author: Justice Thomas

text:
    DELAWARE v. NEW YORK
    No. 111,
    Orig.
    Argued December 9, 1992
    Decided March 30, 1993

      Thomas, J., delivered the opinion of the Court, in which Rehnquist, C. J., and O’Connor, Scalia, Kennedy, and Souter, JJ., joined. White, J., filed a dissenting opinion, in which Blackmun and Stevens, JJ., joined, post, p. 510.

      Dennis G. Lyons argued the cause for plaintiff. With him on the briefs were Charles M. Oberly HI, Attorney General of Delaware, J. Patrick Hurley, Jr., Deputy Attorney General, and Kent A. Yalowitz.

      Jerry Boone, Solicitor General of New York, argued the cause for defendant. With him on the briefs were Robert Abrams, Attorney General, and Robert A. Forte, Assistant Attorney General.

      Bernard Nash argued the cause for intervenors State of Alabama et al. With him on the briefs were Andrew P. Miller, William Bradford Reynolds, Judith E. Schaeffer, Dan Schweitzer, Daniel E. Lungren, Attorney General of California, Roderick E. Walston, Chief Assistant Attorney General, Thomas F. Gede, Special Assistant Attorney General, and Yeoryios C. Apallas, Deputy Attorney General, and by the Attorneys General for their respective States as follows: Jimmy Evans of Alabama, Charles Cole of Alaska, Winston Bryant of Arkansas, Robert A. Butterworth of Florida, Michael J. Bowers of Georgia, Warren Price III of Hawaii, Roland W Burris of Illinois, Linley E. Pearson of Indiana, Bonnie Campbell of Iowa, Robert T. Stephan of Kansas, Chris Gorman of Kentucky, Richard Ieyoub of Louisiana, Michael E. Carpenter of Maine, Mike Moore of Mississippi, William L. Webster of Missouri, Marc Racicot of Montana, Frankie Sue Del Papa of Nevada, John P. Arnold of New Hampshire, Robert J. Del Tufo of New Jersey, Nicholas J. Spaeth of North Dakota, Lee Fisher of Ohio, Susan B. Loving of Oklahoma, Ernest D. Preate, Jr., of Pennsylvania, James E. O’Neil of Rhode Island, Mark Barnett of South Dakota, R. Paul Van Dam of Utah, Jeffrey L. Amestoy of Vermont, Kenneth 0. Eikenberry of Washington, Mario J. Palumbo of West Virginia, and Joseph B. Meyer of Wyoming.

      James F Flug, Martin Lobel, Frank J. Kelley, Attorney General of Michigan, J. Joseph Curran, Jr., Attorney General of Maryland, John Payton, Corporation Counsel of District of Columbia, Charles L. Reischel, Deputy Corporation Counsel, and Lutz Alexander Prager, Assistant Deputy Corporation Counsel, Don Stenberg, Attorney General of Nebraska, and Dale A. Comer, Assistant Attorney General, filed briefs for intervenors State of Michigan et al.
    A brief for intervenors State of Texas et al. was filed by Dan Morales, Attorney General of Texas, Will Pryor, First Assistant Attorney General, Mary R. Keller, Deputy Attorney General, and James A. Thomassen and Jeffrey A. Cory-ell, Assistant Attorneys General, Grant Woods, Attorney General of Arizona, and Gail H. Boyd, Assistant Attorney General, Gale A. Norton, Attorney General of Colorado, Raymond T. Slaughter, Chief Deputy Attorney General, Timothy M. Tymkovich, Solicitor General, and Maurice Knaizer, Assistant Attorney General, Richard Blumenthal, Attorney General of Connecticut, and William J. Prensky, Assistant Attorney General, Larry EchoHawk, Attorney General of Idaho, and Theodore V. Spangler, Jr., and Lawrence G. Sirhall, Jr., Deputy Attorneys General, Hubert H. Humphrey III, Attorney General of Minnesota, and Alan Gilbert, Assistant Attorney General, Tom Udall, Attorney General of New Mexico, and Guru Terath Singh Khalsa,
      Assistant Attorney General, Lacy H. Thornburg, Attorney General of North Carolina, Andrew A. Vanore, Jr., Chief Deputy Attorney General, M. Ann Reed, Senior Deputy Attorney General, and Douglas A. Johnston, Assistant Attorney General, Charles S. Crookham, Attorney General of Oregon, Jack L. Landau, Deputy Attorney General, Virginia L. Linder, Solicitor General, and William R. Cook, Assistant Attorney General, T. Travis Medlock, Attorney General of South Carolina, Ray N. Stevens, Chief Deputy Attorney General, and Ronald W. Urban, Deputy Attorney General, Charles W. Burson, Attorney General of Tennessee, and Michael W. Catalano, Deputy Attorney General, James E. Doyle, Attorney General of Wisconsin, and Burneatta Bridge, Assistant Attorney General, Mary Sue Terry, Attorney General of Virginia, Stephen D. Rosenthal, Chief Deputy Attorney General, Gail Starling Marshall and Mary Yancey Spencer, Deputy Attorneys General, and E. Suzanne Darling, Assistant Attorney General.

      Briefs of amici curiae were filed for Midwest Securities Trust Co. et al. by Michael Fischer and llene Knable Gotts; and for the Securities Industry Association et al. by Judith Welcom.

   Justice Thomas

delivered the opinion of the Court.

In this original action, we resolve another dispute among States that assert competing claims to abandoned intangible personal property. Most of the funds at issue are unclaimed securities distributions held by intermediary banks, brokers, and depositories for beneficial owners who cannot be identified or located. The Special Master proposed awarding the right to escheat such funds to the State in which the principal executive offices of the securities issuer are located. Adhering to the rules announced in Texas v. New Jersey, 379 U. S. 674 (1965), and Pennsylvania v. New York, 407 U. S. 206 (1972), we hold that the State in which the intermediary is incorporated has the right to escheat funds belonging to beneficial owners who cannot be identified or located.

I

This case involves unclaimed dividends, interest, and other distributions made by issuers of securities. Such payments are often channeled through financial intermediaries such as banks, brokers, and depositories before they reach their beneficial owners. By arrangement with the beneficial owners, these intermediaries frequently hold securities in their own names rather than in the names of the beneficial owners; as “record owners,” the intermediaries are fully entitled to receive distributions based on those securities. This practice of holding securities in “nominee name” or “street name” facilitates the offering of customized financial services such as cash management accounts, brokerage margin accounts, discretionary trusts, and dividend reinvestment programs. Street name accounts also permit changes in beneficial ownership to be effected through book entries rather than the unwieldy physical transfer of securities certificates. See Brown, The Shareholder Communication Rules and the Securities and Exchange Commission: An Exercise in Regulatory Utility or Futility?, 13 J. Corp. L. 683, 688-691 (1988). The economies of scale attained in the modern financial services industry are epitomized by the securities depository, a large institution that holds only the accounts of “participant” brokers and banks and serves as a clearinghouse for its participants’ securities transactions. Because a depository retains record ownership of securities, it effectively “immobilizes” the certificates in its possession by allowing its participants to trade securities without the physical transfer of certificates. Most of the equity securities traded on the New York Stock Exchange are immobilized in this fashion. See App. to Report of the Special Master B-2. Cf. Securities and Exchange Commission, Division of Market Regulation, Progress and Prospects: Depository Immobilization of Securities and Use of Book-Entry Systems 4 (1985).

