Notre Dame Law Review Volume 16 | Issue 4 Article 4 5-1-1941 Contributors to the May Issue/Notes Thomas W. Cain A. E. Kerger Ronald P. Rejent Carl J. Kegelmayer Follow this and additional works at: http://scholarship.law.nd.edu/ndlr Part of the Law Commons Recommended Citation Thomas W. Cain, A. E. Kerger, Ronald P. Rejent & Carl J. Kegelmayer, Contributors to the May Issue/Notes, 16 Notre Dame L. Rev. 337 (1941). Available at: http://scholarship.law.nd.edu/ndlr/vol16/iss4/4 This Note is brought to you for free and open access by NDLScholarship. It has been accepted for inclusion in Notre Dame Law Review by an authorized administrator of NDLScholarship. For more information, please contact [email protected]. CONTRIBUTORS TO THE MAY ISSUE Luis DE GARAY, of Mexico City, Mexico, is a Professor of Law in the Escuela Nacional de Jurisprudencia of that city. He is also a lawyer practicing law with the firm of Bufete, Menendez and Garay. He is the Editor of Jus a monthly review of law and the social sciences, and is a regular contributor to that review in which his article first ap- peared. JAMES J. KEARNEY, member of the Faculty of the College of Law of the University of Notre Dame. Director of the Bureau of Research in Educational and Civil Church Law. Contributor to the NOTRE DAME LAWYER, the LOUISIANA LAW REvIEw, the JOHN MARSHALL LAW QUARTERLY, the ILLINOIS LAW REvIEW, the ILLINOIS BAR AsSOCIA- TION JOURNAL, the YEARBOOK OF SCHOOL LAW OF 1940, and other non-legal periodicals. Author of the fourth edition of CLARK AND MARSHALL ON CRIMES. JOHN E. SAVORD, is a graduating senior in the College of Law of the University of Notre Dame. His article was the winning essay in the 1941 Nathan Burkan Memorial Competition sponsored by the American Society of Composers, Authors and Publishers. NOTES AIRcRFT - PRIORITY OF FEDERAL LIEN ON AIRPLANE FOR FOR- FEITURE OVER MORTGAGEE'S LIEN. - The recent growth and develop- ment of the aircraft industry and its direct consequence, the growth of private flying has opened many new and interesting fields in the law regarding aircraft ownership and operation. Financing of light air- planes is becoming a prevalent practice in the banks throughout the country. The legal status of the mortgagee in regards to other liens, especially those enforced by the Civil Aeronautics Authority for for- feitures arising out of infractions of rules and regulations upon the owner of the particular airplane is the point in question. The body of law govering the operation of aircraft is found in the Civil Aeronautics Act of 1938.1 This act was passed to supersede the Air Commerce Act of 1926 2 and embodies practically the same law as I U. S. C. A. Title 49, § 401. 2 U. S. C. A. Title 49, § 171. NOTRE DAME LAWYER the former act only in a much broader scope. The administration of the act is placed in the hands of the Civil Aeronautics Authority upon whom rests the duty of passing such rules and regulations and the en- forcement of said rules to promulgate safe operation of aircraft.3 Violation of the rules carries with it a civil penalty in the form of fines ranging up to $1,000 for each such violation. It is in the enforcement of these penalties that the question of priority of liens arises. Subchapter 1, section 26 of the Civil Aeronautics Act provides that: "Operation of aircraft or operate aircraft means the use of aircraft, for the purpose of air navigation and includes the navigation of aircraft. Any person who causes or authorizes the operation of aircraft, whether with or without the right of legal control (in the capacity of owner, lessee or otherwise) of the aircraft, shall be deemed to be engaging in the operation of aircraft within the meaning of this chapter." 4 This provision specifically includes the bailor for hire of an airplane as the operator even though at the time of the violation he is not in command of the aircraft, or has knowledge of the violation. Subchapter IX, section 621 of the Civil Aeronautics Act provides that: "(a) Any person who violates (1) any provision of subchapters V, VI, VII, of this chapter on any provision of subsection (a) (1) of section 181 of this title, or (2) any rule or regulation issued by the Postmaster General under this chapter, shall be subject to a civil penalty of not to exceed $1,0O0 for each such violation. .. " "(b) In case an aircraft is involved in such violation and the viola- tion is by the owner or person in command of the aircraft such air- craft shall be subject to lien for the penalty: Provided that this sub- section shall not apply to a violation of a rule or regulatioh of the Post- master General." 