Court Opinion

ID: 9516619
Source: CourtListenerOpinion
Date Created: 2023-08-06 23:47:12.387727+00
Date Added: 2024-06-11T09:37:28.665400
License: Public Domain

WHITAKER, Judge
(dissenting).
■I must express the reasons for my dissent from the opinion and decision of 'the majority, because I think there has been a flagrant violation of a right of one of our citizens by his Government, which seeks to escape liability under the cloak of the immunity of a sovereign. This is a case in which this court gives sanction to bureaucratic action in violation of a right, this time a right acquired in consideration of the payment of a large sum of money to the defendant itself, who asserts the power to keep the money and to deny the right for which the money was paid. I cannot allow such a decision to go unchallenged.
One of the rights inherent in the ownership of property is the right to sell it to anyone who wishes to buy it. This right is, however, frequently restricted by statute or by contract; but, unless so restricted, it is absolute.
In 1916 Congress passed and the President approved the Shipping Act of 1916, Act of September 7,1916, c. 451, 39 Stat. 728. Its caption says it is:
“An Act To. establish a United States Shipping Board for the purpose of encouraging, developing, and creating a naval auxiliary and naval reserve and a merchant marine to meet the requirements of the commerce of the United States with its Territories and possessions and with foreign countries;, to regulate carriers by water engaged in the foreign and interstate commerce of the United States; and for other purposes.”
By sections 7 and 8 the Shipping Board, created by the Act, was authorized to sell or lease any vessel acquired by it. By section 9 it was required that any vessel purchased, chartered, or leased from the Board should be eligible for American registry, and should be operated only under such registry, “unless otherwise authorized by the board”. It was also provided, at p. 731:
“ * * * No such vessel, without the approval of the board, shall be transferred to a foreign registry or flag, or sold; nor, except under regulations prescribed by the board, be chartered or leased.”
This section was amended several times before the transaction in question. As last amended, by the Act of June 23, 1938, 52 Stat. 953, 964, section 9 was made to read in part as follows:
“ * * * it shall be unlawful, without the approval of the United States Maritime Commission, to sell, mortgage, lease, charter, deliver, or in any. manner transfer, or agree to sell, mortgage, lease, charter, deliver, or in any manner transfer, to any person not a citizen of the United States, or transfer or place under foreign registry or flag, any vessel or any interest therein owned in whole or in part by a citizen of the United States and documented under *143the laws of the United States, or the last documentation of which was under the laws of the United States.”
So that, at the time plaintiff acquired the vessel, Colonel Frederick C. Johnson, his right to sell it to anyone who wished to buy it, or to transfer it to foreign registry, was restricted by the necessity to secure the approval of the Maritime Commission, which had succeeded to the powers of the Shipping Board.
But this was the only restriction which the law placed on his right to sell it or to transfer it to foreign registry. Only the approval of the Maritime Commission had to be obtained. No other approval was required.
This being the law, the Maritime Commission advertised for bids on the Colonel Frederick C. Johnson. One of the inducements to secure bids, as set out in the invitation for them read:
' “ * * * The Commission will consent to the transfer of the vessel to foreign ownership, registry, and flag pursuant to the applicable provisions of the Shipping Act, 1916, as amended, provided the transfer is made effective within (6) months from the date of award and provided, further, the transferee, in the determination of the Commission, is not an alien country, or a national or nationals thereof prohibited by the Government of the United States from engaging in commercial transactions with the United States and its citizens or anyone acting on behalf or in the interest thereof. 'The applicant shall submit such evidence as the Commission shall deem necessary in connection with such application for transfer.
Thus the Commission, as an inducement to secure plaintiff’s bid, said it would consent to the transfer of the vessel to foreign registry, provided only the request for the transfer be made in 6 months and the transferee was not an enemy country or an enemy alien.
With this inducement in mind, plaintiff •offered $48,120 for the vessel. His offer was accepted, and he paid the amount on June 12,1947. In his letter transmitting the payment he said:
“Kindly let me have a Bill of Sale and Certificate of Registry, and a written acknowledgment of my full right to transfer this vessel to foreign registry if I should so desire.”
In reply the Maritime Commission wrote plaintiff acknowledging the check and saying:
“The Commission will consent to the transfer of the vessel to foreign ownership, registry, and flag as provided in Section 8 of the subject Invitation for Bids.”
Section 8 of the Invitation for Bids is set out above.
We have, then, an unequivocal commitment to consent to the transfer, provided only that the request for the consent be made in 6 months, and that the transferee be not an enemy country or an enemy alien. It is agreed that the request for consent was made in 6 months and that the transferee was not an enemy country or an enemy alien. The Shipping Act plainly gave the Commission the power to make such an agreement.
This agreement was made as part consideration for the payment of $48,120. There is no question that this money would not have been offered or paid except for this agreement.
The consent was not given when it was requested. It was not given until June 30, 1948, and then only after plaintiff had satisfied additional requirements imposed by the Maritime Commission.
There can be no doubt that defendant violated its agreement, an agreement made to secure from plaintiff $48,120. As a result plaintiff has suffered considerable damage.
The only excuse offered for this breach of faith is that the State Department feared that the vessel would be used to carry Jews to Palestine in violation of the policy adopted by the British Government regulating the admission of immigrants to that country.
For the purposes of this case I am not' at all concerned with the propriety of *144the efforts of the State Department to prevent the use of an American vessel in this traffic. This is beside the issue. The issue is the sanctity of contracts, the dishonesty of the Government’s inducing payment of money to it on the faith of its agreement to do a thing it later refuses to do, and this without any offer to return the money paid, but, instead, a refusal to reimburse the payor for the damages he suffered thereby.
I cannot give my approval to such conduct.
If international politics demanded that the Maritime Commission repudiate its agreement, then justice demands that the defendant respond in damages therefor.
The majority opinion says the Maritime Commission and the State Department were exercising sovereign powers in refusing the consent. No sovereign has the power to induce the payment of money to it in consideration of a promise and then not keep the promise, or pay for the damages suffered for its failure to do so.
I respectfully dissent.
LARAMORE, Judge, concurs in the above dissent.