weighed the evidence insofar as the facts relating to the liability of the United States Government were concerned; rather, they held, as a matter of law, that the Government's fertilizer program was a "discretionary function" within the meaning of the Federal Tort Claims Act and that Federal courts, therefore, were without jurisdiction to entertain the claims. (See pp. 3-5, supra.) This is made clear by the dispositive statement in the majority opinion of the Supreme Court which reads (p. 24):

Even assuming their correctness arguendo, though, it is our judgment that they do not establish a case within the act. This is for the reason that as a matter of law the facts found cannot give the district court jurisdiction of the cause under the Tort Claims Act.

The conclusion and recommendations of the committee, on the other hand, are based upon a study of the merits of the issues and facts connected with the disaster.

[Draft bill]

A BILL To provide a method for compensating claims for damages sustained as the result of the explosions at Texas City, Texas

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That

SECTION 1. (a) The Secretary of the Army shall investigate and may settle claims against the United States insofar as they relate to damages for compensation for property, death, or personal injuries, resulting from the explosions at Texas City, Texas, on April 16 and 17, 1947, commonly referred to as the Texas City disaster.

(b) Claimants shall submit their claims in writing to the Department of the Army, under such rules as the Secretary of the Army prescribes, within one year after the date of enactment of this Act.

SEC. 2. (a) Claims for damages based on wrongful death. may be submitted only by persons authorized to institute actions for wrongful death under the Revised Civil Statutes of the State of Texas and may be approved for settlement by the Secretary of the Army in sums not to exceed $10,000.

(b) The Secretary of the Army may approve for settlement subrogated claims in sums not to exceed 40 per centum of the amounts paid by subrogees.

SEC. 3. The Secretary of the Treasury shall pay out of moneys in the Treasury not otherwise appropriated, in full settlement, the claims referred to in this Act which are approved for settlement by the Secretary of the Army or his designate. SEC. 4. A settlement made under the provisions of section 3 shall be in full discharge of all claims against the Government of the United States.

SEC. 5. The Secretary shall require assignment to the United States of any right of action against a third party arising from the property damage, death, or personal injuries, with respect to which the settlement is made.

SEC. 6. The Secretary of the Army shall transmit to the Congress:

(a) each claim submitted to the Department of the Army in accordance with section 1 which has not been settled by him, with supporting papers and a report of his finding of facts and recommendations;

(b) a report of each claim settled by him and paid pursuant to section 3. 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. 7. No attorney or agent on account of services rendered in connection with each claim shall receive in excess of 20 per centum of the amount paid, any contract to the contrary notwithstanding. Whoever violates the provisions of this Act shall be fined not to exceed $5,000.

APPENDIX TO COMMITTEE REPORT

JANUARY 4, 1954.

Hon. EDGAR A. JONAS,

Committee on the Judiciary,

House of Representatives, Washington, D. C.

MY DEAR MR. CONGRESSMAN: This is in response to your letter of December 2, 1953, addressed to the Attorney General, transmitting copies of volumes 1 and 2 of the transcript of hearings before the subcommittee of the Committee on the Judiciary of the House of Representatives in connection with the Texas City disaster, and of your additional letter of December 4, 1953, transmitting volume 3 of the hearings before your subcommittee at Galveston, Tex., on November 16, 17, and 18, 1953.

You have requested expressions of the Department of Justice relative to the subject matter of the hearings.

In the first place, I wish to express my appreciation of the opportunity to appear informally with a member of my staff before your subcommittee in Washington on November 9, 1953, and of the present invitation to comment on the arguments and statements presented by claimants' counsel to your subcommittee in Galveston. Not merely as a preliminary remark, but as a sincere expression on behalf of myself and of the several officers, employees, and counsel of the Government who have had the responsibility of representing the United States in this matter, I want to state that all of us are fully aware of the magnitude of the destruction of property and of the loss of life at Texas City on April 16, 17, 1947; and all of us, as individuals, are moved by the considerations of human sympathy so eloquently expressed by Representative Thompson of the Ninth Congressional District of Texas and other spokesmen for those who suffered the losses.

