author: MANSFIELD, Circuit Judge: MULLIGAN, Circuit Judge

text:
    Robert REID and Nadia Alice Reid, Petitioners, v. IMMIGRATION AND NATURALIZATION SERVICE, Respondent.
    No. 171, Docket 73-1067.
    United States Court of Appeals, Second Circuit.
    Argued Nov. 21, 1973.
    Decided Feb. 13, 1974.

      Benjamin Globman, Hartford, Conn. (Globman & Cooper, Hartford, Conn., of counsel), for petitioners.
    Stanley H. Wallenstein, Sp. Asst. U. S. Atty. (Paul J. Curran, U. S. Atty., S. D. N. Y., Joseph P. Marro, Asst. U. S. Atty., New York City, of counsel), for respondent.
    Before LUMBARD, MANSFIELD and MULLIGAN, Circuit Judges.
   MANSFIELD, Circuit Judge:

Petitioners, Mr. & Mrs. Robert Reid, are natives and citizens of British Honduras who entered the United States at Chula Vista, California, which is on the Mexican border, falsely representing themselves to be United States citizens, with the result that they were not inspected as aliens by a United States immigration officer. Mr. Reid entered on November 29, 1968, and Mrs. Reid on January 3, 1969. Thereafter Mrs. Reid gave birth in the United States to two sons, one born on November 2, 1969, and the other on April 4, 1971, each of whom is a native born citizen of the United States.

On November 22, 1971, the Immigration and Naturalization Service (“INS”) began deportation proceedings against the Reids, alleging that they were deportable under § 241(a)(2) of the Immigration and Nationality Act (“Act”), 8 U.S.C. § 1251(a)(2) as aliens who entered the United States without inspection as immigrants. At a hearing held on December 13, 1971, before a special inquiry officer the Reids conceded the essential allegations of the INS order to show cause, admitting that they had entered the United States by falsely claiming to be United States citizens and that upon entry they had not presented themselves to an INS officer for inspection as aliens. However, they contended that their deportation was precluded by § 241(f) of the Act, 8 U.S.C. § 1251(f), an ameliorative statute which waives deportation in the case of fraudulent entry by aliens otherwise admissible into the United States who have close family ties with United States citizens. The ties relied upon by them were their two children born in the United States after the Reid’s illegal entry.

Holding that § 241(f) was inapplicable, the special inquiry officer sustained the charge that the Reids were deporta-ble on the ground that they had entered the United States without inspection. By order entered on May 8, 1972, he granted them voluntary departure in lieu of deportation and directed that they be deported to British Honduras in the event that they did not depart. On appeal the Board of Immigration Appeals by order entered on December 12, 1972, affirmed the special inquiry officer’s order and dismissed the appeal, holding § 241(f) to be inapplicable. This petition for review followed, our jurisdiction being invoked pursuant to § 106 of the Act, 8 U.S.C. § 1105a. For the reasons stated below the petition is dismissed.

DISCUSSION

The broad issue before us is whether § 241(f) of the Act, which concededly applies to aliens who gain entry as the result of fraud in obtaining immigrant visas or fraud upon being inspected as immigrants at the point of entry, see Immigration and Naturalization Service v. Errico, 385 U.S. 214, 87 S.Ct. 473, 17 L.Ed.2d 318 (1966), also applies to aliens who enter by fraudulently posing as United States citizens. Section 241(f) provides in pertinent part:

“(f) The provisions of this section relating to the deportation of aliens within the United States on the ground that they were excludable at the time of entry as aliens who have sought to procure, or have procured visas or other documentation, or entry into the United States by fraud or misrepresentation shall not apply to an alien otherwise admissible at the time of entry who is the spouse, parent, or a child of a United States citizen, or of an alien lawfully admitted for permanent residence.”

On its face the language of the statute does not appear to limit the type of fraud or misrepresentation that will be waived or the status claimed by the entrant. Reading the statute literally, therefore, one might conclude that as long as the alien was “otherwise admissible” at the time of entry the species of fraud or nature of the entry is immaterial. But, as Learned Hand has wisely warned, “[I]t is commonplace that a literal interpretation of the words of a statute is not always a safe guide to its meaning,” Peter Pan Fabrics Inc. v. Weiner Corp., 274 F.2d 487, 489 (2d Cir. 1960). Even more appropriate for present purposes are his remarks in Guiseppi v. Walling, 144 F.2d 608, 624 (2d Cir. 1944) (concurring opinion), where he stated:

“It does not therefore seem to me an undue liberty to give the section as a whole the meaning it must have had, in spite of the clause with which it begins. . . . There is no surer way to misread any document than to read it literally; in every interpretation we must pass between Scylla and Charybdis; and I certainly do not wish to add to the barrels of ink that have been spent in logging the route. As nearly as we can, we must put ourselves in the place of those who uttered the words, and try to divine how they would have dealt with the unforeseen situation; and, although their words are by far the most decisive evidence of what they would have done, they are by no means final.” (144 F.2d at 624.)

See also Federal Deposit Ins. Corp. v. Tremaine, 133 F.2d 827, 830 (2d Cir. 1943) (L. Hand, C. J.). (“There is no surer guide in the interpretation of a statute than its purpose when that is sufficiently disclosed; nor any surer mark of over solicitude for the letter than to wince at carrying out that purpose because the words used do not formally quite match with it.”) Apparently the Supreme Court had these principles of statutory construction in mind in Errico, supra, where it rejected a literal application of § 241(f), which would limit it to cases where an alien is charged with fraud in violation of § 212(a) (19) of the Act, 8 U.S.C. § 1182(a) (19), concluding that it “cannot be applied with strict literalness,” 385 U.S. at 217, 87 S.Ct. at 476, since to do so would frustrate Congress’ purpose in enacting it and would deny relief in cases where it was intended to be made available. There appears to be no reason for not using the same approach in determining whether a literal reading would expand the statute’s application beyond that intended by its drafters.

The legislative history of § 241(f) reveals a desire on the part of Congress to avoid the tragic destruction of family unity that might occur where an alien who fraudulently entered the United States as an immigrant, either by procuring the issuance of an immigration visa through misrepresentation or by deceiving those charged with examination and inspection of immigrants upon entry, later became the spouse, parent or child of a United States citizen in the United States, with whom he then established a family. Prior to the adoption of the statute and its predecessor, § 7 of the Immigration Act of 1957, P.L. 85-316, 71 Stat. 640, our immigration laws had mandated deportation of immigrants who gained admission through misrepresentation, even when made to escape persecution in the alien’s country of national origin and even though, with the passage of time, the immigrant had established a family in the United States. The 1957 Act, which was incorporated into the current statute by §§ 15 and 16 of the Act of September 26, 1961, P.L. 87-301, 75 Stat. 650, alleviated the harshness of these earlier laws by relieving such immigrants of deportation charges based on entry gained by fraud provided they were otherwise admissible at the time of entry. See House Committee Report on the 1957 Act (H.R. Rep. 1199, 85th Cong., 1st Sess.) and H.R.Rep. 1086, 87th Cong., 1st Sess., p. 37.

Nothing in the text or history of § 241(f) indicates an intent on Congress’ part to waive the essential substantive and procedural steps to which an alien must submit himself in order to obtain a visa and enter the United States. On the contrary the history and language of the statute disclose that Congress assumed that the waiver provision would apply only to immigrants who underwent the screening process. Its intent in this respect is evidenced by its direction to the INS in mandatory terms to inspect aliens seeking to enter the United States, 8 U.S.C. § 1225(a), whereas no such mandate was enacted with respect to interrogation of returning United States citizens. This intent was further implied by Congressman Celler, Chairman of the Judiciary Committee of the House of Representatives, when, in commenting on the original waiver provision (later adopted as § 7 of the 1957 Act), he stated:

“This section also provides for leniency in the consideration of visa applications made by close relatives of United States citizens and aliens lawfully admitted for permanent residence who in the past may have procured documentation for entry by misrepresentation” (emphasis supplied) 103 Cong.Rec. 16301.

