Article I. Legislative Department |
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ARTICLE I
__________
LEGISLATIVE DEPARTMENT
__________
CONTENTS
Page
Section 1. Legislative Powers............................. 63
Separation of Powers and Checks and Balances.............. 63
The Theory Elaborated and Implemented............. 63
Judicial Enforcement.............................. 65
Bicameralism.............................................. 70
Enumerated, Implied, Resulting, and Inherent Powers....... 71
Delegation of Legislative Power........................... 73
Origin of the Doctrine of Nondelegability......... 73
Delegation Which Is Permissible................... 75
Filling Up the Details.................... 76
Contingent Legislation.................... 76
The Effective Demise of the Nondelegation Doctrine 78
The Regulatory State...................... 78
Standards................................. 82
Foreign Affairs........................... 86
Delegations to the States................. 86
Delegation to Private Persons............. 87
Delegation and Individual Liberties....... 88
Punishment of Violations.......................... 89
Congressional Investigations.............................. 90
Source of the Power to Investigate................ 90
Investigations of Conduct of Executive Department. 92
Investigations of Members of Congress............. 93
Investigations in Aid of Legislation.............. 93
Purpose................................... 93
Protection of Witnesses: Pertinency and
Related Matters....................... 96
Protection of Witnesses: Constitutional
Guarantees............................ 100
Sanctions of the Investigatory Power: Contempt.... 103
Section 2. The House of Representatives................... 105
Clause 1. Congressional Districting....................... 105
Elector Qualifications............................ 109
Clause 2. Qualifications of Members of Congress........... 110
When the Qualifications Must Be Possessed......... 110
Exclusivity of Constitutional Qualifications...... 110
Congressional Additions........................... 110
State Additions................................... 113
Clause 3. Apportionment of Seats in the House............. 114
The Census Requirement............................ 114
Clause 4. Vacancies....................................... 116
Clause 5. Officers and Power of Impeachment............... 116
Section 3. The Senate..................................... 116
Clause 1. Composition and Selection....................... 116
Clause 2. Classes of Senators............................. 116
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Clause 3. Qualifications.................................. 117
Clause 4. The Vice President.............................. 117
Clause 5. Officers........................................ 117
Clause 6. Trial of Impeachments........................... 117
Clause 7. Judgments on Impeachment........................ 117
Section 4. Elections...................................... 117
Clause 1. Congressional Power to Regulate................. 117
Federal Legislation Protecting Electoral Process.. 118
Clause 2. Time of Assembling.............................. 121
Section 5. Powers and Duties of the Houses................ 121
Clause 1. Power to Judge Elections........................ 122
``A Quorum to Do Business''....................... 122
Clause 2. Rules of Proceedings............................ 123
Powers of the Houses Over Members................. 124
Clause 3. Duty to Keep a Journal.......................... 125
Clause 4. Adjournments.................................... 121
Section 6. Rights and Disabilities of Members............. 125
Clause 1. Compensation and Immunities..................... 126
Congressional Pay................................. 126
Privilege from Arrest............................. 127
Privilege of Speech or Debate..................... 127
Members................................... 127
Congressional Employees................... 132
Clause 2. Disabilities.................................... 134
Appointment to Executive Office................... 134
Incompatible Offices.............................. 135
Section 7. Legislative Process............................ 135
Clause 1. Revenue Bills................................... 136
Clause 2. Approval by the President....................... 137
The Veto Power.................................... 138
Clause 3. Presentation of Resolutions..................... 141
The Legislative Veto...................... 141
Section 8. Powers of Congress............................. 144
Clause 1. Power to Tax and Spend.......................... 144
Kinds of Taxes Permitted.......................... 144
Decline of the Forbidden Subject Matter
Test.................................. 144
Federal Taxation of State Interests....... 145
Scope of State Immunity from Federal
Taxation.............................. 147
Uniformity Requirement.................... 149
Purposes of Taxation.............................. 150
Regulation by Taxation.................... 150
Extermination by Taxation................. 151
Promotion of Business: Protective Tariff.. 152
Spending for the General Welfare.................. 153
Scope of the Power........................ 153
Social Security Act Cases......................... 155
An Unrestrained Federal Spending Power............ 156
Conditional Grants-In-Aid......................... 156
Earmarked Funds................................... 158
Debts of the United States........................ 158
Clause 2. Borrowing Power................................. 159
Clause 3. Commerce Power.................................. 160
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Power to Regulate Commerce........................ 160
Purposes Served by the Grant.............. 160
Definition of Terms....................... 160
Commerce.......................... 160
Among the Several States.......... 163
Regulate.......................... 164
Necessary and Proper Clause....... 165
Federalism Limits on Exercise of
Commerce Power................ 166
Illegal Commerce.................. 167
Interstate versus Foreign Commerce................ 167
Instruments of Commerce........................... 169
Congressional Regulation of Waterways............. 170
Navigation................................ 170
Hydroelectric Power; Flood Control........ 173
Congressional Regulation of Land Transportation... 175
Federal Stimulation of Land Transportation 175
Federal Regulation of Land Transportation. 176
Federal Regulation of Intrastate Rates.... 178
Federal Protection of Labor in Interstate
Rail Transportation................... 179
Regulation of Other Agents of Carriage and
Communications........................ 180
Congressional Regulation of Commerce as Traffic... 181
The Sherman Act: Sugar Trust Case......... 181
Sherman Act Revived....................... 183
The ``Current of Commerce'' Concept: The
Swift Case............................ 183
The Danbury Hatters Case.................. 184
Stockyards and Grain Futures Acts......... 185
Securities and Exchange Commission........ 186
Congressional Regulation of Production and
Industrial Relations:
Antidepression Legislation...................... 187
National Industrial Recovery Act.......... 187
Agricultural Adjustment Act............... 188
Bituminous Coal Conservation Act.......... 188
Railroad Retirement Act................... 189
National Labor Relations Act.............. 190
Fair Labor Standards Act.................. 192
Agricultural Marketing Agreement Act...... 194
Acts of Congress Prohibiting Commerce............. 196
Foreign Commerce: Jefferson's Embargo..... 196
Foreign Commerce: Protective Tariffs...... 198
Foreign Commerce: Banned Articles......... 198
Interstate Commerce: Power to Prohibit
Questioned............................ 199
Interstate Commerce: National Prohibitions
and State Police Power................ 200
The Lottery Case.......................... 200
The Darby Case............................ 202
The Commerce Clause as a Source of National Police
Power......................................... 203
Is There an Intrastate Barrier to
Congress' Commerce Power?............. 203
Civil Rights.............................. 207
Criminal Law.............................. 208
The Commerce Clause as a Restraint on State Powers 209
Doctrinal Background...................... 209
The State Proprietary Activity Exception.. 216
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Congressional Authorization of
Impermissible State Action............ 216
State Taxation and Regulation: The Old Law........ 220
General Considerations.................... 220
Taxation.................................. 221
Regulation................................ 224
State Taxation and Regulation: The Modern Law..... 227
General Considerations.................... 227
Taxation.................................. 228
Regulation................................ 233
Foreign Commerce and State Powers................. 240
Concurrent Federal and State Jurisdiction......... 243
The General Issue: Preemption............. 243
Preemption Standards.............. 245
The Standards Applied............. 246
Federal Versus State Labor Laws... 254
Commerce With Indian Tribes....................... 260
Clause 4. Naturalization and Bankruptcies................. 265
Naturalization and Citizenship.................... 265
Nature and Scope of Congress' Power....... 265
Categories of Citizens: Birth and
Naturalization........................ 267
The Naturalization of Aliens.............. 268
Rights of Naturalized Persons..................... 270
Expatriation: Loss of Citizenship................. 272
Aliens............................................ 276
The Power of Congress to Exclude Aliens... 276
Deportation............................... 280
Bankruptcy........................................ 281
Persons Who May Be Released from Debt..... 281
Liberalization of Relief Granted and
Expansion of the Rights of the Trustee 282
Constitutional Limitations on the
Bankruptcy Power...................... 283
Constitutional Status of State Insolvency
Laws: Preemption...................... 284
Clauses 5 and 6. Money.................................... 286
Fiscal and Monetary Powers of Congress............ 287
Coinage, Weights, and Measures............ 287
Punishment of Counterfeiting.............. 287
Borrowing Power versus Fiscal Power....... 288
Clause 7. Post Office..................................... 289
Postal Power...................................... 289
``Establish''............................. 289
Power to Protect the Mails................ 290
Power to Prevent Harmful Use of the Postal
Facilities............................ 290
Exclusive Power as an Adjunct to Other
Powers................................ 292
State Regulations Affecting the Mails..... 292
Clause 8. Copyrights and Patents.......................... 293
Copyrights and Patents............................ 294
Scope of the Power........................ 294
Patentable Discoveries.................... 295
Procedure in Issuing Patents.............. 297
Nature and Scope of the Right Secured..... 298
Power of Congress over Patent Rights...... 299
State Power Affecting Payments and
Copyrights............................ 300
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Trade-Marks and Advertisements............ 302
Clause 9. Creation of Courts.............................. 302
Clause 10. Maritime Crimes................................ 303
Piracies, Felonies, and Offenses Against the Law
of Nations.................................... 303
Origin of the Clause...................... 303
Definition of Offenses.................... 303
Extraterritorial Reach of the Power....... 304
Clauses 11, 12, 13, and 14. War; Military Establishment... 305
The War Power..................................... 305
Source and Scope.......................... 305
Three Theories.................... 305
An Inherent Power................. 306
A Complexus of Granted Powers..... 307
Declaration of War........................ 307
The Power to Raise and Maintain Armed Forces...... 311
Purpose of Specific Grants................ 311
Time Limit on Appropriations for the Army. 312
Conscription.............................. 312
Care of the Armed Forces.................. 314
Trial and Punishment of Offenses:
Servicemen, Civilian Employees, and
Dependents............................ 316
Servicemen........................ 316
Civilians and Dependents.......... 319
War Legislation................................... 319
War Powers in Peacetime................... 319
Delegation of Legislative Power in Wartime 322
Constitutional Rights in Wartime.................. 324
Constitution and the Advance of the Flag.. 324
Theater of Military Operations.... 324
Enemy Country..................... 324
Enemy Property.................... 325
Prizes of War..................... 326
The Constitution at Home in Wartime....... 326
Personal Liberty.................. 326
Enemy Aliens...................... 328
Eminent Domain.................... 329
