1. A person employed as an inspector by the Emergency Fleet
Corporation is not an agent of the United States, within the
meaning of § 41 of the Criminal Code. P.
254 U. S. 491.
2. The Emergency Fleet Corporation, though all of its stock is
owned by the United States, is a separate entity. P.
254 U. S.
492.
3. Generally, agents of a corporation are not agents for the
stockholders, and cannot contract for them.
Id.
Affirmed.
The case is stated in the opinion.
Page 254 U. S. 492
MR. JUSTICE McREYNOLDS delivered the opinion of the Court.
The ultimate question for determination is whether the
employment of defendant Strang as an inspector by the United States
Shipping Board Emergency Fleet Corporation, without more, made him
an agent of the government within the meaning of § 41, Criminal
Code.
"Sec. 41. No officer or agent of any corporation, joint-stock
company, or association, and no member or agent of any firm or
person directly or indirectly interested in the pecuniary profits
or contracts of such corporation, joint-stock company, association,
or firm shall be employed or shall act as an officer or agent of
the United States for the transaction of business with such
corporation, joint-stock company, association, or firm. Whoever
shall violate the provision of this section shall be fined not more
than two thousand dollars and imprisoned not more than two
years."
Holding that this employment did not suffice to create the
relation alleged, the trial court sustained a demurrer to the
indictment. It contains four counts, three of which charge that
Strang unlawfully acted as agent of the United States in
transacting business with the Duval Ship Outfitting Company, a
copartnership of which he was a member, in that, while an employee
of the Fleet Corporation as an inspector, he signed and executed
(February, 1919) three separate orders to the Outfitting Company
for repairs and alterations on the steamship
Lone Star.
The other defendants are charged with aiding and abetting him. The
trial court and counsel here have treated the fourth count as
charging all the defendants with conspiracy to commit the offenses
set forth in the three preceding counts.
United States v.
Colgate & Co., 250 U. S. 300.
Counsel for the government maintain that the Fleet
Page 254 U. S. 493
Corporation is an agency or instrumentality of the United States
formed only as an arm for executing purely governmental powers and
duties vested by Congress in the President and by him delegated to
it; that the acts of the corporation within its delegated authority
are the acts of the United States; that therefore, in placing
orders with the Duval Company in behalf of the Fleet Corporation
while performing the duties as inspector, Strang necessarily acted
as agent of the United States.
The demurrer was properly sustained.
As authorized by the Act of September 7, 1916, c. 451, 39 Stat.
728, the United States Shipping Board caused the Fleet Corporation
to be organized (April 16, 1917) under laws of the District of
Columbia with $50,000,000 capital stock, all owned by the United
States, and it became an operating agency of that Board. Later, the
President directed that the corporation should have and exercise a
specified portion of the power and authority in respect of ships
granted to him by the Act of June 15, 1917, c. 29, 40 Stat. 182,
and he likewise authorized the Shipping Board to exercise through
it another portion of such power and authority.
See The Lake
Monroe, 250 U. S. 246,
250 U. S. 252.
The corporation was controlled and managed by its own officers and
appointed its own servants and agents, who became directly
responsible to it. Notwithstanding all its stock was owned by the
United States, it must be regarded as a separate entity. Its
inspectors were not appointed by the President, nor by any officer
designated by Congress; they were subject to removal by the
corporation only, and could contract only for it. In such
circumstances, we think they were not agents of the United States
within the true intendment of § 41.
Generally agents, of a corporation are not agents of the
stockholders, and cannot contract for the latter. Apparently this
was one reason why Congress authorized organization of the Fleet
Corporation.
Bank of the
United
Page 254 U. S. 494
States v. Planters' Bank of Georgia, 9 Wheat. 904,
22 U. S. 907,
22 U. S. 908;
Bank of Kentucky v.
Wister, 2 Pet. 318;
Briscoe v.
Bank of Kentucky, 11 Pet. 257;
Salas v. United
States, 234 F. 842. The view of Congress is further indicated
by the provision in § 7, Appropriation Act of October 6, 1917, c.
79, 40 Stats. 345, 384:
"
Provided, that the United States Shipping Board
Emergency Fleet Corporation shall be considered a government
establishment for the purposes of this section."
Also, by the Act of October 23, 1918, c. 194, 40 Stats. 1015,
which amends § 35, Criminal Code, and renders it criminal to
defraud or conspire to defraud a corporation in which the United
States owns stock.
Affirmed.
MR. JUSTICE CLARKE dissents.