Schilling v. Rogers

PETITIONER:Schilling
RESPONDENT:Rogers
LOCATION:Dry Docks at Reed, WV

DOCKET NO.: 319
DECIDED BY: Warren Court (1958-1962)
LOWER COURT: United States Court of Appeals for the District of Columbia Circuit

CITATION: 363 US 666 (1960)
ARGUED: Feb 29, 1960 / Mar 01, 1960
DECIDED: Jun 20, 1960

Facts of the case

Question

  • Oral Argument – February 29, 1960
  • Audio Transcription for Oral Argument – February 29, 1960 in Schilling v. Rogers

    Audio Transcription for Oral Argument – March 01, 1960 in Schilling v. Rogers

    Robert Kramer:

    — section 32 of the Trading with the Enemy Act is silent about the question of judicial review and makes no provision for it and in addition, it contains language giving extremely wide discretionary powers and authority dealing with the return of property.

    The Government, however, wants to make it clear that it does not rest its case, dealing with the proposition that there is no judicial review here, on the language of Section 32, which is simply silent on the matter of judicial review.

    Section 32 is simply one of some 40 odd sections of the Trading with the Enemy Act.

    It must be considered with the other sections of the Act.

    Turning to other sections of the Act, we find at least two such sections which on their face would seem in sweeping language to bar judicial review under Section 32.

    The first of those sections is the one mentioned by petitioner’s counsel yesterday Section 7 (c) found in petitioner’s brief at page 41.

    Hugo L. Black:

    That’s the one the Court relied on, isn’t it?

    Robert Kramer:

    Yes, that is the one that the Court of Appeals relied on in this case and in the four other cases —

    Hugo L. Black:

    Well I mean in the motion for dismissal.

    Robert Kramer:

    Yes sir and the Court of Appeals relied on it in the four other cases where it similarly had to.

    The same question has been before the Court of Appeals of this from the five times including this case and that each case in that Court has reached the same result relying as you say on Section 7 (c).

    Felix Frankfurter:

    Did it argue the matter at length in any of the prior cases?

    Robert Kramer:

    I think in the first case, McGrath against Zenith —

    Felix Frankfurter:

    Zenith —

    Robert Kramer:

    — that is the leading opinion and the one which is simply to a large extent been followed since then.

    In this case the opinion was simply a per curiam.

    Potter Stewart:

    Has the question arisen in any other Court of Appeals?

    Robert Kramer:

    No other Court of Appeals, no.

    As far as I know, the issue was only in the Court of Appeals for the District of Columbia.

    The language of section —

    Hugo L. Black:

    Is it likely to arrive elsewhere, isn’t it?

    Robert Kramer:

    No, that is right.

    The question — the language of Section 7 (c) is very broad.

    It reads in part the sole relief and remedy of any person having any claim to any money or other property heretofore or hereafter conveyed, transferred, assigned, delivered or paid over to the Custodian shall be that provided by the terms of this Act.

    (Inaudible)

    Robert Kramer:

    I should think not ordinarily because the Attorney General or the Alien Property Custodian before would be ordinarily be the defendant and therefore the action ordinarily I should think wouldn’t be brought here in the District of Columbia.

    Well – (Inaudible)

    Robert Kramer:

    That is correct, yes.

    Now in addition to that, there is a significant section which is found in our brief on page 33, Section 9 (f) of the Trading with the Enemy Act.

    Section 9 (f) in part reads as follows “Except as herein provided the money or other property conveyed, transferred, assigned, delivered, paid to the Custodian shall not be subject to any order or decree of any court.

    Robert Kramer:

    Now I think Section 9 (f) is particularly significant because Section 9 is the key section of the Trading with the Enemy Act insofar as a judicial review is concerned.

    Section 9 (a) —

    Charles E. Whittaker:

    Only with respect to 9 (a)?

    Robert Kramer:

    Not — well not — today that is true.

    That is today Section 9 (a) allows judicial review in the case of either citizens or non-enemy aliens.

    However, I’d like to point out that after World War I, Congress also enacted Sections 9 (b) and 9 (c) which allowed judicial review for enemy aliens.

    Now contrast to what Congress did after World War I when it specifically allowed judicial review in 9 (b) and 9 (c) with what Congress did after World War II when they enacted Section 32 and said nothing at all about judicial review.

    Felix Frankfurter:

    Am I right in thinking that the Second World War legislation dealing with enemy aliens mitigated some of the provisions not existing but mitigated some of the provisions of the — of the Alien Enemy Act of the (Inaudible)

    Robert Kramer:

    That is right.

    As the legislative — to go into the legislative history, the legislative history indicates that the pattern that was envisaged for relief after World War II, so to speak, was a two-fold one.

