Accordingly, I find that the defense of res judicata has not been waived, that it was properly invoked by the Chief of the Claims Section and that it is fatal to the claim.

Claimant urges that even if the defense of res judicata is applicable as a matter of law I should nevertheless exercise my discretion to grant a hearing. Assuming I have the power to do so, I see no reason for exercising it in this claim. Claimant had his opportunity to have a trial of his claim in open court and on the merits but chose not to avail himself of that opportunity. The Government held out no inducements to him and he was not misled in any way in making his choice. Whatever the motives which impelled him to refuse to go to trial, the consequences of his refusal are his sole responsibility. They are not unique and were plainly foreseeable.

Claimants' petition for review is denied.

/S/ Dallas S. Townsend,

DALLAS S. TOWNSEND, Assistant Attorney General, Director, Office of Alien Property.

March 23, 1956.

FOREIGN CLAIMS SETTLEMENT COMMISSION

OF THE UNITED STATES, Washington, D.C., July 8, 1959.

Hon. JAMES O. EASTLAND,

Chairman, Committee on the Judiciary,
U.S. Senate, Washington, D.C.

DEAR SENATOR EASTLAND: This refers further to your request for the views of this Commission on the bill S. 664, entitled "A bill to amend the Trading With the Enemy Act, as amended."

The subject bill deals with the disposition of remaining enemy vested assets and the settlement of certain American World War II damage claims in the European theater. Its claims provisions are similar to a number of bills on this subject pending before your committee including S. 2005, which was submitted to the Congress in draft form by this Commission, January 7, 1959, in behalf of the executive branch, except that S. 2005 provides for certain war damage claims in the Pacific theater as well.

The bill is identical with S. 411, 85th Congress, which was favorably reported in the Senate, August 13, 1958. It provides (1) for the use of the net liquidated proceeds of enemy assets in payment of World War II damage claims arising in the European theater only as authorized in the bill; and (2) the return of property, vested under the Trading With the Enemy Act, to individuals who have become U.S. citizens since the vesting of their property. No other provision for the return of vested assets is contained in the bill.

A third aspect of the bill would authorize an action in the Court of Claims with respect to the vesting of certain shares of stock concerning which a compromise settlement was previously entered into. Question is now raised as to the equities of that settlement. This Commission has no jurisdiction over such matters.

The Commission is informed that enactment of the return provisions of the bill could have a serious impact on the aggregate of funds potentially available for payment of the claims authorized in the bill. For that reason the Commission is opposed to enactment of these provisions.

As already noted, the administration's recommendations with respect to the subjects covered by the present measure are contained in the bill which has been introduced as S. 2005. On the basis of the justification advanced in support of that bill in the explanatory letter transmitting it to the Vice President, this Commission recommends the enactment of S. 2005 in lieu of the present bill.

Advice has been received from the Bureau of the Budget that there would be no objection to the presentation of this report to your committee.

Sincerely yours,

WHITNEY GILLILLAND, Chairman:

[S. 672, 86th Cong., 1st sess.]

AMENDMENT (IN THE NATURE OF A SUBSTITUTE)

Intended to be proposed by Mr. JOHNSTON of South Carolina to the bill (S. 672) to amend the War Claims Act of 1948, as amended, and the Trading With the Enemy Act, as amended, and to provide for the payment of certain American war damage claims and for the return of vested assets or the value thereof, viz: Strike out all after the enacting clause and insert in lieu thereof the following:

That this Act may be cited as the "World War II Claims Settlement Act".

