Source: https://www.legalcrystal.com/case/99122/rex-trailer-co-inc-vs-united-states
Timestamp: 2018-02-25 02:16:50
Document Index: 444273002

Matched Legal Cases: ['§ 26', '§ 26', '§ 269', '§ 26', '§ 26', '§ 5438', '§ 231', '§ 26']

Rex Trailer Co Inc Vs United States - Citation 99122 - Court Judgment | LegalCrystal
Rex Trailer Co., Inc. Vs. United States - Court Judgment
LegalCrystal Citation legalcrystal.com/99122
Case Number 350 U.S. 148
Appellant Rex Trailer Co., Inc.
.....inc. v. united states - 350 u.s. 148 (1956) u.s. supreme court rex trailer co., inc. v. united states, 350 u.s. 148 (1956) rex trailer co., inc. v. united states no. 46 argued december 5, 1955 decided january 9, 1956 350 u.s. 148 certiorari to the united states court of appeals for the seventh circuit syllabus in an action based on § 26(b)(1) of the surplus property act of 1944, the united states recovered $2,000 on each of five counts of a complaint charging petitioner with fraudulent purchases of motor vehicles. petitioner had previously pleaded nolo contendere to a 5-count indictment arising out of the same five transactions, and paid fines aggregating $25,000. held: 1. the recovery under 26(b)(1).....
Rex Trailer Co., Inc. v. United States - 350 U.S. 148 (1956)
U.S. Supreme Court Rex Trailer Co., Inc. v. United States, 350 U.S. 148 (1956)
1. The recovery under 26(b)(1) is civil in nature, and did not put petitioner twice in jeopardy in violation of the Fifth Amendment. Pp. 350 U. S. 148 -162.
2. The failure of the Government to allege specific damages did not preclude the recovery here. Pp. 350 U. S. 152 -153.
3. On the record in this case, it cannot be said that the measure of recovery fixed by Congress in the Act is so unreasonable or excessive that it transformed the civil remedy into a criminal penalty. Pp. 350 U. S. 153 -154.
Petitioner contends that this action brought by the Government to recover $2,000 on each of five counts of a complaint based on § 26(b)(1) of the Surplus Property Act of 1944 [ Footnote 1 ] places it twice in jeopardy in violation
of the Fifth Amendment. In an earlier proceeding, it had pleaded nolo contendere to a five-count indictment bottomed on the same five transactions and paid fines in the aggregate amount of $25,000. In the present case, the District Court granted the Government's motion for summary judgment, and the Court of Appeals affirmed, 218 F.2d 880. We granted certiorari, 349 U.S. 937, to resolve an asserted conflict between the decisions of the Courts of Appeals. [ Footnote 2 ]
Helvering v. Mitchell, 303 U. S. 391 , 303 U. S. 399 .
We conclude that the recovery here is civil in nature. The Government has the right to make contracts and hold and dispose of property, and, for the protection of its property rights, it may resort to the same remedies as a private person. Cotton v. United States, 11 How. 229. Liquidated damages are a well known remedy, and in fact Congress has utilized this form of recovery in numerous situations. In all building contracts, for example, Congress has required the insertion of a liquidated damage clause which "shall be conclusive and binding upon all parties" without proof of "actual or specific damages sustained. . . ." 32 Stat. 326, 40 U.S.C. § 269. Liquidated damage provisions, when reasonable, are not to be regarded as penalties, United States v. United Engineering & Contracting Co., 234 U. S. 236 , 234 U. S. 241 , and are therefore civil in nature.
In § 26 of the Surplus Property Act, Congress has provided three alternative remedies. The first provides a recovery of $2,000 plus double the amount of the damage sustained; the second permits a recovery "as liquidated damages" of twice the consideration agreed upon; the third permits the Government to recover the property and retain "as liquidated damages" the consideration it received. These alternative remedies are set out in three consecutively numbered subsections of § 26(b). All three were recognized as civil remedies by Congress before the bill was passed, [ Footnote 3 ] and the conclusion is inescapable
The case of United States ex rel. Marcus v. Hess, 317 U. S. 537 , involved a provision of the False Claims Act, R.S. §§ 5438, 3490, 31 U.S.C. § 231, essentially the equivalent of § 26(b)(1). [ Footnote 4 ] In Marcus, as here, the defendant had pleaded nolo contendere in an earlier criminal prosecution based on the same transaction. This Court rejected the petitioner's contention of double jeopardy and held that the statute involved was remedial and not penal, since it was unable to say that the provision for $2,000 plus double damages would "do more than afford the government complete indemnity for the injuries done it." 317 U.S. at 317 U. S. 549 . In concluding, it recognized that "[t]he inherent difficulty of choosing a proper specific sum which would give full restitution was a problem for Congress." 317 U.S. at 317 U. S. 552 .
the Court in Marcus. [ Footnote 5 ] The Government's recovery here is comparable to the recovery under liquidated damage provisions which fix compensation for anticipated loss. As this Court recognized in Priebe & Sons v. United States, 332 U. S. 407 , 332 U. S. 411 -412, liquidated damages
It is obvious that injury to the Government resulted from the Rex Trailer Company's fraudulent purchase of trucks. It precluded bona fide sales to veterans, decreased the number of motor vehicles available to Government agencies, and tended to promote undesirable speculation. [ Footnote 6 ] The damages resulting from this injury may be difficult or impossible to ascertain, but it is the
MR. JUSTICE FRANKFURTER concurs in the judgment substantially for the reasons given by him in his opinion in support of the Marcus decision. 317 U.S. at 317 U. S. 553 .