Rent and Price Controls........... 330
Clauses 15 and 16. The Militia............................ 331
The Militia Clause................................ 331
Calling Out the Militia................... 331
Regulation of the Militia................. 332
Clause 17. District of Columbia; Federal Property......... 333
Seat of the Government............................ 333
Authority Over Places Purchased................... 337
``Places''................................ 337
Duration of Federal Jurisdiction.......... 338
Reservation of Jurisdiction by States..... 339
Clause 18. Necessary and Proper Clause.................... 339
Coefficient or Elastic Clause..................... 339
Scope of Incidental Powers................ 339
Operation of Coefficient Clause........... 340
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Definition of Punishment and Crimes....... 341
Chartering of Banks....................... 341
Currency Regulations...................... 342
Power to Charter Corporations............. 342
Courts and Judicial Proceedings........... 343
Special Acts Concerning Claims............ 343
Maritime Law.............................. 344
Section 9. Powers Denied to Congress...................... 344
Clause 1. Importation of Slaves........................... 344
General Purpose of Sec. 9......................... 344
Clause 2. Habeas Corpus Suspension........................ 345
Clause 3. Bills of Attainder and Ex Post Facto Laws....... 346
Bills of Attainder................................ 347
Ex Post Facto Laws................................ 350
Definition................................ 350
What Constitutes Punishment............... 351
Change in Place or Mode of Trial.......... 352
Clause 4. Taxes........................................... 352
Direct Taxes...................................... 352
The Hylton Case........................... 352
From the Hylton to the Pollock Case....... 353
Restriction of the Pollock Decision....... 354
Miscellaneous............................. 354
Clause 5. Duties on Exports from States................... 356
Taxes on Exports.................................. 356
Stamp Taxes............................... 356
Clause 6. Preference to Ports............................. 357
The ``No Preference'' Clause...................... 357
Clause 7. Appropriations and Accounting of Public Money... 358
Appropriations.................................... 358
Payment of Claims................................. 358
Clause 8. Titles of Nobility; Presents.................... 359
Section 10. Powers Denied to the States................... 359
Clause 1. Not to Make Treaties, Coin Money, Pass Ex Post
Facto Laws, Impair Contracts.......................... 359
Treaties, Alliances, or Confederations............ 360
Bills of Credit................................... 360
Legal Tender...................................... 361
Bills of Attainder................................ 361
Ex Post Facto Laws................................ 362
Scope of the Provision.................... 362
Denial of Future Privileges to Past
Offenders............................. 363
Changes in Punishment..................... 363
Changes in Procedure...................... 365
Obligation of Contracts........................... 366
``Law'' Defined........................... 366
Status of Judicial Decisions.............. 366
``Obligation'' Defined.................... 369
``Impair'' Defined........................ 369
Vested Rights Not Included................ 370
Public Grants That Are Not ``Contracts''.. 370
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Tax Exemptions: When Not ``Contracts''.... 372
``Contracts'' Include Public Contracts and
Corporate Charters.................... 374
Corporate Charters: Different Ways of
Regarding............................. 377
Reservation of Right to Alter or Repeal
Corporate Charters.................... 379
Corporation Subject to the Law and Police
Power................................. 380
Strict Construction of Charters, Tax
Exemptions............................ 381
Strict Construction and the Police Power.. 384
Doctrine of Inalienability as Applied to
Eminent Domain, Taxing, and Police
Powers................................ 385
Private Contracts......................... 388
Remedy a Part of the Private Obligation... 389
Private Contracts and the Police Power.... 392
Evaluation of the Clause Today............ 395
Clause 2. Not to Levy Duties on Exports and Imports....... 398
Duties on Exports and Imports..................... 399
Scope..................................... 399
Privilege Taxes........................... 400
Property Taxes............................ 400
Inspection Laws........................... 401
Clause 3. Not to Lay Tonnage Duties, Keep Troops, Make
Compacts, or Engage in War............................ 402
Tonnage Duties.................................... 402
Keeping Troops.................................... 403
Interstate Compacts............................... 403
Background of Clause...................... 403
Subject Matter of Interstate Compacts..... 404
Consent of Congress....................... 405
Grants of Franchise to Corporations by Two
States................................ 406
Legal Effects of Interstate Compacts...... 406
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ARTICLE I
LEGISLATIVE DEPARTMENT
Section 1. All legislative Powers herein granted shall be vested in a
Congress of the United States, which shall consist of a Senate and House
of Representatives.
SEPARATION OF POWERS AND CHECKS AND BALANCES
The Constitution nowhere contains an express injunction to
preserve the boundaries of the three broad powers it grants, nor does it
expressly enjoin maintenance of a system of checks and balances. Yet, it
does grant to three separate branches the powers to legislate, to
execute, and to adjudicate, and it provides throughout the document the
means by which each of the branches could resist the blandishments and
incursions of the others. The Framers drew up our basic charter against
a background rich in the theorizing of scholars and statesmen regarding
the proper ordering in a system of government of conferring sufficient
power to govern while withholding the ability to abridge the liberties
of the governed.\1\
\1\Among the best historical treatments are M. Vile,
Constitutionalism and the Separation of Powers (1967), and W. Gwyn, The
Meaning of the Separation of Powers (1965).
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The Theory Elaborated and Implemented
When the colonies separated from Great Britain following the
Revolution, the framers of their constitutions were imbued with the
profound tradition of separation of powers, and they freely and
expressly embodied in their charters the principle.\2\ But the theory of
checks and balances was not favored because it was drawn from Great
Britain, and, as a consequence, violations of the separation-of-powers
doctrine by the legislatures of the States were common
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place events prior to the convening of the Convention.\3\ As much as
theory did the experience of the States furnish guidance to the Framers
in the summer of 1787.\4\
\2\Thus the Constitution of Virginia of 1776 provided: ``The
legislative, executive, and judiciary department shall be separate and
distinct, so that neither exercise the powers properly belonging to the
other; nor shall any person exercise the powers of more than one of
them, at the same time[.]'' Reprinted in 10 W. Swindler (ed.), Sources
and Documents of United States Constitutions (1979), 52. See also 5 id.,
96, Art. XXX of Part First, Massachusetts Constitution of 1780: ``In the
government of this commonwealth, the legislative department shall never
exercise the executive and judicial powers, or either of them; the
executive shall never exercise the legislative and judicial powers, or
either of them; the judicial shall never exercise the legislative and
executive powers, or either of them; to the end it may be a government
of laws, and not of men.''
\3\``In republican government the legislative authority,
necessarily, predominates.'' The Federalist No. 51 (J. Cooke ed. 1961),
350 (Madison). See also id., No. 48, 332-334. This theme continues today
to influence the Court's evaluation of congressional initiatives. E.g.,
Metropolitan Washington Airports Auth. v. Citizens for the Abatement of
Aircraft Noise, 501 S.Ct. 252, 273-2274, 277 (1991). But compare id.,
286 n. 3 (Justice White dissenting).
\4\The intellectual history through the state period and the
Convention proceedings is detailed in G. Wood, The Creation of the
American Republic, 1776-1787 (1969) (see index entries under
``separation of powers'').
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The doctrine of separation of powers, as implemented in drafting
the Constitution, was based on several principles generally held: the
separation of government into three branches, legislative, executive,
and judicial; the conception that each branch performs unique and
identifiable functions that are appropriate to each; and the limitation
of the personnel of each branch to that branch, so that no one person or
group should be able to serve in more than one branch simultaneously. To
a great extent, the Constitution effectuated these principles, but
critics objected to what they regarded as a curious intermixture of
functions, to, for example, the veto power of the President over
legislation and to the role of the Senate in the appointment of
executive officers and judges and in the treaty-making process. It was
to these objections that Madison turned in a powerful series of
essays.\5\
\5\The Federalist Nos. 47-51 (J. Cooke ed. 1961), 323-353
(Madison).
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Madison recurred to ``the celebrated'' Montesquieu, the ``oracle
who is always consulted,'' to disprove the contentions of the critics.
``[T]his essential precaution in favor of liberty,'' that is, the
separation of the three great functions of government had been achieved,
but the doctrine did not demand rigid separation. Montesquieu and other
theorists ``did not mean that these departments ought to have no partial
agency in, or controul over, the acts of each other,'' but rather
liberty was endangered ``where the whole power of one department is
exercised by the same hands which possess the whole power of another
department.''\6\ That the doctrine did not demand absolute separation
provided the basis for preservation of separation of powers in action.
Neither sharply drawn demarcations of institutional boundaries nor
appeals to the electorate were sufficient.\7\ Instead, the security
against concentration of powers ``consists in giving to those who
administer each department the necessary constitutional means and
personal motives to resist encroachments of the others.'' Thus,
``[a]mbition must be made to
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counteract ambition. The interest of the man must be connected with the
constitutional rights of the place.''\8\
\6\Id., No. 47, 325-326(emphasis in original).
\7\Id., Nos. 47-49, 325-343.
\8\Id., No. 51, 349.
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Institutional devices to achieve these principles pervade the
Constitution. Bicameralism reduces legislative predominance, while the
presidential veto gives to the Chief Magistrate a means of defending
himself and of preventing congressional overreaching. The Senate's role
in appointments and treaties checks the President. The courts are
assured independence through good behavior tenure and security of
compensation, and the judges through judicial review will check the
other two branches. The impeachment power gives to Congress the
authority to root out corruption and abuse of power in the other two
branches. And so on.
Judicial Enforcement
Throughout much of our history, the ``political branches'' have
contended between themselves in application of the separation-of-powers
doctrine. Many notable political disputes turned on questions involving
the doctrine. Inasmuch as the doctrines of separation of powers and of
checks and balances require both separation and intermixture,\9\ the
role of the Supreme Court in policing the maintenance of the two
doctrines is problematic at best. And, indeed, it is only in the last
two decades that cases involving the doctrines have regularly been
decided by the Court. Previously, informed understandings of the
principles have underlain judicial construction of particular clauses or
guided formulation of constitutional common law. That is, the
nondelegation doctrine was from the beginning suffused with a
separation-of-powers premise,\10\ and the effective demise of the
doctrine as a judicially-enforceable construct reflects the Court's
inability to give any meaningful content to it.\11\ On the other hand,
periodically, the Court has essayed a strong separation position on
behalf of the President, sometimes with lack of success,\12\ sometimes
successfully.