    First, under Section 9 (a), there was to be judicial review and so to speak a mandatory return for all non-enemy aliens.

    Section 9 (a) gave an absolute right of judicial review for them, but then as the — as the Alien Property Custodian pointed out to the congressional committee, Section 32 was to provide, so to speak, another remedy.

    It was a remedy that might be utilized, if they so wish, by even by not enemy alien but it could also be utilized by enemy aliens, but because it could be utilized by enemy aliens, it was envisaged as one that was purely administrative.

    It gave wide discretion to the administrator and there was to be no judicial review under it.

    Now it’s significant that Congress considered Section 32 for almost two years from 1944 to 1946.

    This was not something that was rushed through Congress under great war of pressure.

    Congress took plenty of time.

    Furthermore, the original of Section 32 (a) was legislation drafted by the Alien Property Custodian and the Attorney General.

    They sent a joint letter which is found in our brief on pages 12 and 13 in which they state that the purpose of Section 32 (a) was to provide administrative remedy with wide discretion and that there was not to be any judicial review under Section 32 (a).

    This was not only their understanding, it was the understanding of witnesses who appeared before the congressional committee and who criticized, they then draft the 32 (a).

    For instance the testimony of Mr. Carroll which is found in our brief on pages 13 and 14.

    In other words it was the general consensus of opinion that there was not to be a judicial review under 32 (a).

    Judicial review was to be under Section 9, not under 32, not under 32 (a).

    Felix Frankfurter:

    Are you saying that a treaty for instance, the treaty claimed requested property as requested under a vesting order was going to Court that he also could go and appeal to the administrator on reviewable action of the Attorney General.

    Robert Kramer:

    That is correct.

    Felix Frankfurter:

    That a German or if an enemy alien only relief was under the (Inaudible)

    Robert Kramer:

    That is correct.

    Hugo L. Black:

    Suppose there had been a question here as to citizenship of the person, did the Attorney General had tried that?

    Robert Kramer:

    Well in —

    Hugo L. Black:

    — in written review.

    Robert Kramer:

    I think if it’s a question of citizenship there would have been alternate forms of relief.

    If —

    Hugo L. Black:

    If what?

    Robert Kramer:

    There would have been alternate forms.

    If the petitioner had wished, he could have asked for administrative determination under Section 32, but if he did not wish to do that, he could have gone into Court under Section 9 (a) and claimed that he was an American Citizen and that issue wouldn’t be subject to judicial review under Section 9 (a).

    Hugo L. Black:

    Suppose Section 9 (a) didn’t provide it and he was a citizen, will it be left to the Attorney General to decide it without —

    Robert Kramer:

    Well it seemed to me that —

    Hugo L. Black:

    — testifying it without the review —

    Robert Kramer:

    — under the decisions of this Court I believe.

    You could — construing the Trading with the Enemy Act.

    This Court has intimated that if it were not for the judicial remedy given by Section 9 (a) constitutional issues would be raised in the type of case you put.

    Hugo L. Black:

    What constitutional provisions would likely affect in your judgment?

    Robert Kramer:

    Well I should think one constitutional provision would be that it would be taking property without due compensation if this was the property of an American citizen.

    Hugo L. Black:

    What about the Due Process Clause?

    Did that Section presented?

    Robert Kramer:

    That might well be that to — the taking would be a violation of due process, if it were of an American citizen though.

    Hugo L. Black:

    Yes, I suppose the difference is if an alien enemy is not entitled to this due process that’s under the Due Process Clause or the just compensation clause.

    Robert Kramer:

    And that has been the indication in the decisions of this Court.

    And I might add that the petitioner has not raised any constitutional issue anytime in this case.

    Felix Frankfurter:

    I suppose the old case would allow him to assure his American citizenship under the doctrine of refuge.

    Robert Kramer:

    Very likely, yes.

    That is quite true.

    Now there’s also significance that Section 32 (a) when it was enacted by Congress was part of Public Law 322 and that law contained other amendments to the Trading with the Enemy Act.

    One of those amendments related to Section 22 which deals with consulting and that amendment enacted at the same time Section 32 (a), that amendment is Section 20 expressly provided for judicial review under Section 20.

    In other words that’s a pretty clear indication that whenever Congress has wanted a judicial review under the Trading with the Enemy Act they had said so.

    And the reason they had said so is because undoubtedly they realized that they didn’t say so.

    Then the provisions of 7 (c) and 9 (f) would operate to bar a review.

    Now you find the same pattern again when a few months later in August, 1946, Congress amended Section 32 (a) and enacted the proviso herein question dealing with discrimination against groups for political reasons.

