within the Department of Defense and will be presented to the committee prior to the hearings. Additionally, the Department of the Army, on behalf of the Department of Defense, submitted a very lengthy report on H. R. 8572, 83d Congress, a similar bill. That report sets out in detail the facts surrounding the events of April 16 and 17 at Texas City, and is set forth in full on pages 56 to 70 of the report of the Committee of the Judiciary, House of Representatives, to accompany H. R. 9785, 83d Congress. This report, together with that which will be submitted to the committee on H. R. 4045, 84th Congress, elaborately explains the position of the Department of Defense on the bill, and it does not appear that any additional information of value to the committee would be presented by having a witness testify at the hearings.

Accordingly, in the absence of an indication that the committee desires the presence of a witness, the Department of the Army does not plan to present any testimony over and above the views reflected in the above-mentioned reports. Sincerely yours,

The committee will go into executive session.

ROBERT T. STEVENS,
Secretary of the Army.

(Whereupon the hearing was adjourned and the committee went into executive session.)

TEXAS CITY CLAIMS ACT

WEDNESDAY, JUNE 8, 1955

HOUSE OF REPRESENTATIVES,

SUBCOMMITTEE No. 2 OF THE JUDICIARY COMMITTEE,

Washington, D. C. The subcommittee met, pursuant to call, at 9:45 a. m., in room 325, Old House Office Building, Hon. Thomas J. Lane, chairman of the subcommittee, presiding.

Present: Representatives Thomas J. Lane, E. L. Forrester, Chauncey W. Reed, Usher L. Burdick, and DeWitt S. Hyde.

Also present: Cyril F. Brickfield, counsel, and Walter E. Lee, legislative assistant.

Mr. LANE. The committee will please be in order.

The committee will consider this morning the bill H. R. 4045, Texas City claims bill.

This bill was heard at some length some time ago, but we have a request from the Assistant Attorney General, Warren Burger, that they be given an opportunity to testify further. He is represented here this morning by Mr. Morton Liftin, attorney, Department of Justice. And, in all fairness to the parties and the committee, who wants to receive all the information that might be helpful, and in fairness to the members of the subcommittee, we decided to hear them on this very important bill.

The first witness this morning will be Attorney Morton Liftin, from the Department of Justice.

STATEMENT OF MORTON LIFTIN, ATTORNEY, DEPARTMENT OF JUSTICE-Continued

Mr. LIFTIN. Mr. Chairman and members of the committee.

Mr. BRICKFIELD. Mr. Chairman, may we make this letter from Mr. Warren E. Burger, Assistant Attorney General, a part of the record? Mr. LANE. Without objection, the letter will be made a part of the record.

(The letter referred to follows:)

Re H. R. 4045, Texas City Claims Act.

Hon. THOMAS J. LANE,

DEPARTMENT OF JUSTICE, Washington, D. C. May 19, 1955.

Chairman, Subcommittee No. 2, Committee on the Judiciary,

House of Representatives, Washington, D. C.

MY DEAR MR. CHAIRMAN: I want to thank you for affording me the opportunity of testifying before your subcommittee on the above measure. In connection with my testimony, I would like to restate to you my impression that the subcommittee intended to consider the proposed legislation primarily as a disaster relief

73.

measure and as a pure gratuity. My testimony and Mr. Liftin's related to consideration of the bill in this limited context.

From the testimony of others and the discussion between members of the subcommittee and witnesses, it appeared that consideration was being given, by some members of the subcommittee at least, to the question of whether the Texas City disaster resulted from the negligence of the Government. I will not, of course, express any opinion as to the subcommittee's undertaking to sit as a judicial or quasi-judicial body, nor the practicability of the subcommittee's attempting to resolve technical and complicated factual issues with respect to which nearly 60,000 pages of evidence were taken in the trial. In view of the testimony that has already been received, however, I should like an opportunity to testify further that the extravagant charges and highly inaccurate statements by other witnesses of negligence on the part of the Government are contradicted by the overwhelming weight of evidence of record. We would like to emphasize again that no court except the trial court held that the Government was guilty of negligence.

If any weight whatever is to be given for any purpose to the suggestions of counsel for insurance companies and other claimants, we would like to have an opportunity to point out factual material in the record which refutes the claims of negligence on the part of the Government. Thank you again for the opportunity to present our views on this matter.

Yours very truly,

WARREN E. BURGER, Assistant Attorney General.

Mr. LANE. Mr. Liftin, we are very glad to have you back with us; you are always welcome to come before the committee.

Mr. LIFTIN. Thank you.

Mr. LANE. We appreciate your coming here this morning. Mr. LIFTIN. We appreciate the opportunity, Mr. Chairman, of presenting further testimony, because, as Mr. Burger indicated throughout the last hearings before the committee, it was our view that the subcommittee was considering a relief bill and that it was not going into the question of negligence. But for several hours, I think it was until around 6 o'clock in the evening, the testimony of one side was heard with respect to negligence on the part of the Government, and was presented largely in support of the insurance company claims for reimbursement of their subrogated claims. The Department's view of the situation is somewhat different from that presented. The record of the case in the trial is very extensive, and demonstrated that the Government was not negligent and that legislation should not be predicated upon the assumption of a finding of negligence.

Mr. LANE. Is it your understanding that under this bill we are admitting negligence?

Mr. LIFTIN. The bill in its present form, and the view presented by Mr. Bryan in support of the bill, would have the insurance companies the principal beneficiary of this legislation, and that on the theory that the Government was negligent, and therefore, should reimburse the insurance companies for the loss. We believe that the Government was not negligent and the insurance company should not be reimbursed.