\9\``While the Constitution diffuses power the better to secure
liberty, it also contemplates that practice will integrate the dispersed
powers into a workable government. It enjoins upon its branches
separateness but interdependence, autonomy but reciprocity.'' Youngstown
Sheet & Tube Co. v. Sawyer, 343 U.S. 579, 635 (1952) (Justice Jackson
concurring).
\10\E.g., Field v. Clark, 143 U.S. 649, 692 (1892); Wayman v.
Southard, 10 Wheat. (23 U.S.) 1, 42 (1825).
\11\See Mistretta v. United States, 488 U.S. 361, 415-416 (1989)
(Justice Scalia dissenting).
\12\The principal example is Myers v. United States, 272 U.S. 52
(1926), written by Chief Justice Taft, himself a former President. The
breadth of the holding was modified in considerable degree in Humphrey's
Executor v. United States, 295 U.S. 602 (1935), and the premise of the
decision itself was recast and largely softened in Morrison v. Olson,
487 U.S. 654 (1988).
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Following a lengthy period of relative inattention to separation
of powers issues, the Court since 1976\13\ has recurred to the doctrine
in numerous cases, and the result has been a substantial curtailing of
congressional discretion to structure the National Government. Thus, the
Court has interposed constitutional barriers to a congressional scheme
to provide for a relatively automatic deficit-reduction process because
of the critical involvement of an officer with significant legislative
ties,\14\ to the practice set out in more than 200 congressional
enactments establishing a veto of executive actions,\15\ and to the
vesting of broad judicial powers to handle bankruptcy cases in officers
not possessing security of tenure and salary.\16\ Contrarily, the
highly-debated establishment by Congress of a process by which
independent special prosecutors could be established to investigate and
prosecute cases of alleged corruption in the Executive Branch was
sustained by the Court in a opinion that may presage a judicial approach
in separation of powers cases more accepting of some blending of
functions at the federal level.\17\
\13\Beginning with Buckley v. Valeo, 424 U.S. 1, 109-143 (1976),
a relatively easy case, in which Congress had attempted to reserve to
itself the power to appoint certain officers charged with enforcement of
a law.
\14\Bowsher v. Synar, 478 U.S. 714 (1986).
\15\INS v. Chadha, 462 U.S. 919 (1983).
\16\Northern Pipeline Construction Co. v. Marathon Pipe Line
Co., 458 U.S. 50 (1982).
\17\Morrison v. Olson, 487 U.S. 654 (1988). See also Mistretta
v. United States, 488 U.S. 361 (1989).
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Important as were the results in this series of cases, the
development in the cases of two separate and inconsistent doctrinal
approaches to separation of powers issues occasioned the greatest amount
of commentary. The existence of the two approaches, which could
apparently be employed in the discretion of the Justices, made difficult
the prediction of the outcomes of differences over proposals and
alternatives in governmental policy. Significantly, however, it appeared
that the Court most often used a more strict analysis in cases in which
infringements of executive powers were alleged and a less strict
analysis when the powers of the other two Branches were concerned. The
special prosecutor decision, followed by the decision sustaining the
Sentencing Commission, may signal the adoption of a single analysis, the
less strict analysis, for all separation of power cases or it may turn
out to be but an exception to the Court's dual doctrinal approach.\18\
\18\The tenor of a later case, Metropolitan Washington Airports
Auth. v. Citizens for the Abatement of Airport Noise, 501 U.S. 252
(1991), was decidedly formalistic, but it involved a factual situation
and a doctrinal predicate easily rationalized by the principles of
Morrison and Mistretta, aggrandizement of its powers by Congress.
Granfinanciera, S.A. v. Nordberg, 492 U.S. 33 (1989), reasserted the
fundamentality of Marathon, again in a bankruptcy courts context,
although the issue was the right to a jury trial under the Seventh
Amendment rather than strictly speaking a separation-of-powers question.
Freytag v. CIR, 501 U.S. 868 (1991), pursued a straightforward
appointments-clause analysis, informed by a separation-of-powers
analysis but not governed by it. Finally, in Public Citizen v. U. S.
Department of Justice, 491 U.S. 440, 467 (1989) (concurring), Justice
Kennedy would have followed the formalist approach, but he explicitly
grounded it on the distinction between an express constitutional vesting
of power as against implicit vestings. Separately, the Court has for
some time viewed the standing requirement for access to judicial review
as reflecting a separation-of-powers component--confining the courts to
their proper sphere--Allen v. Wright, 468 U.S. 737, 752 (1984), but that
view seemed largely superfluous to the conceptualization of standing
rules. However, in Lujan v. Defenders of Wildlife, 112 S.Ct. 2130, 2144-
2146 (1992), the Court imported the take-care clause, obligating the
President to see to the faithful execution of the laws, into standing
analysis, creating a substantial barrier to congressional decisions to
provide for judicial review of executive actions. It is not at all
clear, however, that the effort, by Justice Scalia, enjoys the support
of a majority of the Court. Id., 2146-2147(Justices Kennedy and Souter
concurring). The cited cases do seem to demonstrate that a strongly
formalistic wing of the Court does continue to exist.
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While the two doctrines have been variously characterized, the
names generally attached to them have been ``formalist,'' applied to the
more strict line, and ``functional,'' applied to the less strict. The
formalist approach emphasizes the necessity to maintain three distinct
branches of government through the drawing of bright lines demarcating
the three branches from each other determined by the differences among
legislating, executing, and adjudicating.\19\ The functional approach
emphasizes the core functions of each branch and asks whether the
challenged action threatens the essential attributes of the legislative,
executive, or judicial function or functions. Under this approach, there
is considerable flexibility in the moving branch, usually Congress
acting to make structural or institutional change, if there is little
significant risk of impairment of a core function or in the case of such
a risk if there is a compelling reason for the action.\20\
\19\``The hydraulic pressure inherent within each of the
separate Branches to exceed the outer limits of its power . . . must be
resisted. Although not `hermetically' sealed from one another, the
powers delegated to the three Branches are functionally identifiable.''
INS v. Chadha, 462 U.S. 919, 951 (1983). See id., 944-51; Northern
Pipeline Construction Co. v. Marathon Pipe Line Co., 458 U.S. 50, 64-66
(1982) (plurality opinion); Bowsher v. Synar, 478 U.S. 714, 721-727
(1986).
\20\CFTC v. Schor, 478 U.S. 833, 850-51, 856-57 (1986); Thomas
v. Union Carbide Agric. Products Co., 473 U.S. 568, 587, 589-93 (1985).
The Court had first formulated this analysis in cases challenging
alleged infringments on presidential powers, United States v. Nixon, 418
U.S. 683, 713 (1974); Nixon v. Administrator of General Services, 433
U.S. 425, 442-43 (1977), but it had subsequently turned to the more
strict test. Schor and Thomas both involved provisions challenged as
infringing judicial powers.
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Chadha used the formalist approach to invalidate the legislative
veto device by which Congress could set aside a determination by the
Attorney General, pursuant to a delegation from Congress, to suspend
deportation of an alien. Central to the decision were two conceptual
premises. First, the action Congress had taken was leg
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islative, because it had the purpose and effect of altering the legal
rights, duties, and relations of persons outside the Legislative Branch,
and thus Congress had to comply with the bicameralism and presentment
requirements of the Constitution.\21\ Second, the Attorney General was
performing an executive function in implementing the delegation from
Congress, and the legislative veto was an impermissible interference in
the execution of the laws. Congress could act only by legislating, by
changing the terms of its delegation.\22\ In Bowsher, the Court held
that Congress could not vest even part of the execution of the laws in
an officer, the Comptroller General, who was subject to removal by
Congress because this would enable Congress to play a role in the
execution of the laws. Congress could act only by passing other
laws.\23\
\21\INS v. Chadha, 462 U.S. 919, 952 (1983).
\22\Id., 954-955.
\23\Bowsher v. Synar, 478 U.S. 714, 726-727, 733-734 (1986).
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On the same day Bowsher was decided through a formalist
analysis, the Court in Schor utilized the less strict, functional
approach in resolving a challenge to the power of a regulatory agency to
adjudicate as part of a larger canvas a state common-law issue, the very
kind of issue that Northern Pipeline, in a formalist plurality opinion
with a more limited concurrence, had denied to a non-Article III
bankruptcy court.\24\ Sustaining the agency's power, the Court
emphasized ``the principle that `practical attention to substance rather
than doctrinaire reliance on formal categories should inform application
of Article III.'''\25\ It held that in evaluating such a separation of
powers challenge, the Court had to consider the extent to which the
``essential attributes of judicial power'' were reserved to Article III
courts and conversely the extent to which the non-Article III entity
exercised the jurisdiction and powers normally vested only in Article
III courts, the origin and importance of the rights to be adjudicated,
and the concerns that drove Congress to depart from the requirements of
Article III.\26\ Bowsher, the Court said, was not contrary, because
``[u]nlike Bowsher, this case raises no question of the aggrandizement
of congressional power at the expense of a coordinate branch.''\27\ The
test was a balancing
[[Page 69]]
one, whether Congress had impermissibly undermined the role of another
branch without appreciable expansion of its own power.
\24\While the agency in Schor was an independent regulatory
commission and the bankruptcy court in Northern Pipeline was either an
Article I court or an adjunct to an Article III court, the
characterization of the entity is irrelevant and, in fact, the Court
made nothing of the difference. The issue in either case was whether the
judicial power of the United States could be conferred on an entity not
an Article III court.
\25\CFTC v. Schor, 478 U.S. 833, 848 (1986) (quoting Thomas v.
Union Carbide Agric. Products Co., 473 U.S. 568, 587 (1985)).
\26\Id., 851.
\27\Id., 856.
