Jurisdictional Statement — Zschernig v. Miller

WILIXAM J. MILLER, Administrator of the Estate of

‘TOM McCALL and ROBERT .W. STRAUB, respectively

OCT 28 1966

~ JOHN F. DAVIS, @LERK

In the Supreme Court

nf the United States :

Eri 2/

In the Matter of the Estate ‘of

‘PAULINE SCHRADER, Deceased.

OSWALD ZSCHERNIG, MINNA PABEL, OLGA HERTA

WINCKLER, ALFRED KOESTER, JOHANNA BLASCHKE

and HANS FUESSEL,

Appellants,

Vv.

Pauline Schrader, Deceased, MARK O. HATFIELD,

the Governor, Secretary of State and State Treasurer

of Oregon, constituting the STATE LAND BOARD OF

OREGON, and all persons’ unnamed or unknown having

or claiming any interest in the Estate of Pauline

Schrader, Deceased,

Appellees.

' Appeal from the Supreme Court of the State of Oregon |

JURISDICTIONAL STATEMENT

PETER A. SCHWABE, SR.,

PETER A: SCHWABE, Jr.,

721 Pacific Building, Portland, Oregon 97204,

Attorneys for Appellants.

ROBERT Y. THORNTON, Attorney General of Oregon,

WAYNE M. THOMPSON, Assistant Attorney General,

Supreme Court Building, Salem, Oregon 97310,

‘ Attorneys for Appellees.

STEVENS-NESS LAW PUB. CO., PORTLAND, ORE. 10-66

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“INDEX t

. ' Page

. I, Opinions Below Sen AON hag oh Seta 1

II. Grounds for Jurisdiction ae Sta TPES PA Sir ears *

(i) Nature of proceeding and statute involved 2

(ii) Court orders appealed from .. *................. 4

Notice of Appeal filed ..............0..00.2222222-... i

(iii) Statutory provisions conferring Jurisdiction’ >.

(iv) Cases sutaining pS, IS eee 5

(v) Sec. 111.070,° Oregon Revised Statutes

(Chapter 519, ian Laws 1951) set forth |

in full - Aig hes taste in nallps ratecbens one sn casted soasten 6

III. Questions Presgiited aes ow 5 . Snes 7

IV. Statement of the Case | SCAN UG Cr Baer eee ce Nhekae) 9 .

The Facts ...:..........2.: oe Tle ORS a eAiet: 9

Federal Questions Raised end Passed ‘in

p in seco os cranin AE ee ET SRO 10

V. Federal Questions Presented Are. so ) Substan-

tial as to Require Plenary Consideration by

eae tah. pa Mey OLE Dae 12

’ A Great Urgency Exists PCRS ae Apo 20

Questions of Great Public iniorwinns Pre-

| TE, Sgaee SIRY saesuitarneen vetouancn Wenenel tent ee Weta se 21

SS Re aOR) SRR 24

_Appendix: | mole

‘Opinion, Supreme Court of Onane, March 23,

| 1966 - cae 1

Opinion, Supreme: Court. of “Oregon; “Jus une os

1966 (denying Petition for Rehearing) ._... 24

Findings and Order of Escheat, Circuit Court

of Multnomah County, Oregon, Apr 15,

URS SREP ai. |e ea, A ae 25

Order of Mandate; Circuit Court of Multnomah

County, Oregon, June 27, 1966... 28

Oral Opinion, Circuit Court of Multnomah .

County, Oregon, April 9, 1965 2... 30

4

INDEX (Cont.)

7 . Page

Addendum: i ;

.Appellee administrator Miller as stakeholder not

active participant in this litigation .

o on Appendix p. 32

Pe

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‘ie

| CITATIONS

Ciena - = ed Page :

. CASES Bs f

_ Arbulich’s. Estate, -41 Cal. 2d 86, “957 ‘P.2d 433

Eh. ERR edhe 05 CSR eh se erica iY LeeLee E 16

Banco Nacional de Cuba v. Sabbatino, 376 U. s. 398

(1964) . 21

Belemiecich’s Estate, 411- Pa. “506, “192 “A2a 740:

(1963), 378 U.S. 395° (1964) ....:6......-2s20.,:. 16; 18 ::

Chichernea’s Estate, 244 A.C.A. 727, 53 Cal. Rptr. —

| RITES Ba ARES areal ieee eae me cme eee 23

Clark v. Allen, 331 U.S. 503 (1947)

Loewen | 2 ee Se Se RR eS

. Dahnke-Walker Milling Co. v. Bondurant 257 U.S.

ee aed et aS a er eet —_

Fiske v. Kansas, 274 U.S. 380 i.) ARSE Sasa 5

Gogabashvele’s Estate, 195 Cal..App. 2d 503, 16 Cal.

AS a): ERR cenit: | Ripken een 22

Hosova’s Estate, 143 Mont. 74, 387 P.2d 305 (1963).. 14

Ioannou v. New York, dissent 371 U.S. 30 (1962) ,

OES IC ELC BORE. 18, 19, 23, 24

Kennedy’s Estate, 106 Cal. /App. 2d 621, 235 P.2d

837 (1951) ........ rn eat A BARE oh Re A es A 23

Kern-Limerick Inc. v. Scurlock, 347 U.S. 110 (1954) 5

Larkin and Terry Estates, 65 A.C. 49, 52 Cal. Rptr.

