use.

Beyond that there exists no necessity, which alone is the foundation of the right."

Or as Mr. Justice Story said in his dissenting opinion in Charles River Bridge v. Warren Bridge (11 Pet. 420, 642) :

"Although the sovereign power in free governments may appropriate all the property, public as well as private, for public purposes, making compensation therefor; yet it has never been understood, at least never in our Republic, that the sovereign power can take the private property of A and give it to B by the right of eminent domain'; or, that it can take it at all, except for public purposes; or that it can take it for public purposes without the duty and responsibility of making compensation for the sacrifice of the private property of one for the good of the whole. These limitations have been held to be fundamental maxims in free governments like ours; and have accordingly received the sanction of some of our most eminent judges and lawyers." Or, as Mr. Justice Swayne said in Township of Pinegrove r. Talcott (19 Wall. 666, 676):

"Private property can be taken for a public purpose only, and not for private gain or benefit."

Now, as pointed out above, the taking, which is provided for by the treaty of Versailles, is a taking of the property belonging to one private owner and turning it over to another private owner, to the enrichment of the latter, and this is a proceeding which has been repeatedly pronounced by the Supreme Court of the United States to be contrary to the principles of free, constitutional government, even where compensation for the property taken is certainly paid. Thus in this respect also the proposal under discussion is contrary to sound constitutional principle.

Furthermore, and to restate the principle stated by Mr. Justice Story, when private property is taken by the Federal Government under the right of eminent domain, compensation therefor must, under the provisions of the fifth amendment, be made, otherwise the taking is devoid of that indispensable element which must accompany the exercise of the right at all. Now, it is proposed that the government which shall exercise the right here shall not pay any compensation at all.

Mr. Justice Field said in U. S. v. Jones (109 U. S. 513, 518):

Compensation is no part of the power itself, but a condition upon which the power may be exercised."

While it is declared by Mr. Justice Harlan in Cherokee Nation v. Kansas Railway Co. (135 U. S. 641, 659) that the fifth amendment does not require that compensation shall be actually paid in advance of condemnation, yet said Mr. Justice Harlan, "the owner is entitled to reasonable, certain, and adequate provision for obtaining compensation before his occupancy is disturbed."

The stipulation (already quoted) in the treaty of Versailles that “Germany undertakes to compensation her nationals in respect of the sale or retention of their property, rights, or interests in allied or associated states " fails to be a "reasonable, certain, and adequate provision for obtaining compensation before his occupancy is disturbed."

So far as the treaty itself goes, it does not appear that Germany has made any provision whatsoever to compensate her nationals, yet under the principles announced by Mr. Justice Harlan, such provision is a condition precedent to the taking over of the property. Obviously, if there is no evidence of any provision at all for compensation, there is no evidence that the provision is either reasonable, certain, or adequate. In this connection it is well to have in mind the words of Mr. Justice Gray in Bauman v. Ross (167 U. S. 548, 574) where he said that

"The just compensation required by the Constitution to be made to the owner is to be measured by the loss caused to him by the appropriation. He is entitled to rece've the value of what he has been deprived of, and no more. To award him less would be unjust to him; and to award him more would be unjust to the public."

There is a complete absence of anything in the treaty to show that Germany is intending or is prepared to make such compensation as is stipulated in these observations by Mr. Justice Gray, and yet such compensation is, to requote Mr. Justice Field, "a condition upon which the power may be exer cised," by the United States. Thus in this respect also the proposal under discussion is not in accord with sound constitutional principle.

Finally, it is to be observed that the fifth amendment provides that no person shall be deprived of his property without due process of law, and with- {

out venturing into a discussion (unnecessary here) of the essential elements of due process it is sufficient to say that the proposal under discussion seems to contemplate the condemnation of the property concerned without even a semblance of an opportunity for a hearing by those from whom the property is to be taken. In this respect also the proposal under consideration appears constitutionally untenable.

From all the foregoing it is a sound deduction (as it is submitted) that the alleged undertaking by Germany to compensate its nationals for property taken by the United States (without compensation from the United States) and applied by the United States to the payment of claims of American citizens against Germany does not relieve this proposal under discussion from the operation of the inhibitions of the fifth amendment.

CONCLUSION

It is therefore finally submitted that the German-owned property still in the hands of the Alien Property Custodian may not, now that peace is established, be "liquidated" or confiscated but must, when Congress so determines, be returned to those (or their representatives or assigns) from whom it was taken.

BRIEF OF THEODORE G. THOMAS, WASHINGTON, D. C.