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While the Court, in applying one or the other analysis in
separation of powers cases, had never indicated its standards for
choosing one analysis over the other, beyond inferences that the
formalist approach was proper when the Constitution fairly clearly
committed a function or duty to a particular branch and the functional
approach was proper when the constitutional text was indeterminate and a
determination must be made on the basis of the likelihood of impairment
of the essential powers of a branch, the overall results had been a
strenuous protection of executive powers and a concomitant relaxed view
of the possible incursions into the powers of the other branches. It was
thus a surprise, then, when in the independent counsel case, the Court,
again without stating why it chose that analysis, utilized the
functional standard to sustain the creation of the independent
counsel.\28\ The independent-counsel statute, the Court emphasized, was
not an attempt by Congress to increase its own power at the expense of
the executive nor did it constitute a judicial usurpation of executive
power. Moreover, the Court stated, the law did not ``impermissibly
undermine'' the powers of the Executive Branch nor did it ``disrupt the
proper balance between the coordinate branches [by] prevent[ing] the
Executive Branch from accomplishing its constitutionally assigned
functions.''\29\ Acknowledging that the statute undeniably reduced
executive control over what it had previously identified as a core
executive function, the execution of the laws through criminal
prosecution, through its appointment provisions and its assurance of
independence by limitation of removal to a ``good cause'' standard, the
Court nonetheless noticed the circumscribed nature of the reduction, the
discretion of the Attorney General to initiate appointment, the limited
jurisdiction of the counsel, and the power of the Attorney General to
ensure that the laws are faithfully executed by the counsel. This
balancing, the Court thought, left the President with sufficient control
to ensure that he is able to perform his constitutionally assigned
functions.
\28\To be sure, the appointments clause did specifically provide
that Congress could vest in the courts the power to appoint inferior
officers, Morrison v. Olson, 487 U.S. 654, 670-677 (1988), making
possible the contention that, unlike Chadha and Bowsher, Morrison is a
textual commitment case. But the Court's separate evaluation of the
separation of powers issue does not appear to turn on that distinction.
Id., 685-696. Nevertheless, the existence of this possible distinction
should make one wary about lightly reading Morrison as a rejection of
formalism when executive powers are litigated.
\29\Id., 695 (quoting, respectively, Schor, supra, 478 U.S.,
856, and Nixon v. Administrator of General Services, supra, 433 U.S.,
443).
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[[Page 70]]
A notably more pragmatic, functional analysis suffused the
opinion of the Court when it upheld the constitutionality of the
Sentencing Commission.\30\ Charged with promulgating guidelines binding
on federal judges in sentencing convicted offenders, the seven-member
Commission, three members of which had to be Article III judges, was
made an independent entity in the judicial branch. The President
appointed all seven members, the judges from a list compiled by the
Judicial Conference, and he could remove from the Commission any member
for cause. According to the Court, its separation-of-powers
jurisprudence is always animated by the concerns of encroachment and
aggrandizement. ``Accordingly, we have not hesitated to strike down
provisions of law that either accrete to a single Branch powers more
appropriately diffused among separate Branches or that undermine the
authority and independence of one or another coordinate Branch.''\31\
Thus, to each of the discrete questions, the placement of the
Commission, the appointment of the members, especially the service of
federal judges, and the removal power, the Court carefully analyzed
whether one branch had been given power it could not exercise or had
enlarged its powers impermissibly and whether any branch would have its
institutional integrity threatened by the structural arrangement.
\30\Mistretta v. United States, 488 U.S. 361 (1989).
Significantly, the Court did acknowledge reservations with respect to
the placement of the Commission as an independent entity in the judicial
branch. Id., 384, 397, 407-08. As in Morrison, Justice Scalia was the
lone dissenter, arguing for a fairly rigorous application of separation-
of-powers principles. Id., 413, 422-427.
\31\Id., 382.
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Although it is possible, even likely, that Morrison and
Mistretta represent a decision by the Court to adopt for all separation-
of-powers cases the functional analysis, the history of adjudication
since 1976 and the shift of approach between Myers and Humphrey's
Executor suggest caution. Recurrences of the formalist approach have
been noted. Additional decisions must be forthcoming before it can be
decided that the Court has finally settled on the functional approach.
BICAMERALISM
By providing for a National Legislature of two Houses, the
Framers, deliberately or adventitiously, served several functions.
Examples of both unicameralism and bicameralism abounded. Some of the
ancient republics, to which the Framers often repaired for the learning
of experience, had two-house legislatures, and the Parliament of Great
Britain was based in two social orders, the hereditary aristocracy
represented in the House of Lords and the
[[Page 71]]
freeholders of the land represented in the House of Commons. A number of
state legislatures, following the Revolution, were created unicameral,
and the Continental Congress, limited in power as it was, consisted of
one house.
From the beginning in the Convention, in the Virginia Plan, a
two-house Congress was called for. The Great Compromise, one of the
critical decisions leading to a successful completion of the Convention,
resolved the dispute about the national legislature by providing for a
House of Representatives apportioned on population and a Senate in which
the States were equally represented. The first function served, thusly,
was federalism.\32\ Coextensively important, however, was the
separation-of-powers principle served. The legislative power, the
Framers both knew and feared, was predominant in a society dependent
upon the suffrage of the people, and it was important to have a
precaution against the triumph of transient majorities. Hence, the
Constitution's requirement that before lawmaking could be carried out
bills must be deliberated in two Houses, their Members beholden to
different constituencies, was in pursuit of this observation from
experience.\33\
\32\The Federalist, No. 39 (J. Cooke ed. 1961), 250-257
(Madison).
\33\Id., No. 51, 347-353 (Madison). The assurance of the
safeguard is built into the presentment clause. Article I, Sec. 7, cl.
2; and see id., cl. 3. The structure is not often the subject of case
law, but it was a foundational matter in INS v. Chadha, 462 U.S. 919,
944-951 (1983).
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Events since 1787, of course, have altered both the separation-
of-powers and the federalism bases of bicameralism, in particular the
adoption of the Seventeenth Amendment resulting in the popular election
of Senators, so that the differences between the two Chambers are today
less pronounced.
ENUMERATED, IMPLIED, RESULTING, AND INHERENT POWERS
Two important doctrines of constitutional law--that the Federal
Government is one of enumerated powers and that legislative powers may
not be delegated--are derived in part from this section. The classical
statement of the former is that by Chief Justice Marshall in McCulloch
v. Maryland: ``This government is acknowledged by all, to be one of
enumerated powers. The principle, that it can exercise only the powers
granted to it, would seem too apparent, to have required to be enforced
by all those arguments, which its enlightened friends, while it was
depending before the people, found it necessary to urge; that principle
is now universally admitted.''\34\
\34\4 Wheat. (17 U.S.) 316, 405 (1819).
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[[Page 72]]
That, however, ``the executive power'' is not confined to those
items expressly enumerated in Article II was asserted early in the
history of the Constitution by Madison and Hamilton alike and is found
in decisions of the Court;\35\ a similar latitudinarian conception of
``the judicial power of the United States'' was voiced in Justice
Brewer's opinion for the Court in Kansas v. Colorado.\36\ But even when
confined to ``the legislative powers herein granted,'' the doctrine is
severely strained by Marshall's conception of some of these as set forth
in his McCulloch v. Maryland opinion. He asserts that ``the sword and
the purse, all the external relations and no inconsiderable portion of
the industry of the nation, are intrusted to its government;''\37\ he
characterizes ``the power of making war,'' of ``levying taxes,'' and of
``regulating commerce'' as ``great, substantive and independent
powers;''\38\ and the power conferred by the ``necessary and proper''
clause embraces, he declares, all legislative ``means which are
appropriate'' to carry out the legitimate ends of the Constitution,
unless forbidden by ``the letter and spirit of the Constitution.''\39\
\35\Infra, pp. 445-452.
\36\206 U.S. 46, 82 (1907).
\37\4 Wheat. (17 U.S.), 407.
\38\Id., 411.
\39\Id., 421.
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Nine years later, Marshall introduced what Story in his
Commentaries labels the concept of ``resulting powers,'' those which
``rather be a result from the whole mass of the powers of the National
Government, and from the nature of political society, than a consequence
or incident of the powers specially enumerated.''\40\ Story's reference
is to Marshall's opinion in American Insurance Co. v. Canter,\41\ where
the latter said, that ``the Constitution confers absolutely on the
government of the Union, the powers of making war, and of making
treaties; consequently, that government possesses the power of acquiring
territory, either by conquest or by treaty.''\42\ And from the power to
acquire territory, he continues arises as ``the inevitable
consequence,'' the right to govern it.\43\
\40\2 J. Story, Commentaries on the Constitution of the United
States (Boston: 1833), 1256. See also id., 1286 and 1330.
\41\1 Pet. (26 U.S.) 511 (1828).
\42\Id., 542.
\43\Id., 543.
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Subsequently, powers have been repeatedly ascribed to the
National Government by the Court on grounds that ill accord with the
doctrine of enumerated powers: the power to legislate in effectuation of
the ``rights expressly given, and duties expressly enjoined'' by the
Constitution;\44\ the power to impart to the paper cur
[[Page 73]]
rency of the Government the quality of legal tender in the payment of
debts;\45\ the power to acquire territory by discovery;\46\ the power to
legislate for the Indian tribes wherever situated in the United
States;\47\ the power to exclude and deport aliens;\48\ and to require
that those who are admitted be registered and fingerprinted;\49\ and
finally the complete powers of sovereignty, both those of war and peace,
in the conduct of foreign relations. Thus, in United States v. Curtiss-
Wright Corp.,\50\ decided in 1936, Justice Sutherland asserted the
dichotomy of domestic and foreign powers, with the former limited under
the enumerated powers doctrine and the latter virtually free of any such
restraint. That doctrine has been the source of much scholarly and
judicial controversy, but, although limited, it has not been repudiated.
\44\Prigg v. Pennsylvania, 16 Pet. (41 U.S.) 539, 616, 618-619
(1842).
\45\Juilliard v. Greenman, 110 U.S. 421, 449-450 (1884). See
also Justice Bradley's concurring opinion in Knox v. Lee, 12 Wall. (79
U.S.) 457, 565 (1871).
\46\United States v. Jones, 109 U.S. 513 (1883).
\47\United States v. Kagama, 118 U.S. 375 (1886).
