have never thought that counsel should be penalized for celerity, particularly when the results obtained were so satisfactory.

Now, it seemed to me that it was my duty to present the matter to the Committee on Appropriations so they might, after giving it consideration, make such appropriation of funds as in their judgment and within what they thought proper under all of the circumstances of the case was adequate or reasonably adequate.

Then we ran against the proposition that perhaps there were some technical objections and that the Committee on Appropriations was not in position to put into an appropriation an item which might on motion or objection be stricken out, and so that committee suggested that there ought to be some enabling act which would permit us to deal with the subject.

This hearing today, as I understand it, had nothing whatever to do with the amount of compensation or any of the details but merely whether or not the Committee on Appropriations ought to be authorized to deal with it so that the matter might be unembarrassed by any technical limitations.

My whole attitude about the matter has been that we have had the benefit of the finest advice and that they have obtained splendid results and we ought to be pleased and happy about it. And I feel that I would not be fair to those gentlemen if I did not suggest that I thought, in justice they were entitled to more than the limited amount that was permitted under existing law. How much, I have not gone on record to say. I know that we never pay counsel for the Government anything commensurate with what similar service would receive in private life. So I thought that the committee might be glad to empower the Committee on Appropriations, or that the Congress might empower the Committee on Appropriations to deal with this matter as the equities seem to warrant.

That is all there is to it, Mr. Chairman.

The CHAIRMAN. Mr. Attorney General, was there any suggestion made by your office to these gentlemen to the effect that they might expect additional compensation in the event there was a satisfactory adjustment?

Mr. CUMMINGS. Oh, yes. I think it fair to say, Mr. Chairman, that they were told that counsel in previous cases had received special compensation and that no doubt Congress would want to give them more than the statutory limitation permitted if the result was satisfactory. It all so much depended on what happened. It might have been a complete washout. The case was not without serious difficulties. We were confronted by the question of whether the cause of action would survive.

The CHAIRMAN. We have had that presented.

Mr. CUMMINGS. Very well.

The CHAIRMAN. We have had a pretty full discussion about it.

Mr. CUMMINGS. I presume, from the Government end, that it seemed to me that we needed the best help that we could get. And I am sorry I do not remember exactly what I said, but I think I probably indicated to them that the Congress possibly would like to give them more than the $10,000 that the statute permitted if the Congress was pleased with the results. And, of course, I could not tell them at that time, as I say, whether it would be satisfactory or not. But it has turned out to be eminently satisfactory.

The CHAIRMAN. We thank you very much, General. Are there any questions? Mr. MICHENER. Mr. Attorney General, what was the date that this contract was entered into with these gentlemen for this special work?

Mr. CUMMINGS. You mean the date of the employment?

Mr. MICHENER. Yes.

Mr. CUMMINGS. What is the date of that?

Mr. LEWINSON. I think I can answer that; January 1, 1936.

Mr. CUMMINGS. The 1st of January 1936.

Mr. LEWINSON. That is when we were appointed.

Mr. CUMMINGS. That was the date of the appointment.

Mr. MICHENFR. The reason I speak of the date is this, and I think the real objection, so far as Congress is concerned, would be this: That Congress adopted a policy; that Congress provided salaries; that Congress has not lodged the discretion in any executive official to go out and make contracts beyond that authorized by Congress.

Mr. CUMMINGS. Yes; but we have not done so.

Mr. MICHENER. With reference to the precedent you have referred to, I was here in 1921 when that thing came up. Some of us have had the feeling that it is not lawful for the Attorney General or any other executive official, nor

have they the right, to go out and create moral obligations for the Government to pay anything beyond that provided by the Congress.

Now, you say the contract was entered into on January 1, 1936. The Congress was in session on January 3, and it seems to me that if you had had the feeling that a contract should be made, other than that contemplated by the statute, that you should have appealed to Congress at that time and gotten the authority, rather than to wait a number of years and then come in and establish another precedent.

Mr. CUMMINGS. May I reply to what you have just said.

Mr. MICHENER. Yes.

Mr. CUMMINGS. First, we have made no contract outside of the limits of the law. That is perfectly manifest. The fact that this now is before your committee is proof enough of that.

Now, in the next place, this hardly establishes a precedent. In fact, it follows a precedent that has been applied to this particular group of cases, and it is the last and final wind-up of a matter that has been running for 15 or more years more than 20 years, I guess. It is all along a certain line.