The CHAIRMAN. Mr. Thomas has asked me to file a written brief. The brief will be included in the record. I have some doubt whether this is the proper place for it, but it does not make very much difference. There is a good deal of question, as I think the committee will find, whether the committee has in the first instance any jurisdiction over such a matter as that which is referred to by Mr. Thomas. (The brief referred to is as follows:)

I am and have been the holder and owner of 100,000 German marks in Reichsbank notes, such notes being in the denomination of 1,000 German marks each. I acquired these marks through a commercial transaction in 1912.

These marks were redeemable in gold until September, 1914, when the Imperial German Government promulgated a decree canceling all payments in gold. In my opinion this decree makes the German Government liable under the provisions of the treaty of Versailles as incorporated into the treaty of Berlin.

Concurrently with the signing of the agreement of August 10, 1922, between the United States and Germany, establishing the Mixed Claims Commission— United States and Germany-there was an exchange of diplomatic notes between the American ambassador at Berlin and the German foreign office wherein the American ambassador gave assurance that the Government of the United States would give notice to Germany of all the claims which it intended to present to the commission within a period of six months after the first meeting of the commission. The time limit as accordingly set up within which claims might be filed before the commission expired on April 9, 1923.

On December 18, 1922, three months before this time limit expired, I filed notice of my claim with the commission and requested that I be given instructions as to what further steps I should take in connection therewith. I heard nothing from this notice of claim, which was in the form of a letter, but I was later advised by the American agent before the commission that this letter was never received. I can not understand how this letter may have been lost or not delivered due to the fact that it was correctly addressed with a typewriter and contained my return address thereon. When my claim was then taken up with the agent the time limit had expired and since that time I have never been able to have my claim considered by the commission.

I respectfully submit that American nationals finding themselves in a situation similar or identical with mine should be given an opportunity to have their claims adjudicated by the commission. With respect to the time limit mentioned, I desire to point out that in my judgment the American Ambassador at Berlin could not by mere exchange of notes give away rights which became vested in American nationals under the treaty. The action of Germany in cancelling the gold payment which I was entitled to receive in exchange for my

marks destroyed the value of my property and I desire to obtain indemnification therefor.

Respectfully submitted.

THEODORE G. THOMAS, Box 1907, Washington, D. C.

WASHINGTON, D. C., November 17, 1926.

The CHAIRMAN. Mr. LeFevre is yet to be heard.

STATEMENT OF CHARLES H. Le FEVRE, WASHINGTON, D. C.

Mr. LE FEVRE. My name is Charles H. Le Fevre, of the law firm of Le Fevre & Le Roy, Hibbs Building, Washington.

Mr. RAINEY. Mr. Le Fevre was in the Alien Property Custodian's office and some of us might want to ask him some questions. Perhaps we had better wait until the entire committee is here.

The CHAIRMAN. If we are going to adjourn until Monday, I think we will have to put in longer hours in some way, for this testimony will take much more time than I had anticipated.

Mr. Rainey, you desire to have this go over until Monday, as I understand.

Mr. RAINEY. There are only four members here now, and I think we ought to have a fuller membership present than we have now, because this man was in the Alien Property Custodian's office. Mr. LEFEVRE. I had a special object in appearing here to-day. The CHAIRMAN. He represents a private claimant.

Mr. LEFEVRE. I represent some American citizens who have received awards from the Mixed Claims Commission, and I also represent some German nationals whose money is now held by the Alien Property Custodian in the Treasury of the United States.

The CHAIRMAN. Do you appear here for the Alien Property Cus todian in any way?

Mr. LEFEVRE. No. I am interested in the trading with the enemy act, as I have followed it from its beginning. I was with the Alien Property Custodian in studying and administering this act all during the war, and was with the Alien Property Custodian up to the time the Winslow Act was drafted. In fact, I drew the original draft of the Winslow Act, which was prepared at the request of the President made upon the Alien Property Custodian.

To the bills that were presented to you last spring and that you have had your hearings on, there are one or two things that have not been mentioned that I feel ought to be added. What I am interested in as an attorney at law is that there be legislation that will help to get the whole matter settled. I have attended these meetingand there are some things that have come up here that I believe in a very few words could be explained. There are things that have either been mistakenly stated or which could have been made probably a little bit clearer to the committee.

The CHAIRMAN. It seems that some of the members of the committee want this witness to go over until next Monday.

Mr. RAINEY. If the witness wants to go ahead, I do not care. Do you want to go on now or Monday?

Mr. LEFEVRE. Whatever is your wish.

The CHAIRMAN. Would you just as leave go on Monday?
Mr. LEFEVRE. Yes, sir.