\48\Fong Yue Ting v. United States, 149 U.S. 698 (1893).
\49\Hines v. Davidowitz, 312 U.S. 52 (1941).
\50\299 U.S. 304 (1936).
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Yet, for the most part, these holdings do not, as Justice
Sutherland suggested, directly affect ``the internal affairs'' of the
nation; they touch principally its peripheral relations, as it were. The
most serious inroads on the doctrine of enumerated powers are, in fact,
those which have taken place under cover of the doctrine--the vast
expansion in recent years of national legislative power in the
regulation of commerce among the States and in the expenditure of the
national revenues. Verbally, at least, Marshall laid the ground for
these developments in some of the phraseology above quoted from his
opinion in McCulloch v. Maryland.
DELEGATION OF LEGISLATIVE POWER
Origin of the Doctrine of Nondelegability
``That the legislative power of Congress cannot be delegated is,
of course, clear.'' \51\ This 1932 statement has never been literally
true, the delegation at issue in the very case in which the statement
was made was upheld, and the Court in recent years has felt little
constrained to much more than bow in the direction of the doctrine.Yet
the doctrine of nondelegation of legislative powers and the permissible
exception of delegation accompanied by standards
[[Page 74]]
have so settled a place in constitutional jurisprudence that notice must
be given at some length.\52\
\51\United States v. Shreveport Grain & Elevator Co., 287 U.S.
77, 85 (1932). See also Field v. Clark, 143 U.S. 649, 692 (1892); Wayman
v. Southard, 10 Wheat. (23 U.S.) 1, 42 (1825).
\52\For particularly useful discussions of delegations, see 1 K.
Davis, Administrative Law Treatise (St. Paul: 2d ed., 1978), Ch. 3; L.
Jaffe, Judicial Control of Administrative Action (Boston: 1965), ch. 2.
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At least three distinct ideas contributed to the development of
the doctrine that legislative power cannot be delegated. The first idea
is the doctrine of separation of powers, the idea that the law-making
power is vested in the legislative branch, the law-executing power in
the executive branch, and the law-interpreting power in the judicial
branch.\53\ Is it not a violation of the doctrine to permit the law-
making branch to divest itself of some of its power and confer it on one
or the other of the other branches or to particular offices in the other
branch?
\53\Field v. Clark, 143 U.S. 649, 692 (1892); Wayman v.
Southard, 10 Wheat. (23 U.S.) 1, 42 (1825).
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The second idea is a due process conception precluding the
transfer of regulatory functions to private persons, a distinct specie
of the delegation doctrine not relevant usually in the field of
administration, of delegation to another public agency.\54\
\54\Carter v. Carter Coal Co., 298 U.S. 238, 310-312 (1936).
Since the separation-of-powers doctrine is inapplicable to the States as
a requirement of federal constitutional law, Dreyer v. Illinois, 187
U.S. 71, 83-84 (1902), it is the due process clause to which federal
courts must look for authority to review the delegation by state
legislatures of power to others which the legislature might have
exercised directly. E.g., Eubank v. City of Richmond, 226 U.S. 137
(1912); Embree v. Kansas City Road District, 240 U.S. 242 (1916).
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The third idea concerns the maxim ``delegata potestas non potest
delegari,'' which John Locke borrowed from agency and offered as a
principle of political science.\55\ In J. W. Hampton, Jr., & Co. v.
United States,\56\ Chief Justice Taft explained the origin and
limitations of this phrase as a postulate of constitutional law. ``The
well-known maxim `delegata potestas non potest delegari,' applicable to
the law of agency in the general and common law, is well understood and
has had wider application in the construction of our Federal and State
Constitutions than it has in private law. The Federal Constitution and
State Constitutions of this country divide the governmental power into
three branches. . . . [I]n carrying out that constitutional division
. . . it is a breach of the National fundamental law if Congress gives
up its legislative power and transfers it to the President, or to the
Judicial branch, or if by law it attempts to invest itself or its
members with either executive power or judicial power.''
\55\J. Locke, Second Treatise on Government (London: 1691), Ch.
11, 141.
\56\276 U.S. 394, 405-406 (1928).
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[[Page 75]]
But whatever the source or combination of sources of the
doctrine, decisions of the Court accepting without comment delegations
of vast powers to administrative or executive agencies constitute a de
facto recognition that Congress in the exercise of its granted powers,
in conjunction with its necessary and proper power, often cannot either
foresee or resolve problems of application of general laws to specific
situations. Thus, ``[d]elegation by Congress has long been recognized as
necessary in order that the exertion of legislative power does not
become a futility.''\57\
\57\Sunshine Anthracite Coal Co. v. Adkins, 310 U.S. 381, 398
(1940).
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Delegation Which Is Permissible
``It will not be contended,'' wrote Chief Justice Marshall in
1825, ``that congress can delegate to the courts, or to any other
tribunals, powers which are strictly and exclusively legislative. But
congress may certainly delegate to others, powers which the legislature
may rightfully exercise itself.''\58\ ``This is not to say,'' said Chief
Justice Taft, ``that the three branches are not co-ordinate parts of one
government and that each in the field of its duties may not invoke the
action of the two other branches in so far as the action invoked shall
not be an assumption of the constitutional field of action of another
branch. In determining what it may do in seeking assistance from another
branch, the extent and character of that assistance must be fixed
according to common sense and the inherent necessities of the
governmental co-ordination.''\59\ Chief Justice Marshall frankly noted
``that there is some difficulty in discerning the exact limits'' on the
legislative power to delegate. Thus, ``the precise boundary of this
power is a subject of delicate and difficult inquiry, into which a court
will not enter unnecessarily.''\60\
\58\Wayman v. Southard, 10 Wheat. (23 U.S.) 1, 41 (1825).
\59\J. W. Hampton, Jr. & Co. v. United States, 276 U.S. 394, 406
(1928).
\60\Id., 10 Wheat. (23 U.S.), 42.
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Two theories suggested themselves to the early Court to justify
the results of sustaining delegations. The Chief Justice alluded to the
first in Wayman v. Southard.\61\ He distinguished between ``important''
subjects, ``which must be entirely regulated by the legislature
itself,'' and subjects ``of less interest, in which a general provision
may be made, and power given to those who are to act under such general
provisions, to fill up the details.'' While his distinction may be lost,
the theory of the power ``to fill up the details'' is impressively
modern law.
\61\Id., 41.
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[[Page 76]]
A second theory, formulated even earlier, is that Congress may
legislate contingently, leaving to others the task of ascertaining the
facts that bring its declared policy into operation.\62\
\62\The Brig Aurora, 7 Cr. (11 U.S.) 382 (1813).
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Filling Up the Details.--At issue in Wayman v. Southard\63\ was
the contention that Congress had unconstitutionally delegated power to
the federal courts to establish rules of practice, provided such rules
were not repugnant to the laws of the United States.\64\ Chief Justice
Marshall agreed that the rule-making power was a legislative function
and that Congress could have formulated the rules itself, but he denied
that the delegation was impermissible. Since then, of course, Congress
has authorized the Supreme Court to prescribe rules of procedure for the
lower federal courts.\65\ Filling up the details of statutes was long a
popular version of the nature of permissible delegations.
\63\10 Wheat. (23 U.S.) 1 (1825).
\64\Act of May 8, 1792, Sec. 2, 1 Stat. 275, 276.
\65\The power to promulgate rules of civil procedure was
conferred by the Act of June 19, 1934, 48 Stat. 1064, now 28 U.S.C.
Sec. 2072; the power to promulgate rules of criminal procedure was
conferred by the Act of June 29, 1940, 54 Stat. 688, now 18 U.S.C.
Sec. 3771. In both instances Congress provided for submission of the
rules to it with the power presumably to change or to veto the rules.
Additionally, Congress has occasionally legislated rules itself. E.g.,
82 Stat. 197 (1968), 18 U.S.C. Sec. Sec. 3501-02 (admissibility of
confessions in federal courts).
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Thus, when Congress required the manufacturers of oleomargarine
to have their packages ``marked, stamped and branded as the Commissioner
of Internal Revenue . . . shall prescribe,'' the Court sustained the
conviction of one selling his goods without the markings against his
objection that he was prosecuted not for violation of law but for
violation of a regulation.\66\ ``The criminal offence,'' said Chief
Justice Fuller, ``is fully and completely defined by the act and the
designation by the Commissioner of the particular marks and brands to be
used was a mere matter of detail.''\67\ Kollock was not the first such
case,\68\ but it was to be followed by a multitude of delegations and
the sustaining of them. Soon thereafter the Court on the same theory
upheld an act directing the Secretary of the Treasury to promulgate
minimum standards of quality and purity for tea imported into the United
States.\69\
\66\In re Kollock, 165 U.S. 526 (1897).
\67\Id., 533.
\68\United States v. Bailey, 9 Pet. (34 U.S.) 238 (1835); Caha
v. United States, 152 U.S. 211 (1894).
\69\Buttfield v. Stranahan, 192 U.S. 470 (1904). See also United
States v. Grimaud, 220 U.S. 506 (1911) (executive officials to make
rules governing use of forest reservations); ICC v. Goodrich Transit
Co., 224 U.S. 194 (1912) (prescribing methods of accounting for carriers
in interstate commerce).
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Legislative Powers
Contingent Legislation.--An entirely different problem arises
when, instead of directing another department of govern
[[Page 77]]
ment to apply a general statute to individual cases, or to supplement it
by detailed regulation, Congress commands that a previously enacted
statute be revived, suspended, or modified, or that a new rule be put
into operation, upon the finding of certain facts by an executive or
administrative officer. Since the delegated function in such cases is
not that of ``filling up the details'' of a statute, authority for it
must be sought elsewhere than in the first theory. It is to be found in
an even earlier case, The Brig Aurora,\70\ where the revival of a law
upon the issuance of a presidential proclamation was upheld. After
previous restraints on British shipping had lapsed, Congress passed a
new law stating that those restrictions should be renewed in the event
the President found and proclaimed that France had abandoned certain
practices which violated the neutral commerce of the United States. To
the objection that this was an invalid delegation of legislative power,
the Court answered briefly that ``we can see no sufficient reason, why
the legislature should not exercise its discretion in reviving the act
of March 1st, 1809, either expressly or conditionally, as their judgment
should direct.''\71\
\70\7 Cr. (11 U.S.) 382 (1813).