DECLARATION OF POLICY

SEC. 2. As a result of evidence adduced before various committees of the Senate and House of Representatives, the Congress hereby finds that

(a) a program which will provide funds without direct congressional appropriations therefor, with which to pay United States war damage claims resulting from World War II is necessary and desirable;

(b) such a program should provide for a speedy termination of the administration of privately owned former enemy or neutral properties by the Government;

(c) such a program should strengthen the foreign political and economic program and policies of the United States;

(d) such a program is necessary to reaffirm and promote respect for the fundamental concept of the inviolability of private property in times of war as well as peace;

(e) such a program should further protect United States private and governmental foreign investments against confiscation; and

(f) to that end it shall be the policy of the United States and the purpose of this Act to provide a coordinated program for—

(A) financing the payment of war damage claims of United States nationals against Germany and Japan in the conduct of World War II; (B) returning private property, or the proceeds thereof, as a matter of grace, vested by the United States under the provisions of the Trading With the Enemy Act, as amended;

(C) establishing a system of priority payments for speedy relief in hardship cases; and

(D) achieving these results without additional direct appropriations or otherwise increasing the burdens of the United States taxpayer solely by: (i) returning such vested assets as have not been liquidated; and (ii) using the balance of the proceeds from the sale of vested assets herein authorized, after the payment of claims under existing legislation and appropriate administrative costs; and (iii) by using, to the extent and in the amount necessary, the payments from the Federal Republic of Germany and Japan to the United States for postwar economic aid or assistance.

TITLE I-AMERICAN WAR DAMAGE CLAIMS

WAR CLAIMS ACT AMENDMENTS

SEC. 3. The War Claims Act of 1948, as amended, is further amended by inserting after section 1 thereof, the following:

"TITLE I"

SEC. 4. The word "Act" wherever it appears in title I of the War Claims Act of 1948, as amended, in reference to that title, is amended to read "title". SEC. 5. The War Claims Act of 1948, as amended, is further amended by adding at the end thereof, the following:

"TITLE II-WAR DAMAGE CLAIMS

"SEC. 201. As used in this title the term or terms

"(a) Albania', 'Austria', 'Czechoslovakia', 'the Free Territory of Danzig', 'Estonia', 'Germany', 'Greece', 'Latvia', 'Lithuania', 'Poland', and 'Yugoslavia',

44467-59-3

when used in their respective geographical senses, mean the area contained within the territorial limits of each such country as such limits existed on December 1, 1937.

"(b) 'Commission' means the Foreign Claims Settlement Commission of the United States, established pursuant to Reorganization Plan Numbered 1 of 1954 (68 Stat. 1279).

"(c) National of the United States' means any individual who (1) is a citizen of the United States, or (2) although not a citizen of the United States, owes permanent allegiance to the United States, or (3) has lost United States citizenship solely by reason of marriage to a citizen or subject of a foreign country, but has reacquired such citizenship before the date of enactment of this title, if such individual but for such marriage would have been a national of the United States (A) on the date of the injury, death, loss, damage, or destruction for which claim is made by such individual under this title, and (B) at all times thereafter until the filing of such claim by such individual. Such term does not include any individual who is an alien.

"SEC. 202. The Commission is authorized and directed to receive and to determine according to this title the validity and principal amount of claims of nationals of the United States for

"(a) physical damage to, or physical loss or destruction of property located in Albania, Austria, Czechoslovakia, the Free Territory of Danzig, Estonia, Germany, Greece, Latvia, Lithuania, Poland, or Yugoslavia, which occurred during the period beginning September 1, 1939, and ending May 8, 1945, or in the territory occupied or attacked by the Imperial Japanese Military Forces, or in the territory to which Japan has renounced all right, title, or claim under the treaty of peace, in the period beginning July 1, 1937, and ending September 2, 1945, except the Commonwealth of the Philippines and the island of Guam, as a direct consequence of military operations of war, or of special measures directed against property in such countries or territories during the respective periods of time aforesaid because of the enemy or alleged enemy character of the owner, which property was owned, directly or indirectly, by the claimant at the time of such loss, damage, or destruction. The sale, transfer, or assignment of such property subsequent to such damage, loss, or destruction shall not bar any claim of the transfer or otherwise compensable under this subsection. If such claim has been assigned for value prior to the enactment of this title the assignee shall be the party entitled to file a claim under this subsection.