7 RRS IR RE Sane Meroe. O97 YER Ces 22

Lappy’s Estate, State Land Board of Oregon v. So-

- venko, 202 Or. 571, 277 P.2d 781, 213)Or:: 368, 322

2k 8 | re on A ppendix p. 32

Marcus v. Search Warrant, 367 U.S. 717 (1961)... 5

Nashville C. & St. L. Ry. Co. v. Walters, 294 US.

ML SPREE ees ree veneer. host ERATED: 5, 13, 22

Spoya’s Estate, 129 Mont. 83, 282 P.2d 456 (1955). 16

State Land Board of Oregon v. Kolovrat, 220 Or.

_-. 448, 349-P.2d 255 (1960), 366 U.S. 187 (1961)...

State Land Board of Oregon v. Pekarek, 234 Or.

a Be ee Fe Ee oe reel 14

- Stoian’s Estate, 128 Mont. 52, 269 P.2d 1085 (1954). 16

iv : ae ie :

f - CITATIONS (Cont.) a: :

STATUTES | ere! )

California, Probate Code § 259.................... 14, 17, 23, 24

Re a a Be

Montana, § 91-520, R.C.M. 1947 _......... Stes Pltine a aT...

Nebraska, 1963, c. 21 § 1, p. 104, § 4-107 R. S. Supp.

1965 gd BR GEe CPR Dea Fe - IEEE Eten me RAS Padstabstneeeine #3 17

New. York, § 269a Surrogate’s, Court Act.......2........ a *

- United States. Constitution . .

Sh © IS Sees etree eeeeoememoroennrs

Article I, § 10 _..... SEE Zandra pea ae eae SOL Ful

pS) GSA SE Sea ceeennne TS RS AS

Fourteenth Amendment 1 -------------------------~ 7, 24

~ REGULATIONS .

MISCELLANEOUS

Boyd, “The- Invalidity of State Statutes Governing

the Share of Nonresident Aliens in Decedents’

Estates,” 51 Georgetown Law Journal 470 (1963)

I I ds a sscesenfniraeedsimenpercernatenne nani Mies

SA nae 18, 23

19 .

3°

Oregon Law Review, Vol. 45, No. 3, p. 221 “Inter- |

national: Law—lInheritance by Nonresident Aliens

in Oregon; The Oregon Statute, the Effect of

Treaties, and the Federal US eden eae ee:

\

\

19

.

a |

j

at tt the Supreme Court

of the United States

ree ee Ocroser. TERM 1966 .

_ .

a: ® y aaa

In the Matter of the Estate of

PAULINE SCHRADER, Deceased.

OSWALD ZSCHERNIG, MINNA PABEL, OLGA HERTA

WINCKLER, ALFRED KOESTER,. JOHANNA BLASCHKE

and HANS FUESSEL, >

Appellants,

v.

WILLIAM J. MILLER, Administrator of the Estate of ~

Pauline Schrader, Deceased, MARK O. HATFIELD,

. TOM McCALL and ROBERT W. STRAUB, respectively

the Governor, Secretary of State and State Treasurer

‘ of Oregon, constituting the STATE LAND BO OF

i

OREGON, and all persons unnamed or unkno having

or claiming any interest in the Estate of Pa

_ Schrader, Deceased, ,

7

Appeal from the Supreme Court of the State of Oregon

_ JURISDICTIONAL STATEMENT

L. Opinions Below

; -* ‘ . ‘ ;

The opinion of the Circuit Court of Multnomah

County, Oregon, was delivered orally by the Honorable

William L. Dickson, Circuit Judge, on April 9, 1965,

and is not reported officially or unofficially. The re-

bd {

eye ese

porter’ s transcript thereof is at page 9 of the Appellant's

Abstract:of Record and Brief before the Supreme Court

of Oregon. .

ae opiaion of the Supreme Court of Oregon. filed

Match 23, 1966, affirming the Findings and. Order of

Escheat,. of the Circuit Court as modified is reported

in 82 Or. Adv. Sh. 435, — Or. —, 412 F.2d 781:

The opinion of the Supreme Court of Oregon filed

June 3, 1966, denying appellants’ petition for rehearing

is reported in 82 Of. Adv. Sh. 861, — Or. —, 415 P.2d-

; 46

The opinions of the Circuit ‘Court ¢ and of the Su-

preme Court of Oregon are. set forth in. the Appendix,

infra. :

- ‘Phe’ Findings . and Order ‘of Escheat appealed: ses

entered by the Circuit Court of Multnomah County,

Oregon, oh April 15, 1965, is at page 10 of the Appellants’

Abstract of Record and Brief before the ‘Supreme Court .

of Oregon, and i is set forth in. the Appendix, infra.

The Order on Mandate entered by the-Circuit Court

of Multnomah County, Oregon, on. June.27, 1966, mod-

ifying | the said Findings and Order of Escheat appealed

from in the manner directed in the above mentioned |

opinions of the Supreme Court of Oregon, and the

Mandate of said Court issued June 8, 1966, is also

set forth in the sony infra. .