At this late stage we do not deem it appropriate or necessary to undertake a reargument of the case on the facts or the law. The Government's position was fully and carefully presented in the trial court, the United States Court of Appeals for the Fifth Circuit, and in the Supreme Court of the United States. Copies of the Government's briefs in the appellate courts have been made available to your subcommittee. It is clear from these briefs that the statement of claimants' leading counsel that the Government "never really questioned these facts [the district court's findings of negligence] (tr. comm. hearings, p. 122) is considerably less than accurate.

We invite the subcommittee's attention to pages 88 through 146 of the brief for the United States in the court of appeals and to pages 55 through 167 of the brief in the Supreme Court. As will be seen, at least one-half of the written argument on behalf of the United States in the appellate courts was addressed to the errors of the district court in its findings that any employee or employees of the Government were guilty of actionable negligence in connection with the disaster at Texas City. Extended oral orgument was addressed to the same aspect of the case.

More important than the arguments of Government counsel, however, is the fact that neither the judges of the court of appeals (197 F. 2d 771), nor the Justices of the Supreme Court (346 U. S. 15), accepted the district court's views that the Government was negligent. We believe that all six judges of the court of appeals decided that at least the basic findings of the district court were clearly erroneous. Judge Strum's opinion (197 F. 2d at 781-782) expressly noted plaintiff's failure to establish fault or negligence in any respect. He found that assertions of negligence in the manufacture, labeling, and handling of the fertilizer and in notice of its character were not supported by the evidence. He specifically found that there was no evidence that the commodity was an inherently dangerous explosive or that there was any failure to use reasonable care in its manufacture, packaging, or transportation, and that the bags were plainly labeled in a manner "sufficient to put the ship operators on notice as to the nature of the substance they were handling." He characterized as "clearly erroneous" the district

court's finding "that the explosion was due to the inherently dangerous character of the FGAN" and that the United States gave inadequate warning. And he concluded that the entire evidence "appraised as a whole" left with him "the definite and firm conviction' that the United States was not guilty of negligence." The opinion of Chief Judge Hutcheson (197 F. 2d at 782-786), in which Judge Borah concurred, also disclosed the clear conviction that petitioners failed properly to establish negligence or fault on the part of any employee of the United States. He agreed "with the appellant [the United States] that the findings are contrary to the truth and right of the case and clearly erroneous," declared that "the district judge erred in holding that the program was in its nature so dangerous that it constituted a public nuisance and its mere undertaking was wrongful," and reiterated that he was "in no doubt" that "the findings and conclusions are, upon this record, clearly erroneous and cannot stand."

Judge Rives' opinion (197 F. 2d at 772-781), in which Judges Holmes and Russell concurred, also rested upon the conclusion that there was a fundamental error in the district court's findings. Although the opinion relied upon the Tort Act's "discretionary function" exemption (28 U. S. C. 2680 (a)), it is clear that these three judges rejected the district court's basic finding that the fertilizer was an inherently dangerous explosive substance of whose qualities the Government's employees were or should have been so aware that the fertilizer program should not have been undertaken as it was. Contrary to the findings of the district court, this opinion stated that "it can hardly be argued that the dangers of explosion from FGAN were so well known prior to the disaster that judgment or discretion were not called into exercise as to whether it should be manufactured at all and under what safeguards and warnings it should be distributed." The Supreme Court opinion also indicates serious reservations with respect to the district court's findings of negligence. It expressed agreement with the characterization of the findings in the court of appeals as "profuse, prolific, and sweeping" and stated that "no proper review could be exercised by taking the 'fact' findings of 'negligence' at face value" (p. 24, fn. 8).

It refers to the Government's manufacture and shipment of the commodity "for more than 3 years without even minor accidents," its investigation and experiments, and the availability and reliance upon TVA and private industry practice and experience (p. 28). It points out that:

"** * The basic 'plan' ***was drawn up in the light of prior experience by private enterprise and the TVA. In fact it was, as we have pointed out, based on the latter agency's engineering techniques, and specifically adopted the TVA process description and specifications (pp. 38-39)." The lack of participation by Government employees in the negligent conduct found by the district court is underlined by the following excerpts from the Supreme Court's opinion

