B-154213, SEPTEMBER 11, 1964, 44 COMP. GEN. 130

B-154213, SEPTEMBER 11, 1964, 44 COMP. GEN. 130

MILITARY PERSONNEL - ACCEPTANCE OF FOREIGN PRESENTS, EMOLUMENTS, ETC. - FOREIGN GOVERNMENT EMPLOYMENT - RETIRED ENLISTED MEMBERS A RETIRED ENLISTED MEMBER OF THE COAST GUARD WHO RECEIVES A SALARY IN A CIVILIAN POSITION WITH THE STATE OF TASMANIA, AUSTRALIA, IS REGARDED AS HOLDING AN "OFFICE OF PROFIT AND TRUST" UNDER THE FEDERAL GOVERNMENT AFTER RETIREMENT AS THOSE TERMS ARE USED IN ARTICLE I, SECTION 9, CLAUSE 8 OF THE UNITED STATES CONSTITUTION, PROHIBITING PERSONS HOLDING SUCH OFFICES FROM ACCEPTING EMOLUMENTS FROM A FOREIGN STATE, SO THAT, IN THE ABSENCE OF THE CONSENT OF CONGRESS, THE ACCEPTANCE BY THE RETIRED MEMBER OF SALARY FOR EMPLOYMENT WITH THE STATE OF TASMANIA, WHICH IS CONSIDERED A "FOREIGN STATE," COMES WITHIN THE CONSTITUTIONAL PROHIBITION, AND, ALTHOUGH THE CONSTITUTIONAL PROVISION DOES NOT SPECIFY THE PENALTY FOR ACTION CONTRARY TO THE PROHIBITION, EFFECT CAN BE GIVEN BY WITHHOLDING FROM THE MEMBER'S RETIRED PAY AN AMOUNT EQUAL TO THE FOREIGN SALARY RECEIVED IN VIOLATION OF THE CONSTITUTION.

TO C. C. GORDON, UNITED STATES COAST GUARD, SEPTEMBER 11, 1964:

REFERENCE IS MADE TO YOUR LETTER OF MAY 15, 1964, AND ENCLOSURES, REQUESTING A DECISION AS TO WHETHER HARVEY E. WARD, 203-021, CBM, USCG, RETIRED, IS ENTITLED TO HIS RETIRED PAY FOR THE PERIOD HE WAS TEACHING FOR THE DEPARTMENT OF EDUCATION OF THE STATE OF TASMANIA, AUSTRALIA.

IT APPEARS THAT DOUBT ARISES IN THIS CASE BY REASON OF POSSIBLE VIOLATION OF THE EIGHTH CLAUSE OF ARTICLE 1, SECTION 9, OF THE UNITED STATES CONSTITUTION, WHICH PROVIDES AS FOLLOWS:

NO TITLE OF NOBILITY SHALL BE GRANTED BY THE UNITED STATES: AND NO PERSON HOLDING ANY OFFICE OF PROFIT OR TRUST UNDER THEM, SHALL, WITHOUT THE CONSENT OF THE CONGRESS, ACCEPT OF ANY PRESENT, EMOLUMENT, OFFICE, OR TITLE, OF ANY KIND WHATEVER, FROM ANY KING, PRINCE, OR FOREIGN STATE.