AM. “rts for Jurisdiction

~@y This cause originated with the filing of a Petition =

for Finding and Order of Escheat. in the probate de-

r

3

partment of the Circuit Court ‘of Multnomah County,

Oregon, by the State Land Board of Oregon [composed .

of the Governor, Secretary of State and State Treas- -

urer] which is the recipient and custodian of escheated '.

property under Oregon law, asking that the clear pro-

ceeds of the estate of Pauline Schrader, deceased, be

-éscheated to the ‘State of Oregon on the grounds that

the next of kin .and heirs at law of said decedent re-

side in “East Germany,” that the rights required by

~ Section ‘111.070, Oregon. Revised Statutes [the so-

called reciprocal inheritance rights statute ] do not ex-

ist with respect . to. “Kast Germany,” that there are no

. heirs, devisees or legatees elsewhere eligible to take said

decedent’s estate, and that therefore the estate consist-

ing of real and personal property ‘of a probable } value

of $20, 000 had escheated to the State of Oregon. By

leave of court and pursuant to Sections 117.510 to

117.560, Oregon Revised Statutes, prescribing the pro-

cedure for an heirship determination; the plaintiffs, who

are the appellants here, being a brother, sister, two

nieces and two nephews of the deceased [later stipu-

lated by the parties and found by the court to be

_ the decedent’s next of kin] all residents of the. Russian- -

occupied zone of Germany, filed a petition to determine

‘ heirship alleging themselves to be the decedent’s next

of. kin and heirs at law and entitled to distribution of the

estate. The State Land Board’s answer alleged that: plain-

tiffs were ineligible to inherit because the rights required

by ORS 111. 070 do not exist: with respect to “East

Germany,” | and demanded escheating of the estate to

the State of Oregon. In their reply the heirs alleged

~

=

that said statute, that is ORS: 111.070, is in* violation

of the existing. policy of the Federal ‘Government of

‘ the United States of America, constituted an unlawful

and unauthorized attempt by the State of Oregon to

invade the exclusive power of the Federal Government

to regulate the foreign relations of the United States

and that therefore said statute is invalid and should be

| given no effect by the court. There were other facts

and circumstances which will be ” mentioned later but

this appeal is aimed at the trial court's ruling, sub-—

sequently affirmed ‘by the Supreme Court of Oregon,

that the statute is valid and enforceable.

For the sake of clarity and brevity the earetiors

' described as the Russian-o¢cupied zone of Germany,

the _Soviet-occupiea zone, the Eastern Zone, as East

Germany, as the Soviet Zone, the German Democratic

Republic [GDR] or the Deutsche Demokratische Re-

publik [DDR], will be called the “Soviet Zone,” con-

sisting of that portion of Germany occupied and ad- :

ministered pursuant to agreement of the Allied Powers

by thé armed forces, of the U.S.S.R. after May 8, 1945.

(ii) The judgment or decree sought to be reviewed

is the Findings and Order of Escheat entered -by the

; Circuit Court of Multnomah County, Oregon, on

April 15, 1965, escheatings all of the clear proceeds of

the estate to the State of Oregon [ Appendix p. 25]

as modified by the Order on Mandate entered by said

court on June 27, 1966, pursuant to the decision of the

Supreme Court of Oregon on appeal [ Appendix: p. 28],

said Order affirming the. escheating of the personal. .

9.

)

- property but declaring the heirs in the Soviet Zoné

to be entitled to the real property in accordance with

the interpretation of the 1923 treaty with Germany in

Clark v Allen, 331 U.S. 503 (1947)..

The Supreme Court of Oregon denied appellants’

' petition for rehearing in its =. filed June 3, 1966

[Appendix p. 24]. _

) The Notice of Appeal is dated. August: 30, 1966, .

and was filed in the Supreme Court of Oregon on Aug-

‘ust 31, 1966. |

(iii) The statutory provision believed to confer on

this Court jurisdiction 7 this appeal is 28 U. Ss: Code~

§ 1257 (2).

(iv) Cases believed to sustain jurisdiction in the cir-

cumstances of this case are the following - decisions:

Dahnke-Walker Milling Co. v. Bondurant, 257 :

U6. 282, 288-9 (1922);

Fiske v. Kansas, 274 U.S. 380, 385-6/(1927);

Nashville C.. & St. L. ‘RR. Co. v. saci 294

U.S. 405, 415 (1935); -

Kern-Limerick Inc. V. Scurlock, 347 US. ‘110,

(1954); :

Maggus v. Search Warrant, 367 US. 717, 721

(1961). :

(v) The statute of the State of Oregon whose valid-

ity is here involved. is Section 111. 070, Oregon Revised

Statutes, Volume 1, page 856. It was enacted as Chap-

ter 519, Oregon Laws 1951 (p. 900) and repealed and

replaced Oregon’ s previous reciprocal inheritance —

rights statute, Section 61-107, O.C.L.A., which had orig-

Ve

| al is, ; zat aes 6 : ae a

inally been enacted as: Chapter 399, Oregon Laws 1937

(p. 607). 7 ar anne

x .

ORS 111.070 provides as follows: | st nies

ee AN ACT |

Relating to the taking of property by- succession

or testamentary disposition’by aliens, not. re-

siding within the United States, or its territories; -

creating new provisions; and répealing section

61-107, O.C.L.A. lee:

_____ Be It Enacted by the People of the State of Ore-:"~

gon: :

Section 1. (1) The right of an alien not residing

within the United States or its territories to take

either: real or personal property or the proceeds

- thereof in this state by succession or testamentary

disposition, upon the same terms and conditions —

as inhabitants and citizens of the United States, ee

is dependent in each case : a

(a) Upon the existence of a reciprocal right _

upon the part of citizens of the United States to

- take real and personal property and the proceeds.

thereof upori the same terms and conditions as

inhabitants and citizens of the country of which

-* such alien is ‘an inhabitant or citizen;. - .

(b) Upon the rights of citizens of the United -

States to receive by payment to them within the

United States or its territories money originating.

from the estates of persons dying within such for-

eign country; and : : |

‘(c) Upon proof that-such foreign heirs, distrib-

utees, devisees or legatees may receive the benefit, -

a

———

cn

s. x H

use or control of money or property from estates

of persons dying in this state without confiscation,

‘in whole or in part, by the _—e of such.

foreign countries.

