Law School Case Brief
United States v. Belmont - 301 U.S. 324, 57 S. Ct. 758 (1937)
The conduct of foreign relations is committed by the United States Constitution to the political departments of the government, and the propriety of what may be done in the exercise of this political power is not subject to judicial inquiry or decision. Who is the sovereign of a territory is not a judicial question, but one the determination of which by the political departments conclusively binds the courts. Recognition by these departments is retroactive and validates all actions and conduct of the government so recognized from the commencement of its existence.
A decree of the Soviet Government dissolved a Russian corporation and expropriated all of its assets, including a deposit account with a bank in New York. Subsequently, the President of the United States recognized and established diplomatic relations with the Soviet Government and, for the purpose of bringing about a final settlement of claims and counterclaims between the Soviet Union and the United States, it was thereupon agreed, among other things, that the Soviet Government would take no steps to enforce claims against American nationals, but that all such claims, including the deposit account, were assigned to the United States with the understanding that the Soviet Government would be notified of all amounts so realized by the United States. United States then demanded payment from the respondents, the duly appointed executors of the account holder’s will. The district court, despite holding that the assignment effected embraced the claim in question, concluded that a judgment for the United States could not be had,because it would put into effect an act of confiscation that was contrary to the controlling public policy of the State of New York, the situs of the bank deposit. The decision was affirmed by the appellate court; thereafter, United States petitioned for certiorari.
Can a judgment for the United States be had, notwithstanding that the same can result to an act contrary to the controlling public policy of the State of New York?
The United States Supreme Court held that no state policy could prevail against the international compact here involved. The conduct of foreign relations was committed by the U.S. Constitution to the political departments of the government, and the propriety of what could be done in the exercise of this political power was not subject to judicial inquiry or decision. According to the Court, the assignment involved here was within the competence of the President and the external powers of the United States were to be exercised without regard to state laws or policies. Further, the Court averred that while the U.S. Constitution stated that private property could not be taken without just compensation, the Constitution had no extraterritorial operation, unless in respect of U.S. citizens.
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