    First of all you discover as we point out in our brief on pages 16 and 17 that the Alien Property Custodian wrote a letter to determine in the House Judiciary Committee which the Chairman read with his approval to the House in which the Alien Property Custodian pointed out that he wanted to make it clear that certain amendments and changes that the Senate had made in Section 33 which deal with the statute of limitations that none of those amendments and changes in his judgment operated to give any judicial review under Section 32 (a).

    The amendments as a matter of fact of Section 32 (a) said again did not deal with judicial review.

    Robert Kramer:

    Furthermore, these August amendments again were part of Public Law Number 671.

    Public Law 671 made other changes to the Trading with the Enemy Act.

    One of those changes was that it added Section 34 to the Act.

    Now Section 34 deals with the so-called death claim, that is the claims of American citizens against the properties that have been — have been seized by the Alien Property Custodian and again it is significant that Section 34, as added here in 1946 of August, specifically provides for judicial review.

    The matter’s not left up in the air.

    In other words, every time Congress has wanted judicial review under the Trading with the Enemy Act it has said so expressly.

    It said so in Section 9, it said so in Section 20, it said so Section 34 as we point out in our brief.

    Since 1946 on at least two occasions bills have been introduced in Congress to amend Section 32 (a) to provide expressly for judicial review, none of those bills have ever been enacted.

    Now turning to for a moment from the legislative history and from the wording of the Trading with the Enemy Act, it also seems to the Government that there were very sound policy reasons that undoubtedly influenced Congress here not to desire to have judicial review.

    Congress probably realized that they were not dealing here with a statute which would involve the liberty of any person.

    There was no question here of imprisonment, no question here of deportation, no question here of putting anyone in the armed forces against his will of drafting anybody for service.

    There’s no question here as I made plain of citizenship.

    There is no question here of any administrative body blackening anybody’s reputation.

    There is no question here of depriving anyone of the right to vote or the right of free speech.

    Congress undoubtedly viewed this proposition simply as an act of grace.

    Do you think that 32 (e) has got any significance?

    Robert Kramer:

    I really do not, Mr. Justice since so, as I read Section 32 (a), my interpret — 32 (e) excuse me.

    My interpretation is 32 (e) deals with the claims of Americans or other creditors against the seized properties.

    But it — it provides that — as an instance to that kind of a claim —

    Robert Kramer:

    Yes.

    — the issue is to whether this man is within 32 (d) —

    Robert Kramer:

    Yes.

    — is a justiciable, litigable issue.

    Robert Kramer:

    Well, but it provides that it —

    In that context I quite agree it’s not this, it’s not your case, does it?

    Robert Kramer:

    Well first —

    It shows that Congress had some — it has this much relevancy that the possible — that issue of status is not wholly excluded because it’s — it’s specifically provided for as litigable in that context.

    Robert Kramer:

    However, it seems to me that not only is it dealing with the different issue, but there it is dealing with the question of judicial suit not judicial review, but judicial suit after return has been made to the property.

    Quite right but it did not say that the man’s status as determined by the Attorney General was to govern the suit, it made it an independent, litigable issue.

    Robert Kramer:

    Well that is quite true.

    That’s true.

    Robert Kramer:

    Yes.

    Felix Frankfurter:

    You’re not denying, are you — you’re not denying, are you, that the subject matter of this controversy namely whether this petitioner was a member of the group characterized by 32 is something that the Court could decide?

    Robert Kramer:

    Of course yes.

    Felix Frankfurter:

    In that sense, it’s a justiciable thing but some other things are not justiciable may not fit for judicial decisions.

    Robert Kramer:

    Oh no, this is perfectly fit.

    Felix Frankfurter:

    What you’re saying is that it was withheld.

    Robert Kramer:

    That is right.

    Congress consciously and deliberately withheld it and as I started to say I think there are — are some reasons why Congress did if you stop and think about it, take the factual situation in this case.

    The petitioner admittedly is a German national.

    During the entire period of the war, he was in Germany.

    Now in order to classify these claims, one must ascertain facts that occurred in Germany.

    One must deal with questions of German law of what the Nazi Government did or did not do.

    All those questions may be particularly difficult of judicial proof accurately in a court of law.

    But your position would go to the extent of saying that if we had a record where the Alien Property Custodian said I am not going to concern myself at all.

    I’m not interested in whether you come within the scope of this section, you say that there was no judicial review in that case?

    Robert Kramer:

    Well I think —

    Wouldn’t you?

    Robert Kramer:

    It has been the Govern — certainly it’s the Government’s position —

    That’s the consequence to your position.

    Robert Kramer:

    Yes you were pushing that undoubtedly, Mr. Justice to the most extreme form.

    Felix Frankfurter:

    But is it — is it?

    Well that’s where you have to —

    Robert Kramer:

    Not necessarily it seems to me because, one, can I suppose to distinguish between a case A where the Alien Property Custodian simply said, “I won’t decide this case.”