: (2) -The burden is upon such nary alien .

to establish the fact of existence of the reciprocal-

rights set forth in subsection (1) of this section...

(8) If such reciprocal rights are not found to

exist and if no heir, devisee or legatee other than |

such alien is found eligible to take such property, —

the property shall be disposed of as —

. property. ~

Section 2. Section 61- 107, OCLA. is repealed.

‘Approved by the Governor May 8, 1951. Pe

} Filed in the office of the sound of State

May 9, 1951.

—— [effective on and ‘after August 2, 1951. The

above is quoted from Oregon Laws 1951 and

varies slightly, immaterially and in form only,

from the text in Oregon Revised Statutes. The

body of the statute is identical in both publi- .

cations. |

| Ill. Questions Presented

The four questions’ presented by’ this appeal as set _

forth in the Notice of Appeal, namely whether or not

ORS 111.070, the Oregon reciprocal | inheritance rights

_ statute, is repugnant to Article I, § 10, Article I, § 8

) and/ or the due process and equal protection clauses of

the Fourteenth Amendment to the Constitution of the

‘United States and further whether said statute should ~

8

4 | a A é ; : : *

be declared invalid and given no effect because it con-

. = flicts with overriding federal law and. policy, are closely

| akin and may be otherwise stated as follows: oi

a) May theeState of Oregon, may any. individual: ,

_ State of . the ‘Union, enact statutes restricting or taking ©

| away inheritance rights in estates within its borders

from some but not all~nonresident aliens, the applica-

tion of such statute being dependent upen whether the:

officials and/or the courts of such state déem and find

that the country of which said alien is a citizen or

resident ‘meets the. terms ‘and conditions. laid down by

‘the state for granting, restricting or denying rights of

inheritance to nonresident aliens?- Appellants think not

and contend that ‘any such regulation may be exercised

_ only by the Federal Government. ce iF, oh

b) Does not such legislation. in effect and directly —

‘place each of such states’ in the position of sitting

and passing in judgment upon the foreign nations whose

| nationals .or residents are potential heirs, upon the laws,

the forms of government, the idealogies, the foreign

policies of such nations, and whether a particular for-

eign nation’s posture is friendly towards or inimical

to the United’ States and the interests of its people;

and if so, A ain eager aan ers

c) Does not such action of the individual state re-

sult in its direct, indeed flagrant invasion of the exclu-

sive power of the Federal Government to regulate the

‘foreign relations of the United States? Appellants think .

so and submit. that’ by. reason thereof thé reciprocal

inheritance rights statute of Oregon as well as similar

Ye ?

cal of other stated are repugnant to the pertinent

provisidns of the fedéral constitution, invalid and may

not be given effect by the courts..

- Consideration of these. questions will necessitate i re-

examination by this Court of its decision in Clark v.

Allen, 331 U.S. 503 (1947) in the light of national and

international events and the judicial decisions by the

state courts during the past tw years or more—this -

for the reason. that every ‘effort to .prevail upon the

state courts to reconsider ; these questions has one

down before the bar of Clark v. Allen.

S IV. Statement of the Cae

_ The Facts. |

The facts of the case are simple and not in dispute.

Pauline Schrader, a resident - ‘of Portland, Oregon,- died :

there, intestate, on September 30, 1962. She was a

widow, had and left no issue, she was a naturalized

American. citizen, and left’ an estate appraised at $17,-

764.72 consisting ‘of real property, that is her modest

home appraised at $4500 [later sold for $2,250.00],

the rest in savings and other personalty. As she had no

relatives in Oregon, William J. Miller, an undertaker

_ who conducted her funeral, vas appointed’ administra-

tor of her estate by: the probate department of the Cir-

_ cuit Court of Multnomah County, Oregon. Subsequent-

ly it was determined and stipulated that her ‘next of kin

. and~ heirs are the: appellants, a brother, sister, two.

nephews and “two nieces all residing at or mear dece-

dent’s native town not: far from ‘Leipzig in the Soviet

Zone of Germany. heals a:

. <=

Federal nie « Raised and Passed Upon .

in Courts Below cand

As explained. under II(i) hice the constitutional

: invalidity ‘of the. Oregon reciprocal inheritance rights:

. statute was alleged in the heirs’ (appellants’) Reply set

forth at-page 8 of Appellants’ Abstract of- Record and

. Brief, the material portion reading as follows:

“In reply to paragraph III of said afiswer plain-

tiffs allege that Section 111.070, Oregon, Revised

Statutes, is in- »violation pf the existing policy _ an

_ the United States of América and constitutes. an

unlawful and: unauthorized attempt by the State of

Oregon to invade tiie exclusive power of the Fed- -

aa eral Government to regulate the foreign relations

of the United States of America; that therefore said _—

statute is — and should be given no effect :

by this Cour } /

"f

The perm was ealiainay argued it in the written briefs

and the oral arguments of counsel to the Circuit: Court

and passed upon by the trial oe? in his oral opinion

[Appendix p. 31] as follows:

' “The contention that ORS. 111. 070 is in viola-

tion of -the existing policy of the Government of

- the United States of America and constitutes an

unlawful -and unauthorized attempt by. the State of

Oregon to invade the exclusive -power of the Fed-

_~ eral Government to regulate the foreign relations

and. therefore is “invalid and should be given’ no

effect by this Court is without merit in view of

" thé decision of the United States Supreme Court in °

“the case of Clark v. Allen, 331 US. 503, 91 L. Ed.