Now, I simply submit the matter to this committee so that its wisdom may operate on it.

I have done what I thought was necessary to protect the Government's interest and I am rather proud of the results, and I thought that Congress might not resist the idea but might be glad to do it. I do not know that it is a wise policy, but when the Congress gets results like this it seems to me we ought to be pretty happy about it.

Mr. HOBBS. May I ask a question?

The CHAIRMAN. Mr. Hobbs.

Mr. HOBBS. What you have done, Mr. Attorney General, as you pointed out. was to employ these gentlemen and told them that in the event the results were satisfactory you would recommend additional compensation?

Mr. CUMMINGS. I think that that is a pretty fair statement. Of course, you realize I could not commit myself to any compensation beyond that provided by law. I was not in position to do that and I was pretty doubfful about these cases. I did not know when or how they would turn out. But I did feel that if these cases did turn out well and in view of what had happened in regard to this whole line of cases, I think it only fair to say, gentlemen, that I think these gentlemen have earned more than the law permits them to be paid. Mr. HOBBS. You do so think?

Mr. CUMMINGS. I absolutely do.

Mr. HOBBS. And that is your recommendation?

Mr. CUMMINGS. Yes.

Mr. MICHENER. Some may feel that you have rendered a service that has not been sufficiently compensated for.

Mr. CUMMINGS. So few people think that.

Mr. MICHENER. It is a pretty good job. Now, in that event, would you think it would be a wise policy on the part of Congress to say that your compensation has not been adequate and allow you 9% percent, for instance, on the money that you have recovered for the United States Government?

Mr. CUMMINGS. No; of course not. But that would be too violent a departure from precedent. But here we have this line of conduct and we have had a very special situation.

The CHAIRMAN. Mr. Attorney General, what was the fee paid to Senator Pomerene?

Mr. CUMMINGS. I am advised it was $240,000 in the second Pan American case. I think it was $205,000. [For facts see memo enclosed in Attorney General's letter of December 16, 1937, to chairman of committee.]

The CHAIRMAN. We thank you. We will have to go in just a moment, gentlemen.

Mr. CUMMINGS. Thank you.

Mr. HOBBS. Mr. Chairman, might we have the figures supplied showing the fees, special fees, paid in these other cases?

The CHAIRMAN. Yes; and we would like to have something of the work done, because they tried those cases in the courts and took them to the Supreme Court.

Mr. HOBBS. Yes.

The CHAIRMAN. We only have a few minutes, but I am going to permit Judge Stephens, if he wishes, to make a brief statement. We will have to adjourn in a moment.

STATEMENT OF HON. HAROLD M. STEPHENS, ASSOCIATE JUSTICE, UNITED STATES COURT OF APPEALS, DISTRICT OF COLUMBIA

Mr. STEPHENS. Mr. Chairman, I do not think I can add much to what the Attorney General has stated, except to say that my personal contact as assistant to the Department of Justice of necessity enables me to confirm his statement.

The CHAIRMAN. You were connected with the Department of Justice and had something to do with this particular class of litigation?

Mr. STEPHENS. Do you want me to tell what I know about it?

The CHAIRMAN. Yes.

Mr. STEPHENS. During the summer of 1935 I was promoted from assistant in charge of the Antitrust Division to Assistant to the Attorney General, which is the First Assistant in the Attorney General's office, and in that connection I was consulted by Mr. Harry Blair, who was then handling this line of cases. It was a part of the duties of the First Assistant Attorney General to try to help the other assistants get adequate representatives. Mr. Blair reported to me that this litigation had been lying around there for a long time without anything having been done; that the claim was a very large one; that there was some question whether the Federal Government could be successful; that it was very doubtful, from the legal standpoint, because the problem of the survivorship of the cause of action; and he wanted to know if I could help him get first-class counsel, engaged in private practice, who had had experience in such matters, and were capable of dealing with capable counsel, who were able to go up against counsel of the other side familiar with such matters. And whether he or I suggested Mr. Martineau first I do not remember. We both knew him. He had rendered service to the Department before and was well known by the Department as a man of high professional ability and character and dependability. And it was suggested in that conversation that I was to try to induce Mr. Martineau to accept the litigation because of his previous experience in this line of cases.

