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U.S. Supreme Court

Uebersee Finanz-Korp. v. McGrath, 343 U.S. 205 (1952)

Uebersee Finanz-Korporation, A.G. v. McGrath

No. 178

Argued January 2, 1952

Decided April 7, 1952

343 U.S. 205


1. Petitioner, a Swiss corporation, sued in the District Court for the return of certain of its property vested in 1942 by the Alien Property Custodian under the Trading with the Enemy Act of 1917, as amended by the First War Power Act of 1941. Petitioner was largely owned and controlled by a national of Germany, through a son with whom he had a usufruct agreement. Petitioner had been acquired with usufruct property for the purpose of enabling the father to control and use his property as he saw fit. The father had and used the substance, while the son had the bare legal title except for a 20% interest in the income of the usufruct property. Such right as the son had he exercised or failed to exercise in complete subordination to the will of the father.

Held: Because of direct and indirect control and domination by an enemy national, petitioner was affected with an "enemy taint," and cannot recover under § 9(a). Pp. 343 U. S. 206-212.

(a) Under § 9(a) of the Act, one not an "enemy," as defined in § 2, can recover any interest, right, or title which he has in property so vested; but corporations affected with an "enemy taint" are included in the word "enemy." Clark v. Uebersee Finanz-Korp., 332 U. S. 480. Pp. 343 U. S. 211-212.

(b) Actual use by an enemy-tainted corporation of its power in economic warfare against the United States is not the crucial fact in determining whether vested property may be retained by the Custodian under the Act. It is the existence of that power that is controlling, and against which the Government may move. P. 343 U. S. 212.

2. At the end of the litigation in the District Court, petitioner sought to have the case reopened for the purpose of asserting and establishing the nonenemy status of the son of the enemy national. Because of failure to diligently and timely assert the interest of the son, the District Court refused to reopen the case for further consideration of such separate interest.

Held: in view of the holding in Kaufman v. Societe Internationale, decided today, ante, p. 343 U. S. 156, the cause is remanded to the District Court for consideration, in chanrobles.com-red

Page 343 U. S. 206

the light of that holding and this opinion, of any application that may be made on behalf of the son within 30 days from the date of remand. Hormel v. Helvering, 312 U. S. 552, applied. Pp. 343 U. S. 212-213.

88 U.S.App.D.C. 182, 191 F.2d 327, affirmed in part.

In a suit brought by petitioner to recover property vested by the Alien Property Custodian under the Trading with the Enemy Act, as amended, the District Court entered judgment for the Custodian. 82 F.Supp. 602. The Court of Appeals affirmed. 88 U.S.App.D.C. 182, 191 F.2d 327. This Court granted certiorari. 342 U. S. 87. Affirmed in part and vacated and remanded in part, p. 343 U. S. 213.


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