    I’m not suggesting at all that there’s any margin to review once the — that the — once the Alien Property Custodian directs his attention, directs his mind to the question whether this is a — this is a man subject to Section 32 (d).

    I’m not raising that question.

    All I’m saying is that —

    Robert Kramer:

    And he did here.

    — we haven’t got that before us as I understand it.

    Robert Kramer:

    Well in this — no.

    Robert Kramer:

    In this case, he did direct his mind to it and as you will — if you — this Court will read the decisions both of the trial examiner and the Custodian which are reprinted in the appendix to our brief and also in the appendix to the petitioner’s petition for certiorari.

    Felix Frankfurter:

    Well are you suggesting or is the Government taking the position that if the Director says suppose the decision goes for the Government that this is the law and if we could not have affirmed that there is no judicial review on the record of this case, is it your position, speaking for the Government that next week the Director can say the Supreme Court said that 32 (d) is not reviewable — the determinations under that are not judicially reviewable, therefore I don’t care what the new — Mr. X said.

    I don’t take whether he is or isn’t within the category of the statute, this is not reviewable.

    I decide against it.

    Are you saying that the decision is saying there’s no judicial review in this case would cover that case?

    Robert Kramer:

    I don’t think so.

    I don’t think it’s necessary to go —

    Felix Frankfurter:

    But it is necessary, that’s the case of refusing to discharge his discretionary duties.

    Robert Kramer:

    That is correct.

    Felix Frankfurter:

    And there are plenty of cases usually the covered cases particularly or non-reviewable action by the Interstate Commerce Commission doesn’t allow it to refuse to exercise discretion and it can be mandamus and an official may have a non-reviewable exercise the power of discretion but he hasn’t that a non-reviewable refusal to exercise the power of discretion which is a very different thing.

    Earl Warren:

    Well suppose the — to go — we’ll just take it one step further and say that the — that the facts — the stipulated facts in the case would clearly show that the man was within that group and the — the administrators or examiners said, “Well I’m going to deny him anyway.”

    Well couldn’t — couldn’t the Court reach that?

    Robert Kramer:

    Well Mr. Chief Justice, I suppose one can — can easily put extreme cases.

    I think one can put even a more extreme case.

    Suppose the allegation was that the Alien Property Custodian has been bribed or —

    Earl Warren:

    No, I’m not dealing with that.

    Robert Kramer:

    — there was fraud.

    Earl Warren:

    I’m just dealing with — with a situation where the agreed statement of facts that — that you have in the case would show clearly that this man was in — in one of the — the groups that would offer one — entitle to some — some relief.

    Robert Kramer:

    I think it is the Government — Government’s position —

    Earl Warren:

    The Director says — the Director said, “Well now I — I just decided he’s not entitled to relief.

    That’s — that’s all there is to it.”

    Now are the courts foreclosed from going into that question?

    Robert Kramer:

    Well of course that is not our case but to take up your hypothetical case, I think that it is a fair interpretation of the statute here whether or not this Court will ultimately agree in the extreme you case put.

    It’s fair interpretation of this statute.

    That Congress here considered this matter and they meant generally speaking for the decision of the Director to be final.

    Now they recognize the fact that anyone to whom you give the power to make a final decision, the judge here, or the Attorney General or even the President can make a mistake.

    Felix Frankfurter:

    But the Chief Justice’s case isn’t a mistake.

    It’s a willful refusal to apply the statute wherein the Director as I understand the Chief Justice’s hypothetical case, the Director says, “Yes this man is within the statute but I willfully refuse to apply the statute.”

    Robert Kramer:

    Well I think in such a case of willful — actual willful bad faith that there — there might well be judicial review.

    Felix Frankfurter:

    Well bad faith, he may think he may have a private policy that none of us could be (Inaudible)

    Robert Kramer:

    That is correct.

    Felix Frankfurter:

    Is he entitled to exercise that in that — is that exercise of discretion?

    To me that is an extreme case.

    It’s a different case.

    Earl Warren:

    Well that’s a little — it goes a little far because I’m not saying I — I and — did intend he would — he would say I willfully disobey the law.

    I willfully refuse to violate the law.

    He merely says on these facts which we — we say in the hypothetical case are clearly placed this man within a — within one of those groups.

    On these facts, I determine that he is not entitled to relief.

    Not eligible for relief.

    I just like to know what the position of the Government is as to a situation of that kind.

    Does the man have judicial review or does he not?

    Robert Kramer:

    I would say there — that’s it’s simply a question of mistake no matter, so to speak, how bad a mistake it is nevertheless if he — if he’s acted in good faith and exercises discretion that there is no judicial review.