5 Subchapter IX, section 623 of the Civil Aeronautics Act, reads: "(b) (1) Any civil penalty imposed under this chapter may be col- lected by proceedings in personam against the person subject to the penalty and, in case the penalty is a lien by proceedings in rem against the aircraft, or by either method alone. Such proceedings shall con- form as nearly as may be to civil suits in admiralty, except that either party may demand trial by jury of any issue of fact if the value in controversy exceeds $20. ... "(2) Any aircraft subject to such lien may be summarily seized and placed in the custody of such persons as the authority may pre- scribe .... 3 U. S. C. A. Title 49, § 421. 4 U. S. C. A. Title 49, § 401 (26). 5 U. S. C. A. Title 49, § 621. NOTES "(3) The aircraft shall be released from such custody upon payment of the penalty . or seizure in pursuance of process of any 'court in proceedings in rem for enforcement of the lien.", 6 The question of priority of the lien rests upon the fact of who is considered the offender under the statute, the operator or the aircraft itself. Only two cases have reached the Federal Courts zn this subject. They were brought up under the Air Commerce Act 7 and involved violation of custom laws. However, they are directly in point by vir- tue of the similarity of the wording of the Civil Aeronautics Act. United States v. Hunter,8 allowed the intervener mortgagee to re- cover on the theory the operator and not the aircraft was guilty of the violation. The court held that the proceeds of the sale of a mono- plane sought to be forfeited for violation of regulations applying to customs laws was properly awarded to the holder of a purchase money mortgage thereon, where the person in charge of the aircraft incurred personal penalties, when the plane itself was not subject to forfeiture. It should be noticed that this decision is under the 1936 Act, and that the 1938 act clearly states the aircraft in any violation is subject to forfeiture. This decision clearly indicates that by interpreting the statute now in effect the mortgagee's lien is secondary to that of the government in enforcing the penalty. In United States v. Batre,9 the court held the airplane, not the per- son, may properly be considered the offender under the statute requir- ing airplanes crossing international boundaries to land at a designated place. The lien of the United States on an aeroplane for the civil penalty prescribed by the Air Commerce Act for the violation of Treasury air customs and health regulations thereunder, by the owner of the plane in flying from Mexico into the United States without notice to the collector of customs, and in not making his first landing at an airport of entry, is paramount to the prior lien of the holder of a chattel mortgage upon the plane, although he had no notice or knowl- edge that the plane was used or intended to be used in violation of the law. The mortgagee permitted the plane to remain in the posses- sion of the owner without restriction upon its use, and, having left it within the power of the owner to violate the law, could not complain; and that, had Congress desired an exemption from penalty under the act violated to apply to an innocent third party, it would have been so stated, as had been done in other enactments. Furthermore, the mortgage was executed after the passage of the Air Commerce Act, 6 U. S. C. A. Title 49, § 623. 7 U.S.C.A. Title 49, § 171. 8 80 F. 2d 968 (1936). 9 69 F. 2d 673 (1934). NOTRE DAME LAWYER which became part of the mortgage. It is apparent then, that under the Civil Aeronautics Act the innocent mortgagee has no exemption from penalties under the act, committed by the mortgagor or someone permitted by the mortgagor to operate the aircraft. ° AMERICAN JURISPRUDENCE," "The lien of the United States on an airplane for the civil penalty prescribed by the Air Commerce Act for the violation of Treasury air customs and health regulations thereunder by the owner of the plane is paramount to the prior lien of the holder of a chattel mortgage upon the plane, although he had no notice or knowledge that the plane was used or intended to be used in violation of law." How the mortgagee is to protect himself against such a lien is problematical. In computing the average worth of a lightplane and the probable extent of the penalty lien imposed, it is more than likely the mortgagee would have very little to redeem.