several Coast Guard districts are vested in and imposed upon the Coast Guard district commanders in charge of such districts,' signed by J. F. Farley, Admiral, United States Coast Guard, Commandant. You were familiar with that, were you not, sir?-A. Certainly.

"Q. That puts squarely on the shoulders of the district commanders the duty to enforce and carry out these general regulations and authorities, didn't it?—A. Yes, sir.

"Q. And that was true prior to Texas City, wasn't it? A. Yes. "Q. And it is under that very authority that immediately after Texas City, Coast Guard issued specific orders directing that they check to see that the ship holds were clean and properly prepared to receive cargo in accordance with present regulations, is it not, sir? A. Yes, sir.

*

"Q. You didn't write the shipping agents; you ordered your district commanders to enforce those regulations, didn't you?-A. Yes, sir.

"Q. But you hadn't done that prior to Texas City, had you?-A. No, sir. "Q. The real truth about it is that they weren't enforcing those regulations prior to Texas City, because they had gotten the wartime attitude of taking a chance, wasn't it?—A. Yes, I think so" (R., pp. 9195–9198).

UNITED STATES DISTRICT COURT, SOUTHERN DISTRICT OF TEXAS, Houston, Tex., May 24, 1955. In re proposed legislation for the relief of victims of the Texas City disaster. Hon. EMANUEL CELLER,

Chairman, Committee on the Judiciary,

House of Representatives, Washington, D. C.

DEAR CONGRESSMAN CELLER: Among the four judges of this district, the docket of the Galveston division presently is my responsibility. For that reason, and by reason of the request as hereinafter set out, I take the liberty of writing you concerning the proposal which would invest this court with special jurisdiction to determine the awards to be made in favor of the claimants who suffered personal injury or damage by reason of the Texas City disaster.

On yesterday, Hon. Austin Y. Bryan, a distinguished member of this bar and one of the attorneys who represented the claimants in the litigation terminated by the Supreme Court opinion, and who likewise is among those actively supporting the enactment of the relief legislation, advised me that at a recent appearance before your committee one or more of the committee members had requested an expression from me as to how much of an additional burden this proposal, if enacted, would impose upon the work of this court.

Mr. Bryan suggested to me that with liberal use being made of the services of special masters this special jurisdiction would not be heavy or burdensome, and could be readily absorbed.

I am not nearly so optimistic in this regard as are these proponents. I am unable to see how the large sum involved may be distributed among several thousand claimants without a tremendous amount of time and effort being expended thereon. While the docket of the court presently is quite congested, I believe the other judges and I are able to fairly well keep abreast of it. The substantial increase suggested would, in my opinion, require very material additional clerical and judicial help.

You will please understand that it is not my purpose to express an opinion either in favor of or against the enactment of the proposed legislation, or any particular draft thereof. My only purpose is to comply with the request made of me, and to make available these facts about the court's docket for such benefit, if any, as they may be to the committee.

Sincerely,

To: House Committee on the Judiciary.

(Attention: Mr. Brickfield.)

From: American Law Division.

BEN CONNALLY.

THE LIBRARY OF CONGRESS, LEGISLATIVE REFERENCE SERVICE, Washington 25, D. C., May 31, 1955.

Subject: Validity of legislation vesting in the Federal district courts in Texas jurisdiction to determine the measure of damages owed to claimants suffering injuries in the Texas City, Tex., disaster, the Government admitting liability and electing merely to contest the amounts claimed by the plaintiffs.

It is submitted that the proposed legislation would be valid for the reason that it would meet all the requirements hitherto exacted by the Supreme Court as conditions prerequisite for the exercise of the judicial power vested in the Federal courts by article 3 of the Constitution. As set forth in applicable precedents, among the conditions to be met is the initial requirement that the function sought to be imposed be judicial in nature; that is, that the duty assigned to the courts be capable of being discharged by the rendition of a final judgment. Finality of judgment being viewed as an essential attribute of judicial power, Federal courts consistently have refused to carry out laws which confront them with a purely administrative, advisory function of passing on, auditing, and approving claims

presented in an ex parte proceeding and the payment of which ultimately would be determined, independently of judicial approval, by officials in the political branches, the executive and Congress (Hayburn's case (1792), 2 Dall. 409; U. S. v. Ferreira (1852), 13 How. 40, 45-50; Murray's Lessee et al. v. Hoboken Land and Improvement Co. (1856), 18 How. 272, 280; Gordon v. U. S. (1865), 117 U. S. 697, 698). No such infirmity is discernible in the proposed legislation and its constitutionality would not be impaired on that score (see 1 Stat. 243, 244, sec. 2; 3 Stat. 768; 6 Stat. 569; 9 Stat. 788).

Second, inasmuch as the judicial power of the Federal judicial system extends only to cases and controversies (art. 3, sec. 2), the contemplated legislation, to become operative, must present the courts with an opportunity to dispose of litigation that is adversary in character. This requirement also would appear to be met; for the proposed legislation would not authorize an ex parte proceeding wherein the claimants, with manifest unconcern on the part of the absent district attorney who normally would represent the United States, would attempt to establish solely by their own evidence the correctness of their estimate of damages sustained. On the contrary, under the contemplated legislation, there would remain, even after stipulated admission of liability on the part of the Government, the necessity of adjudicating the measure of damages to be awarded; and in this proceeding the United States would not be required to play the role of a passive, disinterested bystander. It is foreseeable, as a matter of practical administration of this proposed law, that in certain instances the United States attorney might be prepared to concede that the plaintiff's estimate of his damages was not excessive; but such concession would appear to be reconcilable with his existing authority, subject to court approval, to enter into compromises (U. S. C. 28: 2677); and therefore would not operate to prevent fulfillment of the case and controversy requirement (In Re Pacific Ry. Com'n. (1897), 32 F. 241, 255; Chicago and Grand Trunk Ry. Co. v. Wellman (1892), 143 U. S. 339, 345; Muskrat v. U. S. (1911), 219 U. S. 346, 361).