The intermediaries are unable to distribute a small portion of the securities to their beneficial owners. When an intermediary claims no property interest in funds so held, they become escheatable. Between 1985 and 1989, New York es-cheated $360 million in funds of abandoned securities held for more than three years by intermediaries doing business in New York, without regard to the last known address of the beneficial owner or the intermediary’s State of incorporation. N. Y. Aband. Prop. Law § 511 (McKinney 1991). See Report of Special Master 10, n. 9. Alleging that certain of these securities were wrongfully escheated, Delaware sought leave in 1988 to initiate an original action in this Court against New York. We granted leave to file the complaint, 486 U. S. 1030 (1988), and appointed a Special Master, 488 U. S. 990 (1988). We granted Texas’ motion to file a complaint as an intervening plaintiff, 489 U. S. 1005 (1989), and every State not already a party to this proceeding and the District of Columbia sought leave to intervene.

On January 28, 1992, the Master filed his report and recommendation. Both Delaware and New York have lodged exceptions to the report, as have four other parties whose motions for leave to intervene have not been granted by this Court. We now sustain two of Delaware’s exceptions in their entirety, one of Delaware’s exceptions in part, and one of New York’s exceptions. We also grant all pending motions to intervene and to file briefs as amici curiae, overrule all exceptions not sustained in this opinion, and remand for further proceedings before the Master.

HH H — f

States as sovereigns may take custody of or assume title to abandoned personal property as bona vacantia, a process commonly (though somewhat erroneously) called escheat. See, e. g., Christianson v. King County, 239 U. S. 356, 365-366 (1915); Cunnius v. Reading School Dist., 198 U. S. 458, 469-476 (1905); Hamilton v. Brown, 161 U. S. 256, 263-264 (1896). No serious controversy can arise between States seeking to escheat “tangible property, real or personal,” for “it has always been the unquestioned rule in all jurisdictions that only the State in which the property is located may es-cheat.” Texas v. New Jersey, 379 U. S., at 677. On the other hand, intangible property “is not physical matter which can be located on a map,” ibid., and frequently no single State can claim an uncontested right to escheat such property.

In Texas v. New Jersey, we discharged “our responsibility in the exercise of our original jurisdiction” to resolve escheat disputes that “the States separately are without constitutional power ... to settle.” Ibid. We adopted two rules intended to “settle the question of which State will be allowed to escheat [abandoned] intangible property.” Ibid. “[SJince a debt is property of the creditor, not of the debtor,” we reasoned, “fairness among the States requires that the right and power to escheat the debt should be accorded to the State of the creditor’s last known address as shown by the debtor’s books and records.” Id., at 680-681 (footnote omitted). This primary rule had the virtue of “involving] a factual issue simple and easy to resolve,” made even simpler by the Court’s resort to “last known address, rather than technical legal concepts of residence and domicile.” Id., at 681. It also achieved rough equity in that it “tend[ed] to distribute escheats among the States in the proportion of the commercial activities of their residents.” Ibid. We recognized, however, that the primary rule could not resolve escheat claims over “property owed persons (1) as to whom there is no record of any address at all, or (2) whose last known address is in a State which does not provide for es-cheat of the property owed them.” Id., at 682. For these situations, we adopted a secondary rule awarding the right to escheat to the debtor’s “State of corporate domicile,” subject to the claims of the State with “a superior right to es-cheat” under the primary rule. Ibid. We characterized the Texas scheme as “the fairest, . . . easy to apply, and in the long run ... the most generally acceptable to all the States.” Id., at 683.

We reaffirmed Texas in Pennsylvania v. New York, 407 U. S. 206 (1972). Texas had involved the relatively simple case of a debtor that “disclaimed any interest” in “various small debts . . . owed to . . . small creditors who ha[d] never appeared to collect them.” Texas, supra, at 676, 675. In Pennsylvania, by contrast, the Western Union Company held proceeds left unclaimed because Western Union was unable to locate the payee of a money order or to make a refund to the sender or because drafts issued by Western Union were not negotiated. See 407 U. S., at 208-209; Western Union Telegraph Co. v. Pennsylvania, 368 U. S. 71, 72-73 (1961). Because Western Union did not “regularly record the addresses of its money order creditors,” the primary rule would rarely apply, and the debtor’s State of incorporation— Western Union’s “corporate domicile” — would “receive a much larger share of the unclaimed funds” under the secondary rule. Pennsylvania, 407 U. S., at 214. In response to this perceived injustice, other States advocated a rule allowing the State of “the place of purchase” to escheat under the primary rule. We nevertheless adhered to our decision in Texas. The “only arguable” difference between money orders and the obligations at issue in Texas lay in the fact that money orders “involve a higher percentage of unknown addresses.” 407 U. S., at 214. We reasoned that neither this distinction nor the resulting “likelihood of a ‘windfall’ ” for the debtor’s State of incorporation would justify the “carving out [of an] exception to the Texas rule.” Ibid.

We therefore resolve disputes among States over the right to escheat intangible personal property in the following three steps. First, we must determine the precise debtor-creditor relationship as defined by the law that creates the property at issue. Second, because the property interest in any debt belongs to the creditor rather than the debtor, the primary rule gives the first opportunity to escheat to the State of “the creditor’s last known address as shown by the debtor’s books and records.” Texas, supra, at 680-681. Finally, if the primary rule fails because the debtor’s records disclose no address for a creditor or because the creditor’s last known address is in a State whose laws do not provide for escheat, the secondary rule awards the right to escheat to the State in which the debtor is incorporated. These rules arise from our “authority and duty to determine for [ourselves] all questions that pertain” to a controversy between States, Kentucky v. Indiana, 281 U. S. 163, 176 (1930), and no State may supersede them by purporting to prescribe a different priority under state law.

III

None of the parties contests the primary rule or the Master’s recommendation that “where the state of domicile of an unbeatable entitled recipient is known, through finding a last known address, that state may take custody of the unclaimed distributions.” Report of Special Master 56-57 (footnote omitted). The bulk of the abandoned distributions at issue, however, cannot be traced to any identifiable beneficial owner, much less one with a last known address. These funds thus fall out of the primary rule and into the secondary rule. Consequently, under Texas and Pennsylvania, the debtor’s State of incorporation should be entitled to escheat this unclaimed property. The Master’s report concludes, first, that the issuer of securities is the relevant “debtor” and, second, that the State in which the debtor’s “principal executive offices” are located should be considered the debt- or’s State. We reject both of these recommendations.

A

“[Wjhere the entitled recipient’s domicile is undeterminable (no last known address), but the state of domicile of the originator of the distribution is known,” the Master recommended that the originator’s State be awarded the right to escheat, “whether or not the originator would have been entitled to receive the funds back in its own right.” Report of Special Master 57. Because he construed the use of the terms “debtor” and “creditor” in Texas and Pennsylvania as a merely “descriptive ... attempt to identify the relevant parties” rather than “prescriptive legal commands,” Report of Special Master 29, the Master defined “debtor” as “the last owner of the funds, in the sense of the last person who had a claim to the funds as an asset that would appropriately be reflected in the net worth of the entity in question,” id., at 32. In its first exception, Delaware argues that “the Report’s recommendation in this regard does not comport with the ordinary meaning of the words ‘debtor’ and ‘creditor,’ is inconsistent with universally-accepted state and common law and with the principles underlying the Texas rule, and changes the law in an area where the law should be settled.” Exceptions and Brief for Plaintiff Delaware E-4. Delaware also objects to the Master’s failure to “ascrib[e] . . . legal relevance to [intermediaries’] status as record security holders,” a “fundamental factual error” that effectively treats record owners “as if they were paying agents.” Id., at E-5. New York’s first exception likewise objects to the Master’s use of “the term ‘debtor’ as ‘shorthand’ to identify parties with ‘debtor attributes’ rather than the obligor of the debt.” Exceptions of Defendant New York 52. We agree with both States and sustain their exceptions.