"(b) damage to, or loss or destruction of, ships or ship cargoes, directly or indirectly owned by the claimant at the time such damage, loss, or destruction occurred, which was a direct consequence of military action by Germany or Japan during the period beginning September 1, 1939, and ending September 2, 1945. The sale, transfer, or assignment of any such ship or ship cargo subsequent to such damage, loss or destruction, shall not bar any claim otherwise compensable under this subsection. If such claim has been assigned for value, the assignee shall be the party entitled to file a claim under this subsection. No award shall be made under this subsection in favor of any insurer or reinsurer as the assignee or otherwise as successor in interest to the right of the insured.

"(c) loss or damage on account of the death or injury of any person who, being then a civilian national of the United States and a passenger on any vessel engaged in commerce on the high seas, was injured or killed as a result of military action by Germany or Japan during the period beginning July 1, 1937, and ending December 11, 1941, or for the loss of, or damage to, the property on such vessel by any civilian national of the United States who was a passenger on any vessel engaged in commerce on the high seas during such period, resulting as a direct consequence of such action. An award on account of the death of any such person shall be made only to or for the benefit of the following persons in the order of priority following:

"(1) Widow or husband, if there is no child or children of the deceased;

"(2) Widow or husband and child or children of the deceased, onehalf to the widow or husband and the other half to the child or children of the deceased in equal shares;

"(3) Child or children of the deceased (in equal shares) if there is no widow or husband; and

"(4) Parents of the deceased (in equal shares) if there is no widow, husband, or child.

An award on account of injury or disability shall be made only to the person so injured or disabled, or, in the event of his death at any time prior to the payment of the award, to the persons specified in paragraphs (1) through (4) of this subsection in the order of priority specified. "SEC. 203. In determining the amount of an award there shall be credited all amounts the claimant has received, by way of tax deductions or otherwise, or is entitled to receive from any source on account of the loss or losses with respect to which the award is made.

"SEC. 204. Awards shall not be made pursuant to section 202 with respect to any of the following classes of property: Intangible property; accounts receivable; bills receivable; records, files, plans, drawings, or formulas; currency, deeds, evidence of debt, securities, money, or bullion; furs, jewelry, stamps, precious and semiprecious stones; works of art, antiques, stamp and coin collections; manuscripts, books, and printed publications more than fifty years old; models, curiosities, objects of historical or scientific interest; and pleasure watercraft and pleasure aircraft, except that awards may be made with respect to property of any such class if such property constituted a part of the inventory, supplies, or equipment for carrying on a trade or business. "SEC. 205. No claim shall be allowed under this title unless the claimant and all predecessors in interest were

"(a) in the case of a natural person, one who, on the date of loss, damage, or destruction, and continuously thereafter until the date of filing his claim with the Commission pursuant to this title, was a national of the United States; and

"(b) in the case of a corporation, partnership, association, unincorporated body, or other entity, one which on the date of loss, damage, or destruction, and continuously thereafter until the date of presentation of its claim, was incorporated or otherwise organized under the laws of the United States or of any State or Territory thereof, or of the District of Columbia, and with respect to which, at all times between the date of such loss, damage, or destruction, and the date of the presentation of its claim, more than 50 per centum of the outstanding capital stock or other proprietary interest in such entity was owned, directly or indirectly, by nationals of the United States who would qualify as individual claimants under section 202.

"SEC. 206. (a) A claim based upon an interest, direct or indirect, in a corporation or other entity entitled to an award under the provisions of section 205 shall not be allowed.

“(b) A claim based upon an interest, direct or indirect, in a corporation or other entity not qualified to receive an award under this title, shall not be allowed unless at least 25 per centum of the outstanding capital stock or other proprietary or similar interest in such entity has been owned, directly or indirectly, at all times between the date of such loss, damage, or destruction, and the date of filing of the claim by nationals of the United States or corporations or other entities qualified to receive an award under this title. Any award under this subsection shall be limited to that proportion of the total loss that the capital stock or other proprietary or similar interest in such entity owned by qualified claimants at the time of the loss, damage, or destruction bears to the total of such capital stock or other proprietary or similar interest. For the purpose of this subsection, the fact that subsequent to the loss, damage, or destruction of the property there has been nationalization, confiscation, or other governmental seizure of title of the capital stock or other proprietary or similar interest in the entity directly owning such property shall not be deemed to have affected the ownership, direct or indirect, of such capital stock or other proprietary or similar interest of such persons, corporations, or other entities.

