amount by an amount equal to the total of insurance benefits (except life insurance benefits), or other payments or settlements of any nature, previously paid with respect to such death claims, personal injury, or property loss.

(b) Payments approved by the Secretary of the Army on death, personal injury, and property loss claims, shall not be subject to insurance subrogation claims in any respect.

(c) The Secretary of the Army shall not include in an award any amount for reimbursement to any insurance company or compensation insurance fund for loss payments made by such company or fund.

(d) Except as to the United States, no claim cognizable under this Act shall be assigned or transferred.

SEC. 7. The Secretary of the Treasury shall pay out of moneys in the Treasury not otherwise appropriated, the claims referred to in this Act in the amounts approved for payment by the Secretary of the Army.

SEC. 8. A payment made under the provisions of section 7 shall be in full settlement and discharge of all claims against the Government of the United States.

SEC. 9. The Secretary of the Army shall require assignment to the United States of any right of action against a third party arising from the death, personal injury, or property loss claim with respect to which settlement is made. SEC. 10. The Secretary of the Army shall, twenty-four months after the date of enactment of this Act transmit to the Congress

(a) a statement of each claim submitted to the Secretary of the Army in accordance with this Act which has not been settled by him, with supporting papers and a report of his findings of facts and recommendations; and

(b) a report of each claim settled by him and paid pursuant to this Act. The reports shall contain a brief statement concerning the character and justice of each claim, the amount claimed, and the amount approved and paid.

SEC. 11. Attorney and agent fees shall be paid out of the awards hereunder. No attorney or agent on account of services rendered in connection with each claim shall receive in excess of 10 per centum of the amount paid, any contract to the contrary notwithstanding.

Whoever violates the provisions of this Act shall be fined a sum not to exceed $5,000.

SEC. 12. If any particular provision of this Act or the application thereof to any person or circumstance, is held invalid, the remainder of the Act shall not be affected thereby.

Approved August 12, 1955.

[S. Rept. No. 684, 84th Cong., 1st sess.]

TEXAS CITY DISASTER

The Committee on the Judiciary, to which was referred the bill (S. 1077) toprovide for settlement of claims for damages resulting from the disaster which occurred at Texas City, Tex., on April 16 and 17, 1947, having considered the same, reports favorably thereon an amendment in the nature of a substitute and recommends that the bill, as amended, do pass.

AMENDMENT

Strike all after the enacting clause and insert in lieu thereof the following: "That this Act may be cited as the "Texas City Claims Act.'"

"NECESSITY FOR LEGISLATION

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

"(1) The catastrophe known as the Texas City disaster of 1947, in which over 570 persons were killed, 3,500 persons were injured, and great property losses occurred, was the result of explosions of ammonium nitrate fertilizer on board vessels destined for France as a part of this Nation's program of foreign aid to various war-ravaged and famine-stricken areas overseas.

"(2) The two shiploads of ammonium nitrate fertilizer exploding at Texas City, Texas, on April 16 and 17, 1947, had been produced and distributed at the instance, according to the specifications, and under the control of the United States, and despite the highly explosive nature of the fertilizer, it was

not so labeled or marked to warn those who conducted its handling and loading.

"(3) The Congress recognizes and assumes the equitable and compassionate responsibility of the United States for the damages sustained by reason of these explosions and fires and hereby provides the procedure by which the amounts shall be determined and paid.

"PROCEDURE ON CLAIMS

"SEC. 3. (a) That exclusive and special jurisdiction be and the same is hereby conferred upon the United States District Court for the Southern District of Texas, notwithstanding any prior determination, or any statute of limitations, to hear, determine, and render judgment for the damages suffered for property loss, death, and personal injuries, resulting from the explosions and fires at Texas City, Texas, on April 16 and 17, 1947, commonly referred to as the "Texas City disaster.' "(b) The United States District Court for the Southern District of Texas, with the aid of the masters appointed as provided for herein, shall receive evidence of, investigate, and allow and fix the amount to be awarded in each of the claims for damages against the United States sustained by individuals, firms, companies, associations, and corporations as a result of the Texas City disaster, subject to exceptions and limitations hereinafter provided.