    Charles E. Whittaker:

    Well the question would be did or not exercise good faith, is your argument valid would it not mean that this relief would be only when Congress or to induce the discharge of that person and get someone of the more liberal discretion.

    Robert Kramer:

    That is correct.

    I — I presume that if the Alien Property Custodian acted in any of these horrible ways we’re talking about that either the Attorney General or the President after all to whom the power is directly delegated would be first person to correct.

    Charles E. Whittaker:

    I would assume and is this right or wrong that there is no doubt of Congress’ power to deny judicial review in such case.

    Robert Kramer:

    That is the Government’s position, yes.

    Charles E. Whittaker:

    And if they have done so, then the fact that the mistrust may have been arbitrarily exercised even by the administrator wouldn’t grant judicial review, would he?

    Robert Kramer:

    That is correct.

    As I — as I said it seems — it seems to the Government that you have a — an unusual area here an area where you are dealing in — in a sense in the field of foreign relations in foreign affairs.

    As we — we point out — out in our brief again, actually the Alien Property Custodian of the Government have found that it desirable to handle many of these claims under Section 32 (a) simply by direct agreement with a foreign government, France or Italy, rather than go — going through the ordinary process of a hearing.

    This — this area comes very close to the area of foreign relation and treaty questions.

    In fact the — the scheme, the general scheme in having on the Trading with the Enemy Act is shown by Section 39 of the Act which is in the appendix to our brief is that Congress has said that in general enemy aliens are to look to their own government for relief for this type of seizure.

    Supposing one was to come to the conclusion that the statute is arguable either way you just can’t tell, where does that leave Section 10 of the Administrative Procedure Act?

    Robert Kramer:

    Well you say that the statute — maybe either way you mean that on the merits or the question of judicial review?

    No on the question of reviewability.

    Robert Kramer:

    Well on the question of reviewability, it seems to me that the case does not fall under —

    You both got fair arguments in both ways otherwise you wouldn’t be here and I’m just wondering if the Court should come to conclusion that you just can’t tell.

    But here is Section 10 of the Administrative Procedure Act that says unless the statute does exclude it there is to be a review except from the ground of agency discretion.

    Robert Kramer:

    Well the —

    Where — where does that leave one?

    Robert Kramer:

    Well it seems to me the answer is two-fold that (A) the statute does preclude review under Section 7 (c) and 9 (f) and therefore —

    Yes but the —

    Robert Kramer:

    — and (B) —

    I’m assuming —

    Robert Kramer:

    Well (B) —

    I want you to assume my premises for the moment.

    Robert Kramer:

    Well I don’t know if he wants or want to assume the second premise.

    The second exception in the APA is where the thing is committed to agency discretion.

    And —

    Robert Kramer:

    And it seems to the — the Government’s position that under the old scheme of the Trading with the Enemy Act it was meant to commit this matter under Section 32 to agency discretion.

    And you can’t carve it down under the two-step process of status and the merit as well.

    Robert Kramer:

    We certainly you do not believe that that is what Congress intended.

    There’s nothing at all in the legislative history to reflect that.

    And certainly that has never been the construction of the statute by the Alien Property Custodian from 1946 until the present date.

    William J. Brennan, Jr.:

    Well what’s the significance?

    You go ahead.

    I am just kept wondering what’s the significance then of “shall” rather than “may” at this place.

    Robert Kramer:

    Well the only “shall” is — is involved is that “he shall make a determination.”

    That brings up the point I suppose that we have just discussed.

    If the Alien Property Custodian simply said, “I won’t even decide this case.

    I won’t even pass upon it.

    I will give you a decision.

    You filed your claim well the claim could not gather dust in my file box.”

    Well then the Act says he shall determine but when it comes to the question of what his determination shall be, there the Act simply says, “He may return.

    He may return,” it’s discretionary and he gives them very broad discretions.

    It says he may return it and then it lists several conditions, one of which is if he finds that the return is in the interest of the United States —

    Felix Frankfurter:

    But if it says he shall determine —

    Robert Kramer:

    Yes.

    Felix Frankfurter:

    — that presupposes that he shall determine in accordance with the Act, I’m coming back to the right question —

    Robert Kramer:

    Yes.

    Felix Frankfurter:

    — he can find that a person within the category to which a return must be made, but he refuses to do it he’s not determining then in any fair sense of the term determine.

    Earl Warren:

    Do you agree with that?

    Robert Kramer:

    No, I think that is going too far.

    Earl Warren:

    But you — you’ve nodded your head as though you agreed.

    I just wonder if you do.

    Robert Kramer:

    No it seems to me that — that is going too far because I think —

    Felix Frankfurter:

    You mean to say if — if a position is made before the Director —

    Robert Kramer:

    Yes.