The CHAIRMAN. We will adjourn, then, until 10 o'clock Monday. Let the witness appear at that time.

That is all for this evening. The committee stands adjourned until next Monday morning at 10 o'clock.

(Whereupon, at 4.32 o'clock, an adjournment was taken until Monday, November 22, 1926, at 10 o'clock a. m.)

HOUSE OF REPRESENTATIVES, COMMITTEE ON WAYS AND MEANS, Washington, November 22, 1926.

The committee met at 10 o'clock a. m., Hon. Willis C. Hawley presiding.

Mr. HAWLEY. The chairman is unavoidably detained and has asked me to start the hearings. The first witness for this morning is Mr. Charles Le Fevre, of this city.

FURTHER STATEMENT OF CHARLES H. LE FEVRE, WASHINGTON.

D. C.

Mr. LE FEVRE. Mr. Chairman and gentlemen of the committee, I was called before your committee just about the time you were ready to adjourn on Friday and I then gave my name and stated I was a member of the law firm of Le Fevre & Le Roy, having offices in the Hibbs Building, of this city, and that that firm represents some American claimants whose claims have been considered by the Mixed Claims Commission and we have awards for our claims in all except one case; that we also represent quite a number of German nationals whose property is held by the Alien Property Custodian or by the Treasury of the United States. I took occasion to state that I was with the Alien Property Custodian during the war and for some time after the war. I did that in order to make known to you the experience I had there and also my familiarity with the trading with the enemy act.

Mr. HAWLEY. You acted as counsel?

Mr. LE FEVRE. Yes. I was in the bureau of law and came there in the latter part of 1917. I was there during the war and for a short time after Colonel Miller became Alien Property Custodian. One of the last acts I performed as a member of the Alien Property Custodian's office was to prepare the original draft of what became the amendment to the trading with the enemy act, under date of March 4, 1923, which is known as the Winslow Act.

You have before you certain bills that were introduced at the first session of the present Congress, which have been termed in the bills themselves as "Settlement of war claims act of 1926," and those bills all contemplate returning to the German nationals the property the Alien Property Custodian took over. If the bills became law, there should be a provision in them that has not been placed in them as yet, and this provision would relate to the property that the Alien Property Custodian demanded or seized and which has not come into his possession. There are quite a number of outstanding demands or seizure orders that have not been com- ·

plied with as yet, although the time for making demands expired a little over five years ago.

When the Knox-Porter peace resolution was adopted by Congress and declared the war to be at an end, we considered that it made the former alien enemies alien friends, the war being over, and the trad ing with the enemy act authorized merely the taking over of property of alien enemies. But the demands that had been issued prior to that date have been judicially determined to have given the Alien Property Custodian constructive possession of that property. or left with him the right, subject to the provisions of another section of the trading with the enemy act, to enforce compliance with those demands.

Mr. HAWLEY. You say "judicially determined"?

Mr. LE FEVRE. Yes.

Mr. HAWLEY. What do you mean by that?

Mr. LE FEVRE. The courts have decided that the Executive orders and proclamations that were made, the rules and provisions for carrying out the trading with the enemy act, as provided for in the act itself, must be construed and treated as a part of the trading with the enemy act, and the President, in his earlier Executive orders. declared that when a demand was served the effect of the service of that demand was to vest the title to the property in the Alien Property Custodian and to give him the power of administration of that property.

Mr. HAWLEY. No case has arisen in any court on any of these demands, however?

Mr. LE FEVRE. No, sir. The nature and the character of the property interests that were demanded is what interfered with immediate compliance with the demands, and, to give you a concrete example of that, there was a man by the name of Wilhelm Wolters who was born and bred in Germany, and as a young man went to Honolulu and became a very successful business man in that city. was interested in the sugar industry and other industries, and died leaving a fortune of over half a million dollars. He died during the war, and his last will and testament provided that a trust should be formed for the period of 10 years and that certain annuities should be paid to designated beneficiaries; that after the end of the 10 years the corpus of the estate should go to the charitable institutions of his native city of Bremen, and the Senate, or the govern ing body of that city, should have the power of appointment in designating what charitable institutions of that city should receive this bounty and in what amounts. The 10 years covering the period of the trusts has not elapsed and the right, you see, of the city of Bremen, whose interests had been demanded, has not accrued, and the money will not be paid to the Alien Property Custodian until the termination of the trusts.

There were a great many reversionary and remainder interests that were demanded. I have mentioned only one concrete case, but there were quite a number of outstanding demands when the war ended, and, unless some provision is made in the contemplated legislation disposing of this property, the Alien Property Custodian office will have to continue to function in order to administer the property when received.