We called Mr. Martineau on the telephone and both Mr. Blair and myself talked to him in his Los Angeles office. He expressed doubt as to whether he could, in view of his present obligations to his private clients, take the litigation. He was very busy in his private practice at the time but we represented to him that he was needed badly and after thinking the matter over for a few days he said that he would accept the retainer provided he could have a lawyer of substantially equal ability associated with him to share the responsibility of the litigation. And he recommended Mr. Lewinson, whom I had also known as a practicing lawyer of first-class ability and character. The question of compensation then came up. We had discussed the matter with the Attorney General, of course. And it was made clear to Mr. Martinean and Mr. Lewinson that no contract should be made with them in excess of the $10,000 retainer and expenses which also are permitted, in respect to all litigation, except antitrust litigation-and this is not antitrust litigation.

It was made quite clear to them that if the litigation proceeded without satisfactory results, without large recovery for the Government, that there could be, in no event, any suggestion of any further compensation.

No contract of any sort was made beyond the legal form as the Attorney General has stated, but we did represent to them, as the Attorney General has also stated, that if they were successful in gaining back a large recovery for the Government that we would represent to Congress the justice of additional compensation, and would do so whenever the litigation was terminated, and would do so with all proper vigor, because we realized that the litigation was very doubtful and that to ask lawyers of first-class ability to accept these responsibilities at the compensation which the Government is able to pay on a technical basis was hardly fair if they made a very large recovery for the Government.

I think that about states it, Mr. Chairman.

The CHAIRMAN. Gentlemen, we have got to go now.

Mr. LEWINSON. Could you hear Mr. Stuart?

The CHAIRMAN. No; we cannot do it right now. I promised the Members that they could get to the House at 12 o'clock. We have the wages and hours question coming up and I do not believe we could continue now.

Mr. LEWINSON. Could he just make a brief statement for the record?

The CHAIRMAN. We would be glad to hear him a little later, but we cannot do so now.

Mr. MARTINEAU. It will only take him a moment.

The CHAIRMAN. Very well; we will stay for a moment, and any members who wish to leave may do so.

STATEMENT OF CAPT. H. A. STUART, DIRECTOR OF NAVAL PETROLEUM RESERVES, NAVY DEPARTMENT

Captain STUART. Mr. Chairman, I concur in what the Attorney General says, and we have always concurred and approved whatever the Attorney General has done in these special-compensation cases. I might say, in reference to what Mr. Lewinson has said, that there were several of these cases; and we have won every one of them with the exception of one, and that the only one we lost was where we did not have special counsel; and the amount that we lost in that case represented about $13,000,000.

The CHAIRMAN. How much is involved in this case?

Captain STUART. $3,000,000.

The CHAIRMAN. How much was sued for?

Mr. LEWINSON. $5,000,000, approximately, although there was an item of $400,000 of interest.

The CHAIRMAN. Thank you, gentlemen. We will have to adjourn now. (At 12:10 p. m. the hearing was adjourned.)

Mr. FORD. I also wish to introduce the stenographic reports of testimony, and the letter of Martineau and Lewinson, dated May 25, 1937, and the brief submitted by Mr. Lewinson, and the Attorney General's letter of 1937 to Chairman Sumners, and the memorandum enclosed therewith.

(The documents referred to are as follows:)

MEMO H. R. 4366

The hearing is set for March 17, at 10:30 a. m., before the subcommittee of the Judiciary Committee. The procedure, I understand, will be:

1. To introduce the transcript of the hearing in the previous bill, H. R. 8662, consisting of:

(a) Stenographic reports of testimony.

(b) Letter of Martineau and Lewinson, dated May 27.

(c) Brief submitted by Lewinson.

(d) Attorney General's letter, 1937, to Chairman Sumners, and memo enclosed therewith.

In addition to this, record of following witnesses: Mr. Frank Hogan, Pat Hurley, L. R. Martineau, Jr., Harold Stephens, and Joseph L. Lewinson.

Also the following affidavits, which I will deliver to you prior to the hearing, will be introduced in evidence: Affidavit of Guy Richards Crump and John Perry Wood.

The transcript will be in the care of the clerk of the Judiciary Committee, and I assume can be introduced by reference, i. e. by stating any evidence referred to.