*1633. If the rules of law announced in’ that case ae

should be changed because of changed conditions _ .

or

Ome 1

in the world or for political . reasons, the Ciiabane ;

or the Supreme Court of the United States should /

revise ‘the laws, CoeenY not, this Probate Court”

' On.appeal the question was argued under Proposi-

tion IV frord_.pages 49 to 56 inclusive of Appellants’

and Brief, and in Appellant’s Reply

8 to 22 iriclusive. The Supreme Court of

Oregon-imNits Opinion filed March 23, 1966, passed upon

the question as follows '[82.Or. Adv. Sh. at ye. 412

P2d at 791 [Appendix p. 19].

~ “Plaintiffs argue, however, that even if the pro-

vision of Article IV of the treaty is inapplicable, the °

personal property may not be escheated pursuant

to the Oregon statute because the statute is an un-

constitutional attempt by the state to invade the

exclusive power of the federal government to regu-

late the foreign relations of the United States. They

contend that the statute violates Article I, Section’

“ 10 of the United States Constitution. They imply

that the subject matter of the statute is within the

tréaty-making power of the federal government and ~

is an area of legislation from which the states are —

. i excluded by virtue of Article VI of the Constitution.

This’ argument was also put to bed by Clark v.

Allen, supra. The court was there dealing with a

- California statute similar to ORS 111.070. It was

_ argued that the statute was an unconstitutional

‘extension of state power into the field of foreign

affairs, which is. exclusively reserved by ‘the Consti- .

tution to the Federal Government.’ 331 US at 516.

The court held that_a, state statute governing the

. descent and distribution of property must:give way .

only i there is a conflict with ‘an overriding fed-

Petition for Rehearing and Brief at pages 20 to 22

ieelesive, bet the Supreme Court of Oregon did not

again pes upon or mention the question in its_opinion

fied Jone 3, 1966, Senying the Petition for Rehearing

[82 Adv. Sh. 861, 415 P.2d 15, Appendix p. 24]. Men-

The federal question here’ presented, that is the

questioned validity of the state statute [ORS 111.070] |

om the ground of its being repugnant to the Constitution, _

treaties or laws of the United States, has therefore been

aitively im this case at all times in the proceedings |

below and the decision was in favor ofthe state -

statute s validity, Sy SS Ce eae Cy.

under 28 U.S.C. § 1257 (2). a |

V. Federal Questions Presented Are so Substantial

@s te Require Plenary Consideration by this Court

" Appellants are aware that in Clark v. Allen, supra,

this Court in 1947 [at 331 U.S. 517] rejected the objec-

tions there made to a very similar California reciproc-

ity statute and declined to declare that statute uncon-

stitutional. However this Court at that place also said:

“Rights of succession to property are deter-

mined by focal law. See Lyeth v. Hoey, 305 US.

}

—— 2

188, 193; Igving Trust Co. v. Day, 314 US. 556,

562. Those rights may be affected by an overrid-

_ ing federal policy, as where a. treaty makes different

or conflicting arrangements. Hauenstein v. Lyn-

haw, supra. Then the state policy must give way.

Cf. Hines v. Davidowitz, 312 U.S. 52:”

Even if it were granted: although by no means conceded,

_that, on the same grounds stated in Clark, .Oregon’s

corresponding reciprocity .statute would then, in 1947,

have been upheld as likewise invulnerable to the attack

there and here made of unconstitutionality because an

- attempted invasion of the exclusive federal power to -

regulate the foreign relations of the United States, ap-

pellants contend’ and will endeavor to demonstrate that

‘the. events of ‘the last twenty years or so and condi-

‘tions presently existing sompel. a reexamination of Clark |

‘: and a different ruling in the case at bar. Even then,

shortly after the end of World War Il, the Attorney.

General of the United States in his brief in Clark [at

p. 75} described the California statute as a “recurrent

source of diplomatic friction.” In Nashville C. & St.

L. Ry. v. Waltérs, 294 U.S. 405, 415, this Court rede-

clared a rule well settled by its decisions that:

“A statute valid as to one set of facts may be

invalid as ‘to another.,A statute valid when en-

- acted may become invalid by change in the condi-

* tions to which it is applied.” : ;

There has tnidtendt boda a radical ite conditions —

between 1947 and 1966, and the case at bar presents a

vastly different set of facts than those in Clark. 3

R

ak

a ‘

Firstly, it should be pointed oft that the’ Oregon

statute, that is ORS 111.070, enacted"in its present, here

| ‘applicable -form in 1951, while basically intended to cov- _

er the same field of reciprocal inheritance rights and to

accomplish the same purposes as Section 259 of the Cal-

ifornia Probate. Code, is far more demanding in its re-

_ quirements and far more confiscatory.in its effect than

California’s statute was in 1942 and is today. The Cal-

ifornia statute, for instance, did. not contain, in fact

has never contained, the requirement in. subparagraph

(1)(c) of ORS 111.070. This provides that even if the

réquired, reciprocal rights of inheritance exist and.even °

if an American heir has the required right to receive

‘payment within the United States of his inheritance

from the foreign - country,. the alien heir would still be

denied ‘his inheritance—and it would’ be taken by the

state ag” eat, in the absence of some other “eligible”

heir} es) he could prove to the satisfaction of the

court he would “receive the benefit, use or control”

of his Oregon inheritance “without confiscation, . in

whole or in part, by the government” of his. country.