Similarly Senator Eastland, Chairman of the Senate Judiciary Committee, in commenting on those sections of the 1961 bill incorporating the previous waiver provisions in the current statute stated:

“Sections 13, 14, 15 and 16 of the bill also incorporate into the basic statute provisions which have been contained in separate enactments. Those provisions relate to the waiver of grounds of inadmissibility and de-portability in the cases of certain close relatives of U.S. citizens and lawful permanent residents involving convictions of minor criminal offenses, fraudulent misrepresentations in connection with applications for visas or admission to the United States.” (Emphasis supplied) 107 Cong.Rec. 19653-19654.

In short, Congress was concerned with fraud on the part of persons seeking to enter as aliens. An alien, whether seeking entry as an immigrant or as a non-immigrant (e. g., temporary visitor, temporary worker, foreign official, treaty alien, or the like) must first apply to the proper American authority abroad for a visa (immigrant or non-immigrant) or other prescribed documentary permission to enter. Next he must submit himself at the point of entry to an INS official for “inspection” as an alien. See Gordon and Rosenfield, Immigration Law and Procedure (1972) §§ 3.1 to 3.28, and 8 U.S.C. § 1225(a). Accordingly Congress, in enacting § 241(f), concerned itself with the two points in the immigration screening and inspection process where fraud might occur: (1) the procurement of “visas or other documentation” and (2) the “entry.”

There is no evidence that Congress had in mind extending the waiver of deportation to an attempt to by-pass completely this immigration screening process and required “inspection” of aliens at the border. If petitioners had entered the United as aliens and had not falsely claimed to be citizens they would have been required first to undergo a screening process designed to ascertain whether they were admissible and to have submitted to an “inspection” of them at the border. To attempt years later to reconstruct the information that would have been obtained from that process in order to ascertain whether they would have been “otherwise admissible” at the time of entry is extremely difficult, if not impossible.

Petitioners concede that regardless how § 241(f) is construed they would be deportable under § 241(a)(1) of the Act, 8 U.S.C. § 1251(a)(1), unless they successfully bore the burden of establishing that at the time of entry they satisfied the substantive, qualitative requirements for admission into the United States as prescribed by § 212(a) of the Act, 8 U.S.C. § 1182(a) and thus would be “otherwise admissible” as that term is used in § 241(f). Section 212(a) lists a series of 31 classes of aliens who shall be ineligible for admission, including among others the insane or mentally retarded, drug addicts, those having contagious disease, the physically disabled, paupers, those convicted of certain offenses, polygamists, prostitutes, laborers likely to adversely affect employment of workers in the United States, and those likely to become public charges if admitted.

Enforcement of § 212(a) requires the Government to undertake a thorough and detailed investigation of each applicant for entry into the United States as an immigrant, which begins with his application to the United States consul in a foreign country for an immigrant visa. At that point the applicant is examined medically to determine whether health requirements are met. Birth and police records are examined to insure that other requirements are satisfied. A passport must be furnished by the applicant and he must furnish fingerprints and sworn answers to detailed questions regarding his residence, prior criminal record, military service, diseases, arrests, employment, skills, narcotics use, organizational memberships, ability to read and prospective means of support in the United States. Following this investigation the consular officer, after interviewing the applicant and reviewing his sworn application and supporting proof, must decide whether to grant or deny a visa and he must record his decision on a prescribed form. See Gordon & Rosenfield, Immigration Law & Procedure, § 3-8b, p. 3-57 (1973).

The United States consular officer is given broad discretionary authority in ruling upon visa applications. For instance, applications may be denied because the “aliens . . ., in the opinion of the consular officer at the time of application for a visa . . . are likely at any time to become public charges,” 8 U.S.C. § 1182(a) (15), because they are aliens “who the consular officer . . . knows or has reason to believe seek to enter the United States solely, principally, or incidentally to engage in activities which would be prejudicial to the public interest, or endanger the welfare, safety or security of the United States,” 8 U.S.C. § 1182(a) (27), or because they are aliens who “the consular officer knows or has reasonable ground to believe probably would, after entry (A) engage in activities which would be prohibited by the laws of the United States relating to espionage, sabotage, public disorder . . . or (B) engage in any activity a purpose of which is . the control or overthrow of the Government of the United States, by force, violence, or other unconstitutional means. . . .”8 U.S.C. § 1182(a) (29).

Assuming that a visa is issued by the American consul to an immigrant, the visa still represents only prima facie evidence of eligibility and does not assure the holder of admission into the United States. Upon arrival at the port of entry the alien is again examined, this time by INS officers who are also given broad authority to exclude him if found inadmissible. Again the immigrant is examined medically, undergoing quarantine inspection by medical officers of the Public Health Service, 42 C.F.R. § 71.136-141, who must also determine whether the alien has any physical or mental afflictions, in which event he may be detained or excluded by the Attorney General. The alien is interrogated by immigration inspectors with respect to the various grounds of ineligibility listed in 8 U.S.C. § 1182 and the documentary evidence as to his admissibility is again reviewed. If the inspector concludes that the immigrant is ineligible for admission or if he is in doubt, he may detain the alien for further inquiry or an exclusion proceeding, at which the applicant bears the burden of establishing his admissibility, 8 U.S. C. § 1361.

In contrast to the foregoing detailed screening process developed for determination of the admissibility of immigrants, the returning United States citizen needs only to furnish evidence of his citizenship, usually in the form of a passport. Lesser evidence is required upon re-entry through land portals. While the inspector has the right to determine whether the citizenship claim appears to be valid, United States ex rel. Lapides v. Watkins, 165 F.2d 1017 (2d Cir. 1948), for obvious reasons the examination of re-entering citizens must of necessity be limited as compared with the detailed inspection of aliens seeking entry. Gordon & Rosenfield, Immigration Law & Procedure, § 3.16b, p. 3-93 (1973). To suggest, as does our dissenting brother, that since the INS has the power to verify a claim of United States citizenship made by an entrant, “the solution is in tightened security” overlooks the fact that with over 100 million American citizens re-entering the United States annually, of whom more than 95 million enter through border land portals, a detailed investigation into the citizenship of each returnee would threaten to paralyze international travel on the part of American citizens.

Confronted with the burden of establishing that but for their fraud they were “otherwise admissible” at the time of entry petitioners, relying principally upon the Ninth Circuit’s decision in Lee Fook Chuey v. INS, 439 F.2d 244 (9th Cir. 1971), suggest that they should now be permitted nunc pro tunc to show that if they had gone through the regular immigration screening process several years ago they would have been found to be admissible. Were we dealing solely with simple objective facts that could be easily ascertained after the passage of years, such as information recorded in birth or death records, it might be feasible to make a retroactive determination of an alien’s qualitative admissibility. But a mere review of the numerous grounds specified by Congress as the bases for finding the alien to be ineligible to receive a visa or for excluding him upon attempted entry persuades us that a post hoc investigation would not be an adequate substitute for the exhaustive contemporaneous probe and examination required of the consular and INS services. In many if not most cases where § 241(f) is invoked an inquiry of the type suggested by petitioners could not be instituted until years after the alien’s fraudulent entry, since the essential familial relationship would not have been established at an earlier point in time. With the passage of time it would be difficult if not impossible, for instance, for the United States consul at the alien’s country of residence to state whether he would have denied a visa on the ground that in his opinion the alien would have been likely to become a public charge if admitted inte the United States, see 8 U.S.C. § 1182(a) (15).

For these reasons we are satisfied that Congress did not intend to permit § 241(f), particularly in view of its language and legislative history, to be utilized by an alien who had completely circumvented the elaborate immigration visa and screening system established by the Act, thus failing to satisfy any of its requirements at the time of entry. So to hold would in our view be unnecessarily to erode an essential procedure which has been painstakingly developed for the purpose of screening out those barred from admission on carefully considered qualitative grounds. While § 241(f) may be invoked by an immigrant who gained entry as the result of his misrepresentation of some specific fact sought to be elicited in the screening process, this is a far cry from the wholesale fraud implicit in the complete by-passing of that process. To waive deportation for such fraud would seriously weaken the effectiveness of our immigration laws.

Aside from these circumstances showing that Congress did not intend in enacting § 241(f) to by-pass the immigration screening process, petitioners’ entry under false claims of citizenship at Chu-la Vista precluded any “inspection” of them as that term is used in 8 U.S.C. §§ 1225(a) and 1251(a)(2).