We have not relied on legal definitions of “creditor” and “debtor” merely for descriptive convenience. Rather, we have grounded the concepts of “creditor” and “debtor” in the positive law that gives rise to the property at issue. In framing a State’s power of escheat, we must first look to the law that creates property and binds persons to honor property rights. “Property interests, of course, are not created by the Constitution,” but rather “by existing rules or understandings that stem from an independent source such as state law.” Board of Regents of State Colleges v. Roth, 408 U. S. 564, 577 (1972). Accord, e. g., Bishop v. Wood, 426 U. S. 341, 344-347 (1976); Paul v. Davis, 424 U. S. 693, 710-712 (1976). See also Barnhill v. Johnson, 503 U. S. 393, 398 (1992) (“In the absence of any controlling federal law, ‘property’ and ‘interests in property’ are creatures of state law”). Furthermore, law that creates property necessarily defines the legal relationships under which certain parties (“debtors”) must discharge obligations to others (“creditors”).

To define “debtor” as “the last person who ha[s] a claim to the funds as an asset that would appropriately be reflected in [his] net worth,” Report of Special Master 32, would convert a term rich with prescriptive legal content into little more than a description of bookkeeping phenomena. Funds held by a debtor become subject to escheat because the debtor has no interest in the funds — precisely the opposite of having “a claim to the funds as an asset.” We have recognized as much in cases upholding a State’s power to escheat neglected bank deposits. Charters, bylaws, and contracts of deposit do not give a bank the right to retain abandoned deposits, and a law requiring the delivery of such deposits to the State affects no property interest belonging to the bank. Security Savings Bank v. California, 263 U. S. 282, 285-286 (1923); Provident Institution for Savings v. Malone, 221 U. S. 660, 665-666 (1911). Thus, “deposits are debtor obligations of the bank,” and a State may “protect the interests of depositors” as creditors by assuming custody over accounts “inactive so long as to be presumptively abandoned. ” Anderson Nat. Bank v. Luckett, 321 U. S. 233, 241 (1944) (emphasis added). Such “disposition of abandoned property is a function of the state,” a sovereign “exercise of a regulatory power” over property and the private legal obligations inherent in property. Standard Oil Co. v. New Jersey, 341 U. S. 428, 436 (1951).

Our rules regarding interstate disputes over competing es-cheat claims cannot be severed from the law that creates the underlying creditor-debtor relationships. In Texas and Pennsylvania, our examination of the holder’s legal obligations not only defined the escheatable property at issue but also carefully identified the relevant “debtors” and “creditors.” See Texas, 379 U. S., at 675-676, n. 4; Pennsylvania, 407 U. S., at 208-209, 213. In Pennsylvania, we noted that Western Union was a “debtor” insofar as it owed contractual duties to two separate creditors. Western Union was obligated not merely to deliver a negotiable draft to the sender’s payee; if Western Union could not locate the payee or if the payee failed to claim his money order, the company was bound to make a refund to the sender. Id., at 208-209. Correspondingly, we recognized that the relevant “creditor” might be either a payee or a sender: “the payee of an unpaid draft, the sender of a money order entitled to a refund,” or a payee or sender “whose claim has been underpaid through error.” Id., at 213 (internal quotation marks omitted).

Moreover, the rules developed in Texas and Pennsylvania reflect the traditional view of escheat as an exercise of sovereignty over persons and property owned by persons. The primary rule flowed from the common-law “concept of ‘mobi-lia sequuntur personam,’ according to which intangible personal property is found at the domicile of its owner.” Texas, supra, at 680, n. 10. Accord, Pennsylvania, supra, at 217-218 (Powell, J., dissenting). See also Blodgett v. Silberman, 277 U. S. 1, 10 (1928) (“[I]ntangible personalty has ... a situs at the domicil of the owner”). In recognizing that “a debt is property of the creditor,” Texas, supra, at 680, the primary rule permits the escheating State to protect the interest of a creditor last known to have resided there. Reasoning that “debts owed by” a holder of unclaimed funds “are not property to it, but rather a liability,” we concluded that “it would be strange to convert a liability into an asset when the State decides to escheat.” 379 U. S., at 680. Cognizant of the creditor’s status as owner of intangible personal property, we awarded the primary right to escheat to the creditor’s State. Conversely, when a creditor’s last known address cannot be determined or the laws of the creditor’s State do not provide for escheat, the secondary rule protects the interests of the debtor’s State as sovereign over the remaining party to the underlying transaction. Unless we define the terms “creditor” and “debtor” according to positive law, we might “permit intangible property rights to be cut off or adversely affected by state action ... in a forum having no continuing relationship to any of the parties to the proceedings.” Pennsylvania, supra, at 213 (internal quotation marks omitted). Cf. Connecticut Mut. Life Ins. Co. v. Moore, 333 U. S. 541, 549-550 (1948) (upholding New York’s escheat of unclaimed insurance benefits only “as to policies issued for delivery in New York upon the lives of persons then resident therein where the insured continues to be a resident and the beneficiary is a resident at. . . maturity”). Texas and Pennsylvania avoided this conundrum by resolving escheat disputes according to the law that creates debtor-creditor relationships; only a State with a clear connection to the creditor or the debtor may escheat. Because the Master failed to identify the relevant “creditors” and “debtors” by reference to that law, we now perform this task.

We hold that intermediaries who hold unclaimed securities distributions in their own name are the relevant “debtors” under the secondary rule of Texas and Pennsylvania. From an issuer’s perspective, the only creditors are registered shareholders, those whose names appear on the issuer’s records. Issuers cannot be considered debtors once they pay dividends, interest, or other distributions to record owners; payment to a record owner discharges all of an issuer’s obligations. Under § 8-207(1) of the Uniform Commercial Code, which is the law of all 50 States and the District of Columbia, “the issuer ... may treat the registered owner as the person exclusively ... to exercise all the rights and powers of an owner.” Payment to an intermediary that is the record owner of securities extinguishes any liability the issuer might have to the beneficial owner. U. C. C. § 8-207, comment 1, 2C U. L. A. 341 (1991). The Master acknowledged as much, see Report of Special Master 25, and none of the parties contends otherwise. Instead, an intermediary serving as the record owner of securities is the “debtor” insofar as the intermediary has a contractual duty to transmit distributions to the beneficial owner. Unlike an issuer,which discharges all liabilities upon payment to a record owner, an intermediary remains liable should a “lost” beneficial owner reappear to collect distributions due under a contract with the intermediary. The Master thus erred in equating intermediary banks, brokers, and depositories with the issuers’ paying agents, who owe no duty to beneficial owners but rather bear the contractual obligation to “return . . . unclaimed distributions to the issuer after a certain period of time.” App. to Report of Special Master B-6. Intermediaries who hold securities in street name or nominee name are the relevant “debtors” because they alone, and not the issuers, are legally obligated to deliver unclaimed securities distributions to the beneficial owners.

B

The Master’s recommended disposition of this case rested on a second major premise: his proposal to locate a corporate debtor in “the jurisdiction of the entity’s principal domestic executive offices rather than the state of incorporation.” Report of Special Master 49 (footnote omitted). In Texas and Pennsylvania, however, we explicitly granted the right to escheat under the secondary rule to the State in which the debtor was incorporated. Texas, supra, at 682; Pennsylvania, supra, at 210-211, 212, 223-224. By the Master’s own admission, relying on the location of a debtor’s principal executive offices “change[s] [this Court’s] longstanding practice.” Report of Special Master 50. The Master proposed this innovation sua sponte; no party sought this alteration of our settled law. Delaware excepts to this “[d]epart[ure] from the rule of corporate domicile” as “inconsistent not only with this Court’s precedents, but with fundamental principles of jurisprudence defining the relationship between the sovereign and its corporate citizens.” Exceptions and Brief for Plaintiff Delaware E-4 to E-5. Finding that the “heavy burden” that attends a request “to reconsider not one but two prior decisions” has not been borne, Walker v. Armco Steel Corp., 446 U. S. 740, 749 (1980), we sustain Delaware’s exception.