This, then, is a highly important difference between the |

_ statute before the Court in Clark and the statute before _

’ the Court here. It directly requires the Oregon court to

recejve and consider evidence of internal conditions in

a foreign country and to sit in judgment on that for-

eign country’ s government, its laws, its policies, its

idealogy, on the integrity and credibility of its cana

including those of the highest rank.

Precisely this happened, for example, in State Land

Board of Oregon v. Pekarek, 234 Or. 74, 378 P.2d 734

ee —

15

' (1963), where the Supreme Court:of Oregon affirmed e

. the escheat of an estate consisting of a savings account —

in.a: Portland, Oregon, ‘bank, left by a citizen and resi-

dent of Czechoslovakia who had’ accumulated the money :

while in this country and left it in the Oregon bank for

years after he had returned to his home and family in

. the old country, where, eventually, he died, The court «

pointed out that Czechoslovakia was listed in the Treas-

ury Department Circular No. 655° [issued under 31 CFR

§ 211.3(a)] among the foreign countries to which U.S.

Treasurer’s checks or warrants could not be sent, and

held that [234 Or. at 82]: aco Marae epee | .

“This official determination: was operative at

the date of decedent’s death. We regard this official

declaration as evidence that foreign beneficiaries

would not ‘receive their interests free from control

amounting to, at least, 4 partial confiscation.”

although that : tedorel regulation pertained only to Unit-

ed States government, riot private funds such as inher-

itances, against thé transmission of which no prohibi-

tions or restrictions existed. The .court’s opinion of

_ _ Czechoslovak officials, including that country’ s ambas-

_ sador to the United States, whose certificate giving as-

surance that full reciprocity and rights existed as re-

quired by the Oregon statute, was received in evidence

[p. 80], is stated at p. 83 as follows:

. “The statements of Cuschodibdabien Officials

must be judged in the light of the interest which

they had in the acquisition of funds for their gov-

ernment. Moreover, in judging the credibility of .

these witnesses we are entitled to take. into consid-

eration the fact that declarations of government of- —

; ae .

«16

_ -ficials in communist-controlled countries as to the

' State of .affairs existing. within their borders do not

always comport with the actual facts.”

Similar, and indeed much stronger criticism, some ap-

proaching the slanderous, of certain foreign govern-

ments and their officials‘:may be found in numerous

other decisions where reciprocal inheritance rights and

similar statutes were involved, for example: |

State Land Board v. Kolovrat, 220 Or. 448, 349

P2d 255 (1960) reversed on ground treaty ap-

plicable in Kolovrat v. Oregon, 366 U. S. 187

(1961). (See 220 Or. at 460-1).

Arbulich’s Estate, 41. Cal. 2d 86, 257 P.2d 433

(1953) (Quotation and criticism of the trial

judge’s extremely’ biased statements at 257

P.2d 447; 448.) :

Stoian’s Estate, 128 Mont. 52, 269 P.2d 1085

(1954) (The dissenting opinion at .269 P.2d.

1090). :

'. Spoya’s Estate, 129 ‘Monit. 83, 282 P.2d 456

. (1955) (The dissenting opinion and the apol-

ogy of the majority for the intemperate re-

‘marks therein at 282 P.2d 548). ,

Hosova’s Estate, 143 . -Mont. 74, 387 P.2d 305

(1963) (The dissenting opinions at 387 P.2d

311).

Belemecich’s Estate, . Consul General of Yugo-

slavia at Pittsburgh v. Pennsylvania, 411 Pa.

- 506, 192 A.2d 740 (1963) 375 U.S. 395, Cer-

tiorari granted, judgment reversed (1964)

(192 A.2d 741-3). . | |

It is.a certainty that such harsh, intemperate, derisive,

defamatory,.even contemptuous statements from highly

7 *

placed members of the American judiciary do not go _

unnoticed in the chancellories of the nations involved.

‘That they must be a ‘source of the deepest embarrass-

ment to the State Department, and add gravely to its

conduct of the relations with those countries, cannot for

“a moment be doubted. ’

3 Since World War II and Clark Vv. Allen, numer-.

ous other states throughout the country have adopted |

statutes similar to the Oregon statute which leamed ~~~

_ students of the subject Thave called the “Western” or

_ “confiscatory”’ type because they originated i im ‘the west,

in fact Oregon led_the field with Chapter 399, Oregon

Laws 1937, which became § 61-107, O.C.L.A. and was |

replaced in 1951 with ORS 111.070. Soon thereafter, in

1939, Montana adopted § 91.520, R.C.M. 1947, Califor--

nia in 1941 adopted § 259 of the Probate Code, and

Iowa in 1951 adopted the provisions of the then“Cal-—

ifornia statute as its’ § 567.8, Iowa Code Annotated. In

1963: Nebraska adopted most of Oregon’s 111.070 with

certain ramifications, [ Neb. Laws 1963, c. 21 § 1, p.

104, § 4-107, R. S. Supp: 1965]. All contain provisions

for éscheating the alien heir’s inheritance if his country

does not meet the conditions laid down’ in. the statute .

and no other, “eligible” heir exists and claims (except

in Montana where escheat occurs regardless of the exist-

ence of an “eligible” heir).