NORMAN J. SMALL, American Law Division.

SUPPLEMENTARY STATEMENT OF DEPARTMENT OF JUSTICE ON

S. 1077 AND H. R. 4045, TEXAS CITY CLAIMS BILLS

This supplementary statement is being submitted, with the permission of the subcommittee, for the limited purpose of providing additional information in connection with testimony offered in support of the proposed legislation. It is not intended to be a complete expression of the Department's views on the bills. The proposed bills would compensate insurance companies to the extent of some $40 million and provide complete reimbursement for the claims paid by the insurance companies arising out of insured losses suffered in the Texas City disaster. Attempts have been made in testimony before the subcommittee to justify this windfall to insurance companies on the theory that the United States has not always opposed the payment of subrogated claims and that the United States is morally responsible in the situation because it is charged that the negligence of the United States caused the disaster.

The charge of negligence is based on the claims that the district court's findings remained undisturbed by the appellate courts and that the evidence of record establishes the negligence of the United States.

The purpose of this supplementary statement is to show that these claims are wholly without foundation. The district court's findings and the charges of negligence are thoroughly discredited by the opinions on appeal and by the record in the case which was prosecuted through the Supreme Court. In this connection, after discussing the various appellate opinions, it will be shown, by reference to testimony and exhibits in the record of the case heard by the Supreme Court, that:

1. The ammonium nitrate fertilizer was manufactured and packaged by an experienced private producer in accordance with established industry practice.

2. It was in all respects privately owned fertilizer after it was loaded aboard and shipped in rail cars from the manufacturing plants, and the United States had no contro lover its transportation or stowage atany time thereafter.

3. It was in no sense a new product when the program for its manufacture was embarked on by the United States in May 1946.

4. It has never been and is not today considered an explosive for transportation purposes, and when shipped it was properly identified as "ammonium nitrate" (an oxidizing material) in strict compliance with Interstate Commerce Commission governing regulations.

5. Everyone who handled it knew it was ammonium nitrate, commonly known as an oxidizing material, and not flour or cement.

I. CLAIMS OF INSURANCE COMPANIES

As a preliminary matter, it may be well to advert to the testimony on behalf of the insurance companies' subrogated claims. In urging that insurance companies should be reimbursed by American taxpayers to the extent of some $40 million paid out under insurance contracts in effect at the time of the Texas City disaster, Mr. Bryan testified as to other situations in which the Department has not opposed subrogation and in which subrogated claims have been paid.

Some important distinctions between the subrogation precedents referred to by Mr. Bryan and the present matter are the circumstances that in the present situation (1) it has been established by the highest court in the land that there is no legal liability on the part of the United States, and (2) as a factual matter, the United States was not responsible for the disaster.

Mr. Bryan has insinuated bad faith on the part of the Department of Justice and the Department of the Army in refusing to admit the responsibility of the United States for the disaster. It is submitted that these baseless charges should be disregarded. Charges against the Government by counsel for the insurance companies and other claimants are not new in the Texas City litigation and have

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given rise to most unusual judicial utterances and action in the course of the proceedings which should warn the members of this subcommittee, as unanimously recognized by the court of appeals, that these charges are a very poor substitute for evidence.

In the district court proceedings, extravagant claims by plaintiffs were accompanied by constant denunciation of the Government and of Government 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 and 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).

Furthermore, in the proceedings below, the court of appeals, on its own motion, took "notice of the abusive and defamatory language in appellees' brief and orders that same be expunged from the record," not only because such matters are immaterial “but are also intemperate and reproachful" (R. 27792.

II. APPELLATE COURTS DID NOT ACCEPT DISTRICT COURT FINDINGS OF NEGLIGENCE It has been suggested that the subcommittee accept the district court findings of negligence on the theory that they were not disturbed by the decisions of the court of appeals and the Supreme Court. It would be difficult to contrive a more misleading approach to consideration of the proposed legislation.

In the court of appeals, in which the evidence relating to alleged negligence received extensive and careful consideration, 3 judges expressly rejected the findings of the district court as clearly erroneous and the remaining 3 judges rejected at least the district court's basic finding that the United States should have known ammonium nitrate fertilizer to be a dangerous explosive. Not a single judge approved the district court findings.

Judge Strum's opinion expressly notes claimants' 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 (R. 27811). 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 (R. 27811), 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" (R. 27812). 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 (R. 27812). 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" (R. 27812).

The opinion of Chief Judge Hutcheson, in which Judge Borah concurred, also discloses the clear conviction that petitioners failed property to establish negligence or fault on the part of any employee of the United States. At the outset, he observed "that the trial as a whole was so infected" with procedural errors as to require reversal of the district court's judgment (R. 27819). Then, addressing himself to the Government's request "to downrightly hold that, procedural errors aside, the findings are clearly erroneous," he declared that because "of the way the case was tried, because, too, of the too-sweeping nature of the findings and conclusions, I agree with the appellant [the Government] that the findings are contrary to the truth and right of the case and clearly erroneous" (R. 27819). And later, apparently to show that his opinion was at least in part premised on the conviction that the findings of negligence were unsupported by the record, he 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" (R. 27820), and reiterated that he was "in no doubt" that "the findings and conclusions are, upon this record, clearly erroneous and cannot stand" (R. 27821).

Judge Rives' opinion, in which Judges Holmes and Russell concurred, also rests upon the conclusion that there was a fundamental error in the district

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