If petitioners had not falsely claimed to be citizens, there would have been an “inspection” of them at the border. The initial question faced by us is whether the fact that immigration officials saw them at the time when they falsely claimed to be citizens at Chula Vista constituted an “inspection” within the meaning of 8 U.S.C. §§ 1225(a) and 1251(a)(2). Faced with this issue two circuits have held, in construing another section of the Act, that there was no “inspection” when an alien gained admittance by falsely representing himself to be an American citizen. Goon Mee Heung v. INS, 380 F.2d 236 (1st Cir.), cert. denied, 389 U.S. 975, 88 S.Ct. 479, 19 L.Ed.2d 470 (1967); Ben Huie v. INS, 349 F.2d 1014 (9th Cir. 1965).

“There is, unfortunately, no definition of the term ‘inspection’ anywhere in the act. In addition to section 1255(a), section 1251(a)(2) uses the term in providing that anyone who enters the United States without inspection shall be subject to deportation. Some cases under this section and its predecessors have held that false statements to immigration inspectors have the effect of preventing meaningful inspection and, accordingly, render an alien deportable. E. g., United States ex rel. Volpe v. Smith, 7 Cir., 1933, 62 F.2d 808, aff’d on other grounds, 289 U.S. 422; 53 S.Ct. 655, 77 L.Ed. 1298. Others have held to the contrary. E. g., Ex parte Gouthro, E. D., Mich., 1924, 296 F. 506, aff’d sub nom. United States v. Southro, 6 Cir., 1925, 8 F.2d 1023. We find no case, however, holding that the acceptance of a false claim to United States citizenship, enabling an alien to enter the country without registering as an alien, constitutes inspection, or is equivalent to having been inspected. See, e. g., Ben Huie v. INS, 9 Cir., 1965, 349 F.2d 1014.” Goon Mee Heung v. INS, 380 F.2d at 236-237.

Relying on Errico and Lee Fook Chuey, petitioners urge, in an argument that has been accepted by our dissenting brother Judge Mulligan, that the humanitarian interest in family unity overrides the concern for a procedural system designed to insure immigration law enforcement. It is true that in Errico the Supreme Court, in construing § 241(f), relied in part upon Congress’ humanitarian purpose. However, that case dealt with aliens who had subjected themselves to the immigrant visa issuance process and not with aliens who, like petitioners, had completely by-passed that process. Furthermore, the issue in Errico — whether a quota fraud (as distinguished from a fraud with respect to qualitative admissibility) precludes an alien from being “otherwise admissible” — was a limited one. The suggestion that the Supreme Court implied that § 241(f) might be available to deprive the consular service and INS of any opportunity to screen entering aliens reads too much into Errico.

The argument that § 241(f) must apply here as a matter of humanitarianism because of the hardship that deportation might work upon the two children who became American citizens as a result of petitioners’ fraud ignores the existence of other sections of the Act which authorize the Attorney General, subject to certain specified conditions, to suspend or waive a deportation that would result in “extreme” or “exceptional and extremely unusual” hardship to the alien or to his close relatives in the United States. See, e. g., 8 U.S.C. §§ 1182(e), (h) and 1254. If § 241(f) were construed to mandate such relief whenever entry is gained under a false claim of citizenship, the discretionary and conditional waiver of deportability carved out by these other sections of the Act would in such cases largely be rendered superfluous. Furthermore, solicitous as we all are for the welfare of the two young American citizens here involved, we cannot overlook the fact that if such hardships were the sole test, deportation would automatically be waived in numerous similar cases, such as where an alien surreptitiously enters the United States and raises a family here. Yet such aliens are deportable, see, e. g., Gambino v. INS, 2 Cir., 419 F.2d 1355, cert. denied, 399 U.S. 905, 90 S.Ct. 2195, 26 L.Ed.2d 559 (1970), relegating the parties to the aforementioned provisions of the Act authorizing discretionary waiver in hardship eases. We believe the same principles govern here.

In Lee Fook Chuey the Ninth Circuit, faced with the issue here confronted, held that § 241(f) could be invoked by an alien who obtained entry into the United States upon a false claim of citizenship. It reasoned that the interest in family unity outweighed that of maintaining the integrity of the immigration

processing system established by the Act and that it would not ascribe to Congress an intent to limit § 241(f) to misrepresentations in the immigration process as distinguished from a by-passing of that process, since both situations were “functionally similar.” With due deference to the distinguished Ninth Circuit we must respectfully disagree. In our view the court in Lee Fook Chuey failed to give adequate weight to the purpose of § 241(f) as reflected in its legislative history and to the essential part played by the immigration screening process in determining whether an alien who gains entry by fraud is “otherwise admissible.” Furthermore the decision appears to be inconsistent with other decisions denying availability of § 241(f) to aliens seeking to avoid deportation under functionally similar circumstances. In Monarrez-Monarrez v. INS, 472 F.2d 119 (9th Cir. 1972), for instance, the court, following our decision in Gambino v. INS, 2 Cir., 419 F.2d 1355, cert. denied, 399 U.S. 905, 90 S.Ct. 2195, 26 L.Ed.2d 559 (1970) (stowaway), held that § 241(f) does not apply to an alien who surreptitiously enters the United States, thus completely avoiding the immigration screening process, and establishes a family here. Although there is no legally significant distinction between the two types of entries, the effect, assuming both aliens are otherwise admissible, is to reward the alien who by-passed the screening process by representing himself to be a citizen but to deport the alien who did not present himself at the border and thus did not resort to such a brazen device. In similar analogous situations § 241(f) has also been held inapplicable. In Bufalino v. INS, 473 F.2d 728 (3d Cir.), cert. denied, 412 U.S. 928, 93 S.Ct. 2751, 37 L.Ed.2d 155 (1973), the Third Circuit, holding § 241(f) inapplicable to an alien’s re-entry into the United States upon a false claim of citizenship, stated:

“A false claim of citizenship obviously frustrates a major policy of our immigration law which is the inspection of aliens. This petitioner not only brazenly pretended to be a United States citizen but used that lying assertion to leave and return to the United States on at least three occasions without being inspected as the alien he was and is.
“. . . In situations involving ‘otherwise inadmissible,’ there is nothing in Errico to justify the waiver of the documentary requirements for entry as petitioner seeks here. Matter of K, 9 I. & N. Dec. 585 (B.I.A.1962). This court in Bufalino v. Holland, 277 F.2d 270 (3 Cir. 1960), cert. den. 364 U.S. 863, 81 S.Ct. 103, 5 L.Ed.2d 85 held that under 8 U.S.C. § 1251(a)(5), petitioner was ‘otherwise inadmissible’ at the time of the entry in question. 277 F.2d at 278. Errico dealt with a problem where the fraudulent citizenship representations were made to circumvent quota restrictions and not to destroy the primary purpose of the regulation, which was to force alien inspection (as in the instant matter).” 473 F.2d at 731-732.

Our view that an alien entering the United States under a false claim of American citizenship should not be treated as one gaining entry as an alien but like one surreptitiously entering the United States finds support in Goon Mee Heung v. INS, supra, where the court stated:

“Whatever the effect other misrepresentations may arguably have on an alien’s being legally considered to have been inspected upon entering the country, we do not now consider; we are here concerned solely with an entry under a fraudulent claim of citizenship. Aliens who enter as citizens, rather than as aliens, are treated substantially differently by immigration authorities. This examination to which citizens are subjected is likely to be considerably more perfunctory than that accorded aliens. Gordon & Rosenfield, Immigration Law and Procedure § 316d (1966). Also, aliens are required to fill out alien registration forms, copies of which are retained by the immigration authorities. 8 C.F.R. §§ 235.4, 264.1; 8 U.S.C. §§ 1201(b), 1301-1306. Fingerprinting is required for most aliens. 8 U.S.C. §§ 1201(b), 1301-1302. The net effect, therefore, of a person’s entering the country as an admitted alien is that the immigration authorities, in addition to making a closer examination of his right to enter in the first place, require and obtain information and a variety of records that enable them to keep track of the alien after his entry. Since none of these requirements is applicable to citizens, an alien who enters by claiming to be a citizen has effectively put himself in a quite different position from other admitted aliens, one more comparable to that of a person who slips over the border and who has, therefore, clearly not been 'inspected.” (380 F.2d at 237) (Emphasis added).