In the eastern part of the country the trend was to- _

- wards the so-called “Eastern” or “withholding” stat-

- utes such as § 269a of the.New York Surrogate’s Act,

~ and Pennsylvania’ s Act of July 28, 1953, P. L. 674,

| 18

which the Pennsylvahia Supreme Court i in 1 Belemecich, |

supra, said: [192 A.2d at 741]:

“.. . carries the sobriquet of ‘Iron.Curtain Act’ _

because its purpose is to protect the moneys, phys- _

ically in America, but .belonging to people who

fatefully find themselves behind the Iron ic we

of Communism. watt

New J ersey, nae Connecticut and hla

eastern states have similar statutes designed to author-:

ize the courts to withhold actual distribution and trans-

mission of a foreign heir’s or legatee’s inheritance i in the

absence of ‘proof that he would have the full usé and

‘benefit thereof. These statutes have, of course, as in

_ the states with the “Western” type statutes, necessarily

led courts to inquire into, and to sit in judgment upon

the particular foreign country’s government, its laws,. its

policies, its idealogy, the integrity and: credibility of its

; officials, etc. '

Space tine: not permit further extension of this dis-

cussion but reference is respectfully made to the learned

and exhaustive treatise “The Invalidity of State Stat-

utes Governing the Share of Nonresident Aliens in De-

cedents’ Estates” by Professor Willard L. Boyd. of the

College of Law, University of Iowa, in Vol. 51, The

-Georgetown’ Law Journal 470 (1963). It appears to

have been motivated by this Court’s dismissal of the

appeal, for want of a substantial federal question, in

Ioannou v. New York, and the dissent of Mr. Justice —

Douglas, with whom Mr. Justice Black concurred, 371 |

U.S. 30.. In recent, years: much literature hag accumu-

. ae

ee

lated on the subject.—Of particular interest are Com-.

-ment\in Vol. 1963, Duke Law Journal 315, entitled:

“State Reciprocity Statutes and the’ Inheritance Rights

of Nonresident Aliens,” and, most recently, under Note

and Comment in Vol. 45, N umber 3: of the Oregon Law |

‘Review 221 (April 1966), a treatise entitled “Interna-

tional Law—Inheritance by Nonresident Aliens in Ore-

gon; The Oregon Statute, the Effect of Treaties, and

the Federal Law.” Therein the decision of the Supreme.

Court of Oregon in the Schrader estate, which is the

subject of this appeal, is severely criticized.

. It is deemed pertinent to point out the radical dif-

ferences between the case at bar and Ioannou v. New

York, supra, in which the appeal was dismissed.. Most

importantly, there was befare the Court in Ioannou

the mild, non-confiscatory New York withholding stat-

ute, that is § 269a of the New York: Surrogate’s Court

Act. There, as Mr. Justice Douglas pointed out, even.

such a modest “restraint” as prohibiting a Czechoslovak

‘heir from assigning her New York inheritance to &

niece in England as a gift might “. :. . affect .interna-

tional relations in a persistent and subtle way.” [371

U.S. 32]. Yet such an effect is as nothing compared to

the effect on the relations with a country whose people

are denied their rights of inheritance and whose inher-

‘itances are escheated, in plain language confiscated, by

an American state. And not infrequently the i injury has

been accompanied by insult. In Ioannou the heir has

not had:her inheritance taken away by the statute, al- -

though that, as far as she i is concerned, may be the end-

result if she should die before, if ever, a future surro-_

c

r

20

- gate: decides she may have. it. In the case at bar the .

deprivation i is complete, absolute, final.

; ¢

It: is a titatter of common knowledge that in the

countries of the civilized world, with the United States

perhaps the. only ‘exception, inheritance laws are na-

tional in scope and-are uniform throughout the coun- .

try. The governments, and the people, of these coun-

tries cannot | ‘understand and cannot rationalize why

_ from’ some American state. inheritances. flow without

restriction, while other American states may seize away,

or in the least withhold transmission of inheritances.

In international affairs every action has a reaction. So

far the reaction has not crystallized, but no one can

deny that international relations have suffered and the

whole nation will ey be held to account.

A Great Unpeacy Exists

The countries most grievously affected are those

countries of Europe from where most of the mass mi-

-grations came to the United States in the late 1800’s

and the early 1900’s. It is the men-and women. who

' came in these mass migrations during the twenty years

or so before the outbreak of World War I in August

1914 who are now dying gff at an ever-increasing rate

and whose desire, by testacy or intestate succession, is,

to benefit their loved ones back home, most of them

in modest or needy circumstances. It is their desires

that are being thwarted in many instances by the so-

. called Western, confiscatory reciprocity statutes and

even by the milder so-called Eastern: withholding stat-

utes. 7

21

of iaiiiii is to be. done, it must tbe done qitickly.

Vast irremedial damage has already been done, literally

hundreds of estates are pending in the probate courts |

of this country in. which there are heirs or beneficiaries

in the affected couritries. Their assets are Substantial,

undoubtedly aggregating into. the millions, and every

day new cases arise. Many estates pending i in the “reci-

2

procity” and “withholdirig” states are being held in

abeyance awaiting the outcome of this most recent ef-

fort to seek invalidation of these statutes, ‘specifically

of course of ORS 111. 070, with which similar statutes :

of the other states would presumably stand or fall.

Questions of Great Public tnprincnchtgnentia

This case does indeed present ¢ estions of great pub- :

lic as well as individual importafice \ so ‘substantial as .

to require plenary consideration by this court, with

briefs on the merits and oral argument, for their reso-

lution. The holding of this Court i in Banco Nacional de

Cuba v. Sabbatino, 376 U.S. 398 (1964) seems to point

the way. As the act of state doctrine was. there held

to be a matter of federal law, not subject to interpre-

tation and application by ‘the individual states, so if -

there is to. be differentiation, discrimination ifr you

please, between aliens of different nationalities, if one

nonresident alien is to be permitted to inherit in the |

United ‘States, another not because of the failure of his

country to meet certain standards: or requirements, this '

should and must-be governed and determined by federal ;

law uniformly. effective throughout the nation.