    Felix Frankfurter:

    — and it is concededly take — take your own position, that means this is the occupied territory, this is — this is Belgium or Holland during occupation and he sets forth all the facts and he says clearly being for all of your political group outlawed by German laws, nevertheless I decide against it.

    I’m not — not talking about the Attorney General, that’s something else here, nevertheless he decides against him, so you think that’s complying what he shall determine?

    Do you think that’s a determination in any fair reading of a statute charging an official with determining something and the criteria you’ve given and he says the criteria is satisfied but I nevertheless reject it.

    Do you think that’s determining?

    Robert Kramer:

    No, I should say that naturally because I would get back to case.

    It seems to me that’s a clear case of bad faith.

    Felix Frankfurter:

    Well, I don’t want to use the word bad for it because that carries other connotations.

    He may have better reach.

    To me he isn’t discharging his duty, concededly not and he may be the most high-handed man in the world, but have the wrong policy with that.

    Hugo L. Black:

    What is the standard under which he has to determine?

    Robert Kramer:

    The standards, I suppose, are the conditions laid down in Section 32 of the Act.

    32 (a) lays down a series of conditions, 32 (a) (1) —

    Hugo L. Black:

    Whether he says, you’ll find that in these categories.

    Robert Kramer:

    Yes.

    Hugo L. Black:

    What is the standard under which it depends on that and the Custodian decides whether he should nevertheless reached for the return of the property (Inaudible)

    Robert Kramer:

    Well assuming that he is in the category then he must meet the other conditions such as 32 (a) (1) says he must have filed his notice of complaint.

    Hugo L. Black:

    Suppose he files it —

    Robert Kramer:

    And then —

    Hugo L. Black:

    — we’re down to the merits now, what’s the standard on which the merits are determined?

    Robert Kramer:

    Well —

    Hugo L. Black:

    That has to be returned for it.

    Robert Kramer:

    The main standard as I judge is in 32 (a) (5), namely that the return as in the interest of the United States.

    Hugo L. Black:

    That’s the sole one.

    It means that I’ve seen the major (Inaudible)

    Robert Kramer:

    No.

    That is, I think, the sole one if you decide the other that he meets the other half of the categories.

    Felix Frankfurter:

    Well then you’re right.

    That is what I think of standard discriminated against that he must be a member of — that he was a citizen of subject to discriminating against political, racial, religious groups, he must come within those — one of those three groups and nothing is more difficult for admiring the technology that goes with the German situation and to determine that fact.

    That’s another reason why it should be left to the administrator and not to the courts because it’s very difficult to ascertain whether you do or do not come within one of these outlawed groups.

    That’s not an easy thing to determine.

    Hugo L. Black:

    I think you answered my question as I intended to ask you when you said the standard what I asked for it holding you — are going to be in the category.

    Robert Kramer:

    Yes, that’s the way I understood your question, Mr. Justice Black.

    Hugo L. Black:

    Where he’s been, that he is, he knows he belongs there.

    What is the standard that the Attorney General must follow in order to reach the conclusion as to whether he shall have a return of the properties?

    Is there any other besides five?

    Robert Kramer:

    Well there the conditions laid down also in — in three and four.

    Three says that the property or interest claim was not at anytime after September 1, 1939 held by or used with the consent of any person who was the owner thereof pursuant to any arrangement to conceal any property or interest.

    In other words, this was not one of these “cloaking” arrangements.

    And then the — and then there is another standard in — in Section 4 that there is no actual or potential liability under the renegotiation act, in respect of the property or interest to be returned.

    And so he must meet — roughly there are five things he must meet there.

    And the last one, number five, of course, is the broadest one, namely, that in some respect it’s the broadest one, namely, that such return is in the interest of the United States.

    Hugo L. Black:

    That’s the ultimate determining of the standard.

    Robert Kramer:

    That is — well in the sense it is but I suppose that the —

    Hugo L. Black:

    Assuming — assuming that he comes within the response of all the others.

    Robert Kramer:

    Yes.

    That is correct.

    Hugo L. Black:

    Assuming as it was said that there was a stipulation that he did then it could still deny him on the ground that the Custodian thought it was not in the interest of the United States, and that would be the final, ultimate —

    Robert Kramer:

    Yes.

    Hugo L. Black:

    — standard that he had the act under.

    Felix Frankfurter:

    Well he wouldn’t be the ultimate determinant?

    Robert Kramer:

    Who?

    Felix Frankfurter:

    The Custodian?

    He’s the Director of the — wasn’t he?

    He can deal —

    Robert Kramer:

    No.

    Felix Frankfurter:

    — with the Attorney General within the Act.

    Robert Kramer:

    It would be Attorney General.

    Hugo L. Black:

    That’s going to be the Attorney General.