In our view there comes a point where, in construing § 241(f), the integrity of the immigration visa and inspection procedure outweighs the interest in giving relief to certain aliens who have entered this country by unlawful means and raised families here. We believe that that point has been reached here. When due consideration is given to the thousands of aliens who are required to follow the established screening process, it would be inequitable to expand § 241(f) to benefit conduct that would wholly evade and stultify that process. The effect could be to encourage disregard for the immigration laws and to render them ineffective since no practical opportunity would be afforded to the I.N.S., in the case of an alien posing as a United States citizen, to conduct an investigation comparable to that mandated in the case of an immigrant seeking entry as such.

The petition for review is dismissed.

MULLIGAN, Circuit Judge

(dissenting) :

The issue before us is whether an alien who obtains entry into this country by falsely claiming United States citizenship, can qualify as “an alien otherwise admissible at the time of entry,” within the meaning of Section 241(f) of the Immigration and Nationality Act, 8 U.S.C § 1251(f). An alien “otherwise admissible” is shielded from deportation despite his fraudulent entry if “he is the spouse, parent, or a child of a United States citizen.” Mr. and Mrs. Reid, the petitioners here, are admittedly aliens and citizens of British Honduras. They did enter the United States at Chula Vista, California, falsely posing as American citizens. They have since become the parents of two sons who were born here and are citizens of the United States. There is no contention and indeed no evidence that they were not “otherwise admissible at the time of entry.” They therefore literally fulfill the requirements of the statute, and yet the Immigration and Naturalization Service (INS) has ordered their deportation and has persuaded a majority of this court to dismiss the petition to review the order. I do not agree and must dissent.

INS has taken the position that the protection of the statute is extended only to those aliens who present themselves as aliens with fraudulent visas. Otherwise, we are advised, the elaborate system of visa issuance might be eroded. The difficulty with this position, which has been adopted by the majority, is of course that the statute makes no such distinction and the only other court to face the identical question has ruled that there is no such distinction. Lee Fook Chuey v. INS, 439 F.2d 244 (9th Cir. 1971). The statute is not limited to fraudulent visa-bearers but in so many words applies to those persons who have “procured visas or other documentation, or entry into the United States by fraud or misrepresentation.” (emphasis added).

Although the language of the statute is clear, the majority opinion, which apparently concedes that the Reids are literally within its protection, seeks to avoid the provision, invoking the shades of Learned Hand for the general proposition that it is somewhat dangerous to read the language of a statute literally. It is at least equally dangerous to take Learned Hand literally, without examining the problems of construction involved in the case he was deciding. Even the quoted excerpt from Giuseppi v. Walling, 144 F.2d 608, 624 (2d Cir. 1944), indicates that Judge Hand was referring to an “unforeseen situation,” not contemplated by the draftsmen of the statute. He still observed that the words employed are “by far the most decisive evidence” of the intent of the authors.

I cannot possibly imagine, in any event, that it was unforeseen that an alien might seek to gain entry to the United States by posing as a citizen. The alien can secure admission fraudulently either with a visa procured by misrepresentation or by falsely posing as an American citizen. The latter alternative could not realistically have been overlooked by the Congress and the language of the statute covers both situations.

In support of the position of INS, the majority argues that the Supreme Court “apparently” had the Hand principles of statutory construction in mind when it refused to apply Section 241(f) literally in INS v. Errico, 385 U.S. 214, 87 S.Ct. 473, 17 L.Ed.2d 318 (1966). If the Court had the Hand “principles” in mind in that case, it concealed that fact from all but the clairvoyant. The Court made no secret of its approach to the statute when it decided that an alien who misrepresented his status for the purpose of evading quantitative quota restrictions, was nonetheless entitled to the protection of Section 241(f). The Court eschewed a literal interpretation which would have been fatal to the alien’s case because it found that the major purpose of the statute was humanitarian — the preservation of family ties and the family unit. The Court also stated that a statute mandating deportation must be construed in favor of the alien :

Even if there were some doubt as to the correct construction of the statute, the doubt should be resolved in favor of the alien. As this Court has held, even where a punitive section is being construed :
“We resolve the doubts in favor of that construction because deportation is a drastic measure and at times the equivalent of banishment or exile, Delgadillo v. Carmichael, 332 U.S. 388, 68 S.Ct. 10, 92 L.Ed. 17. It is the forfeiture for misconduct of a residence in this country. Such a forfeiture is a penalty. To construe this statutory provision less generously to the alien might find support in logic. But since the stakes are considerable for the individual, we will not assume that Congress meant to trench on his freedom beyond that which is required by the narrowest of several possible meanings of the words used.” Fong Haw Tan v. Phelan, 333 U.S. 6, 10, 68 S.Ct. 374, 92 L.Ed. 433.
See also Barber v. Gonzales, 347 U.S. 637, 642-643, 74 S.Ct. 822, 98 L.Ed. 1000. The 1957 Act was not a punitive statute, and § 7 of that Act, now codified as § 241(f), in particular was designed to accomplish a humanitarian result. We conclude that to give meaning to the statute in the light of its humanitarian purpose of preventing the breaking up of families composed in part at least of American citizens, the conflict between the circuits must be resolved in favor of the aliens, and that the Errico, 9 Cir., 349 F.2d 541, decision must be affirmed and the Scott, 2 Cir. 350 F.2d 279, decision reversed.

385 U.S. at 225, 87 S.Ct. at 480.

In sum, the canons of construction applied by the Supreme Court in Errico are not conjectural but are explicit and support the position of the Reids here. I submit that the statute is clear and that no construction is necessary at all. In Errico, the Supreme Court avoided a literal reading of Section 241(f) because it would thwart the humanitarian purposes of the statute. Here, a literal reading of the statute concededly supports the position of the Reids and fully comports with the humanitarian purposes of the legislation. I therefore fail to understand how Errico now compels a construction which would contort the plain language of the statute and thwart its humanitarian purposes.

The majority opinion appeals to the legislative history of Section 241(f) for support of the thesis that the congressional intent was not to waive the essential substantive or procedural steps to which an alien must submit in order to obtain a visa. Of course, legislative history is “a legitimate aid to the interpretation of a statute where its language is doubtful or obscure .... But when taking the act as a whole, the effect of the language used is clear to the court, extraneous aid like this can not control the interpretation.” Wisconsin R. R. Comm’n v. Chicago, B. & Q. R. R., 257 U.S. 563, 589, 42 S.Ct. 232, 237-238, 66 L.Ed. 371 (1922) (citation deleted); accord, Holtzman v. Schlesinger, 484 F.2d 1307, 1314 (2d Cir. 1973).

I find the language lucid but in any event I find nothing in the legislative history to support the suggested dichotomy. Section 241(f) by its terms applies to aliens who have “procured entry into the United States by fraud or misrepresentation.” This is the clause the majority has excised from the statute. The term “entry” into the United States is defined in 8 U.S.C. § 1101(a)(13). “The term ‘entry’ means any coming of an alien into the United States . .” (emphasis added). This definition does not say visa-bearing alien; it says any coming of an alien. The Reids’ entry is within the statute and there is no ambiguity compelling resort to legislative history.

Moreover, the historical excursion in my view is fruitless. I have found nothing in the available legislative history to support the proposition now sought to be advanced by the majority. Even the emphasized language of Senator East-land’s statement set forth in the majori ty opinion refers to fraudulent misrepresentations in connection with visa applications or admission into the United States. Aside from the total silence with respect to any design to reserve the protection of the statute to visa-bearing aliens, there is language in the legislative history which the Supreme Court referred to in Errico indicating that the principal beneficiaries of the law were Mexican nationals who were able to avoid border restrictions. If the Congress had in mind the so-called “wet back”, entrants, then it is difficult to comprehend that it intended only visa-carrying entrants. In short, I see no evidence of any congressional intent at odds with the clear language of the statute. As Judge Friendly observed about the majority position in his dissenting opinion in Peter Pan Fabrics, Inc. v. Martin Weiner Corp., 274 F.2d 487, 491 (2d Cir. 1960): “[T]he voice so audible to them is silent to me.”

Aside from this, I cannot accept the argument that the Reids here, by the “brazen” statement that they were citizens of the United States, thus frustrated the screening processes of INS. If they are this porous, then the solution is a tightened security and not the mutilation of Section 241(f).

