Zimmermann v. Miller

• Decision Date: 25 April 1924
• Citation: 2 F.2d 629
• Parties: ZIMMERMANN et al. v. MILLER, Alien Property Custodian, et al.
• Court: U.S. District Court — Southern District of New York

2 F.2d 629 (1924)

ZIMMERMANN et al. v. MILLER, Alien Property Custodian, et al.

District Court, S. D. New York.

April 25, 1924.

Stockton & Stockton, of New York City (Joseph M. Hartfield and Hamilton Vreeland, Jr., both of New York City, of counsel), for plaintiffs.

Wm. Hayward, U. S. Atty., of New York City (Thomas J. Crawford, Asst. U. S. Atty., of New York City, of counsel), for defendants Miller and White.

Manhein & Wachtell, of New York City, for defendant Wiener Bank-Verein, of Vienna, Austria.

KNOX, District Judge.

This suit is brought under section 9 of the Trading With the Enemy Act (Comp. St. 1918, Comp. St. Ann. Supp. 1919, § 3115½e) for the recovery by plaintiffs of the dollar value as of April 6, 1917, of 2,036,799.03 kronen which were then on deposit with the Wiener Bank-Verein of Vienna, Austria, and which are said to have been due and owing.

The Alien Property Custodian and the Treasurer of the United States admit their possession of certain money and property which was, pursuant to statute requirement, determined to belong to the bank during the time it was an alien enemy, and which, for that reason, was sequestered. They also allege that suits of persons other than plaintiffs are pending against them whereby it is sought to collect the sum of about $750,000 from said money and property.

The bank admits that as of April 6, 1917, plaintiffs had on deposit with it the specific number of kronen, and that these were held subject to orders for the disposal thereof. Denial is made that payment of the kronen was due as claimed by plaintiffs.

The parties, excepting the Custodian and the Treasurer, have stipulated the following facts:

(1) That the bank was organized, and prior to and during the war functioned under the laws of the Empire of Austria Hungary; that it still does business in Vienna under a validation of its charter by the Austrian government. It has no branch office within the United States.

(2) That plaintiffs, for a number of years preceding the outbreak of war, maintained a bank account with the bank in which they made deposits in kronen for the purpose of providing payment of their drafts and orders issued and transmitted by letter, cable, wireless, etc., and drawn on and payable at the bank.

(3) That at least every three months plaintiffs received in ordinary course periodic statements of the condition of the account. These were upon a printed form containing the following provisions:

"The relations existing between us and our business friends will in general be governed by the laws in force in Austria. So far as transactions without main office come into consideration, the city of Vienna is to be considered the place where payment is to be made or where obligations are to be made, as the case may be. In transactions existing between customers and our branches, the city where the branch is domiciled becomes the place of payment or the place of fulfillment of liabilities as the case may be."

(4) That at all times from a time prior to the opening of the account, section 1425 of the General Court Law of Austria continued and remained in force. It reads:

"If a debt cannot be paid because the creditor is unknown, absent or dissatisfied with the offer, or because of other important reasons, the debtor may deposit in court the subject-matter in dispute; or, if it is not susceptible of such action he may take legal steps for its custody. If legally carried out and the creditor has been informed thereof, either of these measures discharges the debtor of his obligation, and places the subject-matter delivered at the risk of the creditor."

(5) That after July 14, 1919, and prior to April 1, 1920, plaintiffs refused to accept the kronen on deposit with the bank, offered either in kind or in United States currency, at the rate of exchange then prevailing, but demanded the amount of said kronen on deposit as of April 6, 1917, at the average cable transfer rate of exchange between the two currencies prevailing in the United States during the month immediately preceding the outbreak of the war, viz., 11.18 United States cents for each kronen.

(6) That on or about April 1, 1920, the bank deposited in the Circuit Court for the Interior at Vienna, in part 6 thereof, the number of kronen stated to be due and owing as of April 6, 1917.

(7) That such Circuit Court was the appropriate depository for deposits made pursuant to section 1425 of the General Civil Law Code.

(8) That notice of the deposit was given to and received by the plaintiffs.

(8a) That plaintiffs' account, during its existence, was credited with interest at 2½ per cent. per annum down to April 6, 1917, and such credits were shown on all quarterly statements of the account; and that such interest was calculated to the day of the deposit of the funds in the Circuit Court and was included therein.

(8b) That on March 25, 1919, plaintiffs filed their claim with the Alien Property Custodian for the moneys alleged to be due and owing from the bank.

Prior to the outbreak of war between the United States and Austria, upon December 7, 1917, plaintiffs made no demand for their balance upon deposit with the bank. Until such demand was made, the balance upon deposit was not due and payable. Zimmermann & Forshay v. Miller and Deutsche Bank, decided April 25, 1924. During the continuance of the war, and down to July 14, 1919, when trade relations and communications were reestablished between Nationals...