Senator ALLEN. Senator Hatch?

Senator HATCH. I have nothing to add. I think you have covered the subject very well, Mr. Chairman. I have no statement at this time. I am going to be very interested in hearing the witnesses on all sides of this question, and I intend to keep a very open mind regarding all of the issues that will be raised in these important hearings.

Senator ALLEN. Thank you very much.

Mr. Leonard, will you come forward?

We welcome you to the subcommittee hearings and we are delighted to have you as our first witness. You may proceed in such manner as you see fit.

TESTIMONY OF GEORGE S. LEONARD, ATTORNEY,

WASHINGTON, D.C.

Mr. LEONARD. Thank you, Mr. Chairman, and Senators.

If the subcommittee so desires, I would like at this time to read a statement which has been circulated and then make myself available for whatever questions the committee might have.

Mr. Chairman and members of the subcommittee, my name is George S. Leonard. My offices are located at 1019 Nineteenth Street NW., in Washington, D.C.

I am an attorney before the bar of the Supreme Court and various other courts in the State of New York, the District of Columbia, and elsewhere. I am an attorney with considerable background and experience in constitutional matters and have been the attorney for certain Senators and Members of the House of Representatives who have been plaintiffs in actions brought to test whether under the doctrine of constitutional separation of powers the executive branch may dispose of a territory of the United States by the presentation of a treaty proposal to the Senate.

I am familiar with the current status of the proposals regarding the disposition of the Canal Zone. I appear here today to question as a matter of constitutional law whether the executive branch may enter into negotiations for a treaty which would divest the United States of its possession of the zone without any necessity for prior authorization from the whole Congress.

CONSTITUTIONAL AUTHORITY

Our question, therefore—and the one to which I have given consideration-is: Does the executive branch have the constitutional authority to negotiate for a treaty which disposes of the Panama Canal Zone? I believe that the answer to that is flatly and unquestionably "no." I do not believe that there is any doubt whatsoever in the law or under the Constitution that such power does not abide in the executive branch of the United States.

Let me give you some background if I may. It is customarily said, and the State Department has always repeated-and I notice even from the remarks of the chairman at this meeting-that it is assumed that the Canal Zone originally started out and was acquired by treaty. That is not so.

94-468 - 77-2

What did happen was that Congress passed an act, which is known as the Spooner Act. It directed the executive to make an arrangement either with Panama, or—in default of Panama-with Nicaragua to acquire in perpetuity the properties across which a transoceanic canal would be built.

The "in perpetuity" requirement was a congressional requirement. It had nothing whatever to do with the executive department.

The treaty was more under that authority and by reference to that authority. Senator Scott has put into the record here the actual text of what is known as the Hay-Bunau-Varilla Treaty. It will be found that in the first paragraph, in the opening word of that, the reference is made to the fact that it is authorized by an act of Congress.

SPOONER ACT

Its terms are the terms which Congress required. Had Panama not agreed to it and I say Panama, because at the time of the Spooner Act there was not even a Panama-the United States would have built the canal in Nicaragua which was, as a matter of fact, within one or two votes in the Senate, the desired place to have put the interocean canal.

It was by virtue of Panama's willingness to accept the treaty in that form that the Spooner Act could be carried out and that the canal was, in fact, built in Panama instead of in Nicaragua.

Under the Spooner Act Congress authorized the President to acquire perpetual control of the necessary lands for the construction and defense of an interocean canal across the Isthmus of Panama. It stated that if the Executive were unable to purchase such control, then it was to approach Nicaragua for the same purpose.

Acting pursuant to the authorization which was thus granted by Congress a convention was negotiated and approved by the then President and Secretary of State between the United States and the newly formed Republic of Panama on November 18, 1903. This is the convention, treaty, or agreement, as you will call it, generally known as the Hay-Bunau-Varilla Convention, a copy of which is now in the record.

It is pursuant to that that the United States acquired in perpetuity the rights of the newly founded Republic of Panama to the territory which is now known as the Canal Zone.

