Opinion · Supreme Court of the United States

United States v. Shaw

309 U.S. 495

Type
Opinion
Court
Supreme Court of the United States
Jurisdiction
Federal
Date
1940-03-25
Topic
general

How later courts describe this case

  • holding that “without specific statutory consent, no suit may be brought against the United States”
  • explaining that “without specific statutory consent, no suit may be brought against the United States. No officer by his action can confer jurisdiction”
  • explaining that, in such cases, “it is necessary to determine the cross-libel as well as the original libel to reach a conclusion as to liability for the collision”
  • rejecting the contention that when the sovereign voluntarily seeks the aid of the courts it thereby takes the form of a private suitor and fully subjects itself to any claim
  • declining to extend the complete immunity rule in favor of cross-actions, as there is no specific congressional authority to do so
  • implying waiver of sovereign immunity in tort case for “cross-actions” up to "the amount necessary as a setoff"
  • suggesting that the right of recoupment arises by statute
  • “[W]ithout specific statutory consent, no suit may be brought against the United States. No officer by his action can confer jurisdiction.”

Citator

UpLaw has not yet analyzed United States v. Shaw. The absence of a flag is not a finding that it is good law.

Cited by
509 opinions

Headnotes

  1. Federal Courts & Jurisdiction — Sovereign Immunity The United States may be sued only with consent given, and only in the courts designated, by statute; absent specific statutory consent, no suit may be brought against the United States, and no officer by his action can confer jurisdiction. 309 U.S. at 500-501
  2. Federal Courts & Jurisdiction — Sovereign Immunity The United States, by filing a claim against an estate in a state probate proceeding, does not subject itself to a binding, though not immediately enforceable, ascertainment and allowance of a cross-claim against itself in excess of set-off. 309 U.S. at 501-504
  3. Federal Courts & Jurisdiction — Sovereign Immunity The rule permitting cross-libels against the United States in admiralty collision cases rests on the peculiar relationship of collision claims, in which libels and cross-libels constitute a single litigation giving rise to one liability that must be determined to reach any conclusion; that principle does not extend to claims and cross-claims in the settlement of estates. 309 U.S. at 503
  4. Federal Courts & Jurisdiction — Jurisdiction — Objection to Suit Against the United States The objection to a suit against the United States is fundamental whether the suit takes the form of an original action, a set-off, or a counterclaim; jurisdiction in any such case does not exist unless Congress has given specific authority for it. 309 U.S. at 503
  5. Federal Courts & Jurisdiction — Judgments — Ascertainment of Indebtedness Against the United States A court order ascertaining that on a balance of just demands the government is indebted to a defendant is not the equivalent of a judgment against the United States; no judgment may be entered against the government even though the court has ascertained through its processes that the government is actually indebted, and the judgment should be limited to a dismissal of the government's claim. 309 U.S. at 504
  6. Federal Courts & Jurisdiction — Sovereign Immunity By taking over the assets of the Fleet Corporation and assuming its obligations, the United States did not waive its immunity from suit in a state court on a counterclaim based on the corporation's breach of contract. 309 U.S. at 505
UNITED STATESv. SHAW,309 U.S. 495(1940)
60 S.Ct. 659
UNITED STATESv. SHAW, ADMINISTRATOR DE BONIS NON.
CERTIORARI TO THE SUPREME COURT OF MICHIGAN.
No. 570.
Argued February 27, 1940.
Decided March 25, 1940.
1. A suit against the United States may be brought only with consent given, and in the courts designated, by statute. P. 500. 2. The United States, by filing a claim against an estate in a state probate proceeding, does not subject itself to a binding, though not enforcible, ascertainment and allowance of a cross-claim against itself, in excess of set-off.TheThekla,266 U.S. 328, distinguished. Pp. 501-504. 3. By taking over the assets of the Fleet Corporation and assuming its obligations, the United States did not waive its immunity from suit in a state court on a counter-claim based on the corporation's breach of contract. P. 505.290 Mich. 311;287 N.W. 477, reversed.
CERTIORARI,308 U.S. 548, to review the affirmance of a decree
in probate holding the United States indebted to a decedent's
estate on a counter-claim.
Page 496
Solicitor General Biddle, with whomAssistant AttorneyGeneral SheaandMessrs. Melvin H. Siegel, Paul A. Sweeney, andThomas E. Harriswere on the brief, for the United States.Messrs. Eugene F. BlackandShirley Stewart, with whomMr. Howell Van Aukenwas on the brief, for respondent.