Mr. FORRESTER. May I interrupt for a question?

Mr. LANE. Yes, Mr. Forrester.

Mr. FORRESTER. Do I understand the gentleman to say-and I am not familiar with the testimony in this case-but do I understand the gentleman to say that the insurance companies are the principal beneficiaries in this matter?

Mr. LIFTIN. That is our view of it. Before the Senate committee there was testimony that the Government has constantly overesti

mated the probable payments under this bill. I do not think that is accurate. We have stated what amounts they have sued for. We have never estimated that the $200 million that has been sued for would be the amount that would be paid under the bill. We have gone along with the estimates that have been made before the committees of the Congress that the payment would be between $60 million and $100 million.

The testimony before the Senate committee was that the claims that would be paid would be nearer $60 million.

The only claims that are pretty well fixed in the amount are the claims paid out by the insurance companies. The claims that they have paid are liquidated in amount.

Mr. FORRESTER. Could you tell us about what that would amount to?

Mr. LIFTIN. The figure listed in the record, by the proponents of the legislation, I believe is $41,200,000. So that on the basis of their estimates, more than two-thirds of the claims paid under this bill would be paid to insurance companies.

Now, I recall when hearings were held by the subcommittee of the Senate last year, which passed a bill that excluded the insurance companies' claims, one of the Senate committee staff members asked the witness, on behalf of the insurance companies to submit information with regard to the losses suffered and the premiums collected, and the financial experience of the company in the period involved, to find out whether or not they were appropriate recipients of legislative grace in this matter. So far as I know that information has never been supplied; it may have been, but it has not as yet come to my

attention.

We would like, if the committee would like it, to have the opportunity to compile a list of the insurance companies that have filed claims in the litigation, so that we would have a starting point for finding out what the experience of those companies was. And with the committee's permission we will be glad to compile, Mr. Chairman, such a list from the litigation records that we have.

Mr. LANE. I think it would be a very great help to the committee. Mr. LIFTIN. We will be glad to furnish that.

Now, it is our view that this bill, in its present form, is primarily for the benefit of the insurance companies, and we want to address ourselves to the argument that the insurance companies are entitled to reimbursement for their losses.

I do want to make clear at this time, as the Department has made clear before this committee in previous sessions of the committee, that the Department does not oppose a genuine relief bill, one that would provide a limitation for claims for death or personal injury to $20,000 and for property damage, to $10,000, but without any allowance for insurance companies on the basis of subrogated claims, or any plaintiffs who were really suing for insurance companies, although they may be suing in their own names.

Now, on the various arguments about the legal rights of the insurance companies, they have already been denied in the decisions; the legal rights have been decided by the Supreme Court, which has held that, as a matter of legal right, they do not have any.

If this Congress passes this bill, which will give the insurance companies more than $40 million, it will be treating the insurance com

panies more favorably than it treats the hundreds of individuals who are injured each year by governmental action, or as a result of governmental action, and who are denied recovery because their claim does not come within the scope of the Federal Tort Claims Act.

There is a Federal Tort Claims Act in existence and I believe that should be given very careful consideration-under which it was decided that there were certain areas of Government conduct which should not be the subject of tort liability. But if this special legislation is passed it would single out insurance companies for preferred treatment while, at the same time, it maintains the general rule of law denying many individuals relief under comparable circumstances.

Now, they have no legal right; that has been decided. The question is whether they should, nevertheless, be the object of legislative grace. And they argue that since the Government was negligent, and since they would be able to recover as a matter of law if comparable conduct had been performed by anyone else, they should be able to recover against the Government.

So on the general principle, we say that Congress has made the decision but we go no further, and we say that on the evidence in the record and I believe I am correct in saying that I have been asked to present the Department's view because I have read every page of the record in this case, some 35,000 printed pages, which I did in connection with the preparation of the case for presentation to the Court of Appeals and the Supreme Court. I spent several months working on it, and I do feel that I have detailed familiarity with the evidence in the case. We are just as convinced and certain as anyone could be that it is improper and incorrect to charge any of the Government officials who acted in this program, with negligence.

They acted quite properly and in accordance with all standards of due care that could have been expected of any reasonable person at that time, and there is no basis for the passage of a bill on the ground that the Government was negligent. To discuss the evidence with respect to this, we requested this additional opportunity to be heard. Mr. HYDE. Mr. Chairman, may I ask a question?

Mr. LANE. Yes, Mr. Hyde.

This is Congressman Hyde of Maryland.

Mr. HYDE. It is true, however, that the only court decision on the subject of negligence, found negligence, that is in the nisi prius court? Mr. LIFTIN. That is correct. It is our view, too, that the appellate courts have cast so much doubt on those findings, that they were so ridiculous that they are entitled to no weight

Mr. HYDE. Yes, but you have argued that before the court.

Mr. LIFTIN. Yes.

Mr. HYDE. And the only court decision on the subject has decided against you on it.

Mr. LIFTIN. That is correct, but

Mr. HYDE. The lower court found negligence.

Mr. LIFTIN. Yes, but we argued that the district court's findings. were palpably erroneous.

Mr. HYDE. That was a part of the argument.

Mr. LIFTIN. Of the argument, yes.

Mr. HYDE. That was the argument to the other court, but the court

of appeals did not pass on that subject.

Mr. LIFTIN. Well, three members of the court of appeals did.