Court Opinion

ID: 6831053
Source: CourtListenerOpinion
Date Created: 2022-07-23 19:53:09.7962+00
Date Added: 2024-06-11T16:04:33.729684
License: Public Domain

SYMES, District Judge
(concurring).
I desire to emphasize a little more fully certain features in the ease that appear to me material.
The allegations of the bill are important to consider. It is alleged that the plaintiff, Goltra, had entered into arrangements with the government during the war for the establishment of plants and transportation facilities to increase the output of iron ore, coal, etc., needed in the prosecution of the war; that the United States constructed the nineteen barges involved in this suit, to be used for transportation of iron ore and coal — also necessary towboats; that the termination of the war made it unnecessary to carry out these plans, and negotiations were then had between the plaintiff, Goltra, and the duly authorized representatives of the United States for the disposition of the boats that resulted in the contract in controversy, which it is alleged was entered into between the plaintiff and the United States.
The contract is then set forth. It recites that the United States of America is about to construct a fleet of towboats for the purpose of towing the barges; that it, as lessor, represented by certain officials, charters the boats to the lessee for five years, to *849be operated as common carriers upon the Mississippi river, the lessor to regulate the rates to be charged, and tho lessee, after paying operating expenses, maintenance, etc., shall deposit the net earnings in a depository, etc., all to the satisfaction and approval of the lessor. Paragraph 8 is important. It provides that tho government shall have the right of inspection at any time for the purpose of seeing that tho lease is being fully performed, and when, in the judgment of the lessor, noncompliance with any of the terms or conditions justify, it may, without notice, terminate the lease, and take the fleet back. It next alleges that a controversy arose with tho Secretary of War over rates to be charged, and admits in effect that complainant did not, as agreed, operate the barges as common carriers, and pleads several excuses for his failure so to do; that John W. Weeks, as Secretary of War, notified lessee under date of March 3d, that in his judgment tho latter had not complied with the terms of the contract, in that he had failed to operate the towboats and barges as common carriers, and in other’ particulars, and he therefore declared the contracts terminated. It is alleged that the action of the Secretary of War, in declaring the contract at an end, was unlawful. It would seem, however, that, a breach by complainant being admitted, this is nothing more than, a legal conclusion; no facts being pleaded in support thereof. In short, the gravamen of the bill is that tho Secretary of War exercised powers specifically given him by the contract.
At the hearing, correspondence was introduced between Goltra and officials of the government, in which the boats were referred to by plaintiff as tho property of the United Slates, and Goltra himself, under date of April 18, 1922, refers to the contract as one with the United States.
The court below states that, if tho United States is the lessor and owner of the boats in controversy, then the plaintiff cannot he heard to dispute its title, and the case must then he dealt with on the question of whether the court can afford any relief, unless the actual lessor is before the court. It comes to the conclusion that the funds with which these boats were built were transferred or loaned by tho Emergency Fleet Corporation, and that therefore the legal title to tho vessels was in it as trustee for the United States, although the custody and control was in the Secretary of War, and, further, that the United States was the beneficial owner and “both Congress and the United States dealt with these vessels as if the United States not only was the absolute owner of them, blit had the legal title to them, also absolutely.”
Section 20.1d of title 2 of the Transportation Act of 1920 (Comp. St. Ann. Supp. 1923, § 10071%aaa) provides, in effect, that these boats shall be operated by the Secretary of War for the purpose of providing facilities for water carriage on tho Mississippi river. Irrespective of who furnished the money, the United States of America, according to tho allegations of the bill and tho terms of the contract, constructed the barges, and delivered.possession of them to the lessee. Further, as the court below points out, the funds with which they were built, while technically they may have been furnished by the Emergency Fleet Corporation, were funds of the United States, appropriated by Congress for the purpose of building ships, and in possession of the Fleet Corporation only to the extent that the latter was an instrumentality of the government, and transferred by order of the President to the Chief of Engineers for the purpose of building these vessels.
But an inquiry into the source of the funds seems irrelevant on the question of title, in view of the plaintiff’s admission that the government built the boats, delivered them to him, exercised dominion over them, and that he acted at all times on the assumption that he was dealing with the United States as owner. It would therefore seein that plaintiff is estopped from denying that tho United States is owner, subject only to such rights as he had as lessee, ft may be that the contract put plaintiff at tho mercy of the Secretary of War, hut the court cannot relieve him from a had bargain. The agreement expressly vested in the government, or the Secretary of War, the right in his discretion to terminate it for failure to perform. The courts cannot control the exercise of such discretion, when the authority to do tho act is not challenged. Philadelphia Co. v. Stimson, 223 U. S. 605, 32 S. Ct. 340, 56 L. Ed. 570, is not in point. Justice Hughes there says at page 620, that the complainant did not ask the court to interfere with the official discretion of tho Secretary of War, but challenged his authority to do the things of which complaint was made. The converse is true in the ease at bar.