The probate court's order is a judicial ascertainment or determination of the amount owing and does not constitute a money judgment against the United States.United Statesv.Eckford, 6 Wall. 487;The Gloria, 286 F. 188. Cf.,United Statesv.National City Bank,83 F.2d 236, cert. den.299 U.S. 563; s.c.4 F. Supp. 417.

The order was proper under the decisions of this Court.United Statesv.The Thekla,266 U.S. 328.

The United States voluntarily entered a state court having jurisdictionin remover theresof an estate and asserted, in accordance with the local statutory practice, a claim against theres. In accordance with the mandatory requirements of the same local practice, a counter-claim was duly asserted and it was thereafter upheld on the merits. There is no essential difference between the act of joining in suit in the one case and the act of entry into court for assertion of claim in the present case. The principle ofThe Theklais applicable to proceedings instituted by the Government in modern courts of law, equity and admiralty. SeeAmerican Propeller Co. v.United States,300 U.S. 475;United Statesv.National City Bank,83 F.2d 236; cert. den.299 U.S. 563;Guaranty Trust Co. v.United States,304 U.S. 126;The Gloria, 286 F. 188, 200;Dexter and Carpenterv.Kunglig Jarnvagsstyrellsen, 43 F.2d 708;United Statesv.American Ditch Assn.,2 F. Supp. 868;United Statesv.Standard Oil Co., 21 F.2d 655;The Barbara Cates, 17 F. 244;United Statesv.East,80 F.2d 134;United Statesv.Page 497Moscow-Idaho Seed Co.,14 F. Supp. 135;United Statesv.Equitable Trust Co.,283 U.S. 745.

Cf.,Danforthv.United States,102 F.2d 5;308 U.S. 271.

For the purposes of the jurisdictional question dealt with inThe Thekla, a libel in admiralty is like a bill for an account,Goldthwaitv.Day,149 Mass. 185,187; and even more like a claim against theresof an estate in charge of a court,Footev.Foote,61 Mich. 192.

The doctrine ofThe Theklahas since aided decision inUnited Statesv.National City Bank,83 F.2d 236; cert. den.299 U.S. 563;American Propeller Co. v.United States,300 U.S. 476;Guaranty Trust Co. v.United States,304 U.S. 134;United Statesv.U.S. Fidelity Guaranty Co.,106 F.2d 804. SeeKeifer Keiferv.Reconstruction Finance Corp.,306 U.S. 381.

Immunity from affirmative judgment or judicial ascertainment in this case, if any, was waived when the United States, having already taken a general assignment of assets and receivables from the Fleet Corporation, dissolved the latter and assumed its obligations, by the Act of June 29, 1936.
MR. JUSTICE REED delivered the opinion of the Court.
In 1918 Sydney C. McLouth contracted to construct nine tugs for the United States Shipping Board Emergency Fleet Corporation. On May 24, 1920, the contract was cancelled and the parties entered into a settlement agreement providing that McLouth was to keep as bailee certain materials furnished him for use in building the tugs and that the Fleet Corporation was to assume certain of McLouth's subcontracts and commitments. Among the commitments assumed was a contract of McLouth'sPage 498to purchase lumber from the Ingram-Day Lumber Company. The Lumber Company obtained a judgment against McLouth for $42,789.96 for breach of this contract,1and, McLouth having died in 1923, filed its claim on the judgment in the probate court of St. Clair County, Michigan. Subsequently the United States obtained a judgment of $40,165.48 against McLouth's administrator,2representing damages for the conversion of the materials left with McLouth as bailee, and claim on this judgment was filed in the probate court. The administrator, respondent here, having presented without success the Lumber Company's judgment to the General Accounting Office,3sought to set off that judgment against the judgment of the United States. The probate court allowed the claim of the United States and denied the set-off, but its ruling as to the set-off was reversed on appeal to the Michigan Supreme Court.4The administrator then petitioned the probate court to grant statutory judgment of the balance due the estate. The court found that the claim of the United States, with interest, amounted to $49,442.41 and the Lumber Company's claim to $73,071.38 and "ordered, adjudged and ascertained" that the United States was indebted to the estate for the difference, $23,628.97, "and that such indebtedness be and the same is hereby allowed as and determined to be a proper claim which is owing to said estate by the United States of America." The probate court's judgment was affirmed on appeal.5Page 499

On this certiorari we are concerned with the question whether the United States by filing a claim against an estate in a state court subjects itself, in accordance with local statutory practice, to a binding, though not immediately enforceable, ascertainment and allowance by the state court of a cross-claim against itself.