"(c) Under such rules as the senior judge of the United States District Court for the Southern District of Texas may promulgate, the court may appoint such number of masters, commissioners, and clerical assistants, on a temporary basis, as may be necessary to determine and report the amounts due under each suit filed, it being the desire and purpose of the Congress that the United States District Court for the Southern District of Texas appoint as many masters and commissioners as shall be sufficient in number to avoid any impairment of the regular work of that court. The masters or commissioners so appointed shall receive reasonable fees, to be fixed by the court, not to exceed $50 per diem each, such fees to be taxed by the Court against the United States Government as costs to be included as a separate item in each judgment entered and certified to the Secretary of the Treasury for payment in accordance with Sec. 7 (b), and the compensation of clerical assistants so appointed shall be fixed by the Director of the Administrative Office of the United States Courts without regard to the Classification Act of 1949, as amended. Such masters, commissioners, and clerical assistants shall be reimbursed for necessary travel and subsistence expenses incurred by them while traveling on official buiness, in accordance with regulations promulgated by the Director of the Administrative Office of the United States Courts. Appropriations for salaries of supporting personnel and for travel and miscellaneous expenses contained in the Judiciary Appropriation Act, 1956, are hereby made available for the payment of the fees, compensation,. and expenses authorized to be paid under this subsection, and there are hereby authorized to be appropriated such additional amounts as may be necessary for such purposes.

"SEC. 3. (a) The United States District Court for the Southern District of Texas, with the aid of the masters and commissioners provided for in section 2 (c), shall limit itself to the determination of (1) the amount of damages sustained by each claimant and to be paid pursuant to this Act, and (2) the indivdiuals, firms, companies, associations, legal representatives, and corporations entitled to receive the same, it being the intention and purpose of this Act, and of the Congress, to recognize and assume the equitable and compassionate responsibility and liability for the damages sustained at Texas City as a result of that disaster on April 16 and 17, 1947, and to submit only to the judicial determination of the United States District Court for the Southern District of Texas the damages to be fixed and allowed in each suit filed.

"(b) The United States, as the defendant, may appear in any and all proceedings before the United States District Court for the Southern District of Texas, and any hearings held by that court, or the masters and commissioners provided for, and oppose the grant and entry of any judgment and the amount of damages to be awarded, if any, by the court, subject to the limitations contained in subsection (a) of this section.

"SEC. 4. (a) A copy of the petition in each suit against the United States filed' under this Act shall, within twenty days after the filing thereof, be served by delivery thereof to the office of the United States attorney for the Southern District of Texas. Any reply or pleading in response to any such petition so filed shall be presented and filed with the clerk of the court within twenty days after service thereof on the office of the United States attorney.

"(b) Prior to the expiration of sixty days after the effective date of this Act, the United States District Court for the Southern District of Texas shall promulgate and publish special rules of procedure for handling the suits to which this Act applies. Unless otherwise in conflict with such special rules, the rules of civil procedure, and the local rules of the Southern District of Texas, as amended, shall be controlling in the handling of such suits.

"(c) The United States District Court for the Southern District of Texas, with the aid of the masters provided for, shall determine and fix damages, if any, in the case of each suit presented, within twelve months from the date on which the claim is submitted.

"LIMITATIONS AND EXCEPTIONS

"SEC. 5. (a) No judgment shall be allowed in any suit unless, prior to the expiration of one hundred and eighty days after the effective date of this Act, the claimant shall have filed his suit in writing with the United States District Court for the Southern District of Texas, in accordance with the rules prescribed by that court, or the rules of civil procedure and local rules where not in conflict with any special rules promulgated by the court.

"(b) No judgment for recovery on any damages or any claim filed shall be entered by the United States District Court for the Southern District of Texas for payment under this Act unless it shall have first been found by the court that such a claim on which a judgment is entered was a part of a civil action filed against the United States in a United States district court prior to April 25, 1950: Provided, That the United States district court, for good cause shown by evidence presented, may waive the failure of filing a claim prior to April 25, 1950, where it is shown that the claimant, because of infancy, insanity, or other legal disability, was unable to bring such civil action.

"(c) Claims for death, personal injuries, and property damage, made by individuals, firms, companies, associations, and corporations, other than insurance companies, shall be limited to actual damage sustained, as determined by the laws of the State of Texas, less any payment received by the claimant from an insurance company. The term "an insurance company" as used herein means any insurance corporation, firm, or association, which, under the laws of the State of Texas, has a right of subrogation, or which would have such right except for this subsection. No insurance company shall have any right to receive any part of any claim approved under the foregoing provisions of this Act. No part of any judgment entered under the provisions of this subsection shall be paid over to any insurance company, and whoever violates the provisions of this subsection shall be fined not to exceed $5,000.

