New-York tribune., 1922-05-02
federal Fleet
Board Suable.
Court Decides
supreme Bench Denies
IL Has Immunity of
Government; Bureau, in
Opinion Read by Holmes
May Cost L. S. Millions
News Is Thunderbolt TO
Officials: Faft. Clark
aud Van Dcyanter Disscn,

WASHINGTON. May The Emer-
ecncy Fleet Corporation of the United
states Shipping Board, "A corporation
organized under the laws of the Dis
trlct OF Columbia, is suable in the Fed
era and state courts, without its CON
sent, and does not have the immunity
or government department or board,
the Supreme Court held to-day in an
opinion delivered by Justice Holmes,
TO which the Chief Justice and Justices
Van Devanter ard Clark dissented. in
an opinion delivered by Mr. Taft
Inc news came as n thunderbolt to
officials of the Shipping Board and
Fleet Corporation Both Chairman Las
ker and General Counsel Schiosingcr
were IN New \ ork, but other officials
expressed tho fear that it would cost
the Shipping Board possibly millions
OF dollars in settlement of claims,
Three Cases Argued
The question was presented to the
court IN three cases, in two of which,
the Sloan Shipysrds Corporation and
others of the State of Washington and
the Astoria Marine iron Works of Ore
gon, the government won in the lower
courts and in thc third that brought
by tho United States against the trus-
zee IN bankruptcy Of the Eastern Shore
Sh1pbuiding Corporation, tho govern
ment lost in the United States Federal
courts Of New York City. In the lat.
ter case, which involved the priority
Of the Emergency Fleet Corporation in
tho assets Of 4 bankrupt corporation,
tho court was unanimous in holding
against the contentious Of the govern
ment
The shipping act contemplated a
corporation in which persons might be
tockholdcrs, and which was to be
formed like any business corporation
under the laws OF the District of Co
Mmbia, with capacity to sue and be
sued Justice Holmes stated. "The
United States took all the stock. but
that did not affect the legal position
of the company
Discussing the "enormous powers
ultimately given to the Fleet Corpora
ton Justice Holmes said it had been
suggested that it wss so far put in
place OF the sovereign as to share ta
immunity of the sovereign from suit
otherwise than as the sovereign al
lows
Calls Idea Dangerous
"But such notion he added, as
very dangerous departure from one
of the first principles of our system
of law, Supposng the powers
of the Fleet Corporation to have been
given TO 9 single man, we doubt if any
one would contend that the acts OF
Congress and the delegations of au-
thority from the President left him
any less liable than other grantees OF
the power of eminent domain to be
called upon to defend himself in
court"
While in general the United States
cannot be sued for a tort. the opinion
stated. cts immunity does not extend
to those that acted in its name
Chief Justice Taft for the minority
stated that Congress intended that
the Fleet Corporation should be sub
ject to suit only as its principal is
Suits against the Fleet Corporation
'are in fact against the United States,
he continued. 'and cannot be brought
except in the manner and under the
procedure provided by the statute for
claims for compensation for acts done
by authority Of the President under
the act vesting him with it."