Legal Document

406 U.S. 759 92 Supreme Court Reporter 1808 32 United States Reports Lawyer’s Edition 2d Series KF101.8 U54 466 FIRST NATIONAL CITY BANK, Petitioner,v.BANCO NACIONAL de CUBA. Number 70—295. Argued Feb. 22, 1972. Decided June 7, Rehearing Denied Oct. 10, See 93 92. Syllabus This case involves a claim by respondent for excess collateral it had pledged with petitioner to secure loan, and counterclaim that as an offset against the value of petitioner's property in Cuba expropriated without compensation. The District recognized this Court's decision Banco Nacional versus Sabbatino, 376 398, 84 923, 11 804, holding generally courts one nation will not sit judgment on acts another within latter's territory (act state doctrine) would bar assertion but concluded post-Sabbatino congressional enactments effect overruled decision. court issued summary all issues except amount available possible setoff. Appeals reversed, Sabbatino barred counterclaim. Held: is reversed. Pp. 762—776. Mr. Justice REHNQUIST, joined THE CHIEF JUSTICE WHITE, since Executive Branch, which charged primary responsibility conduct foreign affairs, has (contrary position took Sabbatino) expressly represented application act doctrine advance interests American policy, Bernstein N.V. Nederlandsche-Amerikaansche, etc., 2 Cir., 210 Federal Reporter, 2nd 375, should be adopted approved, thus permitting judicial examination legal raised sovereign its own territory. 762—770. DOUGLAS central issue governed National City Bank Republic China, 348 356, 75 423, 99 L.Ed. 389 (holding sovereign's may or setoff), rather than exception accordingly allow setoff up respondent's claim. 770—773. POWELL, believing Sabbatino's broad was compelled principles underlying said doctrine, federal have obligation hear cases such apply applicable international law. 773—776. 442 530, reversed remanded. Henry Harfield, New York City, petitioner. Victor Rabinowitz, respondent. REHNQUIST announced Court, delivered opinion WHITE join. 1 In July 1958, loaned sum $15 million predecessor loan secured pledge Government bonds. renewed following year, 1960 $5 repaid, $10 balance equal portion repaid released Meanwhile, January 1, 1959, Castro government came power Cuba. On September 16, 1960, Cuban militia, allegedly pursuant decrees government, seized branches located A week later bank retaliated selling securing applying proceeds sale repayment principal unpaid interest. Petitioner concedes at least.$1.8 over above interest realized from collateral. Respondent sued recover excess, petitioner, way counterclaim, asserted right damages result expropriation 3 our 804 (1964), further held 'for practical purposes' case. Following favor exceeded could properly applied parties stipulated any event difference less prove support if were allowed. then waived recovery recoverable complaint, rendered dismissing complaint merits. 4 appeal, Second Circuit relied upon did govern case, We granted certiorari vacated consideration views Department State been furnished us filing petition certiorari. 400 1019, 19 581, 27 630 (1971). Upon reconsideration, divided vote adhered earlier again certiorari, First Cuba, 404 820, 79, 30 48 5 must here decide whether, view substantial between taken Branch prevents litigating hold does not. 6 separate lines enunciating both immunity doctrines common source Schooner Exchange M'Faddon, 7 Cranch 116, 146, 287 (1812). There Chief Marshall stated general principle immunity: sovereigns are presumed explicit declaration opened their tribunals suits other sovereigns. Yet policy considerations root fundamental large part also underpinnings doctrine. observed: 'The arguments drawn inability enforce decisions description, consideration, alone competent avenge wrongs committed sovereign, questions give birth law, they diplomatic, discussion, great weight, merit serious attention.' (Emphasis added.) 8 Thus, judicially created effectuate notions comity among nations respective Government. history basis treated comprehensively supra. there cited Fuller's 'classic statement' found Underhill Hernandez, 168 250, 252, 18 83, 84, 42 456 (1897): 9 'Every bound respect independence every state, country done Redress grievances reason obtained through means open availed powers themselves.' 