United States v. Caltex Inc. (1952)

344 U.S. 149 (1952)

Decision: Reversed
Vote: 7-2
Majority: Vinson, joined by Reed, Frankfurter, Jackson, Clark, Minton and Burton
Dissent: Douglas, joined by Black

MR. CHIEF JUSTICE VINSON delivered the opinion of the Court.

Each of the respondent oil companies owned terminal facilities in the Pandacan district of Manila at the time of the Japanese attack upon Pearl Harbor. These were used to receive, handle and store petroleum products from incoming ships and to release them for further distribution throughout the Philippine Islands. Wharves, rail and automotive equipment, pumps, pipelines, storage tanks, and warehouses were included in the property on hand at the outbreak of the war, as well as a normal supply of petroleum products …

On December 12, 1941, the United States Army, through its Chief Quartermaster, stationed a control officer at the terminals. Operations continued at respondents’ plants, but distribution of the petroleum products for civilian use was severely restricted. A major share of the existing supplies was requisitioned by the Army …

The Chief Engineer on the staff of the Commanding General addressed to each of the oil companies letters stating that the Pandacan oil deposits “are requisitioned by the U.S. Army.” The letters further stated: “Any action deemed necessary for the destruction of this property will be handled by the U.S. Army.” …

At 5:40 p.m., December 31, 1941, while Japanese troops were entering Manila, Army personnel completed a successful demolition. All unused petroleum products were destroyed, and the facilities were rendered useless to the enemy. The enemy was deprived of a valuable logistic weapon.

After the war, respondents demanded compensation for all of the property which had been used or destroyed by the Army. The Government paid for the petroleum stocks and transportation equipment which were either used or destroyed by the Army, but it refused to compensate respondents for the destruction of the Pandacan terminal facilities …

In United States v. Pacific R. Co., (1887), Justice Field, speaking for a unanimous Court, discussed the question at length. That case involved bridges which had been destroyed during the war between the states by a retreating Northern Army to impede the advance of the Confederate Army. Though the point was not directly involved, the Court raised the question of whether this act constituted a compensable taking by the United States, and answered it in the negative:

“The destruction or injury of private property in battle, or in the bombardment of cities and towns, and in many other ways in the war, had to be borne by the sufferers alone, as one of its consequences. Whatever would embarrass or impede the advance of the enemy, as the breaking up of roads or the burning of bridges, or would cripple and defeat him, as destroying his means of subsistence, were lawfully ordered by the commanding general … The safety of the state in such cases overrides all considerations of private loss.”

It may be true that this language also went beyond the precise questions at issue. But the principles expressed were neither novel nor startling, for the common law had long recognized that, in times of imminent peril — such as when fire threatened a whole community — the sovereign could, with immunity, destroy the property of a few that the property of many and the lives of many more could be saved …

Had the Army hesitated, had the facilities only been destroyed after retreat, respondents would certainly have no claims to compensation. The Army did not hesitate. It is doubtful that any concern over the legal niceties of the situation entered into the decision to destroy the plants promptly, while there was yet time to destroy them thoroughly. Nor do we think it legally significant that the destruction was effected prior to withdrawal. The short of the matter is that this property, due to the fortunes of war, had become a potential weapon of great significance to the invader. It was destroyed, not appropriated for subsequent use. It was destroyed that the United States might better and sooner destroy the enemy.

The terse language of the Fifth Amendment is no comprehensive promise that the United States will make whole all who suffer from every ravage and burden of war. This Court has long recognized that, in wartime, many losses must be attributed solely to the fortunes of war, and not to the sovereign. No rigid rules can be laid down to distinguish compensable losses from noncompensable losses. Each case must be judged on its own facts. But the general principles laid down in the Pacific Railroad case seem especially applicable here. Viewed realistically, then, the destruction of respondents’ terminals by a trained team of engineers in the face of their impending seizure by the enemy was no different than the destruction of the bridges in the Pacific Railroad case. Adhering to the principles of that case, we conclude that the court below erred in holding that respondents have a constitutional right to compensation on the claims presented to this Court.

Reversed.

MR. JUSTICE DOUGLAS, with whom MR. JUSTICE BLACK concurs, dissenting.

I have no doubt that the military had authority to select this particular property for destruction. But, whatever the weight of authority may be, I believe that the Fifth Amendment requires compensation for the taking. The property was destroyed not because it was in the nature of a public nuisance, but because its destruction was deemed necessary to help win the war. It was as clearly appropriated to that end as animals, food, and supplies requisitioned for the defense effort. As the Court says, the destruction of this property deprived the enemy of a valuable logistic weapon.

It seems to me that the guiding principle should be this: whenever the government determines that one person’s property — whatever it may be — is essential to the war effort, and appropriates it for the common good, the public purse, rather than the individual, should bear the loss.

Excerpted by Ethan Derstine