J. L. L.

Mr. FORD. In addition I wish to introduce the following witnesses, Mr. Frank J. Hogan; Mr. Patrick J. Hurley; Mr. L. R. Martineau, Jr.; Associate Justice Harold M. Stephens of the Court of Appeals for the District of Columbia; and Mr. Joseph L. Lewinson.

Also the following affidavits which I have here attached. They are affidavits from Guy Richards Crump, John Perry Wood, and Wilson McCarthy. With your permission I will present these for

the record at this time.

Mr. WEAVER. All right; we will be glad to incorporate them in the record; we are glad to have them.

169330-39-ser. -4

(The affidavits referred to are as follows:)

AFFIDAVIT OF HON. GUY RICHARDS CRUMP ON REASONABLE VALUE OF SERVICES OF SPECIAL ASSISTANTS

STATE OF CALIFORNIA,

County of Los Angeles, 88:

Guy Richards Crump, being first duly sworn, on oath deposes and says: 1. My name is Guy Richards Crump.

2. I reside at San Marino, Calif.

3. I am a member of the law firm of Crump and Rogers, with offices at Los Angeles, Calif.

4. I have practiced law in Los Angeles County, Calif., for over 30 years, and during the past 10 years or more my practice has been devoted largely to the preparation and conduct of litigated cases of a complicated character, mostly in equity, in the State and Federal courts in California.

5. I have been a judge of the Superior Court of the State of California, in and for the county of Los Angeles, and have been president of the Los Angeles Bar Association and of the State Bar of California. At present I am California State delegate to the American Bar Association and chairman of the rules committee of the House of Delegates of the American Bar Association.

6. I know the standing at the Los Angeles bar and the California bar of Messrs. L. R. Martineau, Jr., and Joseph L. Lewinson, and know the legal fees current in Los Angeles County, Calif., and the reasonable value of professional services generally, and particularly with reference to usages and practices prevailing in the State of California and in the county of Los Angeles. 7. I have read and considered the following:

(a) A bill to authorize the payment of additional compensation to special assistants to the Attorney General in the case of United States v. Doheny Executors, designated "Seventy-sixth Congress, first session, H. R. 4366.”

(b) A bill to authorize the payment of additional compensation to special assistants to the Attorney General in the case of United States v. Doheny Executors, designated "Seventy-fifth Congress, second session, H. R. 8662."

(c) A transcript of the testimony taken before the Committee on the Judiciary of the House of Representatives on December 13, 1937, on a hearing on the bill designated "H. R. 8662," as aforesaid, consisting of statement of Joseph L. Lewinson, Esq., of Los Angeles, Calif., statement of Hon. Homer S. Cummings, Attorney General of the United States; statement of Hon. Harold Stephens, a justice of the Court of Appeals of the District of Columbia; and statement of Capt. H. A. Stuart, United States Navy, Director of Naval Petroleum Reserves.

(d) Copy of letter of Messrs. L. R. Martineau, Jr., and Joseph L. Lewinson, under date of May 25, 1937, addressed to the honorable the Attorney General, Washington, D. C., and referred to in said transcript.

(e) Printed transcript of oral argument of Joseph L. Lewinson in opposition to motion to quash writ of scire facias in case No. 6726-J, in the District Court of the United States for the Southern District of California, also referred to in said transcript.

8. In my opinion the services rendered by the special assistants, as described in the transcript and letter above referred to, and as shown by the transcript of oral argument also above referred to, were of a value to exceed $300.000, considering that the compensation was largely contingent, and it would be fair and equitable for Congress to enact H. R. 4366 above referred to.

9. The elements to be considered in determining attorney fees are well stated in In re Osofsky (50 Fed. (2d) 925 (D. C., S. D. N. Y., 1931)), and in Corpus Juris, volume 6, title "Attorney and Client," pages 750–752.

The following is quoted from the opinion in the case cited:

"The elements to be considered in determing an attorney's fee were once most aptly summarized in evidence given on a reference by Hon. William G. Choate, formerly a judge of this court, and David B. Ogden, Esq., a well-known lawyer of a generation ago.

"They laid down the following elements as being matters properly to be considered when the fees of an attorney have not been agreed on beforehand, but are to be fixed: (1) The time which has fairly and properly been used in dealing with the case; because this represents the amount of work necessary. (2) The quality of skill which the situation facing the attorney demanded. (3) The skill employed in meeting the situation. (4) The amount involved;