    Robert Kramer:

    And he might even be the President if he wished to be.

    Hugo L. Black:

    I considered him as the ultimate Custodian?

    Robert Kramer:

    Yes.

    That is correct.

    Hugo L. Black:

    Would it make any difference whether the Attorney General or someone under him (Inaudible) the laws and terms?

    Robert Kramer:

    Well —

    Hugo L. Black:

    Do you think if the — the —

    Robert Kramer:

    Well I think the Attorney General could —

    Hugo L. Black:

    Attorney General more power and that would give the —

    Robert Kramer:

    No, I think not —

    Hugo L. Black:

    That has said now.

    Robert Kramer:

    Under the present regulations, the Attorney General would simply not delegate it fully his powers to the Director of Alien Property.

    Felix Frankfurter:

    If the Court has said it makes a difference that delegation was given to cabinet officers rather than (Inaudible)

    Robert Kramer:

    Well then perhaps it might make a difference.

    Hugo L. Black:

    Well maybe the Court said to them —

    Robert Kramer:

    Under the present set up I might say that the way it operates is that in what are — what are known as the —

    Hugo L. Black:

    I would — I would presume that was the information with whatever the subject is constitutionally speaking, I know of no provision in the Constitution that requires that — which provides that something could make him the President with the Attorney General, it doesn’t even express to the Deputy Attorney General unless — unless you’re saying that the Constitution authorizes the Attorney General to do a certain thing.

    I’m talking about delegation of power.

    Robert Kramer:

    Yes.

    Felix Frankfurter:

    Does the Attorney General — has the Attorney General, as a matter of fact, (Inaudible) in the interest of United States?

    Robert Kramer:

    I think in only a few instances.

    Felix Frankfurter:

    And has the written opinion on that or just denied it?

    Robert Kramer:

    I think in many — as I understand it in certain instances at least the problem has involved secret or highly classified information and therefore it has not been fully divulged in the opinion.

    Felix Frankfurter:

    He just denied — he just denied it.

    Robert Kramer:

    That is correct, but I think there’d been relatively few cases actually that have gone off on that ground.

    Hugo L. Black:

    Who did it here?

    Robert Kramer:

    Well here it is — let me explain to you briefly the way the situation now operates.

    The initial hearing is before the trial examiner who makes his recommended decision.

    It then goes to the Director of Alien Property.

    He makes his decision.

    His decision is final except where as in this case more $50,000 is involved or maybe involved, or except where a novel or unusual question of law or policy is involved in those accepted cases so speak, the Attorney General is given an opportunity to review the case and the decision does not become final until the Attorney General has reviewed the case as was the situation here.

    Ordinarily reviewing the case, unless the Attorney General disagrees with the decision of the Director, he does not write another opinion.

    He simply says that he has reviewed it and he adopts the decision of the Director as his own.

    That is the procedure followed.

    Could you give us any idea as to the volume of these claims, have they been very, very voluminous?

    Robert Kramer:

    Yes, we have reference in that in our brief.

    You will find there on page 20 of our brief note — excuse me, page 30 of our brief.

    30?

    Robert Kramer:

    Footnote 25, I believe we have.

    Your reference there, there have been approximately 12,000 claims down to the end of the fiscal year 1957.

    Now those are all types of claims under Section 32, a very substantial volume.

    Charles E. Whittaker:

    Did I understand you to concede in answer to Mr. Justice Brennan’s question that there is mandatory language in Section 32?

    Robert Kramer:

    There’s mandatory language, I think, in the sense that the Director must make a decision.

    Charles E. Whittaker:

    Well reference was made —

    Robert Kramer:

    They must decide — decide the case.

    Charles E. Whittaker:

    Reference was made to the word, “shall.”

    Robert Kramer:

    Yes.

    Charles E. Whittaker:

    Well as I read this, it appears on page 44 of the petitioner’s brief.

    The President or certain law officers he may designate may return the property or the proceeds thereof whenever the President or such officer or agency shall determine, then follows one and then follows two that such owner and legal representative or it’s just an interest of any are not, then follows (d) and then (d) says, “provided that notwithstanding provisions of sub — Subdivision (d) return may be made to an individual who as a consequence of such rule.

    Now I fail to see the basis upon which you feel there is any mandatory language because the word, “shall” relates only to “if he shall find.”

    Robert Kramer:

    I think the basis in the argument is that the language indicates that Congress intended him to make a determination.

    It intended however for his determination to be within his discretion.

    Congress did not intend him simply to receive the claim and do nothing about it.

    Charles E. Whittaker:

    That’s the point.

    Robert Kramer:

    I think that is the point.

    Earl Warren:

    Thank you, Mr. Fillman.