Because of different views of other federal courts as to the decisions of this Court in the important federal field of cross-claims against the United States,6we granted certiorari.7United Statesv.United States FidelityGuaranty Company8involves this question.

The statute of Michigan under which this ascertainment of indebtedness was made, so far as pertinent, is set out in the footnote.9There is no contention on the part of respondent that the judgment is enforceable against the United States even in the limited sense of statutory direction to report the judgment to Congress as in the CourtPage 500of Claims Act10or the Merchant Marine Act.11Execution against property of governmental agencies subjected to such procedure by statute is sometimes allowed.12The position taken is that the probate court judgment is a "final determination" of the rights of the litigants, howsoever such rights may later become important. We are not here concerned with the manner of collection. Such was the holding of the Supreme Court of Michigan.13

The state procedure for the determination of the balance against or in favor of an estate, which was employed here, was the recognized method of closing an estate at the time of the probate judgment. The probate judge was empowered to act as commissioner under the statute quoted above.14His decision unreviewed was considered final.15The determination of the probate court between private parties was enforceable without reexamination in the circuit court.16Even the right to execution is not essential to a complete judicial process.17The order entered was a final determination of the amounts due the estate by the United States on this claim and cross-claim if the probate court had jurisdiction to render the order against the petitioner.

Whether that jurisdiction exists depends upon the effect of the voluntary submission to the Michigan court by the United States of its claim against the estate. As a foundation for the examination of that question we may lay the postulate that without specific statutory consent, no suit may be brought against the UnitedPage 501States.18No officer by his action can confer jurisdiction.19Even when suits are authorized they must be brought only in designated courts.20The reasons for this immunity are imbedded in our legal philosophy. They partake somewhat of dignity and decorum, somewhat of practical administration, somewhat of the political desirability of an impregnable legal citadel where government as distinct from its functionaries may operate undisturbed by the demands of litigants. A sense of justice has brought a progressive relaxation by legislative enactments of the rigor of the immunity rule. As representative governments attempt to ameliorate inequalities as necessities will permit, prerogatives of the government yield to the needs of the citizen. By the act of March 3, 1797, and its successor legislation, as interpreted by this Court, cross-claims are allowed to the amount of the government's claim, where the government voluntarily sues.21Specially designated claims against the United States may be sued upon in the Court of Claims or the district courts under the Tucker Act.22Special government activities, set apart as corporations or individual agencies, have been made suable freely. When authority is given, it is liberally construed.23As to these matters no controversy exists.

Respondent contends this immunity extends, however, only to original suits; that when a sovereign voluntarily seeks the aid of the courts for collection of its indebtednessPage 502it takes the form of a private suitor and thereby subjects itself to the full jurisdiction of the court. The principle of a single adjudication is stressed, as is the necessity for a complete examination into the cross-claim, despite attendant dislocation of government business by the appearance of important officers at distant points and the production of documents as evidence, to justify the allowance of an offset to the government's claim.24It is pointed out that surprise is not involved as no cross-claim may be proven until after submission to and refusal by the government accounting officers.25Respondent further insists that his position is supported byTheThekla26and subsequent decisions quoting its language.27Emphasis is placed upon the fact that these probate proceedings are in rem or quasi in rem28as were the libels in admiralty inThe Thekla.

It is not our right to extend the waiver of sovereign immunity more broadly than has been directed by the Congress. We, of course, intimate no opinion as to the desirability of further changes. That is immaterial. Against the background of complete immunity we find no Congressional action modifying the immunity rule in favor of cross-actions beyond the amount necessary as a set-off.The Theklaturns upon a relationship characteristic of claims for collision in admiralty but entirely absent in claims and cross-claims in settlement of estates. The subject matter of a suit for damages in collision is not the vessel libelled but the collision. Libels and cross-libels for collision are one litigation and give rise to onePage 503liability.29In equal fault, the entire damage is divided. As a consequence when the United States libels the vessel of another for collision damages and a cross-libel is filed, it is necessary to determine the cross-libel as well as the original libel to reach a conclusion as to liability for the collision. That conclusion must be stated in terms of responsibility for damages. InThe Theklaopinion the cases ofIllinois Central R. Co. v.Public Utilities Commission30andNassau Smelting Worksv.United States31were cited in support of the statement that ". . . generally speaking a claim that would not constitute a cause of action against the sovereign cannot be asserted as a counterclaim." This Court then said: "We do not qualify the foregoing decisions in any way." In theSmeltingcase this Court had said, two weeks before, on a certificate as to the jurisdiction of the district court to consider a counterclaim:

"The objection to a suit against the United States is fundamental, whether it be in the form of an original action or a set-off or a counterclaim. Jurisdiction in either case does not exist unless there is specific congressional authority for it. Nor is there doubt that the question is one which involves the jurisdiction of the District Court as a federal court under the statutes of the United States, for the jurisdiction of the District Court in this regard is wholly dependent on such statutes."32

There is little indication in the facts or language ofTheTheklato indicate an intention to permit generally unlimited cross-claims. Quotations fromThe Theklain later opinions of this Court are used to illustrate problemsPage 504entirely apart from the one under consideration here.33

The suggestion that the order of the probate court is in reality not a judgment but only a "judicial ascertainment" of credits does not affect our conclusion. No judgment against the United States is more than that. But such an entry, if within the competence of the court passing the order, would be res judicata of the issue of indebtedness.34The suggestion springs from the opinion inUnited Statesv.Eckford.35These words there appear:

"Without extending the argument, we adopt the views expressed by this court in the case ofDe Grootv.United States, (5 Wall. 432) decided at the last term, that when the United States is plaintiff and the defendant has pleaded a set-off, which the acts of Congress have authorized him to do, no judgment can be rendered against the government, although it may be judicially ascertained that, on striking a balance of just demands, the government is indebted to the defendant in an ascertained amount."

The Court had just written that no action could be sustained against the government without consent and that to permit a demand in set-off to become the foundation of a judgment would be the same thing as sustaining the prosecution of a suit.36The language quoted above means no more than that no judgment may be entered against the government even though the court has ascertained, through its processes, that the government is actually indebted to the defendants. The judgment should be limited to a dismissal of the government's claim.

In theEckfordcase this Court was dealing with the litigation at a more advanced stage than the present litigationPage 505has reached. The United States has sued Eckford's executors on his bond in the District Court for the Southern District of New York. They pleaded a set-off, a balance was found in their favor and a judgment entered that the executors were entitled to be paid the amount found. Suit in the Court of Claims was instituted by the executors, the record was proven, over objection, and judgment entered accordingly. Consequently a reversal of the Court of Claims was the only step necessary. This Court did not deal with the New York judgment.37

We have considered respondent's further argument that sovereign immunity was waived when the United States took possession of the assets of its agent the Fleet Corporation prior to the institution of this action, and later, but prior to the entry of the probate judgment appealed from, assumed the Corporation's obligations by the act of June 29, 1936.38We see nothing in these transactions which indicates an intention to waive the immunity of the United States in the state courts.Reversed.

MR. JUSTICE McREYNOLDS took no part in the decision of this case.Page 506
  1. Page 498Ingram-Day Co. v.McLouth,275 U.S. 471. ↩
  2. Page 498Shawv.United States,75 F.2d 175. ↩
  3. Page 498 The Act of March 3, 1797,1 Stat. 512, 514, as amended, 28 U.S.C. § 774, provides that in "suits brought by the United States against individuals, no claim for a credit shall be admitted . . . except such as appear to have been presented to the General Accounting Office for its examination, and to have been by it disallowed. . . ." ↩
  4. Page 498In re McLouth's Estate,281 Mich. 191;274 N.W. 759. ↩
  5. Page 498290 Mich. 311;278 N.W. 477. ↩
  6. Page 499 Cf.United Statesv.Eckford, 6 Wall. 484;The Thekla,266 U.S. 328.In re Patterson-MacDonald Shipbuilding Co.,293 F. 192(C. C.A. 9), certiorari denied,sub nom. McLeanv.Australia,264 U.S. 582.Roumaniav.Guaranty Trust Co.,250 F. 341(C. C.A. 2), certiorari denied,246 U.S. 663;UnitedStatesv.Nipissing Mines Co.,206 F. 431,434(C. C.A. 2);Adamsv.United States, 3 Ct. Cls. 312, 333;Petersonv.United States, 26 Ct. Cls. 93, 98.United Statesv.NationalCity Bank,83 F.2d 236(C. C.A. 2), certiorari denied,299 U.S. 563;American Propeller Co. v.United States,300 U.S. 475;Guaranty Trust Co. v.United States,304 U.S. 126. ↩
  7. Page 499308 U.S. 548. ↩
  8. Page 499Post, p. 506. ↩
  9. Page 499 Compiled Laws of Michigan (1929), c. 266, § 15682:

    "Set-offs in settlement of claims. Sec. 9. When a creditor against whom the deceased had claims shall present a claim to the commissioners, the executor or administrator shall exhibit the claims of the deceased in offset to the claims of the creditor, and the commissioners shall ascertain and allow the balance against or in favor of the estate, as they shall find the same to be; but no claim barred by the statute of limitations shall be allowed by the commissioners in favor of or against the estate, as a set-off or otherwise." ↩
  10. Page 500 31 U.S.C. § 226. ↩
  11. Page 500 46 U.S.C. § 1113. ↩
  12. Page 500Federal Housing Administrationv.Burr, ante, p. 242. ↩
  13. Page 500290 Mich. 311;287 N.W. 477. ↩
  14. Page 500 3 Comp. Laws Mich. (1929), § 15681. ↩
  15. Page 500Flynnv.Lorimer's Estate,141 Mich. 707;105 N.W. 37. ↩
  16. Page 500Shurbunv.Hooper,40 Mich. 503. ↩
  17. Page 500Nashville, C. St. L. Ry. Co. v.Wallace,288 U.S. 249,263;Flynnv.Lorimer's Estate,141 Mich. 707;105 N.W. 37. ↩
  18. Page 501Kansasv.United States,204 U.S. 331;United Statesv.Thompson,98 U.S. 486,489,490;Buchananv.Alexander, 4 How. 20. ↩
  19. Page 501Stanleyv.Schwalby,162 U.S. 255,270;Carrv.UnitedStates,98 U.S. 433,437. ↩
  20. Page 501Minnesotav.United States,305 U.S. 382,388. ↩
  21. Page 5011 Stat. 512, 514; R.S. § 951; 28 U.S.C. § 774.United Statesv.Wilkins, 6 Wheat. 135, 144. ↩
  22. Page 50128 U.S.C. § 41(20), 250. ↩
  23. Page 501Keifer Keiferv.Reconstruction Finance Corp.,306 U.S. 381;Federal Housing Administrationv.Burr, supra. ↩
  24. Page 502United Statesv.Wilkins, supra. ↩
  25. Page 502 28 U.S.C. § 774. ↩
  26. Page 502266 U.S. 328. ↩
  27. Page 502 See note 33,infra. ↩
  28. Page 502United Statesv.Bank of New York Co.,296 U.S. 463,477;Montgomeryv.Wayne Circuit Judge,284 Mich. 430. ↩
  29. Page 503Bowkerv.United States,186 U.S. 135,139. ↩
  30. Page 503245 U.S. 493,504,505. ↩
  31. Page 503266 U.S. 101. ↩
  32. Page 503Id., 106. ↩
  33. Page 504American Propeller Co. v.United States,300 U.S. 475,478;Guaranty Trust Co. v.United States,304 U.S. 126,134. ↩
  34. Page 504Williamsv.United States,289 U.S. 553,564. ↩
  35. Page 504 6 Wall. 484, 491. ↩
  36. Page 504 Cf.Reesidev.Walker, 11 How. 272, 290. ↩
  37. Page 505 Cf.Schaumburgv.United States,103 U.S. 667. ↩
  38. Page 50549 Stat. 1987:

    "SEC. 203. The United States Shipping Board Merchant Fleet Corporation shall cease to exist and shall stand dissolved. All the records, books, papers, and corporate property of said dissolved corporation shall be taken over by the Commission. All existing contractual obligations of the dissolved corporation shall be assumed by the United States. Any suit against the dissolved corporation pending in any court of the United States shall be defended by the Commission upon behalf of the United States, under the supervision of the Attorney General, and any judgment obtained against the dissolved corporation in any such pending suit shall be reported to Congress in the manner provided in section 226, title 31, United States Code, for reporting judgments against the United States in the Court of Claims." ↩