U.S. Supreme Court GUARANTY TRUST CO. OF NEW YORK v. UNITED STATES, 304 U.S. 126 (1938)

304 U.S. 126

GUARANTY TRUST CO. OF NEW YORK v. UNITED STATES. No. 566. Argued March 28-29, 1938. Decided April 25, 1938.[ Guaranty Trust Co. of New York v. [Page 304 U.S. 126, 135]

in like situation, those rules, which must be assumed to be founded on principles of justice applicable to individuals, are to be relaxed only in response to some persuasive demand of public policy generated by the nature of the suitor or of the claim which it asserts. That this is the guiding principle sufficiently appears in the many instances in which courts have narrowly restricted the application of the rule nullum tempus in the case of the domestic sovereign. [Footnote 3] It likewise appears from those cases which justify the rule as applied to the United States suing in a state court, on the ground that it is sovereign within the state and that invocation of the rule nullum tempus protects the public interest there as well as in every other state. United States v. Beebe, , 8 S.Ct. 1083; Booth v. United States, 11 Gill & J., Md., 373; McNamee v. United States, 11 Ark. 148; cf. United States v. People of State of California, 297 U.S. 175, 186, 56 S.Ct. 421, 425.

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mination as well as to the underlying policy are to be addressed to it and not to the courts. Its action in recognizing a foreign government and in receiving its diplomatic representatives is conclusive on all domestic courts, which are bound to accept that determination, although they are free to draw for themselves its legal consequences in litigations pending before them. Jones v. United States, supra, 137 U.S. 202, 212, 11 S.Ct. 80; Agency of Canadian Car & Foundry Co. v. American Can Co., 2 Cir., 258 F. 363, 6 A.L.R. 1182; Lehigh Valley R. Co. v. State of Russia, supra.

We accept as conclusive here the determination of our own State Department that the Russian State was represented by the Provisional Government through its duly recognized representatives from March 16, 1917, to November 16, 1933, when the Soviet Government was recognized. [Footnote 4] There was at all times during that period a recog-

[Page 304 U.S. 126, 144]

alleged repudiation was tentative and conditional, to await negotiations with a stable Russian Government upon its recognition by the United States. If this contention be rejected, respondent insists that at least there is a conflict in the evidence and in the inferences which may be drawn from it which, under the local practice, should have been resolved by a full trial rather than summarily on motion. As these questions were not passed on by the Court of Appeals, the case will be remanded to that court for further proceedings in conformity with this opinion.

REVERSED.

Mr. Justice CARDOZO and Mr. Justice REED took no part in the consideration or decision of this case. Footnotes

Footnote 1 United States v. Knight, 14 Pet. 301, 315; Gibson v. Chouteau, 13 Wall. 92, 99; United States v. Thompson, , 490; Fink v. O'Neil, 106 U.S. 272, 281, 1 S.Ct. 325.

Footnote 2 A foreign sovereign as suitor is subject to the local rules of the domestic forum as to costs, Republic of Honduras v. Soto, 112 N.Y. 310, 19 N.E. 845, 2 L.R.A. 642, 8 Am.St.Rep. 744; Emperor of Brazil v. Robinson, 5 Dowl.Pr. 522; Otho, King of Greece v. Wright, 6 Dowl.Pr. 12; The Beatrice, 36 L.J.Rep.Adm., N.S., 10; Queen of Holland v. Drukker, (1928) Ch. 877, 884, although the local sovereign does not pay costs. United States v. Verdier, 164 U.S. 213, 219, 17 S.Ct. 42. The foreign sovereign suing as a plaintiff must give discovery. Rothschild v. Queen of Portugal, 3 Y. & C.Ex. 594, 596; United States v. Wagner, L.R. 2 Ch.App. 582, 592, 595; Prioleau v. United States, L.R. 2 Eq. 659. A foreign sovereign plaintiff 'should so far as the thing can be done be put in the same position as a body corporate.' Republic of Costa Rica v. Erlanger, L. R. 1 Ch.D. 171, 175; Republic of Peru v. Weguelin, L.R. 20 Eq. 140, 141; cf. King of Spain v. Hullett, 7 Bligh, N.S., 359, 392.