"SEC. 207. Within sixty days after the enactment of this title or of legislation providing funds to the Commission for the payment of administrative expenses, whichever date is later, the Commission shall give public notice by publication in the Federal Register of the time when, and the limit within which, claims under this title may be filed, which limit shall not be more than eighteen months after the date of such publication.

SEC. 208. The amount of any award based on a claim of a national of the United States other than the national by whom the loss was originally sustained, shall not exceed the amount of the actual consideration last paid by such claimant for such claim.

"SEC. 209. The Commission shall as soon as possible, and in the order of the making of such awards, certify the same to the Secretary of the Treasury, in terms of United States currency, each award made pursuant to section 202.

"SEC. 210. All payments authorized under section 211 of this title shall be disbursed exclusively from the Japanese and German Claims Fund and all amounts covered into the Treasury to the credit of such fund are permanently available for the making of the payments authorized under section 211 of this title.

"SEC. 211. (a) The Secretary of the Treasury is authorized and directed, out of the sums covered into the fund created by this Act, after making the deductions provided for in said Act, to make payments on account of awards certified by the Commission pursuant to this title as follows and in the following order of priority:

"(1) Payment in full of the principal amounts of awards made pursuant to section 202 (c).

"(2) Thereafter, payment in the amount of $1,000 or in the principal amount of the award, whichever is less, on account of the other awards made pursuant to section 202.

"(3) Thereafter, payments from time to time on account of the unpaid principal of the remaining awards made pursuant to section 202 in an amount which bears to such unpaid principal substantially the same proportions as the total amount in the fund available for distribution at the time such payments are made bears to the aggregate unpaid principal of all such awards. "(b) Such payments shall be made in accordance with such regulations as the Secretary of the Treasury shall prescribe.

"(c) For the purpose of making any such payments, other than section 211(a)(1), an award shall be deemed to mean the aggregate of all awards certified in favor of the same claimant.

"(d) With respect to any claim which, at the time of the award, is vested in persons other than the person by whom the loss was sustained due to the death or disability of the claimant, the Commission may issue a consolidated award in favor of all claimants then entitled thereto, which award shall indicate the respective interests of such claimants therein; and all such claimants shall participate, in proportion to their indicated interests, in the payments provided by this section in all respects as if the award has been in favor of a single person.

"SEC. 212. Payments on account of any award pursuant to this title shall not, unless such payment is for the full amount of the award, extinguish any rights against any foreign government for the unpaid balance of the award. "SEC. 213. The action of the Commission in allowing or denying any claim under this title shall be final and conclusive as to all questions of law and fact, and shall not be subject to review by any other official of the United States or by any court by mandamus or otherwise, and the Comptroller General is authorized and directed to allow credit in the amounts of any certifying or disbursing officer for payments in accordance with such action.

"SEC. 214. If any person to whom any payment is to be made pursuant to this title is deceased or is under a legal disability, payment shall be made to his legal representatives, except as provided in subsection (c) of section 202 and except that if any payment to be made is not over $1,000 and there is no qualified guardian, committee, executor, or administrator, payment may be made to the person or persons found by the Commission to be entitled thereto, without the necessity of compliance with the requirement of law with respect to the administration of estates.

"SEC. 215. Awards shall not be made under this title to or for the benefit of any person who has been convicted of a violation of any provision of chapter 115 of title 18 of the United States Code, or any other crime involving disloyalty to the United States.

"SEC. 216. To the extent they are not inconsistent with the provisions of this title, the following provisions of title I of this Act and title I of the International Claims Settlement Act of 1949, as amended, shall apply to this title: The first sentence of subsection (b) of section 2, all of subsection (c) of section 2 and section 11 of title I of this Act, and subsections (c), (d), (e), and (f) of section 7 of the International Claims Settlement Act of 1949, as amended."