    Henry I. Fillman:

    Mr. Chief Justice I did run over my time yesterday, but —

    Earl Warren:

    Yes you may have — you may have a few minutes to sum up your argument there.

    It takes amount of time with the other side you may answer if you wish for a few minutes.

    Henry I. Fillman:

    Thank you Mr. Chief Justice.

    I will just confine my rebuttal to the statements made by Mr. Kramer on the point that the legislative history and particularly the fact that Section 34 was added to the Trading with the Enemy Act at the time they added the first proviso from Section 32 (a) (2) (D) has really nothing to do with the question before the Court because the purpose of incorporating the right to sue in Section 34, the debt claim provision review by the Court of a debt claim determination was clearly pointed out in the hearings before — it’s not on my brief, in the hearings before the Subcommittee No. 1 and Committee on the Judiciary, House of Representatives, 79th Congress on House Bill 5089, a Bill to amend the First War Powers Act, Serial No. 20.

    And it is there stated by Mr. Markham, who was then the Custodian, that in view of this Court’s decision in Markham v. Cabell which had held that one could sue the Custodian under Section 9 (a) to recover from the vested property a debt owing to the plaintiff.

    There would be a first-come, first-serve situation as far as payment of the debt claims were concerned, so the Custodian asked legislation to take away from Section 9 (a), and it’s in 9 (a) there is the provision that any person not an enemy or ally of an enemies, it’s on page 42, claiming or to whom any debt may be owing from an enemy or ally of an enemy whose property or any part thereof shall have been conveyed to the Custodian may sue the Custodian or the Treasurer of the United States to recover on his debt out of the vested property.

    They took that away in enacting Section 34 and allowed the creditor to come-in in an administrative proceeding and if he was dissatisfied with the administrative proceeding there could then be an equitable distribution of the vested assets owing by the former property owner to his creditors who are not enemies or allies of enemies and Section 34 is based on the National Bankruptcy Act.

    There’s a system of equitable distribution and review by the courts of the mere fact that they did that in the same Act which incorporated the first proviso is no indication and no proof that Congress did not intend that there should be no judicial review of any determination by the Custodian which was without supporting evidence or arbitrary or capricious or void.

    That is to that.

    Now as to the real point here on Section 32, when it says “may return” in the first part, the word “may” relates solely to the return of the property.

    The word “may” does not relate to a determination of the status or the condition.

    He is not given a permissive right to determine whether the man comes within the conditions laid down for return.

    “May” in that sense must be read as “shall” or mandatory because the word “may” has been construed in a statute.

    It has been construed by this Court and other courts.

    The word “may” is to be read as mandatory.

    It means shall or must whenever it is necessary to carry out the intent of the legislature that has enacted the particular statute in which the word is found and to carry out the sense of the policy of the legislation.

    Now Congress in our brief quotes Congress on the sense and purpose of the first proviso of Section 32 (a) (2) (D).

    Congress considered these people who were persecuted as non-hostile enemies.

    Congress said we call them the enemies of our enemies.

    They, in fact, wanted to have the allied course succeed they should have their property back.

    That’s the exact language of Congress in the reports.

    Since that is the sense and the purpose and intent of the legislature to give these people back their property if they come within this class, then I suggest to the Court that the word “may” which only relates to return if it has any application or consideration with respect to the determination of status or condition, I say it should then be read as mandatory.

    And my last point, if the Court please, is, that the issue here is not the expertise of the administrator.

    He is not an expert on what were considered political, religious, or racial groups no more than I have.

    He must determine that on the facts adduced on the record.

    There were facts adduced here on the record before the hearing examiner.

    Henry I. Fillman:

    The hearing examiner said though evidence was documentary and only one witness was called by the petitioner.

    He names that witness in his recommendation and findings.

    That witness is named M. Magdalena Shack.

    Although it does not appear here, I doubt whether the Government will deny that M. Magdalena Shack is an employee and attorney in the Office of Alien Property.

    So if there is any expertise in the office of Alien Property to determine this question, M. Magdalena Shack, an employee of that office, a former lawyer in Germany, arium, and who had taught one semester at Harvard law school, who was the witness here before the hearing examiner and who testified to the conditions in Germany and as to what the political groups and knew who the bar examiners were and the chief of the bar examiners then I say we have in the records the expert in the office of Alien Property that supported the case of the petitioner which evidence was disregarded by the Director when he made his decision and we say that was arbitrary, capricious, and void and if it’s void, the District Court has jurisdiction.

    It has jurisdiction to control not to decide, but to control void acts of an agency.

    Well that’s just begging the question.

    Henry I. Fillman:

    Sir?

    That’s just begging the question, not arguing.

    Henry I. Fillman:

    Well.

    Your question here finds that on better argument.

    Henry I. Fillman:

    Thank you.