United States v. Caltex (Philippines), Inc.

In 1941 Caltex (Philippines), Inc. (Caltex) (defendant), along with other companies (the oil companies) (defendants), owned and operated terminal facilities in Manila, Philippines. These facilities received, handled, and stored petroleum products. After Pearl Harbor was attacked, the United States began preparing for an attack on Manila. When it became clear that the enemy would overtake Manila, the commanding general of the United States Army ordered the destruction of the oil companies’ facilities and remaining petroleum products in Manila so that they would not become an asset to the enemy. The facilities were requisitioned by the United States Army, and an engineer from one of the facilities was commissioned to design their destruction. Any items useful to the United States Army were removed, and the remainder of the facilities were demolished as Japanese troops were entering Manila. Before the demolition, Caltex demanded and received a receipt for the terminal facilities and Caltex stock. After the end of World War II, the oil companies demanded compensation for the facilities and petroleum products. The federal government paid for petroleum stocks and transportation equipment but would not pay for the terminal facilities. The oil companies filed an action in the Court of Claims. The Court of Claims ordered that the oil companies be compensated for the terminal facilities. The United States appealed.