"SEC. 6. (a) Any final judgment entered by the United States district court, fixing and awarding money damages on claims filed under this Act, shall be subject to review on appeal as to the extent of such damages so awarded, and as to the individuals, firms, companies and legal representatives, and corporations entitled to receive the same, in the same manner and to the same extent as other judgments of the United States district courts: Provided, however, That no appeal may be taken on any issue of liability of the United States for such damages resulting from the Texas City disaster.

"SEC. 7. (a) The Attorney General, acting through the United States district attorney for the southern district of Texas, may negotiate, compromise, or settle any suit cognizable under this Act, provided the same is approved by the court and entered as an agreed judgment.

"(b) Each and every final judgment certified by the United States District Court for the Southern District of Texas pursuant to this Act shall be paid by the Secretary of the Treasury out of the moneys in the Treasury not otherwise appropriated.

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"(c) Any payment under the provisions of this Act of any judgment so reported shall be in full settlement and discharge of all claims against the Government of the United States made by the particular claimant in the suit in which the judgment so certified was entered.

"SEC. 8. (a) The Secretary of the Treasury, before paying any judgments certified to him, shall require of, and receive, from the claimants, persons, firms, corporations, and legal representatives awarded any part of the damages found by the district court judgment, an assignment to the United States to the extent of the payment to be made by the Secretary of any right of action arising out of the Texas City disaster, which such parties participating in the judgment award may have against a third party.

"SEC. 9. (a) The United States District Court for the Southern District of Texas, with the aid of the masters and commissioners provided for herein, shall, as a part of such judgment, award, or settlement, determine and allow reasonable attorneys' fees which shall not exceed 10 per centum of the amount so recovered, to be paid out of, but not in addition to, the amount of the judgment awarded, to the attorneys of record representing the claimants and parties named in said judgment. Any attorney who charges, demands, receives, or collects for services rendered in connection with such a claim any amount in excess of that allowed under this section, if recovery be had, shall be fined not more than $2,000 or imprisoned not more than one year, or both."

PURPOSE

The general purpose of the bill, as amended, is to afford relief to the families of the 570 persons who were killed and to those people who suffered personal injuries or property damage as a result of the explosions and fires which occurred in Texas City, Tex., on April 16 and 17 of 1947.

STATEMENT

A similar bill, H. R. 9785, passed the Senate in the 83d Congress.

House Resolution 296 of the 83d Congress, 1st session, sponsored by Hon. Clark Thompson of Texas, directed the House Committee on the Judiciary, acting as a whole or by subcommitee, to make a full and complete investigation and study of the merits, if any, of all claims against the United States for compensation for property damage, personal injuries, and death alleged to have been caused by the explosions which occurred at Texas City, Tex., on April 16 and 17, 1947. Representative Chauncey Reed, then chairman of the Committee on the Judiciary, appointed a special subcommittee composed of Representatives Edgar A. Jonas, of Illinois, chairman; DeWitt Hyde, of Maryland; and Thomas J. Lane, of Massachusetts to proceed under this resolution.

The report of that special subcommittee was unanimously adopted by the full committee. The special subcommittee in its investigation conducted hearings for 3 days at Galveston and Texas City, Tex. In addition, it had at its disposal for study and use, the record of the trial court in the Dalehite case-a test case relating to the disaster-consisting of 39 volumes and over 33,000 pages of testimony and exhibits. It also had the views of the Department of Justice transmitted by letter dated January 4, 1954.

For reasons to be stated later in the report, the House committee was of the considered opinion, concurred in by the corresponding Senate committee and the Senate, that the United States Government was responsible for the explosions and the resulting catastrophe at Texas City; that the disaster was caused by forces set in motion by the Government, completely controlled or controllable by it. It recommended that Congress enact appropriate legislation to compensate the innocent victims who not only were incapable of contributing to the disaster but, because of the suddenness and force of the explosions, could not escape it.