The argument of the majority that 8 U.S.C. § 1225(a) supports the position that Congress intended to limit the benefits of Section 241(f) only to those aliens who admitted alienage, is not persuasive. While Section 1225(a) does not mandate the interrogation of returning United States citizens, the section does provide in part that “any immigration officer . . . shall have power to administer oaths and to take and consider evidence of or from any person touching the privilege of any alien or person he believes or suspects to be an alien to enter, reenter, pass through, or reside in the United States . . . . ” (emphasis added). See also United States ex rel. Lapides v. Watkins, 165 F.2d 1017 (2d Cir. 1948). Moreover, the pertinent INS regulation, 8 C.F.R. § 235.-1(b), provides:

U.S. citizens. A person claiming U.S. citizenship must establish that fact to the examining immigration officer’s satisfaction and must present a U.S. passport if such passport is required under the provisions of 22 CFR Part 53. If such an applicant for admission fails to satisfy the examining immigration officer that he is a U.S. citizen, he shall thereafter be inspected as an alien, (emphasis added).

See also 8 U.S.C. § 1323(a); Gordon & Rosenfield, Immigration Law & Procedure § 3.2 (1973).

It is also significant that 8 U.S.C. §. 1361 cited by the majority as part of the screening process permitting the detention of aliens and casting upon them the burden of proving admissibility is not limited to visa applicants. It provides:

Whenever any person makes application for a visa or any other document required for entry, or makes, application for admission, or otherwise attempts to enter the United States, the burden of proof shall be upon such person .... (emphasis added).

In short, INS is not helpless in the face of a claim by an alien that he is a United States citizen. If he is suspected of being an alien, he must be inspected as an alien. I fail to see how recourse to Sections 1225(a) or 1361 advances the position of the majority by a jot or a tittle. The blunder of the constable here results, in effect, in the deportation of the petitioners as well as their native-born American sons.

I indeed agree that an alien who applies for a visa in advance of his entry into the United States is more readily investigated than one who poses as an American citizen at the point of entry. But this point is not raised in the legislative history and is not mentioned in the statute. The administrative inconvenience to INS in making a post hoc investigation' of the Reids’ qualitative admissibility is rile minimis, in my view, in contrast to what the dismissal of this petition accomplishes.

Mr. and Mrs. Reid are both gainfully employed in this country, have never been arrested since arriving and belong to no subversive organizations. There is no hint or suggestion that they are or have been qualitatively deficient in any of the categories mentioned by the majority. They have, moreover, become the parents of two native-born American boys who, by reason of their infancy (now ages 2 and 4), have no alternative but involuntary exile. The sins of the father are now literally visited upon the sons. I had thought that this was what the statute was designed to avoid.

At his deportation hearing, the petitioner Reid was asked if he had anything to say before the proceedings were closed. His answer was:

I have got something to say, but I don’t know whether it’s going to make any difference. On the back of the form you say to show reason why you should not be deported. We have plenty reason why we shouldn’t be deported. For one we have two kids and if we are deported we ain’t got no home to go back to. Everything we had was abandoned. Taking two kids back there like sending two kids to die from malnutrition.

Even if the statute were ambiguous, I think it should be construed in favor of the Reids and their infant native-born sons. Where they are literally' within its protection, as the majority admits, recourse to a supposed principle-of construction which makes clear language suspect is neither convincing nor persuasive. I believe there is “plenty reason” to set aside the order of deportation and I emphatically dissent from the holding of the majority.

      . “§ 1251. Deportable aliens — General classes

      “(a) Any alien in the United States (including an alien crewman) shall, upon the order of the Attorney General, be deported who—
      “(2) entered the United States without inspection or at any time or place other than as designated by the Attorney General or is in the United States in violation of this chapter or in violation of any other law of the United States; . . . . ”

      . “§ 1182. Excludable aliens — General classes

      “(a) Except as otherwise provided in this chapter, the following classes of aliens shall be ineligible to receive visas and shall be excluded from admission into the United States:
      “(19) Any lien who seeks to procure, or has sought to procure, or has procured a visa or other documentation, or seeks to enter the United States, by fraud, or by willfully misrepresenting a material fact;

      . Section 10 Displaced Persons Act of June 25, 1948, 62 Stat. 1013, § 11(e) Refugee Relief Act of August 7, 1953, 67 Stat. 405 and § 212(a) (19), Immigration and Nationality Act of 1952, 8 U.S.C. § 1182(a) (19).

      . “§ 1225. Inspection by Immigration Officers — Powers of officers

      “(a) The inspection, other than the physical and mental examination, of aliens (including alien crewmen) seeking admission or readmission to or the privilege of passing through the United States shall be conducted by immigration officers, except as otherwise provided in regard to special inquiry officers. All aliens arriving at ports of the United States shall be examined by one or more immigration officers at the discretion of the Attorney General and under such regulations as he may prescribe. Immigration officers are authorized and empowered to board and search any vessel, aircraft, railway car, or other conveyance, or vehicle in which they believe aliens are being brought into the United States.”

      . The definition of “entry” as “any coming of an alien into the United States,” 8 U.S.C. § 1101(a) (13), is not inconsistent with the intent to refer to such “coming” in the ca-pacify of an alien or immigrant.

      . According to the 1972 Annual Report of the Immigration and Naturalization Service, page 25, 105,439,188 citizens entered the United States under claim of citizenship during the year from June 30, 1971 to June 30, 1972, of which 95,209,861 were border-cross-ers.

      . I do not overlook Bufalino v. INS, 473 F.2d 728 (3d Cir.), cert. denied, 412 U.S. 928, 93 S.Ct. 2751, 37 L.Ed.2d 155 (1973), cited by the majority for the proposition that the Tlm-d Circuit has held that Section 241(f) is inapplicable to an alien’s reentry into the United States on a false claim of citizenship. Judge McLaughlin’s opinion, containing the language relied upon, expressed his view only. The separate concurring opinion of Judge Adams, concurred in by Judge Van Dusen, dismissed the petition for review there on other grounds and specifically found it unnecessary to determine the applicability of Section 241(f). See 473 F.2d at 739 n. 4.

      . We must read statutes “literally” just as we must so read the opinions of courts. We do it everyday. It is only when a literal reading would lead to some absurdity or gro-tesquerie that we are free to do otherwise. Sturges v. Crowninshield, 17 U.S. (4 Wheat.) 70, 106-107 (1819). Otherwise, of course, we would be anticipating Orwell by exactly a decade, and could sympathize with More’s Utopians, who would have no lawyers amongst them since they considered it our profession to disguise matters.

      . In addition, the Court stated that “the administrative authorities have consistently held that § 241(f) waives any deportation charge that results directly from the misrepresentation regardless of the section of the statute under which the charge was brought- . . . . ” 385 U.S. at 217, 87 S.Ct. at 476. In support of this statement the Court cited the opinion of the Board of Immigration Appeals in Matter of Y-, 8 I. & N. Dec. 143 (1959).
      In Matter of Y-, the Board held that Section 7 of the 1957 Act required termination of the deportation proceedings where the alien had entered this country by misrepresenting himself as an American citizen and the ground for deportation was entry without inspection. In Matter of K-, 9 I. & N. Dec. 585 (1962), the Board reached a similar result under Section 241(f). The Board adhered to this position following the Supreme Court’s decision in Brrico, Matter of Lee, 13 I. & N. Dec. 214 (1967), but the Attorney General, overruling the Board, ordered Lee deported, 13 I. & N. Dec. 214, 218 (1969). The Ninth Circuit, however, did not find the Attorney General’s opinion persuasive and reversed. Lee Fook Chuey v. INS, 439 F.2d 244 (1971).

      . The Supreme Court stated :
      The only specific reference to the part of § 7 that deals with close relatives of United States citizens or residents is in the House Committee Report, and it says only that most of the persons eligible for relief would be
      “Mexican nationals, who, during the time when border-control operations suffered from regrettable laxity, were able to enter the United States, establish a family in this country, and were subsequently found to reside in the United States illegally.” H.R.Rep.No.1199, 85th Cong. 1st Sess. p. 11.
      Without doubt most of the aliens who had obtained entry into the United States by illegal means were Mexicans, because it has always been far easier to avoid border restrictions when entering from Mexico than when entering from countries that do not have a common land border with the United States. There is nothing in the Committee Report to indicate that relief under the section was intended to be restricted to Mexicans, however. Neither does it follow that, because Mexicans are not subject to quota restrictions, therefore nationals of countries that do have a quota must be within the quota to obtain relief. 385 U.S. 223-224, 87 S.Ct. 479-480.