In Noble v. Union River Logging R. Co., 147 U. S. 165, 13 S. Ct. 271, 37 L. Ed. 123, the court at page 171, citing Marbury v. Madison, 1 Cranch, 137, 2 L. Ed. 60, states *850that no power exists to control executive discretion, no matter how erroneous its exercise may be. This ease is in point here, as this contract, gave the Secretary of War the right to use his judgment in deciding whether there had been a breach or not, and the specific breach cited by him in his letter of March 3d, declaring the contract terminated, is admitted by the bill, and fully established by the evidence. There is neither allegation nor testimony that Goltra performed.
If we grant, as I think we must, that it was the Secretary of War’s duty to exercise executive power and discretion generally over vessels built by the United States for war purposes, and which was specifically granted by the terms of this contract, then our inquiry is at an end.
The case at bar on the facts is similar to Wells v. Roper, 246 U. S. 335, 38 S. Ct. 317, 62 L. Ed. 755. The court said, at page 337 (38 S. Ct. 317): “And the case does not fall within any of the exceptions to the general rule that the United States may not be sued without its consent, nor its executive agents subjected to the control of the courts respecting the performance of their official duties.”
And at page 338 (38 S. Ct. 318): “And neither the question of official authority nor that of official discretion is affected, for present purposes, by assuming or conceding, for the purposes of the argument, that the proposed action may have been unwarranted by the terms of the contract and such as to constitute an actionable breach of that contract by the United States.”
That was a case where it was sought, as it is here, to prevent an officer of the government from annulling' a contract, or from further interfering with its performance, and it was held that such a suit was one against the United States, although it was not named as a party, and therefore could not be maintained.
Minnesota v. Hitchcock, 185 U. S. 373, 22 S. Ct. 650, 46 L. Ed. 954, and In re Ayers, 123 U. S. 443, 8 S. Ct. 164, 31 L. Ed. 216, show that the courts look at the whole record in deciding whether the United States is a real party or not, and should decide the question whether it is so named or not. See, also, Stanley v. Schwalby, 162 U. S. 255, 16 S. Ct. 754, 40 L. Ed. 960.
United States v. Lee, 106 U. S. 196, 1 S. Ct. 240, 27 L. Ed. 171, is relied upon by appellees. But, as Mr. Justice Miller points out there, the United States went so far as to contend -that, though it did not have any title to the land in controversy, and what it set up as a title was no title at all, the court, could not render judgment in favor of the plaintiff and against the defendants, because the latter held the property as officers of the United States. This argument was rejected by the court, because, it being clear that the title to the property in question had always been in the plaintiffs, it followed that.the acts of any government officials in taking and holding possession was trespass pure and simple, and they could not avail themselves of the immunity of the United States from suit. Further, as the court said, it was not alleged, and could not be contended, that Congress or the President had any lawful authority to take possession of the property in question. See, also, Belknap v. Schild, 161 U. S. 11, 16 S. Ct. 443, 40 L. Ed. 599.
Sloan Shipyards v. U. S. Fleet Corp., 258 U. S. 549, 42 S. Ct. 386, 66 L. Ed. 769, is also relied upon by appellee. But it differs from the one at bar because the defendant, the Fleet Corporation, was held to be a separate entity, incorporated under the laws of the District of Columbia. The court found that the bill stated a cause of action against the Corporation, because it could not be assumed from the allegations of the bill alone that the taking possession of the property in question by the Fleet Corporation was in pursuance of powers delegated to it by the President at the time that act occurred, or that it was included within the ratification of the past acts of the Fleet Corporation made by executive order.
In Dakota Central Telephone Co. v. South Dakota, 250 U. S. at page 184, 39 S. Ct. 507, 509, 63 L. Ed. 910, 4 A. L. R. 1623, the Supreme Court reiterates that the motive or mere abuse of discretion by a government official in exerting a power given, involves considerations that are beyond the reach of the judicial power, and that the judiciary may not invade the executive department for the purpose of correcting alleged mistakes or wrongs arising from an asserted abuse of discretion.
I cannot find on this record that the 'government officials arbitrarily interfered with property of the plaintiff. The boats were not his property, and his limited right of possession was lost by his failure to operate them. Before they were seized, there were negotiations between the parties, and he was notified that the government would exercise its rights under the contract.
In conclusion, it must be remembered that the whole objeet of the United States in *851leasing these boats was to have them operated for the benefit of shippers in the .Mississippi Valley; that Goltra attempted only two trips on the river, and then tied them up at the wharf in St. Louis. The shipping pubiie were complaining of the lack of service, so the government then took possession in order to turn them over to a lessee who would give service to the pubiie.
It would therefore seem that the motion to dismiss and to quash the temporary restraining order should have been granted.