In Texas, we considered and rejected a proposal to award the primary right to escheat to the State “where [the debt- or’s] principal offices are located.” 379 U. S., at 680. Although we recognized that “this State is probably foremost in giving the benefits of its economy and laws to the company whose business activities made the intangible property come into existence,” we rejected the rule because its application “would raise in every case the sometimes difficult question of where a company’s ‘main office’ or ‘principal place of business’ or whatever it might be designated is located.” Ibid. Even when we formulated the secondary rule, we looked instead to the debtor’s State of incorporation. Id., at 682. As in Texas, we find that determining the State of incorporation is the most efficient way to locate a corporate debtor. Exclusive reliance on incorporation permits the disposition of claims under the secondary rule upon the taking of judicial notice. Although “a general inquiry into where the principal executive office is located [may] see[m] neither burdensome [n]or complex,” Report of Special Master 49, we cannot embrace a “rule leaving so much for decision on a case-by-case basis,” Texas, supra, at 680. The mere introduction of any factual controversy over the location of a debtor’s principal executive offices needlessly complicates an inquiry made irreducibly simple by Texas’ adoption of a test based on the State of incorporation.

Even if we were to endorse the Master’s redefinition of a debtor’s location, we doubt that his proposal could fulfill its promise “to distribute the funds [more] fairly among the various jurisdictions.” Report of Special Master 50. The Master sought to counteract the inequity he perceived in the happenstance that “the larger, publicly-traded, enterprises that generate the lion’s share of the securities distributions . . . are by any standard disproportionately incorporated in one state.” Id., at 47. His “principal executive offices” initiative, however, cannot survive independent of his erroneous decision to treat the issuers as the relevant “debtors.” Because we have already decided that the intermediaries are the proper debtors under the secondary rule, this change would simply transfer the bulk of the disputed funds from Delaware, where many intermediaries are incorporated, to New York, where many intermediaries have located their principal executive offices. A company’s arguably arbitráis-decisión to incorporate in one State bears no less on its business activities than its officers’ equally arbitrary decision to locate their principal executive offices in another State. It must be remembered that we refer to a debtor’s State of incorporation only when the creditor’s last address is unknown or when the creditor’s State does not provide for es-cheat. When the creditor’s State cannot assert its predominant interest, we detect no inequity in rewarding a State whose laws prove more attractive to firms that wish to incorporate.

Precedent, efficiency, and equity all dictate the rejection of the Master’s “principal executive offices” proposal. We accordingly adhere to Texas and Pennsylvania and award the right to escheat under the secondary rule to the State in which the debtor is incorporated.

>

We turn, finally, to New York s contention that many of the disputed funds need not be escheated under the secondary rule at all. New York concedes that “the creditors of unclaimed distributions” held by depositories and custodian banks “are always unknown.” Exceptions of Defendant New York 81. It argues, however, that “reconstruction]” of “the debtor brokers’ transactions” will lead to “creditor brokers that purchased the underlying securities and were underpaid the distributions.” Id., at 80 (emphasis added). Because “the amount of time and resources that would be required to reconstruct the overpayment transactions would be very considerable,” however, New York “has suggested the use of statistical sampling to prove that virtually all of the creditor brokers and banks recorded on the books of debtor brokers in New York have New York addresses.” Ibid.

We overrule New York’s exception. As an initial matter, New York’s proposal rests on the dubious supposition that the relevant “creditors” under the primary rule are other brokers. We have already held that “creditors” are the parties to whom the intermediaries ,are contractually obligated to deliver unclaimed securities distributions. Accordingly, to the extent that beneficial owners are the relevant “creditors,” New York’s exception is inapposite.

Even if we indulge New York’s premise that most creditors of New York brokers are in fact other New York brokers, the exception must fail. As the Master correctly observed: “[N]othing in the Court’s jurisprudence . . . suggests] that New York can prevail by making a statistical showing that ‘most’ [creditor-brokers’] addresses are in New York.” Report of Special Master 67. In Pennsylvania, we rejected a proposal practically identical to New York’s. In that case, because Western Union’s records frequently did not disclose a creditor’s identity or last known address, the debtor’s State of incorporation stood to “receive a much larger share of the unclaimed funds” under the secondary rule. 407 U. S., at 214. The plaintiff States urged us to define the creditor’s residence according to a “presumption based on the place of purchase.” Ibid. Like New York’s proposal, the rule advocated in Pennsylvania would use a statistical surrogate instead of the debtor’s records to locate the last known addresses of creditors. That much is clear from the Pennsylvania dissent’s description of the rejected rule as “a reasonable approximation.” Id., at 221 (opinion of Powell, J.). New York may object to the cost and difficulty of culling creditors’ last known addresses from brokers’ records, but in Pennsylvania, we expressly refused “to vary the application of the [primary] rule according to the adequacy of the debtor’s records.” Id., at 215. And we decline to do so here.

Despite our refusal to adopt New York’s proposal for statistical analysis of creditors’ addresses under the primary rule, we decline Delaware’s invitation to enter judgment against New York on the basis of the Master’s findings. Exceptions and Brief for Plaintiff Delaware 85. On remand, if New York can establish by reference to debtors’ records that the creditors who were owed particular securities distributions had last known addresses in New York, New York’s right to escheat under the primary rule will supersede Delaware’s right under the secondary rule. As we noted in Texas, “the State of corporate domicile should be allowed to ... retai[n] the property for itself only until some other State comes forward with proof that it has a superior right to es-cheat.” 379 U. S., at 682. Accord, Pennsylvania, 407 U. S., at 210-211. If New York or any other claimant State fails to offer such proof on a transaction-by-transaction basis or to provide some other proper mechanism for ascertaining creditors’ last known addresses, the creditor’s State will not prevail under the primary rule, and the secondary rule will control. Id., at 215.

V

Only by adhering to our precedent can we resolve escheat disputes between States in a fair and efficient manner. We have repeatedly declared our unwillingness “either to decide each escheat case on the basis of its particular facts or to devise new rules of law to apply to ever-developing new categories of facts.” Texas, swpra, at 679. Accord, Pennsylvania, supra, at 215. To craft different rules for the novel facts of each case would generate “so much uncertainty and threaten so much expensive litigation that the States might find that they would lose more in litigation expenses than they might gain in escheats.” Texas, supra, at 679. If the States are dissatisfied with the outcome of a particular case, they may air their grievances before Congress. That body may reallocate abandoned property among the States without regard to this Court’s interstate escheat rules. Congress overrode Pennsylvania by passing a specific statute concerning abandoned money orders and traveler’s checks, §§601-603, 88 Stat. 1525,12 U. S. C. §§2501-2503, and it may ultimately settle this dispute through similar legislation.

We remand this case to the Master for further proceedings consistent with this opinion and for the preparation of an appropriate decree.

So ordered.

Justice White,

with whom Justice Blackmun and Justice Stevens join, dissenting.

In my view, the Special Master did no violence to our precedents and has a much superior approach and more equitable result than does the Court. I would overrule all of the exceptions to the Special Master’s Report, adopt his recommended findings and conclusions, and issue a decree in accordance therewith.

       An individual investor who opts to retain record ownership of a security will receive distributions directly from the issuer. This case does not concern transactions of this sort.

       In a cash management account, the broker holds, rather than distributes, dividends and interest paid on a customer’s securities. The customer withdraws funds through a check-like negotiable instrument and receives interest on held funds, typically at a rate higher than that offered on passbook savings accounts and negotiable-order-of-withdrawal accounts.

       In a brokerage margin account, the broker holds the customer’s securities as collateral against any margin debt generated by the customer’s stock market transactions. Dividends and other distributions may be credited against a customer’s margin debt to the broker.