      . Since Errico, surreptitious entrants have been held not to be within Section 241(f). However, Monarrez-Monarrez v. INS, 472 F.2d 119 (9th Cir. 1972), and Gambino v. INS, 419 F.2d 1355 (2d Cir.), cert. denied, 399 U.S. 905, 90 S.Ct. 2195, 26 L.Ed.2d 559 (1970), cited by the majority as “functionally” similar to the circumstances of this case and inconsistent with Lee Fooh Ghuey, are readily distinguishable. Gambino involved a “stowaway,” which this court considered to be a special type of alien, and moreover, at the time of his entry (1921) Gambino was excludable as a stowaway. Judge Smith termed the part of the legislative history relating to Mexicans as “ambiguous.” The INS in its brief here employs the same adjective. In any event, the courts have disregarded it since it does conflict with the language of the statute. Accordingly, in Monarrez-Monarrez, a surreptitious entry (concealment in an auto trunk) was not considered by the court to be entry gained by “fraud or misrepresentation,” and on this basis the court distinguished Lee Fooh Ghuey.

      . The quarantine inspection provided for in 42 C.F.R. §§ 71.136 to 71.141 and referred to in the majority opinion is applicable to persons entering the United States and is not limited to aliens. Even 42 C.F.R. Part 34 providing for medical examination of aliens applies to all aliens not simply visa applicants.

      . The precise nature of the fraud employed here at entry is not clear. The Reids represent that “[a]t the time of their entry each of them, in response to a question from the Immigration Officer on duty, indicated that he was an American citizen, either by an affirmative answer or by - remaining silent.” The INS has not challenged this representation.

      . Ben Huie v. INS, 349 F.2d 1014 (9th Cir. 1965), relied upon by the majority involves 8 U.S.C. § 1251 (a) (2) which in substance authorizes the deportation of aliens who enter the United States without inspection. The alien there apparently did not qualify under Section 241(f) which is in issue here. The Ninth Circuit’s later opinion in Lee Fook Chuey makes the proper distinction. 439 F.2d at 249. See also Cabuco-Flores v. INS, 477 F.2d 108, 110-111 (9th Cir. 1973), which indicates that Section 241(f) is determinative. Goon Mee Heung v. INS, 380 F.2d 236 (1st Cir.), cert. denied, 389 U.S. 975, 88 S.Ct. 479, 19 L.Ed.2d 470 (1967), also relied upon in the majority opinion, involves a request for adjustment of status under 8 U.S.C. § 1255 and again does not mention Section 241(f) which is in issue here. The distinction between deportation which involves humanitarian considerations and adjustment of status or naturalization was made by this court in Yik Shuen Eng v. INS, 464 F.2d 1265, 1267-1268 (2d Cir. 1972).


source: Caselaw Access Project

author: PER CURIAM:

license: Public Domain

text:
    UNITED STATES of America, Plaintiff-Appellee, v. Robert Arsenio DeHERRERA, Jr., Defendant-Appellant.
    No. 73-2523.
    United States Court of Appeals, Ninth Circuit.
    Feb. 19, 1974.

      Cark E. Larson, Asst. Public Defender (argued), Sacramento, Cal., for defendant-appellant.
    Brewster Q. Morgan, Asst. U. S. Atty. (argued), Dwayne Keyes, U. S. Atty., Sacramento, Cal., for plaintiff-appellee.
    Before BROWNING and WALLACE, Circuit Judges, and WILLIAMS, District Judge.

       Honorable Spencer Williams, United States District Judge, Northern District of California, sitting by designation.

   OPINION

PER CURIAM:

DeHerrera was convicted on four counts for (1) failing to report for physical examination on November 19, 1970, (2) failing to submit for induction on January 19, 1971, (8) failing to keep the board advised of an address where mail would reach him and (4) failing to submit for induction on March 7, 1972.

DeHerrera asserts that he did report for a preinduetion physical examination on September 17, 1970, and that if the Armed Forces Examination and Entrance Station (AFEES) personnel had at that time followed Army Regulations 601-270 §§ 3-8 and 3-9 requiring that he be interviewed with respect to his prior criminal record, he would have been found unfit for military service; consequently, the subsequent orders for examination and induction would never have been issued and he would never have been convicted.

The government contends that although DeHerrera presented himself for the examination on September 17, 1970, only the physical phase was completed due to his intoxication and, therefore, there was substantial compliance with the regulations. We agree and affirm.

We have held that the government must comply with its own regulations and that prejudicial noncompliance can be a defense to a subsequent failure to submit to induction. In United States v. Brown, 438 F.2d 1115 (9th Cir. 1971), we held that the failure of the AFEES personnel to comply with an army regulation requiring that the registrant be examined with his clothes off at the time of his induction was prejudicial to the defendant and, therefore, required a reversal of his conviction for refusing to submit to induction. We stated that if the AFEES personnel had complied with the regulation they would have found that the registrant was unfit for military service and, consequently, he would have had no duty to submit to induction.

However, in United States v. Adams, 458 F.2d 619 (9th Cir. 1972), we held that noncompliance did not require reversal if the AFEES personnel had substantially complied with the army regulations. In Adams, the AFEES commander had refused to grant a moral waiver under AR 601-270 because he mistakenly classified petty larceny as a minor rather than a nonminor offense. We concluded that the officer did develop and consider the facts pertinent to the defendant’s moral qualifications and that the case was therefore distinguishable from Briggs v. United States, 397 F.2d 370 (9th Cir. 1968), where the armed forces never came into possession of the facts relevant to the defendant’s eligibility.

The requirement placed upon AFEES is contained in section 3-8 of AR 601-270, the substance of which indicates that moral waiver information is secured at the time of the AFEES interview. DeHerrera contends that AFEES had available forms and records indicating his prior criminal record, that it should have directed the appropriate governmental body to provide his past criminal record and that the interview was, therefore, unnecessary. It is true that in his Classification Questionnaire submitted to the draft board, he alleged two juvenile court adjudications for assault, but there was no information as to the type (i. e. aggravated, etc.) or where they occurred. It is also true that a prior order for a physical examination was postponed because he was in jail and was not ordered until completion of a parole period. However, neither the draft board nor AFEES is required to make any independent inquiry as to criminal background prior to the AFEES moral interview. That is the purpose of the interview. Even if the interview had been held we cannot say that DeHerrera would have been rejected. Although a local army officer testified that, had he had all the facts, he would have recommended rejection, the decision-making body would not necessarily have accepted that recommendation. The responsibility is upon De-Herrera to complete his AFEES examination. If he failed to do so through his own fault, then the AFEES personnel have substantially complied with the regulations.

The crucial question in this case, therefore, is whether DeHerrera was so intoxicated when he reported for his preinduction physical that it was impossible for the AFEES personnel to ascertain the information necessary to determine his moral qualifications. This was a question of fact for the trial court and, taking the evidence and all reasonable inferences in a light most favorable to the government as the prevailing party, Glasser v. United States, 315 U.S. 60, 80, 62 S.Ct. 457, 86 L.Ed. 680 (1942), we hold the evidence was sufficient. DeHerrera did not testify. In the record was an entry by the medical examiner: “intox.” Although DeHerrera filled out medical examination forms, he did not complete the mental or moral phase. We cannot say the trial court could not find that DeHerrera was too intoxicated to complete the examination and, therefore, there was substantial compliance with the regulations.

Affirmed.

