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The managers on the part of the House at the conference on the disagreeing votes of the two Houses on the amendment of the Senate to the bill (H. R. 980), to permit the United States to be made a party defendant in certain cases, submit the following written statement explaining the effect of the action agreed on:

That your managers were unable to agree to the Senate amendment, striking out all after the enacting clause and inserting new language, and the conferees on the part of the Senate were unwilling to recede from the Senate amendment. Growing out of this situation a compromise was agreed to in the form of a substitute bill embodying in substance the provisions of the House bill and Senate amendment.

In explanation of the provisions of the substitute bill, we respectfully submit the following:

1. So far as concerns suits, the substitute bill agreed to by the conferees is limited to liens on real estate. There seems to be no real demand for legislation having to do with liens on personalty and that subject is so complicated and gives rise to so many different situations requiring special provisions to protect the United States that it is very difficult to deal with. The provision for voluntary releases by the United States of worthless liens does relate both to personalty and realty.

2. The House bill deals only with cases where the United States lien is a junior lien. The substitute bill also covers cases where the United States lien is a prior lien. Cases often may arise where a junior lien holder needs to be informed as to the validity, amount, etc., of a prior lien, so as to know how much to bid on foreclosure of his junior lien, and in some cases the very question for adjudication is one of priority.

3. The House bill provides that if the case is in a State court the controversy with the United States must be removed to the United States court, and that the removal is effected by the plaintiff before the United States is joined as a defendant. That procedure does not fit in very well with the law on removal of causes.

The Senate amendment provides that if brought in the State courts the suit shall remain there and the only power of review by a Federal court would be the Supreme Court of the United States reviewing the judgment of the highest court of the State. That departs from general practice that the Government only allows itself to be sued in its own courts. It also compels United States attorneys to arrange their court schedules so as to attend terms of the State courts. The substitute bill allows suits in the State courts but makes the removal by the United States optional, not mandatory. Practical experience with the subject justifies the belief that, in a large percentage of the cases, there will be no removal where liens of the United States are inferior as they may be worthless or not disputed.

4. The time allowed for the Government to answer is made 60 days and the time allowed for removal runs for 30 days thereafter. The general removal statute requires removal within the time allowed by law for answer, but it is believed in the present case that if decision on the desirability for removal is postponed until after issue is joined, many removals may be avoided where it becomes apparent that there is no real dispute.

5. It is provided in the substitute bill that in addition to service on the United States attorney, service by registered mail shall also be made on the Attorney General. This is in accordance with existing laws in other types of cases.

6. The House bill provides that only the part of the controversy affecting the United States shall be removed, and when decided the cause shall be remanded to the State courts where the litigation shall proceed. It is doubted whether this splitting of the cause would be to the advantage of anyone. Adjudicating the validity, amount, and priorities of the lien of the United States in most cases will require in the Federal court some decision as to the rights of the other lien holders. If the case is then remanded, a second trial might be required at which some of the same ground would be covered. The split proceeding is cumbersome. It seems that time and money would be saved by having the entire proceeding in one court.

7. It was suggested by one member that to prevent useless removals where there is no real dispute affecting the United States, the United States attorney in his removal papers be required to add a certificate that there is a real controversy. There are objections to this. It is a departure from the established practice on removals, and United States attorneys are apt to overlook it and fail to bring about the proper removal. A provision has been inserted that the Federal court may remand the cause if it appears before judgment that there is no real dispute affecting the Government. The clause already referred to allowing removal after issue has been joined will also tend to prevent useless removals. These two provisions of the substitute bill seem to furnish a reasonable precaution against useless removals.

8. The Senate amendment contains a clause allowing the court to stay proceedings on sale until the expiration of the next session of Congress. This was no doubt intended to allow Congress to appropriate money to enable the United States, if a junior lien holder, to bid enough at the sale to take care of prior liens and thus protect its

In place of that the substitute bill provides that if a junior lien holder, the United States shall have a year in which to redeem. That does away with any necessity for a delay of sale. In many States of the Union there are now laws allowing junior lien holders as well as fee owners a year in which to redeem from execution and foreclosure sale of real estate. It is true that in other States no such equity of redemption exists. However, the provision adds nothing to the present difficulties in States which allow no redemption period, as under present conditions where present lien holders can not sue the United States, the rights of the United States never are barred by foreclosure decree.

9. The substitute bill gives the United States, where it owns the first lien, authority to ask for affirmative relief in the form of foreclosure of its lien, and to bid at the sale up to the amount of its claim and expenses of sale. This is necessary for the protection of the United States. There is no general statute which allows the United States to be a bidder at its own foreclosure sale. (See title 26,

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sec. 121, U. S. C., relating to sales on distraint for taxes; title 31, sec. 195, U. S. C., execution sales.)

10. The clause providing for the release of worthless junior liens in favor of the United States has been changed in the substitute bill so as to give that duty to the Comptroller General instead of the Attorney Ceneral. The Comptroller General is in a better position to know whether the facts justify the release.

11. The House bill (sec. 5) contains a provision that 'where a private person obtains a judgment and proposes to sell land on execution to satisfy it, he may, in the suit in which the judgment is obtained, have an adjudication as to the rights of the United States and how it will be affected by the execution sale. That has all been omitted in the substitute bill. The purpose of this legislation is to give private litigants the same rights against the United States as they have against others, not to put them in a better position as against the United States than in private litigation. If any citizen obtains a judgment lien on real estate affected by a Government lien, he may before execution sale under the terms of the substitute bill bring an action against the United States to have a sale to satisfy his judgment lien and determine the rights and priorities of the United States. That should be enough. He has no greater rights against private persons.


Managers on the part of the House.

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FEBRUARY 18, 1931.-Committed to the Committee of the Whole House on the

state of the Union and ordered to be printed

Mr. McSwain, from the Committee on Military Affairs, submitted

the following


[To accompany S. 5732]

The Committee on Military Affairs to which was referred the bill (S. 5732) to authorize the acquisition for military purposes of land in Orange County, N. Y., for use as an addition to the West Point Military Reservation, having considered the same, report favorably thereon with the recommendation that it do pass with the following amendment:

Strike out all after the enacting clause and insert in lieu thereof the following:

That the Secretary of War is hereby authorized to acquire, by purchase, condemnation, or otherwise, additional land in the vicinity of, and for use by, the United States Military Academy, in connection with the present military reservation at West Point, New York, such land being fifteen thousand one hundred and thirty-five acres, more or less, and including land surrounding Popolopen Lake, land bordering on the River Hudson, and other interlocking plots of land, all located in Orange County, New York; and the sum of $1,500,000 is hereby authorized to be appropriated, from any funds in the Treasury not otherwise appropriated, which sum shall remain available until expended: Provided, That nothing herein contained shall adversely affect the existing water supply, its sources, or pipe lines of the town of Highlands, New York. SEC. 2. The Secretary of War shall

, by due advertisements in such manner as he deems best and calculated to give the widest necessary publicity, call for offers of land for use in connection with said West Point, New York, and if after negotiation he is able to buy said land or any part or parcel or tract thereof, and at such price or prices as he shall deem to be the fair and reasonable market value of the land, then he is authorized to purchase said land for said purpose at such prices; and if any of said offers of land are at prices deemed by the Secretary of War to be above the reasonable market value of such parceľ or tract of land, and if after the negotiation the Secretary of War is unable to purchase the same at fair and reasonable prices as herein defined, then in such case the Secretary of War is authorized to request the Attorney General of the United States to

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