Because of the enormity of the disaster and the great number of claims involved, the committee adopted the procedure of determining first whether negligence and responsibility therefor existed on the part of the Federal Government and then, if the responsibility was found to exist, to promulgate a plan whereby, at some later date, the individual damages suffered by each claimant could be determined and settled.1

INTRODUCTORY STATEMENT

On April 16 and 17, 1947, a manmade disaster occurred in Texas City, Tex., of almost unbelievable proportions. Loaded bags of ammonium nitrate fertilizer stowed for overseas shipment in the holds of two ships at the docks in that city blew up. The disaster occurred as the result of the explosion of an inherently dangerous material manufactured, packaged, shipped, and controlled by the United States Government under the label of fertilizer. Over 570 persons perished

1 There were over 8,000 claims filed in the Federal district court under the Federal Tort Claims Act in the Texas City disaster litigation. Approximately 1,510 claims were based on wrongful death, approximately 988 on personal injury claims, and approximately 5,987 on property damage or destruction claims. It would be manifestly impracticable for a committee of Congress to hear and ascertain the amount claimed by each individual claimant.

in the disaster, and about 3,500 more suffered injuries. Damage to private properties ran into millions of dollars.

The committee, as will be pointed out in this report, is of the firm belief that the United States Government is wholly responsible for this catastrophe. The fertilizer which blew up in Texas City was part of a fertilizer project through which the United States was seeking to carry out a program of foreign aid to various war-ravaged and famine-stricken areas overseas. While there were many who had a part in the production, shipping, and handling of this fertilizer, it was nevertheless the United States Government which conceived and initiated the foreign-aid program and it was the Government which controlled or had the power to control all phases of the project right from the manufacturing stage to the final delivery of the fertilizer at its destination.

The dissenting opinion of Mr. Justice Jackson in Dalehite v. United States (346 U. S. 15, 48), a test case relating to this disaster, aptly stated the responsibility of the United States Government in the following language:

"This was a manmade disaster; it was in no sense an "act of God." The fertilizer had been manufactured in Government-owned plants at the Government's order and to its specifications. It was being shipped at its direction as part of its program of foreign aid. The disaster was caused by forces set in motion by the Government, completely controlled or controllable by it. Its causative factors were far beyond the knowledge or control of the victims; they were not only incapable of contributing to it, but could not even take shelter or flight from it."

Mr. Justice Reed, in speaking for the majority of the Court, said:

"This fertilizer had been produced and distributed at the instance, according to the specifications and under the control of the United States."

HISTORY OF COURT LITIGATION

Before going into a discussion of the merits of the issues and problems relating to the Government's responsibility for this catastrophe, it may be well to consider at the outset the history and status of the matter when it was presented to the Congress for investigation and study. The committee believes this to be necessary because the belief has been expressed that the persons who suffered damage in the disaster, having litigated their claims under the Federal Tort Claims Act and having had their day in court and lost, should not now petition Congress as a further remedy. This belief, however, is far from being correct. It is a matter of record that subsequent to the disaster over 300 actions against the United States were instituted in the names of some 8,500 claimants under the Federal Tort Claims Act for death, personal injury, and property damages arising out of the disaster.

After those suits were filed, the parties, in order to simplify matters and to eliminate repetition of questions and legal issues common to all litigants, consolidated their cases with the approval of the United States District Court for the Southern District of Texas under civil action No. 787, Elizabeth Dalehite et al. v. United States (1950). The plan of procedure adopted by that trial court was to determine first whether negligence and liability existed on the part of the Federal Government and then, if the liability was found, to ascertain at some later date, the amount of damages each individual claimant suffered. Findings of district court establish liability of Government

After a trial of the issues, the district court judge, sitting without a jury, found negligence on the part of the Government and rendered judgment in favor of the plaintiffs. The basic ground for the district court's findings is expressed in its "Findings of Fact" that the "record discloses blunders, mistakes, and acts of negligence, both of omission and commission, on the part of defendant (the U. S. Government) its agents, servants, and employees, in deciding to begin the manufacture of this inherently dangerous fertilizer. And from the beginning of its manufacture on down to and after the day of the Texas City disaster, it discloses such disregard of and lack of care for the safety of the public and of persons manufacturing, handling, transporting, and using such fertilizer as to shock one. When all the facts in this record are considered, one is not surprised by the Texas City disaster, i. e., that men and women, boys and girls, in and around Texas City, going about their daily task in their homes, on the streets, in their places of employment, etc., were suddenly and without warning killed, maimed, or wounded, and vast property damage done. The surprising thing is that there were not more of such disasters." The court