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War Minerals Relief Statutes

BEFORE THE

HEARINGS

u si Congress. House,
SUBCOMMITTEE ON MINES AND MINING

HOUSE OF REPRESENTATIVES

SEVENTY-THIRD CONGRESS

SECOND SESSION

ON

H.R. 7984

A BILL TO AMEND SECTIONS OF THE ACT OF MARCH
2, 1919, GENERALLY KNOWN AS THE WAR

MINERALS RELIEF STATUTES

APRIL 24, 25, AND 28, MAY 1 AND 3, 1934

Printed for the use of the Committee on Mines and Mining

UNITED STATES
GOVERNMENT PRINTING OFFICE

WASHINGTON: 1934

57022

COMMITTEE ON MINES AND MINING

JOE L. SMITH, West Virginia, Chairman ANDREW L. SOMERS, New York

HARRY L. ENGLEBRIGHT, California BEN CRAVENS, Arkansas

O. MURRAY TURPIN, Pennsylvania VIRGINIA E. JENCKES, Indiana

HAROLD MCGUGIN, Kansas FINLEY HAMILTON, Kentucky

L. T. MARSHALL, Ohio
ABE MURDOCK, Utah

RAY P. CHASE, Minnesota
FRANK H. LEE, Missouri
WILLIAM M. BERLIN, Pennsylvania

ANTHONY J. DIMOND, Alaska
J. HARDIN PETERSON, Florida
WILL ROGERS, Oklahoma
WILLIAM R. THOM, Ohio
ALFRED F. BEITER, New York
WALTER NESBIT, Illinois
ALBERT C. WILLFORD, Iowa
ROBERT T. SECREST, Ohio

CHARLES J. FARRINGTON, Clerk

SUBCOMMITTEE

ANDREW L. SOMERS, New York, Chairman WILL ROGERS, Oklahoma

HARRY L. ENGLEBRIGHT, California ALFRED F. BEITER, New York

RAY P. CHASE, Minnesota

II

Supt. Pre

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WAR MINERALS RELIEF STATUTES

TUESDAY, APRIL 24, 1934

HOUSE OF REPRESENTATIVES, SUBCOMMITTEE OF THE COMMITTEE ON MINES AND MINING,

Washington, D.C. The subcommittee met at 10 a.m., Hon. Joe L. Smith (chairman) presiding.

The CHAIRMAN. The subcommittee will come to order. We have before us this morning H.R. 7984, introduced by Mr. Vinson of Georgia, to amend section 5 of the act of March 2, 1919, generally known as the “War Minerals Relief Statutes."

Mr. Vinson, we will be glad to hear whatever statement you desire to make in reference to this bill.

STATEMENT OF HON. CARL VINSON, A REPRESENTATIVE IN

CONGRESS FROM THE STATE OF GEORGIA

Mr. VINSON. Mr. Chairman, on Saturday you set this bill to be heard this morning before a subcommittee. I think it is not necessary for the clerk of the committee to read the bill, or the report from the Department of the Interior. But I ask permission that the bill be printed, together with the report of the Department of the Interior, at this point in the hearing.

The CHAIRMAN. Without objection, it is so ordered. (The bill referred to is as follows:)

(H.R. 7984, 73d Cong., 2d sess.) A BILL To amend section 5 of the Act of March 2, 1919, generally known as the “War Minerals Relief

Statutes'

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That in any claim that has heretofore been filed within the time and in the manner provided by the Act approved March 2, 1919 (40 Stat. 1272) as amended, generally referred to as the “War Minerals Relief Statutes”, in which the Supreme Court of the District of Columbia under the authority conferred upon said court by the Act approved February 13, 1929 (45 Stat. 1166), has adjudged or decreed interest payments or obligations to be losses reimbursable within the meaning of the Act of March 2, 1919 (40 Stat. 1272), as amen the Secretary of the Interior shall open or reopen such claim and include in his adjustments and payments of losses, interest which has been paid or has accrued to the date of approval of this Act: Provided, however, That such losses shall be shown to the satisfaction of the Secretary of the Interior as a matter of fact to be the result of a legal obligation incurred within the statutory period as provided in said Act of March 2, 1919.

1

(The report of the Secretary of the Interior referred to is as follows:)

THE SECRETARY OF THE INTERIOR,

Washington, March 23, 1934. Hon. Joe L. SMITH,

Chairman Committee on Mines and Mining, House of Representatives. MY DEAR Mr. Smith: Your letter of February 17, requesting a report on H.R. 7984, Seventy-third Congress, which bill is now before your committee for consideration, has been received.

The United States Supreme Court in the Vindicator-Chestatee case (284 U.S. 231), rendered December 7, 1931, held that March 2, 1919, was the date to which interest was allowable for money borrowed and lost in producing and preparing to produce chrome, manganese, pyrites, and tungsten under the War Minerals Relief Act.

The effect of this bill, if enacted into law, will be to extend the date from March 2, 1919, to the date of the approval of this act, for the payment of interest.