       In a discretionary trust, the financial institution as trustee enjoys the discretion not to distribute current income but rather to accumulate it for further investment.

       In a dividend reinvestment program, the beneficial owner authorizes the broker to use dividends to purchase additional shares and fractional shares.

       Approximately 0.02% of funds distributed through intermediaries cannot be traced to their beneficial owners. This low percentage nevertheless accounts for a very substantial amount of escheatable property. See Report of Special Master 10, n. 9.

       Unlike Depository Trust Company, the two other securities depositories in the United States “do claim entitlement to certain securities, interest payments, dividends and distributions that cannot be accounted for.” Brief for Midwest Securities Trust Co. et al. as Amici Curiae 2. The issue of these depositories’ “entitlement to the excess funds under their rules” is not before us. Id., at 3.

       In a joint brief, Michigan, Maryland, Nebraska, and the District of Columbia filed two exceptions to the Master’s report.

       “At common law, abandoned personal property was not the subject of escheat, but was subject only to the right of appropriation by the sovereign as bona vacantia.” Anderson Nat. Bank v. Luckett, 321 U. S. 233, 240 (1944). See generally 7 W. Holdsworth, A History of English Law 495-496 (2d ed. 1937). Our opinions, however, have understood “escheat” as encompassing the appropriation of both real and personal property, and we use the term in that broad sense.

       See also Western Union Telegraph Co. v. Pennsylvania, 368 U. S. 71, 75 (1961); Standard Oil Co. v. New Jersey, 341 U. S. 428, 443 (1951).

       New York has filed an exception to the Master’s application of the primary rule. We address this argument in Part IV below.

       New York and other States could have anticipated and prevented some of the difficulties stemming from incomplete debtor records, for nothing in our decisions “prohibits the States from requiring [debtors] to keep adequate address records.” Pennsylvania, 407 U. S., at 215.


source: Caselaw Access Project

author: Justice Stevens Justice Scalia,

license: Public Domain

text:
    CONROY v. ANISKOFF et al.
    No. 91-1353.
    Argued January 11, 1993
    Decided March 31, 1993

      Stevens, J., delivered the opinion of the Court, in which Rehnquist, C. J., and White, Blackmun, O’Connor, Kennedy, and SouteR, JJ., joined, and in all but n. 12 of which Thomas, J., joined. Scalia, J., filed an opinion concurring in the judgment, post, p. 518.

      Robert H. Klonoff argued the cause and filed briefs for petitioner.

      John F. Manning argued the cause for the United States as amicus curiae urging reversal. With him on the brief were Solicitor General Starr, Acting Assistant Attorney General Bruton, Deputy Solicitor General Wallace, Richard Farber, and Bridget M. Rowan.

      Kevin M. Cuddy argued the cause and filed a brief for respondents.

        Lawrence M. Maher filed a brief for Veterans of Foreign Wars of the United States as amicus curiae.

   Justice Stevens

delivered the opinion of the Court.

The Soldiers’ and Sailors’ Civil Relief Act of 1940, 54 Stat. 1178, as amended, 50 U. S. C. App. §501 et seq. (1988 ed. and Supp. Ill) (Act), suspends various civil liabilities of persons in military service. At issue in this case is the provision in § 525 that the “period of military service shall not be included in computing any period . . . provided by any law for the redemption of real property sold or forfeited to enforce any obligation, tax, or assessment.” The question presented is whether a member of the Armed Services must show that his military service prejudiced his ability to redeem title to property before he can qualify for the statutory suspension of time.

I

Petitioner is an officer in the United States Army. He was on active duty continuously from 1966 until the time of trial. In 1973, he purchased a parcel of vacant land in the town of Danforth, Maine. He paid taxes on the property for 10 years, but failed to pay the 1984,1985, and 1986 local real estate taxes. In 1986, following the Maine statutory procedures that authorize it to acquire tax-delinquent real estate, the town sold the property.

In 1987, petitioner brought suit in the Maine District Court against the town and the two purchasers. He claimed that § 525 of the Act tolled the redemption period while he was in military service, and federal law therefore prevented the town from acquiring good title to the property even though the State’s statutory procedures had been followed. The trial court rejected the claim. In an unreported opinion, it noted that some courts had construed § 525 literally, but it elected to follow a line of decisions that refused to toll the redemption period unless the taxpayer could show that “military service resulted in hardship excusing timely legal action.” It agreed with those courts that it would be “absurd and illogical” to toll limitations periods for career service personnel who had not been “handicapped by their military status.” The Supreme Judicial Court of Maine affirmed by an equally divided court. We granted certiorari to resolve the conflict in the interpretation of §525. 505 U. S. 1203 (1992).

II

The statutory command in § 525 is unambiguous, unequivocal, and unlimited. It states that the period of military service “shall not be included” in the computation of “any period now or hereafter provided by any law for the redemption of real property ....” Respondents do not dispute the plain meaning of this text. Rather, they argue that when § 525 is read in the context of the entire statute, it implicitly conditions its protection on a demonstration of hardship or prejudice resulting from military service. They make three points in support of this argument: that the history of the Act reveals an intent to provide protection only to those whose lives have been temporarily disrupted by military service; that other provisions of the Act are expressly conditioned on a showing of prejudice; and that a literal interpretation produces illogical and absurd results. Neither separately nor in combination do these points justify a departure from the unambiguous statutory text.

Respondents correctly describe the immediate cause for the statute’s enactment in 1940, the year before our entry into World War II. Congress stated its purpose to “expedite the national defense under the emergent conditions which are threatening the peace and security of the United

States ...50 U. S. C. App. § 510. That purpose undoubtedly contemplated the special hardship that military duty imposed on those suddenly drafted into service by the national emergency. Neither that emergency, nor a particular legislative interest in easing sudden transfers from civilian to military status, however, justifies the conclusion that Congress did not intend all members of the Armed Forces, including career personnel, to receive the Act’s protections. Indeed, because Congress extended the life of the Act indefinitely in 1948, well after the end of World War II, the complete legislative history confirms a congressional intent to protect all military personnel on active duty, just as the statutory language provides.

Respondents also correctly remind us to “follow the cardinal rule that a statute is to be read as a whole, see Massachusetts v. Morash, 490 U. S. 107, 115 (1989), since the meaning of statutory language, plain or not, depends on context.” King v. St. Vincent’s Hospital, 502 U. S. 215, 221 (1991). But as in King, the context of this statute actually supports the conclusion that Congress meant what §525 says. Several provisions of the statute condition the protection they offer on a showing that military service adversely affected the ability to assert or protect a legal right. To choose one of many examples, § 532(2) authorizes a stay of enforcement of secured obligations unless “the ability of the defendant to comply with the terms of the obligation is not materially affected by reason of his military service.” The comprehensive character of the entire statute indicates that Congress included a prejudice requirement whenever it considered it appropriate to do so, and that its omission of any such requirement in § 525 was deliberate.

Finally, both the history of this carefully reticulated statute, and our history of interpreting it, refute any argument that a literal construction of §525 is so absurd or illogical that Congress could not have intended it. In many respects the 1940 Act was a reenactment of World War I legislation that had, in turn, been modeled after legislation that several States adopted during the Civil War. See Boone v. Lightner, 319 U. S. 561, 565-569 (1943). The Court had emphasized the comprehensive character and carefully segregated arrangement of the various provisions of the World War I statute in Ebert v. Poston, 266 U. S. 548, 554 (1925), and it had considered the consequences of requiring a showing of prejudice when it construed the World War II statute in Boone, supra. Since we presume that Congress was familiar with those cases, we also assume that Congress considered the decision in Ebert to interpret and apply each provision of the Act separately when it temporarily reestablished the law as a whole in 1940, and then considered Boone’s analysis of a prejudice requirement when it permanently extended the Act in 1948.