\71\Id., 388.
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The theory was utilized again in Field v. Clark,\72\ where the
Tariff Act of 1890 was assailed as unconstitutional because it directed
the President to suspend the free importation of enumerated commodities
``for such time as he shall deem just'' if he found that other countries
imposed upon agricultural or other products of the United States duties
or other exactions, which ``he may deem to be reciprocally unequal and
unjust.'' In sustaining this statute the Court relied heavily upon two
factors: (1) legislative precedents, which demonstrated that ``in the
judgment of the legislative branch of the government, it is often
desirable, if not essential, . . . to invest the President with large
discretion in matters arising out of the execution of statutes relating
to trade and commerce with other nations;''\73\ (2) that the act did
``not, in any real sense, invest the President with the power of
legislation. . . . Congress itself prescribed, in advance, the duties to
be levied, . . . while the suspension lasted. Nothing involving the
expediency or the just operation of such legislation was left to the
determination of the President. . . . He had no discretion in the
premises except in respect to the duration of the suspension so
ordered.''\74\ By similar reasoning, the Court sustained the flexible
provisions of the Tariff Act of 1922
[[Page 78]]
whereby duties were increased or decreased to reflect differences in
cost of production at home and abroad, as such differences were
ascertained and proclaimed by the President.\75\
\72\143 U.S. 649 (1892).
\73\Id., 691.
\74\Id., 692, 693.
\75\J. W. Hampton, Jr. & Co. v. United States, 276 U.S. 394
(1928).
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The Effective Demise of the Nondelegation Doctrine
``[O]ur jurisprudence has been driven by a practical
understanding that in our increasingly complex society, replete with
ever changing and more technical problems, Congress simply cannot do its
job absent an ability to delegate power under broad general
directives.''\76\ The modern doctrine may be traced in its inception to
the 1928 case in which the Court, speaking through Chief Justice Taft,
upheld congressional delegation to the President of the authority to set
tariff rates that would equalize production costs in the United States
and competing countries.\77\ Although formally looking to the
contingency theory, the Court's opinion also looked forward, emphasizing
that in seeking the cooperation of another branch Congress was
restrained only according to ``common sense and the inherent
necessities'' of the situation.\78\ This vague statement was elaborated
somewhat in the statement that the Court would sustain delegations
whenever Congress provided an ``intelligible principle'' to which the
President or an agency must conform.\79\
\76\Mistretta v. United States, 488 U.S. 361, 372 (1989).
``Delegation by Congress has long been recognized as necessary in order
that the exertion of legislative power does not become a futility.''
Sunshine Anthracite Coal Co. v. Adkins, 310 U.S. 381, 398 (1940).
\77\J. W. Hampton, Jr. & Co. v. United States, 276 U.S. 394
(1928).
\78\Id., 406.
\79\Id., 409. The ``intelligible principle'' test of Hampton is
the same as the ``legislative standards'' test of A. L. A. Schechter
Poultry Corp. v. United States, 295 U.S. 495, 530 (1935), and Panama
Refining Co. v. Ryan, 293 U.S. 388, 421 (1935).
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The Regulatory State.--Except for two Depression-era cases in
which standards were found to be absent, the Court has never voided as
impermissible a congressional delegation.\80\ The now familiar pattern
of regulation of important segments of the economy by boards or
commissions, which combine in varying proportions the functions of all
three departments of government, was first established by the States in
the field of railroad rate regulation. Discovering that direct action
was impracticable, the state legislatures created commissions to deal
with the problem. One of the pioneers in this development was Minnesota,
whose supreme court justified
[[Page 79]]
the practice in an opinion, which, with the implied\81\ and later the
explicit,\82\ endorsement of the United States Supreme Court,
practically settled the law on this point: ``If such a power is to be
exercised at all, it can only be satisfactorily done by a board or
commission, constantly in session, whose time is exclusively given to
the subject, and who, after investigation of the facts, can fix rates
with reference to the peculiar circumstances of each road, and each
particular kind of business, and who can change or modify these rates to
suit the ever-varying conditions of traffic.''\83\ Contemporaneously,
Congress created the Interstate Commerce Commission to regulate the
rates and practices of railroads with respect to interstate commerce.
Although the Supreme Court has never had occasion to render a direct
decision on the delegation of rate-making power to the Commission, it
has repeatedly affirmed rate orders issued by that agency.\84\
\80\See Mistretta v. United States, 488 U.S. 361, 371-379 (1989)
(extensively reviewing doctrinal foundation and case law). See also
Skinner v. Mid-America Pipeline Co., 490 U.S. 212, 218-224 (1989); Touby
v. United States, 500 U.S. 160, 164-168 (1991).
\81\The Court reversed the decision of the state supreme court
on the grounds that the rates fixed by the commission were not subject
to judicial review, a due process violation, but the opinion implicitly
sanctioned the exercise of ratemaking powers by such bodies. Chicago,
Milwaukee & St. Paul Ry. Co. v. Minnesota, 134 U.S. 418 (1890).
\82\J. W. Hampton, Jr. & Co. v. United States, 276 U.S. 394, 409
(1928).
\83\State v. Chicago, Milwaukee & St. Paul Ry. Co., 38 Minn.
288, 301, 37 N.W. 782, 788 (1888), revd, on other grounds, 134 U.S. 418
(1890).
\84\ICC v. Louisville & Nashville R.R., 227 U.S. 88 (1913); New
York v. United States, 331 U.S. 284, 340-350 (1947), and cases cited.
See also New York v. United States, 342 U.S. 882 (1951); American
Trucking Assns. v. Atchison, Topeka & Santa Fe Ry., 387 U.S. 397 (1967).
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Breathtaking has been the breadth of delegations sustained.
Congress has given the Interstate Commerce Commission the responsibility
to approve railroad consolidations found to be in the ``public
interest,''\85\ and conferred powers on the Federal Radio Commission\86\
and the Federal Communications Commission\87\ to license broadcasting
stations as the ``public convenience, interest and necessity'' may
require. In the field of communications still, the exercise of power by
the FCC, pursuant to statute, to exert jurisdiction and authority over
an industry that did not exist at the time Congress enacted the statute
and that was unforeseen by Congress has been found to be valid.\88\ The
Supreme Court directed a regulatory agency acting under delegated powers
to exercise its own judgment about whether competition or restraint
would be in the
[[Page 80]]
public interest in the communications field rather than to attempt to
extrapolate a principle favoring one or the other from the body of
congressional law.\89\
\85\New York Central Securities Co. v. United States, 287 U.S.
12, 25 (1932).
\86\Federal Radio Comm. v. Nelson Bros. Bond & Mortgage Co., 289
U.S. 266 (1933).
\87\National Broadcasting Co. v. United States, 319 U.S. 190
(1943).
\88\United States v. Southwestern Cable Co., 392 U.S. 157 (1968)
(regulation of cable television under the 1934 Communications Act). See
also Red Lion Broadcasting Co. v. FCC, 395 U.S. 367 (1969) (approving
promulgation of rules on the ``fairness doctrine'' and ``right to
reply'' privilege in the absence of congressional enactment).
\89\FCC v. RCA Communications, 346 U.S. 86 (1953).
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The Court has upheld the delegation to the Federal Power
Commission of authority to determine ``just and reasonable'' rates.\90\
Agencies have been held properly to have received power to determine
whether rates and charges were too high or excessive.\91\ Regulation of
corporate conduct has been extended to close supervision of
activity.\92\
\90\FPC v. Hope Natural Gas Co., 320 U.S. 591 (1944).
\91\Yakus v. United States, 321 U.S. 414 (1944) (wartime
delegation to administrator to fix commodity prices that would be fair
and equitable); Lichter v. United States, 334 U.S. 742 (1948) (wartime
delegation to determine excessive profits by defense industries). See
also Amalgamated Meat Cutters & Butcher Workmen v. Connally, 337 F.Supp.
737 (D.D.C. 1971) (three-judge court) (upholding imposition of
nationwide price and wage controls by President upon general
delegation).
\92\American Light & Power Co. v. SEC, 329 U.S. 90 (1946)
(upholding delegation of authority to Securities and Exchange Commission
to prevent unfair or inequitable distribution of voting power among
security holders).
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In Mistretta v. United States,\93\ the Court approved
congressional delegations to the Sentencing Commission, an independent
agency in the judicial branch, to develop and promulgate guidelines
binding federal judges and cabining their discretion in sentencing
criminal defendants. Although the Court enumerated the standards
Congress had provided, it admitted that significant discretion existed
with respect to making policy judgments about the relative severity of
different crimes and the relative weight of the characteristics of
offenders that are to be considered, but it was forthright in stating
that delegations may carry with them ``the need to exercise judgment on
matters of policy.''\94\
\93\488 U.S. 361 (1989).
\94\Id., 378.
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That this latter observation is indubitably true is revealed in
many case results. Thus, the Court has upheld complex economic
regulations of industries in instances in which the agencies had first
denied possession of such power, had unsuccessfully sought authorization
from Congress, and had finally acted without congressional guidance.\95\
It has also recognized that when Administrations changes, new officials
may have been conferred enough discretion so that they can change agency
policies, often to a considerable degree, so that both previous and
present agency policies may be consistent with congressional
delegations.\96\
\95\E.g., Permian Basin Area Rate Cases, 390 U.S. 747 (1968);
American Trucking Assns. v. Atchison, Topeka & Santa Fe Ry., 387 U.S.
397 (1967).
\96\Chevron, U.S.A. v. NRDC, 467 U.S. 837, 842-845, 865-866
(1984) (``[A]n agency to which Congress has delegated policymaking
responsibilities may, within the limits of that delegation, properly
rely upon the incumbent administration's views of wise policy to inform
its judgments.'' Id., 865). See also Motor Vehicle Mfgrs. Assn. v. State
Farm Mutual Automobile Ins. Co., 463 U.S. 29, 42-44, 46-48, 51-57 (1983)
(recognizing agency could have reversed its policy but finding reasons
not supported on record).