10 represents rule States, where appropriate jurisdictional standards met, before choosing rules various sources law including Paquete Habana, 175 677, 20 290, 44 320 (1900). precludes review whatever State. It clear, however, ipinions inflexible one. Specifically, described 'a binding alike neither nor Constitution,' U.S., 427, S.Ct., 940, continued: '(I)ts continuing vitality depends capacity reflect proper distribution functions political matters bearing affairs.' Id., 427—428, 940. 12 Government, speaking State, advised attorneys amici vein being 'intended no more Department's wish make statement litigation.' 420, 936. argued 'hold, first time, executive silence regarding equivalent approval inquiry into act.' 13 now us, quite different position. Legal Adviser November 17, 1970, matter publicly advises need applied, proceed examine question it. His letter refers below N. V. 375 (CA2 1954), representing recognition principle, suggests applicability limited Adviser's goes state: 14 believes defendant's like cases.' 15 we whether so-called context facts Court. said: 16 'This never occasion pass exception, do so now.' 276 17 sovereigns, roots, Constitution, notion independent supra, 438, 923; 72 (1955); (1812).1 buttressed deference exclusive relations Senate advise consent making treaties. presented invocation therefore dissimilar those Zschernig Miller, 429, 88 664, 683 (1968), struck down Oregon statute 'an intrusion field affairs Constitution entrusts President Congress.' 432, 666. line establishing justifies existence primarily juridical embarrass government. (1897), stressed fact revolutionary Venezuela States. Oetjen Central Leather Co., 246 297, 302, 38 309, 311, 62 726 (1918), explicit: legislative—'the political'—departments propriety what exercise subject . specifically decided that: 'Who jure facto, judicial, question, determination legislative departments conclusively binds judges, well officers, citizens subjects .." 21 Belmont, 301 324, 57 758, 81 1134 (1937), emphasized competence affairs.2 year earlier, Curtiss-Wright Corp., 299 304, 319, 216, 220, 255 (1936), quoted John when he member House Representatives dealing same subject: 22 "The sole organ external relations, representative nations." 23 Scrutton, L.J., Luther James Sagor & (1921) K.B. 532, case' articulating 'in terms unlike cases,' strongly under English representation waive doctrine: 24 'But appears breach comity, postulate legislation 'contrary essential justice morality.' Such allegation might susceptible become casus belli; my action Sovereign his ministers, judges reference recognized. non-recognition consequences each rests advisers judges.' 559. 25 think foregoing indicates primacy emphatically throughout lead role particularly seeking redress nationals who victims expropriation, based mere neutrality conflict Judicial Branches. Here, serve policy. 26 grounded concern customary judge frustrate conclude courts. doing, course adopt approve believe classical common-law maxim '(t)he ceasing, itself ceases' (Black's Law Dictionary 288 (4th ed. 1951)). Our sense abdication function Branch. extends established Congress adjudication met parties. only deciding use otherwise fear interpretation judiciary country's relations. But branch responsible consequence feared free limitations imposed 28 bears noting reach consonant equity set forth (1955). Here respondent, claimed instrument sought come favor, submitting merits asserts Speaking closely analogous situation 29 'We invoking resisting fairly curtail recovery. wants litigant, claims justice. becomes vital, therefore, extent led suit foreclose determining, according prevailing China's unjustly enforced disregarding legitimate China. As expounded Exchange, implied territorial exempt 'exclusive absolute' jurisdiction, implication deriving public morality, fair dealing, reciprocal self-interest, 'power dignity' sovereign.' 361—362, 427. reflected culminating accepted limitation normal adjudicative processes courts, springing thoroughly sound individual litigants forgo because involvement Nation's wholly illogical insist rule, fashioned interfere face assurance conducts obtain. confines them, leaves faithful separation consistent lacked sort 31 reverse Appeals, remand alternative bases attack Reversed 33 DOUGLAS, concurring result. 34 control presen2{J8

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