Iran National Airlines Corp. v. Marschalk Co.

Background

The United States Court of Appeals for the Second Circuit sent three legal questions to the Supreme Court about actions taken by the President. The questions asked whether certain executive steps were lawful and whether those steps required payment as compensation for property. The specific actions at issue included nullifying legal attachments and suspending claims.

Reasoning

For the first two certified questions the Court answered “Yes” and directed readers to the Court’s separate opinion in Dames & Moore v. Regan for the reasoning. On the third question the Court held that the President’s action in nullifying the attachments did not constitute a taking of property that requires compensation. The Court further stated, “We dismiss question (3) so far as it concerns whether the action of the President in suspending the claims constituted a taking of property for which compensation must be paid.” The opinion therefore resolves the nullification issue but declines to decide the suspension-of-claims compensation question.

Real world impact

As answered here, the Court’s brief ruling means nullifying those attachments will not automatically force the government to pay compensation under the circumstances described. The dismissal of the suspension question leaves uncertainty about whether suspending claims could ever be treated as a compensable taking. The opinion points to Dames & Moore v. Regan, which lower courts will consult when handling similar disputes.

Dissents or concurrances

Justice Powell, joined by Justices Marshall and Stevens, dissented and argued the Court should have dismissed the certified questions and relied on the fuller Dames & Moore opinion instead of issuing short answers.