The records of the Department disclose that 126 cases already given awards and 44 cases certified by the Supreme Court of the District of Columbia to the Secretary of the Interior for review, and 161 cases awaiting action of the Supreme Court of the District of Columbia--making a total of 351 cases would be subject to review by the Secretary of the Interior upon petition by the claimant under author. ity of this bill.

There is no way of reasonably approximating the total amount of interest losses involved by the enactment of this bill into law, for the reason that the only evidence before me at this time is that in the cases upon which awards have been made.

In many of the awards made by my predecessor, since the amendment of February 13, 1929, the claimants have accepted such awards in "complete and final settlement of their rights under the War Minerals Relief Act.”. One exception to this is the case of the Chestatee Pyrites & Chemical Corporation, in which awards to the amount of $828,850 have been made, of the last of which, on February 23, 1933, acceptance was made by claimant “as payment of its losses in full to March 2, 1919, as stated in the award." From our records in the case the approximate interest which would be claimed under the proposed act, if passed as to April 1, 1934, would be $608,221.24.

In all awards which I have made under the War Minerals Relief Act, with one exception the claimant has signed a release in complete and final settlement of all rights under the act.

The exception is the case of the Hanna Minerals Co., to which awards have been rendered in the amount of $314,924.31. The approximate interest which could be claimed under the proposed act, if passed as of April 1, 1934, would be $324,367.68.

A decision by the Court of Appeals of the District of Columbia, February 19, 1934, in the case of Harold L. Ickes, Secretary of the Interior v. Cuyuna Mining & Investment Co., holds that awards under the War Mineral Relief Act are purely in the nature of a gratuity by the Government and are not legal claims, nor does the act create in the claimants any vested legal right.

I am not at this time able to give your committee the effect which this decision will have on the 161 cases pending in the Supreme Court of the District of Columbia.

It may be a timely observation to say that all these claims are based upon World War operations during the period between April 6, 1917, and November 12, 1918, and that good administration would require that complete and final settlement should be made in all claims at the earliest opportunity, consistent with justice and equity. I therefore find myself disposed to object to the passage of this bill. Sincerely yours,

HAROLD L. ICKES,

Secretary of the Interior. Mr. VINSON. I think the proper way to proceed in this matter is for me to ask the indulgence of the committee to permit Mr. George L. Pratt, of Atlanta, Ga., who was vice president and general manager of the Chestatee Corporation, which was engaged in the manufacture of pyrites, to make a statement giving the whole history of the war minerals relief legislation, and I know of no one better qualified to furnish the subcommittee with full information with reference to that legislation than Mr. Pratt.

It has been my privilege and pleasure to know Mr. Pratt for a great, great many years. He is one of the most prominent and outstanding citizens of the State of Georgia, and I want to assure you that everything that Mr. Pratt tells you this morning will be nothing but the truth, irrespective of how it may cut. So I ask permission for Mr. Pratt to present all the factors relating to this bill.

But just before Mr. Pratt makes his statement, Mr. Chairman, our colleague, Mr. Woodrum, of Virginia, who is also interested in this bill, desires to make a short statement, because he has another committee meeting to attend.

The CHAIRMAN. We will hear Mr. Woodrum at this time.

STATEMENT OF HON. CLIFTON A. WOODRUM, A REPRESENTA

TIVE IN CONGRESS FROM THE STATE OF VIRGINIA

Mr. WOODRUM. Mr. Chairman, I appreciate very much the opportunity of registering my interest in this legislation.

I can agree very heartily in all that Mr. Vinson has said about Mr. Pratt, which also applies to Mr. Ashcraft, representing the company that they are interested in, and also Mr. Ray Brannan, of Lynchburg, Va., representing the Virginia Ore Corporation, and some of these other gentlemen.

I have gone over this matter very thoroughly with these gentlemen, and it seems to me there is absolutely no question about the justice and the moral obligation of the Government to pass this legislation and comply with it.

I have always felt that the same code of right and fair dealing and square shooting ought to obtain with the Government in its financial transactions as with private individuals or corporations, although sometimes it does not, I am sorry to say.

It has been the experience of all of us, especially in the matter of allowing interest charges in just and proper claims-and that is principally what is involved here, as I understand it—it is a sort of unwritten law in cases like that that we say to our constituents, “You may consider yourself damn lucky if you get the principal, to say nothing of the interest, when you are dealing with the Government. But that is not honest.

If these gentlemen are to be reimbursed for their expenditures during the war, they should be given fair treatment. And I know that these people did respond during the war just the same as the young men who wore the uniform and went to war. They allowed their businesses to be commandeered by the Government, and, 1 might add, they borrowed money for the purpose of financing their business. They answered the call to arms, and they helped to win the war, and the Government should treat them with fairness and justice.

I feel sure that when the members of the committee get the full facts you will feel constrained to act favorably on this bill, because this relief has already been too long delayed.

I thank you for giving me the opportunity to make this statement, Mr. Chairman, and ask that you will excuse me now so that I may attend the meeting of another committee.

Mr. Vinson. Now, Mr. Chairman, I will ask the subcommittee to hear Mr. George L. Pratt.

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