Legislative history confirms that assumption. Since the enactment of the 1918 Act, Congress has expressed its understanding that absolute exemptions might save time or money for service members only at the cost of injuring their own credit, their family’s credit, and the domestic economy; it presumably required a showing of prejudice only when it seemed necessary to confer on the service member a genuine benefit. By distinguishing sharply between the two types of protections, Congress unquestionably contemplated the ways that either type of protection would affect both military debtors and their civilian creditors.

The long and consistent history and the structure of this legislation therefore lead us to conclude that — just as the language of § 525 suggests — Congress made a deliberate policy judgment placing a higher value on firmly protecting the service member’s redemption rights than on occasionally burdening the tax collection process. Given the limited number of situations in which this precisely structured statute offers such absolute protection, we cannot say that Congress would have found our straightforward interpretation and application of its words either absurd or illogical. If the consequences of that interpretation had been — or prove to be — as unjust as respondents contend, we are confident that Congress would have corrected the injustice — or will do so in the future.

The judgment of the Supreme Judicial Court of Maine is reversed.

It is so ordered.

Justice Scalia,

concurring in the judgment.

The Court begins its analysis with the observation: “The statutory command in § 525 is unambiguous, unequivocal, and unlimited.” Ante, at 514. In my view, discussion of that point is where the remainder of the analysis should have ended. Instead, however, the Court feels compelled to demonstrate that its holding is consonant with legislative history, including some dating back to 1917 — a full quarter century before the provision at issue was enacted. That is not merely a waste of research time and ink; it is a false and disruptive lesson in the law. It says to the bar that even an “unambiguous [and] unequivocal” statute can never be dis-positive; that, presumably under penalty of malpractice liability, the oracles of legislative history, far into the dimmy past, must always be consulted. This undermines the clarity of law, and condemns litigants (who, unlike us, must pay for it out of their own pockets) to subsidizing historical research by lawyers.

The greatest defect of legislative history is its illegitimacy. We are governed by laws, not by the intentions of legislators. As the Court said in 1844: “The law as it passed is the will of the majority of both houses, and the only mode in which that will is spoken is in the act itself. . . .” Aldridge v. Williams, 3 How. 9, 24 (emphasis added). But not the least of the defects of legislative history is its indeterminacy. If one were to search for an interpretive technique that, on the whole, was more likely to confuse than to clarify, one could hardly find a more promising candidate than legislative history. And the present case nicely proves that point.

Judge Harold Leventhal used to describe the use of legislative history as the equivalent of entering a crowded cocktail party and looking over the heads of the guests for one’s friends. If I may pursue that metaphor: The legislative history of §205 of the Soldiers’ and Sailors’ Civil Relief Act contains a variety of diverse personages, a selected few of whom — its “friends” — the Court has introduced to us in support of its result. But there are many other faces in the crowd, most of which, I think, are set against today’s result.

I will limit my exposition of the legislative history to the enactment of four statutes:

1. The Soldiers’ and Sailors’ Civil Relief Act of 1918 (1918 Act), 40 Stat. 440;
2. The Soldiers’ and Sailors’ Civil Relief Act of 1940 (1940 Act or Act), 54 Stat. 1178;
3. The Soldiers’ and Sailors’ Civil Relief Act Amendments of 1942 (1942 Amendments), 56 Stat. 769;
4. The Selective Service Act of 1948, 62 Stat. 604.

That, of course, cannot be said to be the “complete legislative history” relevant to this provision. Cf. ante, at 515. One of the problems with legislative history is that it is inherently open ended. In this case, for example, one could go back further in time to examine the Civil War-era relief Acts, many of which are in fact set forth in an appendix to the House Report on the 1918 Act, see App. A, H. R. Rep. No. 181, 65th Cong., 1st Sess., 18-32 (1917) (hereinafter 1917 House Report). Or one could extend the search abroad and consider the various foreign statutes that were mentioned in that same House Report. See id., at 4, 13-14 (discussing English and French enactments). Those additional statutes might be of questionable relevance, but then so too are the 1918 Act and the 1940 Act, neither of which contained a provision governing redemption periods. Nevertheless, I will limit my legislative history inquiry to those four statutes for the simple reason that that is the scope chosen by the Court.

The 1918 Act appears to have been the first comprehensive national soldiers’ relief Act. See 55 Cong. Rec. 7787 (1917). The legislative history reveals that Congress intended that it serve the same vital purpose — providing “protection against suit to men in military service” — as various state statutes had served during the Civil War. 1917 House Report 3; see also id., at 18-32 (App. A) (setting forth text of numerous state soldiers’ relief Acts from the Civil War era). Congress intended, however, that the 1918 Act should differ from the Civil War statutes “in two material respects.” 55 Cong. Rec. 7787 (1917) (statement of Rep. Webb). The first was that, being a national statute, it would produce a disposition “uniform throughout the Nation.” 1917 House Report 3; see also 55 Cong. Rec. 7787 (1917) (statement of Rep. Webb). But it is the second difference which has particular relevance to the Court’s ruling today:

“The next material difference between this law and the various State laws is this, and in this I think you will find the chief excellence of the bill which we propose: Instead of the bill we are now considering being arbitrary, inelastic, inflexible, the discretion as to dealing out even-handed justice between the creditor and the soldier, taking into consideration the fact that the soldier has been called to his country’s cause, rests largely, and in some cases entirely, in the breast of the judge who tries the case.” Id., at 7787 (statement of Rep. Webb).

This -comment cannot be dismissed as the passing remark of an insignificant Member, since the speaker was the Chairman of the House Judiciary Committee, the committee that reported the bill to the House floor. Moreover, his remarks merely echoed the House Report, which barely a page into its text stated: “We cannot point out too soon, or too emphatically, that the bill is not an inflexible stay of all claims against persons in military service.” 1917 House Report 2. Congress intended to depart from the “arbitrary and rigid protection” that had been provided under the Civil War-era stay laws, ibid., which could give protection to men “who can and should pay their obligations in full,” id., at 3. It is clear, therefore, that in the 1918 Act Congress intended to create flexible rules that would permit denial of protection to members of the military who could show no hardship.

The 1918 Act expired by its own terms six months after the end of the First World War. See 1918 Act, § 603,40 Stat. 449. The 1940 Act was adopted as the Nation prepared for its coming participation in the Second World War. Both the House and Senate Reports described it as being, “in substance, identical with the [1918 Act].” H. R. Rep. No. 3001, 76th Cong., 3d Sess., 3 (1940); S. Rep. No. 2109, 76 Cong., 3d Sess., 4 (1940). Moreover, in Boone v. Lightner, 319 U. S. 561, 565 (1943), we acknowledged that the 1940 Act was “a substantial reenactment” of the 1918 Act, and looked to the legislative history of the 1918 Act for indications of congressional intent with respect to the 1940 Act. Relying on that legislative history, we found that “the very heart of the policy of the Act” was to provide “judicial discretion ... instead of rigid and undiscriminating suspension of civil proceedings.” Ibid.