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[[Page 81]]
Despite some dicta to the contrary, it appears that there is no
power Congress cannot delegate. ``[A] constitutional power implies a
power of delegation of authority under it sufficient to effect its
purposes.''\97\ Denying that it had ever suggested that the taxing power
was nondelegable, the Court has placed that congressional authority on
the same plane of permissible delegation.\98\ Nor is there a problem
with the fact that in exercising a delegated power the President or
another officer may effectively suspend or rescind a law passed by
Congress. A rule or regulation properly promulgated under authority
received from Congress is law and under the supremacy clause of the
Constitution can preempt state law,\99\ and likewise it can supersede a
federal statute. Early cases sustained giving the President upon the
finding of certain facts to revive or suspend a law,\100\ and the
President's power to raise or lower tariff rates equipped him to alter
statutory law.\101\ Similarly, in Opp Cotton Mills v.
Administrator,\102\ Congress' decision to delegate to the Wage and Hour
Administrator of the Labor Department the authority, after hearings and
findings by an industry committee appointed by him, to establish a
minimum wage in particular industries greater than the statutory minimum
but no higher than a prescribed figure was sustained. Congress has not
often expressly addressed the issue of repeals or supersessions, but in
authorizing the Supreme Court to promulgate rules of civil and criminal
proce
[[Page 82]]
dure and of evidence it directed that such rules supersede previously
enacted statutes with which they conflicted.\103\
\97\Lichter v. United States, 334 U.S. 742, 778-779 (1948).
\98\Skinner v. Mid-America Pipeline Co., 490 U.S. 212 (1989). In
National Cable Television Ass. v. United States, 415 U.S. 336, 342
(1974), and FPC v. New England Power Co., 415 U.S. 345 (1974), the Court
had appeared to suggest that delegation of the taxing power would be
fraught with constitutional difficulties. How this conclusion could have
been thought viable after the many cases sustaining delegations to fix
tariff rates, which are in fact and law taxes, J. W. Hampton, Jr. & Co.
v. United States, 276 U.S. 394 (1928); Field v. Clark, 143 U.S. 649
(1892); and see FEA v. Algonquin SNG, Inc., 426 U.S. 548 (1976)
(delegation to President to raise license ``fees'' on imports when
necessary to protect national security), is difficult to discern. Nor
should doubt exist respecting the appropriations power. See Synar v.
United States, 626 F.Supp. 1374, 1385-1386 (D.D.C.) (three-judge court),
affd. on other grounds sub nom. Bowsher v. Synar, 478 U.S. 714 (1986).
\99\City of New York v. FCC, 486 U.S. 57, 63-64 (1988);
Louisiana PSC v. FCC, 476 U.S. 355, 368-369 (1986); Fidelity Federal
Savings & Loan Assn. v. de la Cuesta, 458 U.S. 141, 153-154 (1982).
\100\E.g., The Brig Aurora, 7 Cr. (11 U.S.) 382 (1813).
\101\E.g., J. W. Hampton, Jr. & Co. v. United States, 276 U.S.
394 (1928); Field v. Clark, 143 U.S. 649 (1892).
\102\312 U.S. 126 (1941).
\103\See 18 U.S.C. Sec. Sec. 3771, 3772 (criminal procedure); 28
U.S.C. Sec. 2072 (civil procedure); id., Sec. 2076 (evidence). In Davis
v. United States, 411 U.S. 233, 241 (1973), the Court referred in
passing to the supersession of statutes without evincing any doubts
about the validity of the results. When Congress amended the Rules
Enabling Acts in the 100th Congress, P.L. 100-702, 102 Stat. 4642, 4648,
amending 28 U.S.C. Sec. 2072, the House would have altered supersession,
the Senate disagreed, the House acquiesced, and the old provision
remained. See H.R. 4807, H.Rept.No. 100-889, 100th Cong., 2d sess.
(1988), 27-29; 134 Cong Rec. 23573-23584 (1988); Id., 31051-31052 (Sen.
Heflin); Id., 31872 (Rep. Kastenmeier).
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Recent concerns in the scholarly literature with respect to the
scope of the delegation doctrine,\104\ have been reflected within the
judicial writings of some of the Justices.\105\ Nonetheless, the Court's
most recent decisions evidence no doubt of the constitutional propriety
of very broad delegations,\106\ and the practice will doubtlessly remain
settled.
\104\E.g., A Symposium on Administrative Law: Part I -
Delegation of Powers to Administrative Agencies, 36 Amer. U. L. Rev. 295
(1987); Schoenbrod, The Delegation Doctrine: Could the Court Give It
Substance?, 83 Mich. L. Rev. 1223 (1985); Aranson, Gellhorn & Robinson,
A Theory of Legislative Delegation, 68 Corn. L. Rev. 1 (1982).
\105\American Textile Mfgrs. Inst. v. Donovan, 452 U.S. 490, 543
(1981) (Chief Justice Burger dissenting); Industrial Union Dept. v.
American Petroleum Inst., 448 U.S. 607, 671 (1980) (then-Justice
Rehnquist concurring). See also United States v. Midwest Video Corp.,
406 U.S. 649, 675, 677 (1972) (Chief Justice Burger concurring, Justice
Douglas dissenting); Arizona v. California, 373 U.S. 546, 625-626 (1963)
(Justice Harlan dissenting in part). Occasionally, statutes are narrowly
construed, purportedly to avoid constitutional problems with
delegations. E.g., Industrial Union Dept., supra, 645-646 (plurality
opinion); National Cable Television Assn. v. United States, 415 U.S.
336, 342 (1974).
\106\E.g., Mistretta v. United States, 488 U.S. 361, 371-379
(1989). See also Skinner v. Mid-America Pipeline Co., 490 U.S. 212, 220-
224 (1989); Touby v. United States, 500 U.S. 160, 164-168 (1991). While
expressing considerable reservations about the scope of delegations,
Justice Scalia, in Mistretta, supra, 415-416, conceded both the
inevitability of delegations and the inability of the courts to police
them.
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Standards.--Critical to the Court's explanations of the
permissibility of legislative delegations has been the necessity of
``intelligible principles'' or ``standards'' to guide the agency or
official in the performance of the task Congress has set. And indeed the
only two instances in which the Court has found an unconstitutional
delegation to another governmental agency have involved grants of
discretion to administrators that the Court found to be unbounded. Thus,
in Panama Refining Co. v. Ryan,\107\ the President was authorized to
prohibit the shipment in interstate commerce of ``hot oil''--oil
produced in excess of state quotas. The statute was silent with regard
to when and under what circumstances he should exercise the power and
the Court, only Justice Cardozo dissenting, found that the stated policy
of the legislation contained
[[Page 83]]
contrary directives.\108\ While the grant of power in Panama Refining
was narrow, the grant, in A.L.A. Schechter Poultry Corp. v. United
States,\109\ was sweeping. The National Industrial Recovery Act devolved
on the executive branch the power to formulate codes of ``fair
competition'' for all industry in order to promote ``the policy of this
title.'' The policy was ``to eliminate unfair competitive practices, to
promote the fullest possible utilization of the present productive
capacity of industries, . . . and otherwise to rehabilitate industry.
. . .''\110\ Though much of the opinion is written in terms of the
failure of these policy statements to provide meaningful standards, it
seems more likely the Court was in fact concerned with the ``virtually
unfettered'' discretion conferred on the President of ``enacting laws
for the government of trade and industry throughout the country.''\111\
\107\293 U.S. 388 (1935).
\108\It is not without note that the Court, in the view of many
observers, was influenced heavily by the fact that the President's
orders were nowhere published and notice of regulations bearing criminal
penalties for their violations was spotty at best. Cf. E. Corwin, The
President--Office and Powers 1787-1957 (New York: 4th ed. 1958), 394-
395. The result of the Government's discomfiture in Court was enactment
of the Federal Register Act, 49 Stat. 500 (1935), 44 U.S.C. Sec. 301,
providing for publication of Executive Orders and agency regulations in
the daily Federal Register.
\109\295 U.S. 495 (1935).
\110\48 Stat. 195 (1933), Tit. I, Sec. 1.
\111\295 U.S., 541-542.
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This conclusion is bolstered by the Court's reversal of a lower
federal court, which had literally applied the Schechter language to
void a delegation to the Federal Home Loan Bank Commissioner of power to
issue regulations for the appointment of conservators or receivers to
take charge of banking associations.\112\ The Act contained no
standards, no declarations of policy, no guidance to the Commissioner.
Nevertheless, the Court unanimously sustained the delegation. ``It may
be,'' said Justice Jackson, ``that explicit standards . . . would have
been a desirable assurance of responsible administration.''\113\ But
while desirable, standards were not a constitutional necessity, since
``[t]he provisions are regulatory'' and deal with but one enterprise,
banking, the problems of which are well known and the remedies
authorized are as equally well known. ``A discretion to make regulations
to guide supervisory action in such matters may be constitutionally
permissible while it might not be allowable to authorize creation of new
crimes in uncharted fields.''\114\
\112\Fahey v. Mallonee, 332 U.S. 245 (1947).
\113\Id., 250.
\114\Ibid. Indeed, the Court has frequently deprecated the
broader holdings of the two cases by pointing out that Panama Refining
criminalized acts not previously punishable offenses and that Schechter
involved delegations to private individuals. Mistretta v. United States,
488 U.S. 361, 373 n. 7 (1989).
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[[Page 84]]
Where the Court has determined that standards are necessary, it
has been notably successful in finding them. Standards have been
ascertained to exist in such formulations as ``just and
reasonable,''\115\ ``public interest,''\116\ ``public convenience,
interest, or necessity,''\117\ and ``unfair methods of
competition.''\118\ Thus, in National Broadcasting Co. v. United
States,\119\ the Court found that the discretion conferred on the
Federal Communications Commission to license broadcasting stations to
promote the ``public interest, convenience, or necessity'' conveyed a
standard ``as complete as the complicated factors for judgment in such a
field of delegated authority permit.''\120\ Yet the regulations upheld
were directed to the contractual relations between networks and stations
and were designed to reduce the effect of monopoly in the industry, a
policy on which the statute was silent.\121\
\115\Tagg Bros. & Moorhead v. United States, 280 U.S. 420
(1930).
\116\New York Central Securities Corp. v. United States, 287
U.S. 12 (1932).
