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80TH CONGRESS 2d Session

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SENATE

{No. 1716

REPORT

GHETEL POLLAK KAHAN, MAGDALENA LINDA KAHAN (WIFE), AND SUSANNA KAHAN (DAUGHTER)

JUNE 16 (legislative day, JUNE 15), 1948.-Ordered to be printed

Mr. WILEY, from the Committee on the Judiciary, submitted the following

REPORT

[To accompany 8. 411)

The Committee on the Judiciary, to whom was referred the bill (S. 411) for the relief of Ghetel Pollak Kahan, Magdalena Linda Kahan (wife), and Susanna Kahan (daughter), having considered the same, report favorably thereon without amendment and recommend that the bill do pass.

PURPOSE OF THE BILL

The purpose of the bill is to record the lawful admission for permanent residence of Ghetel Pollak Kahan, Magdalena Linda Kahan (wife), and Susanna Kahan (daughter).

STATEMENT OF FACTS

The pertinent facts in this case are set forth in the letter of the Assistant to the Attorney General to the chairman of the Committee on the Judiciary of the United States Senate, dated August 15, 1947, which letter reads as follows:

DEPARTMENT OF JUSTICE,

OFFICE OF THE ASSISTANT TO THE ATTORNEY GENERAL,
Washington, August 15, 1947.

Hon. ALEXANDER WILEY,

Chairman, Committee on the Judiciary,

United States Senate, Washington, D. C.

MY DEAR SENATOR: This is in response to your request for the views of the Department of Justice concerning a bill (S. 411) for the relief of Ghetel Pollak Kahan, Magdalena Linda Kahan (wife), and Susanna Kahan (daughter).

The bill would provide that in the administration of the immigration and naturalization laws the Attorney General is authorized and directed to record Ghetel Pollak Kahan; his wife, Magdalena Linda Kahan; and their daughter, Susanna Kahan, as having entered the United States on August 21, 1945, for

permanent residence and that they shall not be subject to deportation by reason of such entry.

The files of the Immigration and Naturalization Service of this Department disclose that Ghetel Pollak Kahan, Magdalena Linda Kahan, and Susanna Kahan are natives of Rumania, having been born in that country May 9, 1907, March 20, 1912, and July 19, 1936, respectively. Mr. and Mrs. Kahan now claim to be citizens of Venezuela. They were admitted to the United States at the port of Miami, Fla., as visitors for a period of 60 days under section 3 (2) of the act of 1924 and have been granted several extensions of their stay. They have been informed that they may depart voluntarily but that if they fail to do so deportation proceedings will be instituted.

The files further reveal that Mr. Kahan is a part owner of a hosiery-manufacturing concern in Caracas, Venezuela, and that the apparent purpose of his trip to the United States was to purchase machinery and nylon for his plant in Venezuela. It appears that during his stay in the United States he has purchased interests in other hosiery mills located in this country and has indicated that it is his intention to reside here permanently. It also appears that he has $16,000 in a checking account in a New York bank and personal property in this country valued at $9,000. There is nothing in the files to indicate that the members of this family are not of good moral character.

This Department is opposed to the enactment of special legislation to adjust the immigration status of individuals in the absence of exceptionally meritorious circumstances. There appears to be no such circumstances present in this case; and, accordingly, the Department is unable to recommend the enactment of this bill.

This Department has been advised by the Director of the Bureau of the Budget that there is no objection to the submission of this report.

Sincerely yours.

DOUGLAS W. MCGREGOR, The Assistant to the Attorney General.

The record reveals that Mr. Kahan has a brother living in Michigan. All other members of the Kahan family (seven brothers and sisters) were killed in the war.

The committee, after consideration of all the facts in the case, is of the opinion that the bill (S. 411) should be enacted, and it therefore accordingly so recommends its enactment.

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FIRST, SECOND, AND THIRD NATIONAL STEAMSHIP COS.

JUNE 16 (legislative day, JUNE 15), 1948.-Ordered to be printed

Mr. WILEY, from the Committee on the Judiciary, submitted the

following

REPORT

(To accompany S. 1691]

The Committee on the Judiciary, to whom was referred the bill (S. 691), for the relief of the First, Second, and Third National Steamhip Cos., having considered the same, do now report the bill to the Senate favorably, with an amendment, and recommend that the bill, s amended, do pass.

The amendment is as follows:

Page 2, line 13, beginning with the ";", strike out all down through ne 23.

The purpose of the proposed legislation is to confer authority upon he Secretary of the Treasury, and to direct him to pay, out of any oney in the Treasury not otherwise appropriated, jointly or severally o the First National Steamship Co., the Second National Steamship o., and the Third National Steamship Co., the sum of $384,256.26, eing the balance of certain sums deposited by and on behalf of those mpanies in the year 1920 as a security with the United States Shipng Board and/or United States Shipping Board Emergency Fleet orporation.

STATEMENT

This statement, and referential data including "Report of details evidence supporting the facts and analysis thereof" are intended assure the ending of this case in fair justice. Necessarily, the xiliary data of evidence is lengthy in order to leave out no pertinent et or circumstance; it is on file with the committee, for reference and rusal.

After this case came to the attention of the Congress and was fully vestigated by Members of the Senate and of the House, and reported to Congress, Congress has consistently endeavored to provide the

relief due to these companies, which common sense and justice, honorable and equitable consideration of the facts do require.

