from time to time to requisition foods and other supplies necessary to the support of the army or the maintenance of the navy, and the act provided that the President should pay a just compensation for property so requisitioned. And it was provided that if the compensation the President determined to be just was not satisfactory to the person entitled to receive it, such person should be paid 75 per centum of the amount so determined, and he should be entitled to sue the United States to recover such further sum as added to the amount paid would be just compensation. Jurisdiction was conferred upon the District Courts to hear and determine all such controversies

The coffee herein involved having been commandeered on November 21, 1918, and the government having awarded the sum of $423,536.69 at the price of 15.29 cents per pound f.o.b. warehouse as compensation, the Bank notified the government on July 5, 1919, that the award was not satisfactory. Thereupon, and on August 26, 1919, the government paid to the Bank 75 per centum of the amount of the award, or the $313,356.77, which, as already stated, constitutes the sole amount which has as yet been paid. Thereafter, and on September 19, 1919, the Bank instituted this proceeding to recover the balance of the 'just compensation' to which it claims to be entitled. When the cause came on to be heard in the court below it was tried without a jury; and the court found as a conclusion of law that the legal title to all of the coffee was in the plaintiff, both at the time when the coffee was requisitioned by the President and at the time of the commencement of this action. As this is one of the errors assigned, we shall consider it at the outset, and before proceeding to a consideration of any of the other errors upon which the government relies.

It appears that all the coffee herein involved had been imported into this country prior to January 18, 1918. On that date it was bought on a cable order from the North Oceanic Steamship & Trading Company, a Russian corporation located at Archangel. It is hereinafter referred to as the Russian Company. This cable was addressed to Francisconi & Co., a New York firm dealing in coffee. The coffee was purchased with the intention of exporting it to Northern Russia. The Bank paid for the coffee under a letter of credit in favor of Francisconi & Co. and Hard & Rand, also coffee dealers, for account of the Russian corporation. These payments resulted in an overdraft which amounted to $13,324.60. On November 21, 1918, and on July 5, 1919, the overdraft was increased to $94,312.42. This was secured by a lien on the coffee and by the warehouse receipts, which were issued to the order of the Bank and were negotiable. These warehouse receipts the Bank continued to hold during the times herein involved, and they invested the Bank with the legal title. Under the New York law a person to whom a negotiable warehouse receipt has been negotiated acquired thereby--

'such title to the goods as the person negotiating the receipt to him had or had ability to convey to a purchaser in good faith for value, and also such title to the goods as the depositor or person to whose order the goods were to be delivered by the terms of the receipt had or had ability to convey to a purchaser in good faith for value. ' New York General Business Law (Consol. Laws, c. 20) Sec. 125.

As the holder of the legal title, although it held the title for the real owners in Russia, the Bank was 'the person entitled to receive' the compensation under section 10 of the Lever Act, and was likewise the person entitled to sue the United States in the manner as therein provided. The facts as to title alleged in the plaintiff's petition show such title in the petitioner as sustains the judgment, if the evidence produced sustained the allegations, as we must assume it did, to the satisfaction of the trial court.

We have said that the case was tried without a jury, and the fact that it was so tried is one of the errors relied upon to secure a reversal. It is said that the government has been deprived of its constitutional right to a jury trial, as actions brought under section 10 must be tried before a jury. Counsel rely upon United States v. Pfitsch, 256 U.S. 547, 41 Sup.Ct. 569, 65 L.Ed. 1084. decided by the Supreme Court on June 1, 1921. But that case has no application to the question now presented. The court did not hold in that case what this court is now asked to hold. The question in the Pfitsch Case was whether the jurisdiction of such cases as the one now before the court was one which could be exercised concurrently by the Court of Claims without a jury, or by the District Court with a jury, and the Supreme Court simply held that the jurisdiction conferred on the District Court was not concurrent with that of the Court of Claims, but was exclusively in the District Court, and that the right to a jury trial is an incident of such jurisdiction.

It will be conceded that the parties in the trial of this case had a constitutional right to a jury trial. But the constitutional right to a jury trial in civil cases is a mere privilege, and as such is capable of being waived. Columbia Bank v. Okely, 4 Wheat. 235, 4 L.Ed. 559; North British, etc., Ins. Co. v. Lathrop (C.C.) 63 F. 508; United States v. Rathbone, Fed. Cas. No. 16,121; Citizens' Gaslight Co. v. Wakefield, 161 Mass. 432, 37 N.E. 444, 31 L.R.A. 457; Joy v. Blum, 55 N. J. Law, 518, 26 A. 861; Baird v. New York, 74 N.Y. 382. And the general rule is that the right to a jury trial may be waived by any conduct or acquiescence inconsistent with an intention or expectation to insist upon it. Dole v. Wooldredge, 142 Mass. 161, 7 N.E. 832; Mackellar v. Rogers, 109 N.Y. 468, 17 N.E. 350; Schumacher v. Crane-Churchill Co., 66 Neb. 440, 92 N.W. 609. And the principle is well established that a jury trial is waived by permitting the court, without any objection or demand for a jury trial, to proceed to hear and determine it. Barnes v. Perine, 12 N.Y. 18; Joy v. Blum, 55 N. J. Law, 518, 26 A. 861; Banning v. Hall, 70 Minn. 89, 72 N.W. 817; Baumbach Co. v. Hobkirk, 104 Wis. 488, 80 N.W. 740; Washington v. Louisville, etc., R. Co., 136 Ill. 49, 26 N.E. 653; Claflin v. Steenbock, 18 Grat (Va.) 842.

We have considered the question as to whether the government has been deprived of its constitutional right to a jury trial, notwithstanding the fact that upon the record, for a reason which will appear as we proceed, the government was, strictly speaking, not entitled to raise the question at all. But the conclusion we have expressed upon the question of constitutional right does not alter or affect the judgment to be rendered, upon the record properly before the court. The record shows that, at the time the case was called in the District Court, the following colloquy between court and counsel occurred:

'Mr. Mead (Counsel for the Bank): I claim the right of a jury trial, but for the purpose of the trial of this case I waive that right.

'The Court: Then you will have to have a signed stipulation that this may be tried without a jury.

'Mr. Barnes (Counsel for the Government): We don't want to waive that. Our position is that it is not necessary for me to waive that. The government does not waive it. The government insists there is no waiver necessary, and that the matter be tried before the court without a jury as a matter of law.

'The Court: Mr. Mead takes the position that that is not correct, this particular case he waives it.

'Mr. Mead: Yes.' Mr. Mead and Mr. Barnes made opening statements of their cases to the court.

Inasmuch as the counsel for the government not only made no demand in the trial court for a trial by jury, but actually insisted that the case 'be tried before the court without a jury,' he is in no position now to ask the...