Smith v. American Asiatic Underwriters, Federal, Inc.

Appellant, A. Viola Smith, a China Trade Act registrar, seeks reversal of a declaratory judgment obtained by appellee, American Asiatic Underwriters, Federal Inc. U. S. A., a China Trade Act corporation, in a suit by appellee against appellant in the United States Court for China.

Appellant is an officer of the Department of Commerce. She was designated as China Trade Act registrar by the Secretary of Commerce. Her official station is at Shanghai, China. Her functions are administered under the supervision of the Secretary. Any action of hers may, upon appeal to the Secretary, be affirmed, modified or' set aside by the Secretary as he deems advisable.

Appellee was incorporated in 1925. Being a China Trade Act corporation, appellee was prohibited from engaging in any form of insurance business. 3 In or prior to 1931, appellee acquired shares of the capital stock of two corporations — Asia Life Insurance Company and International Assurance Company, Limited — each of which was engaged in the insurance business. In 1932 a controversy arose between appellee and the Secretary of Commerce as to the effect of appellee’s ownership of said shares, the Secretary contending that such…

(dissenting).

I cannot agree with the majority opinion that there is no dispute or controversy between appellee and the registrar. Appellee was engaged in owning stock in insurance companies. The registrar was claiming that such activity is illegal and was threatening to bring proceedings to revoke appellee’s certificate of incorporation, which she was authorized to do by the statute when she was satisfied that the law was being violated.

Since the registrar was .entitled to litigate this question against the appellee, and the Secretary of Commerce had made his administrative determination that she could do so by his consent to engage in litigation to determine her right so to do, if that be necessary, and since she was threatening so to do, it is my opinion that appellee was entitled to institute a suit against her to have a declaratory judgment as to her right so to proceed. Certainly the purposes and objectives of the declaratory judgment act would be served by procuring a declaratory judgment prior to such threatened action. However it is not necessary to determine this question because the registrar, though she moved to dismiss the complaint brought by the appellee, did…