      . The relevant language of the regulation in effect on the date that DeHerrera presented himself to the AFEES for physical examination reads as follows:
      3-8. Determination of moral acceptability. Information concerning court convictions or adverse juvenile adjudications of a registrant and whether he is in custody of the law will be indicated on DD Form 47 under items 13a and b. More specific information concerning such an entry, especially with respect to personal background, the circumstances of the incident or incidents, and final disposition of charges will be obtained from the registrant at the AFEES during the preinduction interview (see para. 5-4c(5) and 5-26b). A complete chronological record of employment will be made back to and including the individual’s schooling in order to determine whether a DD Form 369 (Police Records Check) should also be made in areas other than those where paragraph 13a, DD Form 47, or the individual, states he was convicted or the subject of an adverse juvenile adjudication or received a dismissal of a charge.
      Army Regulation 601-270 § 3-8 (March 18, 1969).


author: CUMMINGS, Circuit Judge.

text:
    CUMMINGS WHOLESALE ELECTRIC CO., INC., Plaintiff-Appellant, v. HOME OWNERS INSURANCE COMPANY et al., DefendantsAppellees. James BAYLOR, Plaintiff and Counter-Defendant-Appellee, v. OTTO ELECTRIC COMPANY, INC., et al., Defendants. DELPHI COMMUNITY SCHOOL BUILDING CORP., Plaintiff-Appellant, v. NORTHEASTERN INSURANCE COMPANY OF HARTFORD et al., Defendants-Appellees.
    Nos. 73-1049, 73-1061, 73-1062 and 73-1070.
    United States Court of Appeals, Seventh Circuit.
    Heard Jan. 9, 1974.
    Decided Feb. 21, 1974.
    Rehearing En Banc Denied March 25, 1974,
    No. 73-1070.
    Henry J. Price, Stephen K. Smith, Indianapolis, Ind., for appellants in No. 73-1049.
    William M. Evans, Indianapolis, Ind., for appellants in Nos. 73-1061 and 73-1062.
    Alan H. Lobley, D. Robert Webster, Charles J. Todd, Indianapolis, Ind., and Lewis N. Mullin, Delphi, Ind., for appellants in No. 73-1070.
    Charles W. Linder, Jr., Sydney L. Steele, James W. Riley, Jr., Indianapolis, Ind., for appellees Nationwide Mutual Ins. Co., Northeastern Ins. Co. of Hartford, and Allstate Ins. Co.
    Nicholas C. Nizamoff, Richard H. Riegner, William A. Wick, Indianapolis, Ind., for James Baylor as amicus curiae in No. 73-1070 and appellee in all other cases.
    Before CUMMINGS and STEVENS, Circuit Judges, and GRANT, Senior District Judge.

       Senior District Judge Robert A. Grant of the Northern District of Indiana is sitting by designation.

   CUMMINGS, Circuit Judge.

These appeals involve common issues concerning plaintiffs’ rights against the reinsurers of the insolvent Home Owners Insurance Company, which had issued certain surety bonds in Indiana.

In No. 73-1049, plaintiff Cummings Electric furnished more than $120,000 worth of materials to Otto Electric Company, which became insolvent. Home Owners had written surety bonds for Otto Electric. Home Owners in turn had reinsurance agreements with the three defendant reinsurers. Home Owners also became insolvent and was undergoing liquidation in Illinois. Plaintiff obtained a default judgment against Home Owners on August 27, 1971. Through negotiations with its liquidator, the default judgment was vacated and a consent decree filed nunc pro tunc as of April 14, 1972, against the liquidator. Plaintiff filed an amended complaint on April 17, 1972, to join the defendant reinsurers who had been ceded portions of Home Owners’ risks on the surety bonds. Judge Noland granted the reinsurers’ and liquidator’s motions to dismiss the amended complaint without prejudice in an order not containing any reasons for the dismissal.

In Nos. 73-1061 and 1062, two Indiana public school building corporations filed counterclaims against Home Owners. They were obligees on 1969 performance bonds securing the completion of electrical work to be done by Otto Electric on two new public high school buildings in Indiana. These counterclaims sought the recovery of all costs and expenses incurred by the schools in completing the electrical work for their high school buildings following the default of Otto Electric. On December 17, 1971, the defendant school building corporations filed their amended supplemental counterclaim seeking judgment against the three reinsurance companies' and the liquidator of Home Owners. In his two orders dismissing the counter-claimants’ actions without prejudice, Judge Steckler explained:

“This dismissal does not operate as an adjudication upon the merits, and Counter-Claimants and Third-Party Plaintiffs are free to pursue their claim in the proper forum, i. e., the Illinois liquidation proceedings of Home Owners Insurance Company [brought in the Circuit Court of Sangamon County, Illinois].”

In No. 73-1070, another Indiana public school building corporation entered into a contract with Otto Electric Company for work to be performed in constructing Delphi Community High School. Otto Electric entered into a performance bond and labor and materials bond with Home Owners as surety for $344,888. After partial performance Otto Electric defaulted and plaintiff expended $176,146.70 to complete the unperformed work. Plaintiff sued the reinsurers without joining the liquidator of Home Owners. In an unreported opinion granting the reinsurers’ motion to dismiss, Judge Eschbach held that the liquidator of Home Owners was an indispensable party and could not be joined because of the April 8, 1971, injunction of the Circuit Court of Sanga-mon County, Illinois, restraining all persons with claims against Home Owners from asserting any claim against the liquidator except in the Illinois liquidation proceedings. As in Nos. 73-1061 and 1062, the court stated that plaintiff was free to pursue its claim in the Illinois liquidation proceedings of Home Owners.

These various appeals involve the proper construction to be given to Ind. Code 1971, § 27-1-13-6 (Burns § 39-4307), which was enacted as Section 175 of the 1935 Indiana Insurance Law and provides as follows:

“Limitation of risks. — No company organized to make any kind or kinds of insurance included in class II and class III of section fifty-nine [§ 39-3501] shall take, on any one [1] risk of whatever nature, a sum exceeding one-tenth [Vio] part of its paid-up capital, surplus, and contingent reserves, if any, if a stock company or one-tenth [Vio] part of its surplus and contingent reserves, if any, if other than a stock company. No portion of any such risk or hazard which shall have been reinsured in a corporation authorized to do insurance business in this state shall be included in determining the limitation of risk prescribed in this section: Provided, That this section shall not apply to marine insurances, or to companies organized to make life insurance.
“No stock or mutual insurance company transacting fidelity or surety business in his state shall expose itself to any loss on any one [1] fidelity or surety risk or hazard in an amount exceeding ten per cent [10%] of its capital, surplus and contingent reserves, if any, unless it shall be protected in excess of that amount by: (a) Reinsurance in a company authorized to transact the fidelity or surety business in this state, provided that such reinsurance is in such form as to enable the obligee or beneficiary to maintain an action thereon against the company reinsured jointly with such reinsurer and, upon recovering judgment against such reinsured, to have recovery against such reinsurer for payment to the extent in which it may be liable under such reinsurance and in discharge thereof; or (b) the cosuretyship of such a company similarly authorized; or (c) by deposit with it in pledge or conveyance to it in trust for its protection of property; or (d) by conveyance or mortgage for its protection; or (e) in ease a sure-tyship obligation was made on behalf or on account of a fiduciary holding property in a trust capacity, by deposit or other disposition of a portion of the property so held in trust that no future sale, mortgage, pledge or other disposition can be made thereof without the consent of such company; except by decree or order of a court of competent jurisdiction: Provided: (1) That such a company may execute what are known as transportation or warehousing bonds for United States internal revenue taxes to an amount equal to fifty per cent [50%] of its capital, surplus and contingent reserves, if any; (2) that, when the penalty of the suretyship obligation exceeds the amount of a judgment described therein as appealed from and thereby secured, or exceeds the amount of the subject-matter in controversy or of the estate in the hands of the fiduciary for the performance of whose duties it is conditioned, the bond may be executed if the actual amount of the judgment or the subject-matter in controversy or estate not subject to supervision or control of the surety is not in excess of such limitation; and (3) that, when the penalty of the suretyship obligation executed for the performance of a contract exceeds the contract price, the latter shall be taken as the basis for estimating the limit of risk within the meaning of this section. No such company shall, anything to the contrary in this section notwithstanding, execute suretyship obligations guaranteeing the deposits of any single financial institution in an aggregate amount in excess of ten per cent [10%] of the capital, surplus and contingent reserves, if any, of such eorpo-rate surety, unless it shall be protected in excess of that amount by credits in accordance with subdivisions (a), (b), (c) or (d) of this paragraph.” (Italics supplied.)

This statute was apparently modeled on a comparable New York statute (Laws of 1920, ch. 563, § 3, now as amended McKinney's Consol. Laws, ch. 28, Insurance Law §§ 47, 315). However, we have found no cases or legislative history under either statute to illuminate the meaning of the critical, italicized proviso.

