Case Basics: Docket No.

532
Petitioner (P): United State
Respondent (R): Belmont
Decided By: Hughes Court (1932 1937)
Opinion: 301 U.S. 324 (1937)
Argued: Thursday, March 4, 1937
Decided: Monday, May 3, 1937
Location: August Belmont & Co.
Brief Fact Summary: - The U.S. (P) claim was based on the fact that funds deposited in a U.S. bank by
Russian corporation that had been nationalized by the Soviet government was due to it.
Synopsis of Rule of Law: - The state cannot interfere in the complete powers which the national
government has in the conduct of international affairs.
Facts: - Before to the 1918 nationalization and liquidation by the Soviet government, a Russian
corporation had deposited money in Belmont (R), a private bank in New York City. In 1933, the Soviet
Union and the United States (P) agreed to a final settlement of claims and counter claims. The
agreement of the Soviet Union was to take no steps to enforce claims against American nationalist and
assigned and released all such claims to the U.S. (P). The court however held that the suits of the bank
deposit was within the state of New York and was not an intangible property right within soviet territory
and that it would be contrary to the public policy of the State of New York to recognize or enforce the
nationality decree when the U.S. (P) sought to recover the money. The U.S. (P) appealed to the Supreme
Court which granted certiorari.
Issue: - Does the national government have complete power in the conduct of international affairs?
Held: - (Justice Sutherland). Yes. The states cannot interfere in the complete powers which the national
government has in the conduct of international affairs. The U.S. (P) recognized the Soviet government
coincidentally with the assignment of all claims. The President does not need the consent of the Senate
to conduct foreign relations. In respect of foreign relations generally, state lines disappear. Reversed
and remanded.
Discussion: - The recognition of the Soviet Union and the release of all claims were interdependent and
this was noted by the Court. Thus it was purely in the realm of foreign policy to make this agreement.
States cannot therefore interfere in the conduct of foreign relations.