Although the Court never mentions this fact, it is clear that under the 1918 and 1940 Acts a redemption period would not be tolled during the period of military service. In both enactments, § 205 governed only statutes of limitations and did not mention redemption periods. Moreover, in

Ebert v. Poston, 266 U. S. 548 (1925), this Court held that neither § 205 nor § 302, which provides protection from foreclosures, conferred on a court any power to extend a statutory redemption period. Congress overturned the rule of Ebert in the 1942 Amendments, a central part of the legislative history that the Court curiously fails to discuss. Section 6 of those amendments rewrote § 205 of the Act to place it in its current form, which directly addresses the redemption periods. See 56 Stat. 770-771; ante, at 612-513, n. 1 (setting forth current version of § 205). The crucial question in the present case (if one believes in legislative history) is whether Congress intended this amendment to be consistent with the “heart of the policy of the Act” — conferring judicial discretion — or rather intended it to confer an unqualified right to extend the period of redemption. Both the House and Senate Reports state that, under the amended §206, “ttjhe running of the statutory period during which real property may be redeemed after sale to enforce any obligation, tax, or assessment is likewise tolled during the part of such period which occurs after the enactment of the [1942 Amendments].” H. R. Rep. No. 2198, 77th Cong., 2d Sess., 3-4 (1942) (emphasis added); S. Rep. No. 1558,77th Cong., 2d Sess., 4 (1942) (emphasis added). The Reports also state that “[although the tolling of such periods is now within the Bpirit of the law, it haB not been held to be within the letter thereof” (citing Ebert). H. R. Rep. No. 2198, supra, at 4; S. Rep. No. 1558, supra, at 4. These statements surely indicate an intention to provide a tolling period for redemptions similar to that already provided for statutes of limitations— which, on the basis of the legislative history Í have described, can be considered discretionary rather than rigid. The existence of discretionary authority to suspend the tolling is also suggested by the House floor debates. Responding to questions, Representative Sparkman (who submitted the Report on behalf of the House Committee on Military Affairs) agreed that, while the bill “pertains to all persons in the armed forces,” a man “serving in the armed forces for more money than he got in civil life ... is not entitled to any of the benefits of the provisions of this bill.” 88 Cong. Rec. 6364, 6366 (1942). In response to that last comment, another Representative inquired further whether “[t]his is to take care of the men who are handicapped because of their military service.” Id., at 6366. Representative Sparkman answered affirmatively. Ibid. He confirmed that Congress did not intend to abandon the discretionary nature of the scheme: “With reference to all these matters we have tried to make the law flexible by lodging discretion within the courts to do or not to do as justice and equity may require.” Ibid. And finally, at a later point in the debates, Representative Brooks made clear that the Act was intended to remedy the prejudice resulting from compelled military service: “We feel that the normal obligations of the man contracted prior to service Induction should be suspended as far as practicable during this tour of duty, and that the soldier should be protected from default in his obligations due to his inability to pay caused by reduction in income due to service.” Id., at 6369.

The final component of the legislative history that I shall treat is the extension of the 1940 Act in the Selective Service Act of 1948, 62 Stat. 604. The Court misconstrues Congress’s intent in this enactment in two respects. First, it asserts that “because Congress extended the life of the Act indefinitely in 1948, well after the end of World War II, the complete legislative history confirms a congressional intent to protect all military personnel on active duty, just as the statutory language provides.” Ante, at 515 (footnote omitted). It is true enough that the War was over; but the draft was not. The extension of the 1940 Act was contained in the Selective Service Act of 1948, which required military service from citizens. And it would appear to have been contemplated that the “life of the Act” would be extended not “indefinitely,” as the Court says, ibid., but for the duration of the draft. See H. R. Rep. No. 1881, 80th Cong., 2d Sess., 12 (1948) (extension was intended to “contihu[e] the Soldiers’ and Sailors’ Civil Relief Act of 1940 in its application to the personnel inducted or entering the armed forces during the life of this act”). The legislative history states that Congress intended to extend the provisions of the 1940 Act “to persons serving in the armed forces pursuant to this act" S. Rep. No. 1268, 80th Cong., 2d Sess., 21 (1948) (emphasis added). Career members of the military such as petitioner would not have been serving “pursuant to” the Selective Service Act, since they were expressly excepted from its service requirement. See Selective Service Act of 1948 §6(a), 62 Stat. 609. In this focus upon draftees, the legislative history of the 1948 extension merely replicates that of the 1940 Act and the 1942 Amendments. The former was enacted on the heels of the Selective Training and Service Act of 1940, 64 Stat. 886, and was introduced on the Senate floor with the explanation that it would provide “relief . . . to those who are to be inducted into the military service for training under [the Selective Training and Service Act of 1940].” 86 Cohg. Rec. 10292 (1940) (statement of Rep. Overton) (emphasis added). In the debate on the 1942 Amendments, Representative Sparkman noted that “hundreds of thousands, and even millions, have been called” into military service since the enactment of the 1940 Act, and admonished his colleagues to “keep uppermost in your mind at all times the fact that the primary purpose of this legislation is to give relief to the boy that is called into service.” 88 Cong. Rec. 6364 (1942). In other words, the legislative history of the 1948 extension, like that of the Act itself and of the 1942 Amendments, suggests an intent to protect those who were prejudiced, by military service, as many who were drafted would be.

The Court also errs in mistaking the probable effect of Congress’s presumed awareness of our earlier opinions in Ebert and Boone. See ante, at 516. In Boone, we stated that the Act “is always to be liberally construed to protect those who have been obliged to drop their own affairs to take Up the burdens of the nation,” 319 U. S., at 575 (emphasis added), but that discretion was vested in the courts to ensure that the immunities of the Act are not put to “unworthy use,” ibid., since “the very heart of the policy of the Act” was to provide “judicial discretion . . . instead of rigid and undiscriminating suspension of civil proceedings,” id., at 565. Awareness of Boone would likely have caused Congress to assume that the courts would vindicate “the very heart of the policy of the Act” by requiring a showing of prejudice. The Court argues, however, that Congress would also have been aware that Ebert recognized the “carefully segregated arrangement of the various provisions” of the Act, ante, at 516. It is already an extension of the normal convention to assume that Congress was aware of the precise reasoning (as opposed to the holding) of earlier judicial opinions; but it goes much further to assume that Congress not only knew, but expected the courts would continue to follow, the reasoning of a case (Ebert) whose holding Congress had repudiated six years earlier. See supra, at 523. In any event, the Court seeks to use Ebert only to establish that Congress was aware that this Court was aware of the “carefully segregated arrangement” of the Act. That adds little, if anything, to direct reliance upon the plain language of the statute.

After reading the above described legislative history, one might well conclude that the result reached by the Court today, though faithful to law, betrays the congressional intent. Many have done so. Indeed, as far as I am aware, every court that has chosen to interpret § 205 in light of its legislative history rather than on the basis' of its plain text has found that Congress did not intend § 205 to apply to career members of the military who cannot show prejudice or hardship. See, in addition to the court below, Pannell v. Continental Can Co., 554 F. 2d 216, 224-225 (CA5 1977); Bailey v. Barranca, 83 N. M. 90, 94-95, 488 P. 2d 725, 729-730 (1971); King v. Zagorski, 207 So. 2d 61, 66-67 (Fla. App. 1968). The only scholarly commentary I am aware of addressing this issue concludes: “An examination of the legislative history of the Act shows that the prevailing interpretation of section 205 [i. e., the Court’s interpretation] is not consistent with congressional intent.” Folk, Tolling of Statutes of Limitations under Section 205 of the Soldiers’ and Sailors’ Civil Relief Act, 102 Mil. L. Rev. 157, 168 (1983). Finally, even the Government itself, which successfully urged in this case the position we have adopted, until recently believed, on the basis of legislative history, the contrary. See Townsend v. Secretary of Air Force, No. 90-1168, 1991 U. S. App. LEXIS 26578, *5-*7 (CA4, Nov. 12, 1991); Brief for United States as Amicus Curiae 17, n. 19 (filed June 2,1992) (noting Government’s position in Townsend that §205 requires a showing of prejudice); see also Bickford v. United States, 656 F. 2d 636, 640 (Ct. Cl. 1981) (“The Government argues that the statute does not mean what it says because the legislative history evinces Congress’ intent to limit the applicability of [§ 205] to those servicemen engaged in battle or who are otherwise handicapped from asserting their legal claims”).