The Indiana legislature required that these reinsurance policies be “in such form” as to permit the obligee or beneficiary to sue the reinsured and reinsurer jointly. Paragraph 14 of the General Reinsurance Agreement sufficiently satisfies this requirement. Because of the mandate of Section 4307, we reject the reinsurers' argument that Paragraph 14 is inconsistent with Article XIV of the Separate Reinsurance Agreements and hence was not incorporated therein by Article XI thereof. This does not require a strained construction of Article XIV, since it only relates to payments during insolvency, and as will be seen, Section 4307 grants no preference and authorizes no direct action after liquidation proceedings begin. Because no part of any of the agreements other than Paragraph 14 of the General Agreement gives the insured any rights against the reinsurers, we hold that these agreements provide such rights only to the extent necessary to comply minimally with Section 4307.

The various insured claimants in these cases were given a direct right of action against the reinsurers by virtue of Section 4307 and Paragraph 14 of the General Reinsurance Agreement. While each case presents different procedural problems relating to whether or not the insurer and reinsurers were sued “jointly,” we conclude that at least in Nos. 73-1061 and 1062 the procedural requirements of Section 4307 were satisfied. It therefore becomes necessary to decide whether the right to sue the rein-surers directly survived the insolvency of Home Owners and gave claimants a preference in the reinsurance proceeds over the general creditors.

Under common law principles followed in Indiana, obligees such as these claimants have no rights to reinsurance proceeds unless the insurance agreements so provide. Therefore, upon the insolvency of the insurer, the proceeds of the reinsurance are assets to be distributed among the general creditors of the insured. Florida ex rel. O’Malley v. Department of Insurance, Ind.App., 291 N.E.2d 907, 913 (1973); United States v. Federal Surety Co., 72 F.2d 964, 967 (4th Cir. 1934), certiorari denied, 294 U.S. 711, 55 S.Ct. 508, 79 L.Ed. 1245. We turn to Section 4307 to see if the contractual incorporation of that statute changes the common law result.

While we agree with claimants that Section 4307 accorded them a direct right of action against the insurer jointly with the reinsurers, we do not agree that the Indiana Legislature intended to give them a preference over the general creditors of an insolvent reinsured. When the General Assembly enacted the 1935 Indiana Insurance Law, it disfavored granting preferences in assets of insolvent insurance companies. Thus Section 37(b) of the 1935 law, now Ind. Code § 27-1-4-9 (Burns § 39-3409(b)), provides that an Indiana liquidation court may issue any orders necessary to prevent the obtaining of any preferences against any part of the assets of an insolvent insurance company. Similarly, Section 38, now Ind.Code § 27-1-4-10 (Burns § 39-3410), provides that if an insurance company is in liquidation in Indiana, no suit can be maintained against the company outside the liquidation proceedings. Since Section 4307 specifies that the reinsurer be sued jointly with the insurer, Section 3410 would prevent any suit under an agreement minimally complying with Section 4307, once Indiana liquidation proceedings had begun. We do not believe a different result was intended when the liquidation proceeding takes place outside Indiana.

When the legislature intended to grant a preference, it did so explicitly, as in Section 43 of the 1935 Act, now Ind.Code § 27-1-4-15 (Burns § 39-3415), which provides that certain wage claims “shall be paid prior to the payment of every other debt or claim * * We conclude that if the Indiana Insurance Law were intended to give claimants a preference in the assets of an insolvent insurance company, the statutory expression would have been equally explicit. Our determination that there is no preference leads to the conclusion that the direct cause of action does not survive the commencement of liquidation proceedings. It would obviously be impossible for the district courts in these cases to determine the share to which each claimant would be entitled if it participated on a non-preferential basis in the Illinois liquidation proceeding. Conversely, since claimants are not entitled to a preference, they will not be prejudiced if the Illinois court refuses to apply Indiana law.

In arguing for preferences, counter-claimants in Nos. 73-1061 and 1062 have relied on First National Bank of Kansas City v. Higgins, 357 S.W.2d 139 (Mo. 1962). However, the Supreme Court of Missouri recognized the general rule that “the liability of the insuring company is solely to the reinsured company, or to its receiver, in the event of its insolvency.” 357 S.W.2d at 143. The court held that although the reinsured had become insolvent, the reinsurer was directly liable to the injured plaintiff because of a provision in the reinsurance contract that the “liability of [rein-surer] shall follow that of [reinsured] in every case and be subject in all respects to all the general and special stipulations, clauses, waivers and modifications of [reinsured’s] policy, binder, or other undertaking and any endorsements thereon * * 357 S.W.2d at 144. This clause was held to incorporate a clause of the reinsured’s auto liability policy which provided that a party who had obtained a tort judgment against the insured could sue the insurer direetly. In the present case, neither the General nor Separate Reinsurance Agreements contains such an incorporation clause, so that Higgins is inapt. For similar reasons, Federoff v. Ewing, 386 Mich. 474, 192 N.W.2d 242 (1971), vacating, 29 Mich.App. 1, 185 N.W.2d 79 (1970), is inapplicable.

This construction does not leave Section 4307 without a purpose. Taken as a whole, the Section is designed to protect insurance companies against insolvency. It prevents insurance companies from committing more than 10% of their assets to any one risk. Where there is a chance that the insurer will be unable to pay a large claim, the insured has an incentive to join the reinsurer as a defendant in any suit. The direct action proviso thus reduces the chances that the insurer will be forced into insolvency during the interval between the time judgment is rendered against it and the time it can collect from the reinsurer. If the insurer nevertheless becomes insolvent, continued operation of the direct action proviso would lead to a multiplicity of litigation and a preference for large risks. Since multiple litigation would waste the assets of the insolvent estate, and insureds with large risks have more incentive to protect themselves by investigating the financial status of the insurer before accepting it as surety, we are confident that the legislature did not intend to give them a direct cause of action to secure preferences from the rein-surers.

What we have said applies to all four cases. Because the incorporation of Section 4307 into the reinsurance agreements creates no preference and no cause of action which survived the insolvency of Home Owners, none of the insured can collect on their claims except through the Illinois liquidation proceedings. It is therefore unnecessary to decide the many other issues raised in the briefs.

The four dismissal orders are affirmed.

      . Judge Dillin dismissed similar counterclaims of two other Indiana public school building corporations on comity grounds in Nos. IP 70-C-202 and 218 (S.D.Ind. October 30 and 31,1973).

      . Paragraph 14 provides in part:
      “This Agreement shall be deemed to comply with any law, whenever applicable, which provides that the Obligee or other beneficiary of the Bond shall have the right to maintain an action on such an agreement against the Reinsurer.”

      . Article XIV of each Separate Reinsurance Agreement (with an immaterial variation) provides in part:
      “In the event of the insolvency of the Company, the Reinsurance under this Agreement shall be payable by the Rein-surer to the Company, or to its liquidator, receiver or statutory successor * * #.”

      . Article XI of each Separate Reinsurance Agreement provides:
      “All reinsurance effected in accordance with the provisions of this Agreement shall be subject to the terms and conditions of the General Reinsurance Agreement (revised February 1, 1950, and as amended from time to time) of the Surety Association of America, except to the extent that said Agreement is inconsistent with the provisions hereof.”

      . In the parallel New York statute, this result was avoided by Laws of 1939, ch. 882, § 315, which, inter alia, added the language italicized below. McKinney’s Consol.Law, ch. 28, Insurance Law, § 315(1) (a) provides:
      “1. In applying the limitation of section forty-seven to fidelity and surety risks, the net amount of exposure on any one fidelity or surety risk shall, except as provided in subsection four, be deemed within the limit of ten per cent if such company is protected in excess of that amount by:
      “(a) reinsurance, in a company authorized to do such business in this state, whicli is in such form as to enable the ob-ligee or beneficiary to maintain an action thereon against the ceding insurer jointly with the assuming insurer or, where the commencement or prosecution of actions against the ceding insurer has been enjoined by any court of competent jurisdiction or any justice or judge thereof, against the assuming insurer alone, and to have recovery against such assuming insurer for its share of the liability thereunder and in discharge thereof; * *
      (Emphasis supplied.)