"As well, serious judgment was involved in the specification of the bag labels and bills of lading. The importance of this rests on the fact that it is the latest point in time and geography when the Government did anything directly related to the fire, for after bagging the FGAN was of course physically in the hands of various nongovernmental agents. *** there was serious room for speculation that the most direct operative fact causing the immediate fire on the Grandcamp arose from errors that the French Council, longshoremen, or ship staff committed *** (p. 41)." The opinion also stresses complete compliance with applicable regulations of the Interstate Commerce Commission in shipping the material

***The Plan had been prepared in this regard by the Transportation Officer of the Director's Office. His decision in the matter was dictated by the ICC regulations. These did not provide for a specific classification for the material other than as fertilizer. Labeling it as anything but 'oxidizing material' was not required-indeed was probably forbidden-and even this requirement was waived for bags of less than 200 pounds. To the extent, then, that the Army had a choice in the matter, its decision not to seek to list its FGAN in any other fashion was within the exception. The immunity of a decision as to labeling, in fact, is quite clearly shown by the fact that the ICC's regulations, for instance, could not be attacked *** (pp. 41-42)."

Similarly, with respect to the Coast Guard, the Supreme Court observed:

"The findings of negligence on the part of the Coast Guard in failing to supervise the storage of the FGAN, and in fighting the fire after it started, were rejected by a majority of the Court of Appeals (p. 42)."

In view of the absence of negligence and the fact, recognized by the Supreme Court, that the material was in possession and control of private persons from a time long before the fire and explosion occurred, it is submitted that suit was brought against the United States because of the magnitude of the disaster and the ability of the United States to pay for it, rather than upon conventional theories of tort liability. It is unlikely that suit would have been brought against any private person who stood in the same relationship to the fertilizer as the United States.

It appears that the "testimony" before the subcommittee at Galveston was largely made up of arguments by counsel for the subrogated insurance company plaintiffs and a rehash of the contentions that were unsuccessfully advanced by them in the courts. In that connection, it might be pointed out that the claimants were and are represented by "approximately 200 attorneys" (Tr. Comm. Hearings, p. 354, 355). In the emotionally charged litigation, the United States was at first represented by only one attorney, a former assistant United States attorney for the southern district of Texas. He was later joined by another trial attorney borrowed from the staff of the United States attorney. They were, of course, given such assistance as was available from advisory attorneys in the Department of Justice. It seems somewhat ironic, therefore, that the leading counsel for the underwriters spoke complainingly before the subcommittee of "a fiercely aggressive attitude on the part of the Department of Justice" (Tr. Comm. Hearings, p. 133). As a matter of fact, the abuse of Government counsel during this litigation reached such heights that it was condemned by the special master in the trial court. The court of appeals, on its own motion, also took "notice of the abusive and defamatory language in appellees' brief and orders that same be expunged from the record * * * for the reason that such matters are not only immaterial, but also intemperate and reproachful" (R. 27792).

As indicated hereinabove, we do not think that any new fact was brought out or established in the hearings at Galveston. Most of the statements to the subcommittee concerning the facts were made by advocates who were understandably argumentative in their presentation. It has been noted that counsel for the leading underwriters involved in the litigation stated to the subcommittee that the amount of all claims based on the Texas City disaster was a figure somewhere between $60 million and $100 million. The amount sued for was in excess of $208 million, and 80 percent thereof was made up of the claims for corporate and other business property damage together with the claims by subrogated insurers, including claims of individuals in excess of their insurance recovery. We assume that the later and more modest total of claims for relief from the Public Treasury would be divided into the same categories in approximately the same proportions. Any program of payment to the claimants would therefore entail reimbursement in enormous amounts to the subrogated insurance companies that suffered losses on their calculated risks.

Yours very truly,

WARREN E. BURGER.