THE TERM "EMOLUMENTS" IS DEFINED IN BALLENTINE'S LAW DICTIONARY, SECOND EDITION, AS "THE PROFIT ARISING FROM OFFICE OR EMPLOYMENT" AND "THAT WHICH IS RECEIVED AS COMPENSATION FOR SERVICES, OR WHICH IS ANNEXED TO THE POSSESSION OF OFFICE AS SALARY, FEES, AND PERQUISITES.' THE TERM "OFFICE" IS A BROAD GENERAL TERM AND IS DEFINED AS "THE RIGHT TO EXERCISE A PUBLIC OR PRIVATE EMPLOYMENT, AND TO TAKE THE FEES OR EMOLUMENTS THERETO BELONGING.' SINCE RETIRED ENLISTED MEMBERS OF THE UNITED STATES COAST GUARD REMAIN A PART OF THE SERVICE AND ARE SUBJECT TO RECALL TO ACTIVE DUTY IN TIME OF WAR OR NATIONAL EMERGENCY, IT APPEARS PROPER TO VIEW THEM AS HOLDING AN OFFICE OF PROFIT AND TRUST UNDER THE FEDERAL GOVERNMENT AFTER RETIREMENT. COMPARE 1 COMP. GEN. 700. THE QUESTION FOR CONSIDERATION, THEREFORE, IS WHETHER ACCEPTANCE OF THE CIVILIAN POSITION IN QUESTION CONSTITUTED PRIVATE EMPLOYMENT OR THE ACCEPTANCE OF AN "OFFICE" OR "EMOLUMENT" FROM A "FOREIGN STATE" WITHIN THE MEANING OF THE CONSTITUTIONAL PROVISION UNDER CONSIDERATION.

WHILE NO JUDICIAL PRECEDENT SPECIFICALLY STATING THE MEANING OF THE TERM "FOREIGN STATE," AS IT IS USED IN THE CONSTITUTIONAL PROVISION, HAS BEEN FOUND, IN THE CASE OF BURNET V. CHICAGO PORTRAIT CO., 285 U.S. 1 (1931), IT WAS HELD THAT NEW SOUTH WALES, ALTHOUGH A COMPONENT STATE OF THE COMMONWEALTH OF AUSTRALIA AND, AS SUCH, WITHOUT INTERNATIONAL STATUS, WAS A "FOREIGN COUNTRY" WITHIN THE MEANING OF SECTION 238 (E) OF THE REVENUE ACT OF 1921, APPROVED NOVEMBER 23, 1921, CH. 136, 42 STAT. 259. UNDER SECTION 238 (E), A DOMESTIC CORPORATION OWNING A MAJORITY OF THE VOTING STOCK OF A FOREIGN CORPORATION FROM WHICH IT RECEIVES DIVIDENDS WAS ENTITLED TO A CREDIT AGAINST UNITED STATES INCOME TAX OF CERTAIN INCOME TAXES PAID DURING THE SAME TAXABLE YEAR "TO ANY FOREIGN COUNTRY.' WOULD SEEM TO FOLLOW THAT THE STATE OF TASMANIA MUST BE CONSIDERED A ,FOREIGN STATE" WITHIN THE MEANING OF THE CONSTITUTIONAL PROVISION. HENCE, WE MUST CONCLUDE THAT THE ACCEPTANCE OF SALARY BY MR. WARD INCIDENT TO HIS EMPLOYMENT BY THE DEPARTMENT OF EDUCATION OF THE STATE OF TASMANIA, AUSTRALIA, WAS PROHIBITED BY THE CONSTITUTION IN THE ABSENCE OF "CONSENT OF THE CONGRESS.'

WHILE THE APPLICABLE CONSTITUTIONAL PROVISION DOES NOT SPECIFY THE PENALTY TO BE IMPOSED FOR ACTION TAKEN CONTRARY TO THE PROHIBITION CONTAINED THEREIN, SUBSTANTIAL EFFECT CAN BE GIVEN SUCH PROVISION BY WITHHOLDING RETIRED PAY FROM MR. WARD IN AN AMOUNT EQUAL TO THE SALARY HE HAS RECEIVED FROM THE STATE OF TASMANIA IN VIOLATION OF THE CONSTITUTION. IT IS BELIEVED THAT SUCH ACTION IS PROPER IN THIS CASE. THAT AMOUNT SHOULD BE RETAINED UNLESS AND UNTIL CONGRESSIONAL CONSENT TO ITS RECEIPT BY MR. WARD IS OBTAINED. SEE, IN THIS CONNECTION, THE ACT OF AUGUST 27, 1958, PRIVATE LAW 85-704, 72 STAT. A159.