American-Hawaiian S. S. Co. v. United States

92 F. Supp. 785, 1950 U.S. Dist. LEXIS 2613
CourtDistrict Court, S.D. New York
DecidedMarch 20, 1950
StatusPublished
Cited by4 cases

This text of 92 F. Supp. 785 (American-Hawaiian S. S. Co. v. United States) is published on Counsel Stack Legal Research, covering District Court, S.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
American-Hawaiian S. S. Co. v. United States, 92 F. Supp. 785, 1950 U.S. Dist. LEXIS 2613 (S.D.N.Y. 1950).

Opinion

LEIBELL, District Judge.

This is an action by the libelant to recover “just compensation” from the United States for the requisition and loss of its vessel, the S. S. Alaskan, brought under Section 902 of the Merchant Marine Act of 1936, 46 U.S.C.A. § 1242. In an opinion filed January 21, 1949 the District Court confirmed the report of the Commissioner appointed in the proceeding and found the value of The Alaskan to be $983,250, 85 F.Supp. 815. While the appeal from the District Court’s decision was pending in the United States Court of Appeals, Second Circuit, the government filed a motion in that court on January 2, 1950: “* * * for an order (1) remanding the cause for the taking of evidence and the making of findings required under the decision of the Supreme Court supervening after perfection of appeal from the decision below, United States v. Cors, 337 U.S. 325, 69 S.Ct. 1086, 93 L.Ed. 1392, decided June 13, 1949; (2) directing the Court below to ascertain what part of the valuation fixed by that Court for the S. S. Alaskan represents (within the meaning of Section 902(a), Merchant Marine Act, 1936, as amended, 46 U.S.C.A. § 1242, 49 Stat. 2015, as amended by the Act of August 7, 1939, 53 Stat. 1254, and within the rule of United States v. Cors, supra) enhancement of value attributable to the Government’s need for vessels which necessitated the taking, and enhancement of value attributable to the Government’s intervention in the market for vessels prior to the taking in its effort to satisfy such need; * *

The affidavit of the Assistant Attorney General sworn to November 4, 1949, submitted in support of the motion states: “2. This proceeding presents the question whether in a case involving a claim for [787]*787just compensation for the taking of a vessel by the United States, where the record below was made on a theory of controlling law which, since the perfection of the appeal, has been fundamentally modified by the supervening decision of the Supreme Court in United States v. Cors, 337 U.S. 325, 69 S.Ct. 1086, 93 L.Ed. 1392, for the first time construing the applicable statute, this Court should remand the case for the taking of evidence upon which alone this Court can make the findings required by the Supreme Court for a correct disposition of the case.”

The motion was argued in the Court of Appeals on January 30th and on that day an order was entered “that said motion be and it hereby is denied; leave be and it hereby is granted to the District Court to hear the application”.

On the same day the District Court heard the application, counsel presented their arguments thereon and briefs were submitted.

The government’s motion is based on the assumption that the District Court applied a standard of valuation for The Alaskan that does not conform to the standard set forth in the majority opinion in United States v. Cors, 1949, 337 U.S. 325, 69 S.Ct. 1086, 93 L.Ed. 1392. The government further contends that the District Court did not inquire whether any part of the just compensation awarded for The Alaskan was attributable to an enhancement in value due to the government’s need of vessels which necessitated the taking of The Alaskan, and that the record made before the Commissioner and in the District Court is blank in respect of proof showing the extent of the government’s intervention in the market, which allegedly resulted in an enhancement in value of The Alaskan.

The libelant, in opposing the motion, contends that the decision of the Supreme Court in the Cors case did not effect any change in the established judicial standards of just compensation so as to constitute a “supervening decision”, and that the government cannot now seek to introduce evidence which was available to it at the time of the trial. The libelant further contends that the government did not, by any activities in the market for ships of the Alaskan type, create any inflationary or speculative increases in the market for vessels of that type, within the meaning of the deductible enhancement clause of Section 902, and that the record does contain evidence upon which the Court and the Commissioner could and did consider the question of any enhancement in value that might be attributable to any government needs which necessitated the taking.

The government’s motion in the Court of Appeals was for a remand. Its application, at the direction of that court, to the District Court may be treated as a motion for a new trial or for relief from the final decree pursuant to Rule 59 or Rule 60 of the Federal Rules of Civil Procedure, 28 U.S.C.A. For reasons hereinafter stated I have concluded that the application should be denied.

Section 902 of the Merchant Marine Act of 1936, Title 46 U.S.C.A. § 1242, providing for the requisition of vessels by the Maritime Commission “during any national emergency declared by proclamation of the President”, provides in part in subdivision (a) : “When any such property or the use thereof is so requisitioned, the owner thereof shall be paid just compensation for the property taken or for the use of such property, but in no case shall the value of the property taken or used be deemed enhanced by the causes necessitating the taking or use.”

Subdivision (d) of the same section provides for a resolution of any controversy between an owner and the Commission on the issue of compensation as follows: “In all cases, the just compensation authorized by this section shall be determined and paid by the Commission as soon as practicable, but if the amount of just compensation determined by the Commission is unsatisfactory to the person entitled thereto, such person shall be paid 75 per centum of the amount so determined and shall be entitled to sue the United States to recover such further sum as, added to said 75 per centum will make up such amount as will be just [788]*788compensation therefor, in the manner provided for by sections 41(20) and 250 of Title 28.” 1

The enhancement clause also appears in the Rules of the Advisory Board on Just Compensation (consisting of Court of Appeals Judges L. Hand, Parker and Hutche-son) created by the President on October 15, 1943, by Executive Order 9387, to establish standards and rules for the guidance of the War Shipping Administration in determining the just compensation to be paid for requisitioned vessels. Rule 4 of the rules promulgated by the Advisory Board stated: “Rule 4. — From the value at the time of taking, there should be deducted any enhancement due, to the Government’s need of vessels which has necessitated the taking, to the previous taking of vessels of a similar type, or to the prospective taking, reasonably probable, whether such need, taking, or prospect, occurred before or after the declaration of the national emergency of May 27, 1941. Enhancement due to a general rise in prices or earnings, whenever occurring, should not be deducted. In the application of this rule neither the proclamation of limited emergency of September 8, 1939, nor the facts existing at that time, are in themselves of significance.”

Free access — add to your briefcase to read the full text and ask questions with AI

Related

De La Rama Steamship Co. v. United States
92 F. Supp. 243 (S.D. New York, 1950)

Cite This Page — Counsel Stack

Bluebook (online)
92 F. Supp. 785, 1950 U.S. Dist. LEXIS 2613, Counsel Stack Legal Research, https://law.counselstack.com/opinion/american-hawaiian-s-s-co-v-united-states-nysd-1950.