I confess that I have not personally investigated the entire legislative history — or even that portion of it which relates to the four statutes listed above. The excerpts I have examined and quoted were unearthed by a hapless law clerk to whom I assigned the task. The other Justices have, in the aggregate, many more law clerks than I, and it is quite possible that if they all were unleashed upon this enterprise they would discover, in the legislative materials dating back to 1917 or earlier, many faces friendly to the Court’s holding. Whether they would or not makes no difference to me — and evidently makes no difference to the Court, which gives lip-service to legislative history but does not trouble to set forth and discuss the foregoing material that others found so persuasive. In my view, that is as it should be, except for the lipservice. The language of the statute is entirely clear, and if that is not what Congress meant then Congress has made a mistake and Congress will have to correct it. We should not pretend to care about legislative intent (as opposed to the meaning of the law), lest we impose upon the practicing bar and their clients obligations that we do not ourselves take seriously.

       Justice Thomas joins all but footnote 12 of the opinion.

       The full text of § 525 presently reads as follows:
      “The period of military service shall not be included in computing any period now or hereafter to be limited by any law, regulation, or order for the bringing of any action or proceeding in any court, board, bureau, commission, department, or other agency of government by or against any person in military service or by or against his heirs, executors, administrators, or assigns, whether such cause of action or the right or privilege to institute such action or proceeding shall have accrued prior to or during the period of such service, nor shall any part of such period which occurs after October 6, 1942 be included in computing any period now or hereafter provided by any law for the redemption of real property sold or forfeited to enforce any obligation, tax, or assessment.” 50 U. S. C. App. §525 (1988 ed., Supp. III).

       He testified that he did not receive tax bills for those years and that his letters asking for tax bills were not answered by the town.

       Under Maine law a taxing authority has a lien against real estate until properly assessed taxes are paid. If taxes remain unpaid for 30 days after a notice of lien and demand for payment has been sent to the owner, the tax collector may record a tax lien certificate to create a tax lien mortgage. The taxpayer then has an 18-month period of redemption in which he may recover his property by paying the overdue taxes plus interest and costs. See Me. Rev. Stat. Ann., Tit. 36, §§ 552, 942, 943 (1990). It is stipulated that the required procedures were followed in this case and that the town’s title was perfected, unless petitioner’s objection based on § 525 requires a different result.

       Pet. for Cert. 33. The court particularly relied on Parnell v. Continental Can Co., 554 F. 2d 216 (CA5 1977); Bailey v. Barranca, 83 N. M. 90, 488 P. 2d 725 (1971); King v. Zagorski, 207 So. 2d 61 (Fla. App. 1968).

       Pet. for Cert. 34.

        Conroy v. Danforth, 599 A. 2d 426 (1991).

       Respondents emphasize that the statement of purposes refers to the ‘“temporary suspension of legal proceedings and transactions.’” Brief for Respondents 8, quoting 50 U. S. C. App. § 510. The length of a suspension that lasts as long as the period of active service is “temporary,” however, whether it applies to a short enlistment or a long career.

       Section 14 of the Selective Service Act of 1948, 62 Stat. 623, provided that the 1940 Act “shall be applicable to all persons in the armed forces of the United States” until the 1940 Act “is repealed or otherwise terminated by subsequent Act of the Congress.”

       Similar qualifications appear in §520(4) (applying to the reopening of judgments against an absent service member); §§521 and 523 (providing for stays of legal proceedings, attachments, and garnishments); § 526 (regulating interest rates on obligations incurred prior to military seryiee); §530(3) (covering eviction and distress proceedings); §531(3) (involving the termination of installment contracts); §535(1) (involving the assignment of insurance coverage); and § 535(2) (limiting the right to enforce liens for the storage of personal property).

       See Cannon v. University of Chicago, 441 U. S. 677, 696-697 (1979).

       The House Report on the suspension of suits in the 1918 Act, for example, provided in part:
      “The lesson of the stay laws of the Civil War teaches that an arbitrary and rigid protection against suits is as much a mistaken kindness to the soldier as it is unnecessary. A total suspension for the period of the war of all rights against a soldier defeats its own purpose. In time of war credit is of even more importance than in time of peace, and if there were a total prohibition upon enforcing obligations against one in military service, the credit of a soldier and his family would be utterly cut off. No one could be found who would extend them credit.” H. R. Rep. No. 181, 65th Cong., 1st Sess., 2-3 (1917).
      And Congressman Webb, Chairman of the House Judiciary Committee, stated:
      “Manifestly, if this Congress should undertake to pass an arbitrary stay law providing that no creditor should ever sue or bring proceedings against any soldier while in the military service of his country, that would upset business very largely in many parts of the country. In the next place, it would be unfair to the creditor as well as to the soldier. It would disturb the soldier’s credit probably in many cases and would deny the right of the creditor to his just debts from a person who was amply able to pay and whose military service did not in the least impair his ability to meet the obligation.” 55 Cong. Rec. 7787 (1917). See Boone v. Lightner, 319 U. S. 561, 566, 567, 568 (1943).

       In his 11-page opinion concurring in the judgment, Justice Scalia suggests that our response to respondents’ reliance on legislative history “is not merely a waste of research time and ink,” but also “a false and disruptive lesson in the law.” Post, at 519. His “hapless law clerk,” post, at 527, has found a good deal of evidence in the legislative history that many provisions of this statute were intended to confer discretion on trial judges. That, of course, is precisely our point: It is reasonable to conclude that Congress intended to authorize such discretion when it expressly provided for it and to deny such discretion when it did not. A jurisprudence that confines a court’s inquiry to the “law as it is passed,” and is wholly unconcerned about “the intentions of legislators,” post, at 519, would enforce an unambiguous statutory text even when it produces manifestly unintended and profoundly unwise consequences. Respondents have argued that this is such a case. We disagree. Justice Scalia, however, is apparently willing to assume that this is such a case, but would nevertheless conclude that we have a duty to enforce the statute as written even if fully convinced that every Member of the enacting Congress, as well as the President who signed the Act, intended a different result. Again, we disagree. See Wisconsin Public Intervenor v. Mortier, 501 U. S. 597, 610, n. 4 (1991).

       The Court refers to this section as “§525,” which corresponds to the unofficial codification of the section in the United States Code, 50 U. S. C. App. § 525. I find it more convenient to use the actual statutory section number — “§ 205” — in discussing the history of the provision.

       When I say “Congress intended,” here and hereafter in this excursus into legislative history, I am speaking as legislative historians speak, attributing to all Members of both Houses of Congress (or at least to a majority of the Members of each House), and to the President (or, if the President did not sign the bill in question, then to at least two-thirds of the Members of both Houses of Congress) views expressed by the particular personage, or committee of personages, whose statements are being described — in the case of the citation at issue in this sentence, a committee of the House of Representatives. It is to be assumed — by a sort of suspension of disbelief — that two-thirds of the Members of both Houses of Congress (or a majority plus the President) were aware of those statements and must have agreed with them;; or perhaps it is to be assumed— by a sort of suspension of the Constitution — that Congress delegated to that personage or personages the- authority to say what its laws mean.

       In quoting this floor statement, I follow the convention of legislative history, which is to assume conclusively that statements recorded in the Congressional Record were in fact made. That assumption of course does not accord with reality. See 117 Cong. Rec. 36506-36507 (1971) (supposed floor statement shown by internal evidence never to have been delivered).

       Section 205 of the 1918 Act provided:
      “That the period of military service shall not be included in computing any period now or hereafter to be limited by any law for the bringing of &ny action by or against any person in military service or by or against his heirs, executors, administrators, or assigns, whether sUch cause of action shall have accrued prior to or durihg the period of such service.” 40 Stat. 443.
      Section 205 of the 1940 Act was identical, except that the word “íhat” at the beginning of the section was omitted.