Since that time the Canal Zone has remained a territory of the United States administered at the direction of the President of the United States in accordance with enabling legislation which has been enacted from time to time thereafter by the Congress.

I point out in this connection that all powers which the President has in terms of the administration and organization of the canal spring from congressional enactment and congressional authorization.

Such legislation by the Congress has directed both the form and the substance of the governance of the administration and jurisprudence of the Canal Zone. It has culminated in a comprehensive revision by the Congress in Public Law 87-845, which is known generally as the Canal Zone Code. It became effective on January 2, 1963. It not only includes provisions for all of the necessary courts, the establishment

of a judiciary, and an office of the U.S. attorney, a criminal code and a civil code, but it also has a congressional guarantee of civil rights under the laws of the United States.

I may say parenthetically in addition to my statement that the bill of rights in the Canal Zone Code has been held by the Fifth Circuit Court of Appeals to be the equivalent to the Bill of Rights in the U.S. Constitution. There are some 3,500 citizens of the United States who are residents in the zone who, if this treaty presently proposed is to be taken at face value, will be put under Panamanian law without any hearing and without any chance of defending themselves or arguing their own case.

Senator SCOTT. Mr. Chairman, if I might interrupt, is that the case of United States v. Husband R. (Roach) which is 453 F.2d, 1054? Mr. LEONARD. That is correct.

Senator SCOTT. I just wanted that established for the record.

Mr. LEONARD. On considering the facts of the acquisition of the Canal Zone the courts have unanimously recognized that the Canal Zone has become a territory of the United States and that the title of the United States to the zone is complete.

I would like to repeat at this point the words of the Supreme Court of the United States in the case of Wilson v. Shaw, which can be found at 204 U.S. 24. It was rendered in 1907 shortly after the canal had been acquired.

The Supreme Court said:

"It is hypercritical to contend that the title of the United States is imperfect, and that the Canal Zone does not belong to this Nation, because of the technical terms used in ordinary conveyances of real estate."

There were two other cases. One was in the Canal Zone, which was Lucas v. Lucas, and another in the eastern district U.S. court in Huasteca Petroleum Company v. United States. They have affirmed that position. I do not believe that there has ever been a court at any

time which has held that the Panama Canal Zone is other than a territory of the United States.

I know that there have been many statements made about sovereignty, but otherwise to the best of my knowledge there has never been any doubt on the question that the Panama Canal Zone, insofar as our courts have interpreted this acquisition, is in fact a territory of the United States. I believe that this is today conceded by the State Department.

In 1936 and 1955 additional agreements with Panama were made on little minor pieces of territory here and there. I believe that some of them were outside the zone itself. In each such case the perpetuity principle was reaffirmed. In each such case, both in 1936 and 1955, the treaties were made subject to the passage of appropriate legislation by the Congress. It did not require ratification of the treaty by the Senate, but congressional action.

JOINT STATEMENT

The whole position changed in 1974. Mr. Kissinger went to Panama as Secretary of State. He discussed the situation with Foreign Minister Tack of the Republic of Panama. Between them they issued a joint statement which was published by the State Department.

Among other things, Mr. Kissinger stated that he had agreed in the name of the United States to the following: "The United States and Panama agree that the Treaty of 1903 should be replaced by a modern treaty that rejects the concept of perpetuity."

In another paragraph of the same statement Mr. Kissinger said: "The United States has proposed that Panamanian law and jurisdiction would be applied in the Canal Zone."

This joint statement, which was made in 1974, is now stated by the Department of State and has been conceded in various motions which it has made before the courts to constitute the framework of the present negotiations-that is, the disposition of the property of the Canal Zone and the turning over of the citizens down there to Panamanian law, placing the zone under Panamanian jurisdiction.

The original announcement by Secretary Vance and President Carter was that they hoped to complete this treaty by June of this year. Since that time the Department has revised its prediction and has reported that it was hoping to complete the new treaty by late

summer.