The foreign relations of the United States are, be-

XY 4

22 |

‘yond any shadow of doubt, being affected, seriously and

adversely, by ORS 111.070 and by: the ‘interpretations

and application thereof by the courts of the State of:

Oregon. If it was a valid statute when enacted, which

is by no means conceded, it has become invalid under

the present, different set of facts and by change in the

conditions to which it is applied (NashvNJe C. & St.

L. Ry. v. Walters, supra).

- It may be presumed that legislators of other states,

ever on the lookout for new sources of revenue, will be

tempted to emulate the action of: Oregon, of California,

Montana, Iowa, etc., in seizing by escheat the inher-

itances.of some fonresident aliens whose countries will

_ not or cannot meet the particular state’s .conditions.

There is a certain popular appeal in the “Iron Curtain”

rule. It would’ serve to avoid much painful and costly

_ litigation if this Court would, as is here prayed for, _

declare that such legislation is in a field of exclusive

federal competence upon which the. individual states

may not encroach.

, As recently as. August 2, 1966, the California Su-

preme Court in Estates of Larkin and Terry, 65 A.C, 49,

52 Cal. Rptr. 441, ruling for reciprocity with the.

U.S.S.R. [but see Estate of Gogasbashvele, 195 Cal.

App. 2d 503, 16 Cal. Rptr. 77 ( 1961) holding against .

‘ reciprocity with the U.S. S.R.], refused to consider the

constitutional validity of the California reciprocity

ie statute, deeming that question to have beer settled by

Clark v. Allen, supra. However, ‘the court did make the .

_ «+ following most cogent comment [52 Cal. Rptr. at 456-

ee | © a bane te 06 v

23°

“The commentators have seriously criticized the

' reasoning of the Clark decision. One writer declares

that the court ‘grossly underestimate [d] the effect

of the California statute on foreign relations’ and

that the decision is inconsistent with prior and sub-

_Sequent court rulings. (Boyd, The Invalidity of

State Statutes Governing the Share of Nonresident

, Aliens in Decedents’ Estates (1963) 51 Geo.L. J. 470,

493-500; cf. Hawley, Succession, 1964 Annual Sur-

vey of American Law 585, 591.)

“Similarly, Justice Douglas, himself the author

of Clark has declared that he believes the time has

come to reconsider tht. rationale of that decision in

light: of the ‘notorious’ practice of certain state

courts ‘in withholding remittances to legatees resid-

ing in Communist countries’ and thus affecting the _

’ foreign relations of this country in a manner “not

. justified by any legitimate state interest ‘in regulat- |

ing the local aspects of inheritance. (Ioannou v.

New. York (1962) 371°U.S. 30,: 83-S. Ct. 6, 9

' L. Ed. 2d 5, per curiam -dismissal of appeal, Jus-

- tices Douglas and Black voting to note jurisdiction,

opinion by Justice Douglas.) Whatever the present’

status of the Clark decision, the construction of sec-

tion 259 for which the Attorney General contends

in the present case goes well beyond that deemed

‘farfetched’ in Clark.”

And still more scene on September 7, 1966, the. Cal-

ifornia District Court of Appeal in the Estate of Mag-.

dalena Chichernea, 244 A.C.A. 727, 53 Cal. Rptt. 535,

rehearing denied 9/26/66, ruling against reciprocity with

Rumania [but see Estate of Kennedy, 106 Cal. App. 2d

621, 235 P.2d-837 (1951) holding for reciprocity with

er

24

Rumania] likewise refused to reconsider the constitu-

tional validity of the California reciprocity statute, say-

ing [53 Cal. Rptr. at 540]:

“Petitioners contend that Probate: Code,. § 259

is unconstitutional in. that it denies to them the

equal protection of the laws and due process ander

the Fourteenth Amendment of the United States

Constitution and that it constitutes an unwarrant-

ed infringement on the powers of the Federal Gov-._

ernment in the area of foreign relations. In Clark ..

v. Allen, 331 U.S. 503, 517, 67 S. Ct. 1431, 91 L.

Ed. 1633; Estate of Knutzen, 31 Cal. 2d 573, 191

P.2d 747; Estate of Bevilacqua, 31 Cal. 2d 580, 582,

191 P.2d 752, these arguments are: eneiyaed and

rejected. We agree with these cases.”

It is clear therefore that unless and until this Court

_ feexamines Clark v. Allen and holds that the ruling there-

im, made in 1947, is no longer valid in view of the

changed conditions and what has happened i in the world

during the past two decades, the state courts will not,

and perhaps could not, invalidate these reciprocity and

~~withholding statutes. As stated by Mr. Justice Douglas

in Ioannou, supra [371 U.S. at 33]:

“The question seems substantial and does not

seem to be foreclosed by Clark v. sss: 331 USS.

503.” :

Vi. CONCLUSION -

Appellants submit that her have shown that sub-

stantial federal questions are presented in this case, in-

_ deed questions of vast national and international im-

portance most seriously affecting the foreign relations

= le 3] 25

of the United States. When state laws or state policies |

affect the foreign relations of the country and thus ad-

.. versely affect the nation as a whole, the state must yield

and a state statute having that result must be invali- °

dated and given no effect. - 3 :

Appellants pray that Diciinilettisin by this Court be

noted and this case set for plenary consideration.

Respectfully submitted,

PETER A. SCHWABE, SR.

PETER A. SCHWABE, JR.

: Attorneys for Appellants. a

Tm reeks a COREE oR