Footnote 3 The presumption of a grant by lapse of time will be indulged against the domestic sovereign. United States v. Chaves, 159 U.S. 452, 464, 16 S.Ct. 57. The rule nullum tempus has never been extended to agencies or grantees of the local sovereign such as municipalities, county boards, school districts, and the like. Metropolitan R. Co. v. District of Columbia, , 10 S.Ct. 19; Boone County v. Burlington & M.R.R. Co., 139 U.S. 684, 693, 11 S.Ct. 687. It has been held not to relieve the sovereign from giving the notice required by local law to charge indorsers of negotiable paper, United States v. Barker, 12 Wheat. 559; cf. Cooke v. United States, , 398; Wilber National Bank v. United States, 294 U.S. 120, 124, 55 S.Ct. 362, 364, and in tax cases has been narrowly construed against the domestic sovereign. Bowers v. New York & Albany Lighterage Co., 273 U.S. 346, 350, 47 S.Ct. 389, 390. Compare United States v. Knight, 14 Pet. 301; Fink v. O'Neil, , 1 S.Ct. 325.

Footnote 4 The United States accorded recognition to the Provisional Government March 16, 1917, and continued to recognize it until November 16, 1933, when the Soviet Government was recognized. During that period the United States declined to recognize the Soviet Government or to receive its accredited representative, and so certified in litigations pending in the federal courts. The Penza, supra; The Rogdai, supra. It recognized Mr. Bakhmeteff as Russian Ambassador from July 5, 1917, until June 30, 1922, when he retired, having designated Mr. Ughet as custodian of Russian property in the United States. Mr. Ughet, after his appointment as Financial Attache April 7, 1917, continued to be recognized as such by the United States until November 16, 1933. He was recognized by the United States as Charge d'Affaires ad interim, during the absence of the Ambassador from December 3, 1918, to July 31, 1919. Their diplomatic status as stated was certified in the present suit by the Secretary of State, who stated that he considered Mr. Ughet's status unaffected by the termination of the Ambassador's duties.

Their status was certified to by the Department on October 31, 1918, and July 2, 1919, respectively, in Russian Government v. Lehigh Valley Railroad Co., D.C., 293 F. 133. Mr. Bakhmeteff's status as Ambassador was certified May 18, 1919, in Agency of Canadian Car & Foundry Co. v. American Can Co., 2 Cir., 258 F. 363, 368, 6 A.L.R. 1182; on April 6, 1920, in The Rogdai, D.C., 278 F. 294, 295; on June 24, 1919, in The Penza, D.C., 277 F. 91, 93. Certificate with respect to both Mr. Bakhmeteff and Mr. Ughet was given February 19, 1923, and with respect to Mr. Ughet December 22, 1927. On the faith of the two last-mentioned certificates the court, in the Lehigh Valley Railroad Case, supra, as stated by the government's brief in the present case, ordered to be paid to Mr. Ughet approximately $ 1,000,000, of which more than $700,000 was paid to the United States Treasurer 'on account of interest due on obligations of the Provisional Government of Russia by the Treasurer.'

Footnote 5 Russian Government v. Lehigh Valley R. Co., D.C., 293 F. 133; Id., D.C., 293 F. 135, affirmed Lehigh Valley R. Co. v. State of Russia, 2 Cir., 21 F.2d 396; State of Russia v. Bankers' Trust Co., D.C., 4 F.Supp. 417, 419, affirmed United States v. National City Bank of New York, 2 Cir., 83 F.2d 236, 106 A.L.R. 1235. See also Agency of Canadian Car & Foundry Co. v. American Can Company, 2 Cir., 258 F. 363, 6 A.L.R. 1182.