I understand from the first page of this morning's Post that a demand is now being made by Panama for a payment in addition to the Canal Zone that could possibly put it off even further.

Let us go at this time, if we may, directly to what the Constitution holds. As the chairman has noted for the record, the Constitution provides complete congressional power over the disposition and governance of territories by article IV, section 3, clause 2. I would like to read it again into the record, since it is of considerable importance in this regard.

The Congress shall have Power to dispose of and make all needful Rules and Regulations respecting the Territory or other Property belonging to the United States.

This clause has come before the courts in many cases. The Supreme Court, in 1872 in the case of Gibson v. Chouteau held that the power given to Congress by the Constitution included the authority to prescribe the times, the conditions, and mode of any transfer, and the right to designate the persons to whom any transfer would be made.

This repeated a prior decision of the same court to the same effect in Irvine v. Marshall, reported in 20 Howard 558 in 1858. It was later followed by Emblen v. Lincoln Land Company, reported at 184 U.S.

660 in 1902.

Quite recently in 1970 in Sierra Club v. Hickel, there was a decision which was affirmed by the Supreme Court at 405 U.S. 727. The original decision was written by the ninth circuit in 1970.

In Sierra Club v. Hickel, the decision of the Ninth Circuit Court of Appeals, which was affirmed by the Supreme Court, stated: Article IV, Section 3 of the United States Constitution commits the management and control of the lands of the United States to Congress. That Congressional power is unlimited.

This power of Congress under the Constitution to dispose of property which belongs to the United States is an exclusive power and has been so held by the courts. To the best of my knowledge, no court has ever said it is not. No court has ever said that any other branch of government has such power.

In Griffin v. United States in the Eighth Circuit Court of Appeals, reported at 168 2d 457, the court specifically pointed to the fact that the constitutional power thus given to Congress was in fact exclusive to the legislative body.

The same holding was made by the Supreme Court in United States v. Fitzgerald, reported at 40 U.S. 785 in 1841; in Osborne v. United States reported at 145 F. 2d 892; and again the Supreme Court in 1954, in Alabama v. Texas reported at 347 U.S. 272. Each has affirmed the principle that the power over the territories which the Consitution lodges in Congress is an exclusive power.

Accordingly, any authority which the Executive may have to dispose of property of the United States must be first derived from authority given by an Act of Congress. This was stated again by the ninth circuit in 1959 in the case of Tugade v. Hoy which is reported at 265 F. 2d 63. It concerned the action of the United States in giving the Philippines their independence.

Does the State Department deny the congressional right to dispose of territories of the United States? The answer is no, it does not. Originally, in the earliest portions of the actions which were brought by various Senators and Congressmen against the State Department and others in this matter, the State Department did in fact take the position that the power of the Congress had to be modified to some extent by the State Department's arrangements with foreign nations.

As I understand from the proposed testimony of Mr. Meeker and others and the filings which have more recently been made in these cases, the State Department no longer contests the power of Congress to dispose of this territory.

However, it has brought up and put forward at this time a claim that under the Constitution's grant of treaty power to the President, the executive branch of government holds a concurrent authority to dispose of any United States property.

The treaty power, of course, is in article II, section 2 of the Constitution. It says nothing whatever about territory or property of the United States.

STATE DEPARTMENT CLAIMS CONCURRENT POWER

When a matter is a proper question of foreign affairs and when it concerns a domestic matter which is not a proper subject of foreign affairs is a matter which I leave to the State Department to explain to this body. As of the present time, however, it is the contention of the State Department that the President has truly concurrent power under the treaty power to dispose of property of the United States.

The point is one of considerable interest. My office has researched the point. I have done considerable work on it myself. As far as we can tell, there is not a single court and there is not a single commentator in the law who has ever supported the existence of this concurrent power which the State Department now claims.

Actually, what we did find was that there have been many rulings by the courts that such an authority does not exist and that the President's treaty power is limited whenever primary authority has been granted to another branch of Government by the Constitution.