As a result of decisive action taken by the Senate, expressed in its "Order of October 13, 1941" pertinent to the subject matter, probative proof was placed into court records and became available to prove as invalid and untenable the Government defense counsel's contentions and alleged reasons for nonreturn of the companies' funds. This evidence has fully vindicated the findings of previous congressional committees that the sum of $384,256.26 belongs to the companies and is withheld by the Government without warranty or just cause. The bill provides for the return of this precisely known balance of cash.

'The United States Shipping Board," hereir referred to as Shipping Board, was in 1920-21 the agency of the Government in charge of supervision of merchant marine vessels. It was succeeded in 1936 by the United States Maritime Commission, by virtue of the 1936 Merchant Marine Act. The Board's Chairman in 1920 and until early March, 1921, was Admiral William S. Benson.

"The United States Shipping Board Emergency Fleet Corporation," referred to as Fleet Corporation, was incorporated under the corporate laws of the District of Columbia and had in 1920-21 the custody, management, operation, and commercial use of the aforesaid vessels. Admiral Benson was the Fleet Corporation's president in 1920 until early March 1921. The aforesaid corporation was changed, in name only, to the United States Shipping Board Merchant Fleet Corporation, which was discontinued in 1936, by provision of the 1936 Merchant Marine Act.

The Government's position in its capacity as a successor to the Fleet Corporation, as a result of the Merchant Marine Act of 1936, was determined in a suit brought by the three companies herein involved and carried through to the Supreme Court. Supreme Court 1062, October Term 1940. First, Second, and Third National Steamship Companies v. U. S. S. B. Merchant Fleet Corporation. (Justice Jackson took no part in the consideration of the aforesaid case.)

The Supreme Court's decision confirms the fact that when Congress or the Government launches a governmentally financed and controlled corporation, duly incorporated by virtue of the corporate laws of a State or of the District of Columbia (as was the Fleet Corporation), authorized to "sue or to be sued," such a corporation is not intended (unless specifically otherwise qualified by Congress) to be less amenable to judicial process and common commercial usages and rules than a privately owned corporation under like circumstances would be. The sovereign immunity of the Government is not applicable in connection with any cause which arises between such corporation and a citizen. When the Government takes possession of the assets and assumes the obligation of such a corporation, the Government as a successor merely steps in the place of such a corporation, and must in such a case carry on as if it were such a corporation, and be measured within normal commercial yardsticks until the unfinished business of such a corporation is fully terminated, unless Congress mandates otherwise. For this just reason, compensation for withholding the companies' funds is properly due them.

"The First, Second, and Third National Steamship Cos.," were organized and incorporated by virtue of the laws of New Jersey, and were financed and operated as transocean ship operating companies by H. O. Schundler; his authority as the executive committee of one and agent of these companies was duly registered in May 1920 with the United States Shipping Board-Fleet Corporation.

1

These three companies did not continue commercial activity after 921. The Statutes of the State of New Jersey provide that cororations such as these companies are deemed to be "bodies corporate" or the purpose of prosecuting suits, settling their affairs, disposing of heir property and distributing their capital, but not for the pur 030 f continuing the active business for which they were incorporated. H. O. Schundler and the three aforesaid steamship companies are eferred to, hereinafter, at times, as "the companies" or "Schundler" nd treated as one party for the sake of simplicity. Schundler, a tizen, was experienced in ship operating and was known to Admiral enson and other Board officials as efficient, reliable, and financially esponsible. Schundler was a governor of the Shipmasters Club, Tew York headquarters, during the period herein involved. His iccinct comments on the necessity of an efficient American merchant arine for commercial and emergency reserve purposes have been ublished and reprinted in the Congressional Record. See New York vening Journal, financial page, November 6, 1922, pertinent to the ecessity to maintain an American merchant marine, printed at reuest of the Marine Engineers Association; and an article set forth y the late Senator Jones in the Congressional Record on January 1, 1930, page 1547, in defense of the American merchant marine. Quotations from Schundler's articles have often been used in support arguments in favor of an efficient American merchant marine.) The steamship Independence, steamship Horie and steamship Scottstrg, herein referred to, were three dry cargo vessels, belonging in 20-21 to the Government; the Independence and the Scottsburg were 1 burners; the Hoxie was a coal burner. These three vessels, as reinafter shown, were during 1920 for some few months in the stody of the three companies, to wit: Independence for 233 days; rie for 166 days; Scottsburg for 104 days.

While in the custody of the companies in 1920 the three vessels rried nine cargoes of American coal to Europe; the Independence rried four cargoes, the Horie carried three cargoes, and the Scottsburg rried two cargoes. The details of the companies' periods of custody d use, the payment by the companies of all of the vessels' physical erating costs from commencement to termination of their custodies; eir gross freight and their net income or net loss are set forth in the ports of the Internal Revenue Department, United States Treasury. Chairman Admiral Benson and the other Commissioners of the ited States Shipping Board, in office in 1920, trusted Schundler. is is evident; they entrusted in midyear and early fall of 1920 (a) three Government cargo vessels, namely, Independence, Horie, and ttsburg into his custody-management-operation and use, upon a ple operating agreement, referred to in three short letters, dated e 3, June 4, and June 9, 1920, exchanged between the Fleet Coration's Contract Bureau and Schundler.

The maritime conditions existing in 1920-21 especially in the s-Atlantic cargo trade have a direct bearing on this case. The cial data and evidence on these maritime conditions are on record his case and are very exhaustive. They consist to a considerable ent of the official reports made by the Shipping Board and Fleet poration to the Congress and of evidence given by the officers

atutes New Jersey, ch. 13, sec. 14: 13-1 and sec. 14: 13-5 of the Revised Statutes of New Jersey (1937);

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