(The following abstracts from the record in the Federal litigation relating to the Texas City disaster were submitted as an exhibit by the attorneys appearing for claimants at the hearings before the special subcommittee at Galveston, Tex., and the exhibit was made a part of the record of those hearings:)

We repeat the text of footnote 3 of the Reply Brief for the United States in the Court of Appeals: "Appellees' invective has not been confined to counsel presenting the appeal for the United States. Similar charges were leveled against trial counsel. The special master appointed by the district court reported, for example, that 'at least 500 pages of the record are taken up' with 'charges and reiteration of charges against Government counsel'; that counsel for plaintiffs had 'been vocal, vigorous, and verbose in their denunciation of Government counsel'; that 'the record is replete with references to Government counsel to the effect that their conduct was reprehensible, outrageous, and dishonorable'; that the special master had refused to accede to the demands of plaintiffs' counsel because that 'would have amounted to a judicial holding that Government counsel were not acting in good faith and were not telling the truth' which he 'did not believe・・・ to be true' (R. 89 ff., passim)."

COMPENDIUM OF STATEMENTS OF KNOWLEDGE OF DANGEROUS AND EXPLOSIVE CHARACTERISTICS OF FGAN AND ADMISSIONS OF FACT, AND FAULT AND NEGLIGENCE ON THE PART OF THE GOVERNMENT, ITS AGENTS, SERVANTS, EMPLOYEES, AND REPRESENTATIVES, BY RESPONSIBLE PERSONS AND OFFICIALS AND AUTHORIZED AGENCIES OF THE UNITED STATES, APPEARING IN THE PRINTED RECORD OF EVIDENCE IN No. 308, OCTOBER TERM, 1952, UNITED STATES SUPREME COURT, A CASE ENTITLED "ELIZABETH H. DALEHITE ET AL., PETITIONERS, V. UNITED STATES OF AMERICA, RESPONDENT"

Because the first manufacture of fertilizer grade ammonium nitrate occurred in 1943, under the Hercules Cairns Explosives Patent 211738, covering blasting explosives, which was licensed to the United States Government for its use (R. vol. 18, p. 13574), the statements and admissions here contained will begin with that year, 1943.

August 20

YEAR 1943

Wilbert J. Huff, consulting explosives chemist, Bureau of Mines, replies to TVA request for opinion of Bureau on use of FGAN that "In general we do not favor the mixing of organic materials with ammonium nitrate, and are of the opinion that, while such mixtures may not be unduly sensitive, accidents due to other causes may be attributed to such mixtures. *** We are very conservative in the recommendation of mixtures that have not been subjected to extended experience and tests. * * * (R. vol. 33, p. 25222).

August 18

J. E. Tiffany, of Bureau of Mines, to Dr. Huff, on question of FGAN and its hazards, says:

"We know that there have been disastrous explosions with ammonium nitrate and undoubtedly these may recur from time to time. The conditions to bring about these explosions have never been satisfactorily established" (D. T. 11). September 18

Canadian scientists at TVA conference objected to the use of FGAN as it was manufactured and shipped to Texas City, because "It might increase the fire and explosion hazards" (P. T. 239, R. vol. 24, pp. 20922-20925).

September 20

Conference of Government and explosives manufacturing experts, considering the beginning of manufacture of FGAN, were told by two ordnance captains attending, of the dangerous materials involved, the minutes reflecting:

"Representatives from the Ordnance Department stated that in their handling of ammonium nitrate it was treated entirely as a high explosive" (R. vol. 26, pp. 21722-21724).

October 29

Tiffany, of Bureau of Mines, to Huff, with report forwarded to TVA, October 29: "Nevertheless, accepted precautions in handling these ammonium nitrate mixtures should be observed because numerous disastrous explosions of ammonium nitrate have occurred in the past. These explosions have taken place under conditions that have never been satisfactorily established. Undoubtedly such occurrences may recur from time to time" (Tiffany, exhibit 5). (Not printed.) November 26

Official Bureau of Mines Report No. M-1871, marked "Confidential Memo, Not for Publication," dated November 26, prepared by D. Harrington, quotes from letter of Hylton Brown, reading in part:

"As this information indicates, extreme care should be taken in fighting fires where ammonium nitrate is present, and persons should be warned of the possibility of explosions" (P. T. exhibit 216).

February 17

YEAR 1944

But

J. E. Underwood, WPB, writing to members of Chemical Referee Board, states: "Considerable data are available in connection with the explosiveness of straight ammonium nitrate, and some mixtures of this material and other salts. practically nothing is known regarding the hazards involved through the introduction of organic materials to ammonium nitrate itself" (R. vol. 23, pp. 20026-20027). [Italics supplied.]