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to jury verdicts, in favor of the plaintiffs, defendant Pan American

World Airways appealed.

Among the issues

considered on appeal was the Constitutionality of the Warsaw Convention and its limitation on air carrier liability, as well as the possible preemptive effects of the Convention on a California statute which permitted wrongful death recoveries to be limited by contract. The court, noting that the District Court failed to consider the preemptive effect of the Warsaw Convention, turned to a consideration of that issue and observed that the question was compounded by the Congress' failure to express its desire to preempt and also by the fact that the Convention specifically requires the application of local law to certain issues. At the same time though, the Court noted that "federal law may also preempt the application of state law where the state law stands as an obstacle to the accomplishment and execution of the full purposes and objectives of the Congress." Id. at 1307.

Turning to an examination of the provisions of the Convention itself, as well as the actions of Congress in its ratification of the Convention; and noting the importance of the liability limitation feature of the Convention and the Congress' desire to permit the unrestrained growth of both domestic and international air travel, the Court concluded that the Congress' intent at the time of ratification was still controlling today despite the fact that the liability limtiations established by Convention were unjustifiable by today's standards. The Court ended its analysis by stating that the California law was indeed preempted by Congress'

ratification of the Warsaw Convention and ruled that preemption was based upon the fact that "the application of California laws suggested here necessarily conflicts with the Congressional scheme." Id. at 1308.

In Fidelity Federal Savings & Loan Association v. de la Cuesta, 458 U.S. 141, 102 S. Ct. 3014 (1982), the Supreme Court considered the appeal of an action brought by purchasers of real estate encumbered by deeds of trust, seeking declaratory and injunctive relief against a federally chartered savings and loan association's exercise of the due-on-sale clauses contained in the trust deeds. Following the consolidation of several actions, the Superior Court for Orange Country granted summary judgment in favor of the savings and loan associations, purchasers were later denied review by the Supreme Court of California. Appeal was sought and granted to the Supreme Court on the question of whether the California due-on-sale clauses were preempted by the Homeowners Loan Act of 1933.

In a lengthy discussion of the doctrine of federal preemption the Court concluded that the Federal Home Loan Bank Board's regulations regarding the right of federally chartered savings and loan associations to exercise due-on-sale clauses barred the application of contrary state doctrines. In reaching its decision, the Court noted that the doctrine of preemption was rooted in the supremacy clause and that it required the court to examine Congressional intent, for preemption may be "either express or implied, and is compelled whether Congress' command is explicitly stated in the statute's language or implicitly contained in its

structure and purpose." 102 S. Ct. 3022. Citing with approval the decision in Rice v. Santa Fe Elevator, the Court added that:

Id.

Absent explicit preemptive language, Congress intent to supercede state law altogether may be inferred because "the scheme of federal regulation may be so pervasive as to make reasonable the inference that Congress left no room for the states to supplement it", because "the act of Congress may touch a field in which the federal interest is so dominant that the federal system will be assumed to preclude enforcement of state laws on the same subject", or because "the object sought to be obtained by federal law and the character of obligations imposed by it may reveal the same purpose.

Commenting that "federal regulations have no less preemptive effect than federal statutes." Id., the Court held that the Board's due-on-sale regulations were intended to preempt conflicting state limitations.

The doctrine of federal preemption, as expanded by the decision cited above, applies to the instant controversy in two distinct manners, namely, by occupation and by nature. The latter of these two principles, as mentioned above, holds that the states are preempted where a given area is of such a nature that the federal system must be presumed to have sole regulatory authority over it. As developed in Section I, above, the field of international relations is, and has been recognized as, an area whose composition will permit nothing less than uniform regulation, something which may only be achieved at the federal level.

Both the proposed plan and the Marketing Act have established an immediate conflict of authority with federal actions irrespective of the fact that an exercise of these state acts has

not yet been attempted. By introducing the field of international trade negotiation into the enumerated powers of the boards constituted under the Act, the California legislature has invested those boardsTM with powers which have not resided in the hands of the states since the adoption of the federal Constitution. As such, they represent an attempt by the state to usurp a specific degree of federal power and do so by establishing a scheme of representation which may preclude successful negotiation and commercial exchange, pending a resolution of the conflict to the satisfaction of those with whom negotiations would be sought.

Against such a background the proposed plan cannot stand for it unnecessarily intrudes on federal ground and thereby impairs the negotiating ability of both state and federal authorities who desire equivalent ends by obfuscating the clear authority of one over the other. On the basis of judicial determination and the practicalities involved in the conduct of foreign relations, the question must be resolved in favor of the United States and consequently, the proposed plan must be withdrawn.

In addition to the federal nature of this question, the doctrine of preemption also operates in this instance to preclude the adoption of the proposed plan on the basis of prior occupation of the field by the United States.

As noted above, preemption operates to bar state action affecting those fields in which the United States has expressed a controlling interest in such a fashion as to manifest a Congressional intention that the states not interfere. Such an intent is witnessed

by the broad authorities conferred upon the Executive by the enactments of the Congress in the field of trade negotiations.

Prior to 1962 all negotiations, whether diplomatic or commercial, were conducted by the Department of State on behalf of the United States. In the Trade Expansion Act of 1962, 19 U.S.C. $1801, et seq., the Congress created the Office of the Special Representative for Trade Negotiations and established it as the "chief negotiator of the United States for each negotiation under this subchapter", 19 U.S.c. $1871, which negotiations are directed to "maintain and enlarge foreign markets for the products of United States agriculture..." 19 U.S.C. $1801, the same avowed purpose as the Marketing Act under which the proposed plan has been promulgated. Fd. & Ag. C. A. $58654(d). The authority of the Special Trade Representative has been continued and updated since the enactment of the 1962 Act, and in 1979 that Office was renamed the Office of the United States Trade Representative, 19 USC $2171, 1979 Reorg. Plan No. 3, and was described as having "primary responsibility,...for developing, and for coordinating the implementation of, United States international trade policy, including commodity matters." Reorg. Plan No. 3, S1(b)(1).

These pronouncements, and the Congressional enactments upon which they are based, have established and empowered a particular office whose sole purpose is to represent the trade objectives of the United States and enter upon negotiations with foreign nations to ensure the unimpeded access of U.S. goods to foreign markets. The genesis of this development was the Congress' dissatisfaction with

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