## Facts

- In 1914, Mathilde Graf died in Sacramento, California, leaving most of her estate to her sister, Karoline Schwab.
- Schwab was a German citizen residing in Germany at the time of the death and throughout the events leading to suit.
- Graf’s will was probated, and by decree of distribution in 1916 the estate was distributed to Schwab.
- Cash of a little over $63,000 from the estate was transmitted to Schwab in Germany.
- Two parcels of Sacramento real property and certain notes secured by trust deeds on real estate remained standing of record in Schwab’s name in California.
- Schwab wrote a series of letters to her son, August Metzger, who lived in the United States and was a naturalized U.S. citizen.
- In the letters, Schwab stated in substance that the inherited property (other than the ready money) was to be Metzger’s, and that the only portion of the inheritance she wanted for herself was the money.
- Schwab asked Metzger to leave Idaho (where he earned about $100 per month) and go to Sacramento to look after the property and her interests, stating she would pay his expenses.
- A daughter of Schwab also wrote to Metzger at Schwab’s direction, repeating that the property was intended for Metzger, and giving directions consistent with that understanding.
- Metzger went to Sacramento, managed the property, and collected rents and income in a manner consistent with ownership.
- After enactment of the Trading with the Enemy Act on October 6, 1917, Miller, the Alien Property Custodian, seized the Sacramento real estate and the secured notes as property of an alien enemy and continued to hold them.
- Metzger sued in equity, seeking a decree that the seized property was his (not enemy property) and seeking an accounting for income and profits while the Custodian held it.
- The case was submitted on written evidence, with the single submitted question being whether the letters could operate as a conveyance of the property to Metzger before the seizure.

## Issues

1. Whether Schwab’s letters (including letters written by her daughter at Schwab’s direction), considered together with the surrounding circumstances, constituted a present and effective conveyance or assignment of Schwab’s interests in the Sacramento real property and secured notes to Metzger under California law.
2. If Metzger acquired ownership before the seizure, whether the Alien Property Custodian lacked authority under the Trading with the Enemy Act to seize and hold the property as “enemy” property, and whether Metzger was entitled to return and an accounting.

## Decision

- The court held that the letters, read as a whole and in context, showed Schwab’s definite present intention to transfer the property (other than the cash) to Metzger and were sufficient to vest ownership in him.
- Because Metzger was a naturalized U.S. citizen and owned the property before the Custodian’s seizure, the property was not subject to seizure as property of an alien enemy under the Trading with the Enemy Act.
- The court granted equitable relief recognizing Metzger’s ownership and awarding an accounting of income and profits received during the Custodian’s custody.

## Legal Principles

- A transfer of an interest in land turns on whether the writing(s) show a present intent to pass an interest, rather than a future promise or a merely testamentary plan.
- A conveyance need not be in the form of a formal deed or use technical words of grant if the writing, taken as a whole, sufficiently identifies the property and evidences a present transfer so as to satisfy California law and the statute of frauds.
- Multiple writings (such as a series of letters), read together and in light of the parties’ conduct, may constitute an effective memorandum of a present gift, assignment, or conveyance that equity will enforce.
- Where equitable or beneficial ownership has passed to a U.S. citizen before government seizure, property is not “enemy” property within the Trading with the Enemy Act merely because record title remained in the alien’s name.
- A claimant who establishes ownership may obtain equitable relief against the Alien Property Custodian, including return of property and an accounting for rents, income, and profits earned during custody.

## Conclusion

Metzger v. Miller held that Schwab’s correspondence, viewed together with the circumstances and Metzger’s management of the Sacramento assets, evidenced a present transfer to Metzger, a naturalized U.S. citizen; therefore the Alien Property Custodian’s seizure under the Trading with the Enemy Act was unauthorized as to that property, and Metzger was entitled to recognition of ownership and an accounting for income and profits during the period of custody.


Metzger v. Miller, 291 F. 780 (1923)