\117\Federal Radio Comm. v. Nelson Bros. Bond & Mortgage Co.,
289 U.S. 266 (1933).
\118\FTC v. Gratz, 253 U.S. 421 (1920).
\119\319 U.S. 190 (1943).
\120\Id., 216.
\121\Similarly, the promulgation by the FCC of rules creating a
``fairness doctrine'' and a ``right to reply'' rule has been sustained,
Red Lion Broadcasting Co. v. FCC, 395 U.S. 367 (1969), as well as a rule
requiring the carrying of anti-smoking commercials. Banzhaf v. FCC, 405
F.2d 1082 (D.C.Cir. 1968), cert. den. sub nom., Tobacco Institute v.
FCC, 396 U.S. 842 (1969).
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On the other hand, the standards may be set out in greater
detail and with greater relevancy to the action taken but may in fact
limit discretion not at all. In United States v. Rock Royal Co-
operatives,\122\ the Court sustained the delegation to the Secretary of
Agriculture of the power to fix the prices of six commodities if and
when he chose to exercise the power with regard to all or some of the
commodities. The Act provided that the price to be fixed should afford
farmers purchasing power equivalent to that they had enjoyed in a base
period, but the Secretary was also to protect the interest of the
consumer by a gradual increase in prices in accordance with the public
interest and current consumption. The majority of the Court thought that
the Act stated the purposes which Congress had hoped to achieve and set
out standards by which it hoped the purposes could be realized.
\122\307 U.S. 533 (1939).
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Numerous delegations have been sustained by the Court in both
war and peacetime which have vested in administrative agencies and
executive officers vast powers over the economic life of the
country.\123\ By and large, however, the Court has paid scant atten
[[Page 85]]
tion to delegation as a constitutional issue in these circumstances. An
exception is Arizona v. California,\124\ in which a divided Court
sustained the delegation of total discretion to the Secretary of the
Interior to apportion water among the southwestern States in times of
shortage. The statute prescribed no formula or standards, and the
majority agreed that he was entirely free ``to choose among the
recognized methods of apportionment or to devise reasonable methods of
his own,''\125\ the Secretary being required to reach ``an informed
judgment in harmony with the Act, the best interests of the Basin
States, and the welfare of the Nation.''\126\ Three dissenters noted
they had ``the gravest constitutional doubts'' about the
delegation.\127\
\123\Intermountain Rate Cases, 234 U.S. 476 (1914); American
Trucking Assns. v. United States, 344 U.S. 298 (1953); FCC v. RCA
Communications, 346 U.S. 86 (1953): Yakus v. United States, 321 U.S. 414
(1944). When in the Economic Stabilization Act of 1970, Congress
authorized the President ``to issue such orders and regulations as he
may deem appropriate to stabilize prices, rents, wages, and salaries,''
and the President complied with broad national controls, the lower court
decision sustaining the action was not even appealed to the Supreme
Court. Amalgamated Meat Cutters & Butcher Workmen v. Connally, 337 F.
Supp. 737 (D.D.C. 1971) (three-judge court).
\124\373 U. S. 546 (1963).
\125\Id., 593.
\126\Id., 594.
\127\Id., 625.
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Administrative implementation of the congressional enactment may
well provide the intelligible standard. Thus, in Lichter v. United
States,\128\ the Court sustained the delegation of power to the War
Department to recover ``excessive profits'' earned on war contracts. The
first Act contained no definition, but the second defined ``excessive
profits'' as meaning ``any amount of a contract or subcontract price
which is found as a result of renegotiation to represent excessive
profits.''\129\ The definition was essayed in the light of standards for
determining ``excessiveness'' worked out by the War Department and in
1944\130\ Congress specifically adopted these standards. Yet, the Court
upheld the validity of the delegation as to proceeds earned prior to
this 1944 adoption. ``The statutory term `excessive profits,' in its
context, was a sufficient expression of legislative policy and standards
to render it constitutional.''\131\
\128\334 U.S. 742 (1948).
\129\Sec. 403(a)(4) of the Act, as added by Tit. 8 of the Act of
October 21, 1942, 56 Stat. 798, 982.
\130\Sec. 403(a)(4) of the Act, as amended by Tit. 7 of the Act
of February 25, 1944, 58 Stat. 21, 78.
\131\334 U.S., 783.
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It seems therefore reasonably clear that the Court does not
really require much in the way of standards from Congress. The minimum
which the Court seems, but only sometimes, to insist on is that Congress
employ a delegation which ``sufficiently marks the
[[Page 86]]
field within which the Administrator is to act so that it may be known
whether he has kept within it in compliance with the legislative
will.''\132\ Where the congressional standards are combined with
requirements of notice and hearing and statements of findings and
considerations by the administrators, so that judicial review under due
process standards is possible, the constitutional requirements of
delegation have been fulfilled.\133\ This requirement may be met through
the provisions of the Administrative Procedure Act,\134\ but where the
Act is inapplicable or where the Court sees the necessity for exceeding
the provisions, due process can supply the safeguards of required
hearing, notice, supporting statements, and the like.\135\
\132\Yakus v. United States, 321 U.S. 414, 425 (1944).
\133\Id., 426; Skinner v. Mid-America Pipeline Co., 490 U.S.
212, 218 (1989); American Power Co. v. SEC, 329 U.S. 90, 107, 108
(1946); Opp Cotton Mills v. Administrator, 312 U.S. 126, 144 (1941). It
should be remembered that the Court has renounced strict review of
economic regulation wholly through legislative enactment, forsaking
substantive due process, so that review of the exercise of delegated
power by the same relaxed standard forwards a consistent policy. E.g.,
Ferguson v. Skrupa, 372 U.S. 726 (1963); Williamson v. Lee Optical Co.,
348 U.S. 483 (1955).
\134\Act of June 11, 1946, 60 Stat. 237, 5 U.S.C. Sec. Sec. 551-
559. In NLRB v. Wyman-Gordon Co., 394 U.S. 759 (1969), six Justices
agreed that a Board proceeding had been in fact rule-making and not
adjudication and that the APA should have been complied with. The Board
won the particular case, however, because of a coalescence of divergent
views of the Justices, but the Board has since reversed a policy of not
resorting to formal rule-making.
\135\E.g., Goldberg v. Kelly, 397 U.S. 254 (1970); Wisconsin v.
Constantineau, 400 U.S. 433 (1971).
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Foreign Affairs.--That the delegation of discretion in dealing
with foreign relations stands upon a different footing than the transfer
of authority to regulate domestic concerns was indicated in United
States v. Curtiss-Wright Corp.\136\ There the Court upheld a joint
resolution of Congress making it unlawful to sell arms to certain
warring countries upon certain findings by the President, a typically
contingent type of delegation. But Justice Sutherland for the Court
proclaimed that the President was largely free of the constitutional
constraints imposed by the nondelegation doctrine when he acted in
foreign affairs.\137\ The Curtiss-Wright doctrine has waxed and waned
over the years, and the viability of this distinction is doubtful.
\136\299 U.S. 304, 312 (1936).
\137\Id., 319-322. For a particularly strong, recent assertion
of the point, see Haig v. Agee, 453 U.S. 280, 291-292 (1981). This view
also informs the Court's analysis in Dames & Moore v. Regan, 453 U.S.
654 (1981). See also United States v. Chemical Foundation, 272 U.S. 1
(1926).
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Delegations to the States.--From the beginning, Congress enacted
hundreds of statutes that contained provisions authorizing
[[Page 87]]
state officers to enforce and execute federal laws.\138\ Challenges to
the practice were uniformly rejected. While the Court early expressed
its doubt that Congress could compel state officers to act, it
entertained no such thoughts about the propriety of authorizing them to
act if they chose.\139\ When, in the Selective Draft Law Cases,\140\ the
contention was made that the act was invalid because of its delegations
of duties to state officers, the argument was rejected as ``too wanting
in merit to require further notice.'' Congress continues to empower
state officers to act,\141\ and Presidents now object on grounds that
the state officers, not having been appointed pursuant to the
appointments clause, may not execute federal laws, rather than offer
delegation arguments.\142\
\138\See Warren, Federal Criminal Laws and the State Courts, 38
Harv. L. Rev. 545 (1925); Holcomb, The States as Agents of the Nation, 3
Selected Essays on Constitutional Law (1938), 1187.
\139\Prigg v. Pennsylvania, 16 Pet. (41 U.S.) 539 (1842);
Kentucky v. Dennison, 24 How. (65 U.S.) 66 (1861). The last doubt as to
compulsion was not definitively removed until Puerto Rico v. Branstad,
483 U.S. 219 (1987).
\140\245 U.S. 366, 389 (1918).
\141\E.g., P.L. 94-435, title III, 90 Stat. 1394, 15 U.S.C.
Sec. 15c (state attorneys general may bring antitrust parens patriae
actions); Medical Waste Tracking Act, P.L. 100-582, 102 Stat. 2955, 42
U.S.C. Sec. 6992f (States may impose civil and possibly criminal
penalties against violators of the law).
\142\See 24 Weekly Comp. of Pres. Docs. 1418 (1988) (President
Reagan). The only judicial challenge to such a practice resulted in a
rebuff to the presidential argument. Seattle Master Builders Assn. v.
Pacific Northwest Electric Power & Conservation Planning Council, 786
F.2d 1359 (9th Cir. 1986), cert. den., 479 U.S. 1059 (1987).
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Delegation to Private Persons.--Statutory delegations to private
persons in the nature of contingency legislation have passed Court
tests. Thus, statutes providing that restrictions upon the production or
marketing of agricultural commodities are to become operative only upon
a favorable vote by a prescribed majority of those persons affected have
been upheld.\143\ The rationale of the Court is that such a provision
does not involve any delegation of legislative authority, since Congress
has merely placed a restriction upon its own regulation by withholding
its operation unless it is approved in a referendum.\144\
\143\Currin v. Wallace, 306 U.S. 1 (1939); United States v. Rock
Royal Co-operative, 307 U.S. 533, 577 (1939); Wickard v. Filburn, 317
U.S. 111, 115-116 (1942); United States v. Frame, 885 F.2d 1119 (3d Cir.
1989), cert. den., 493 U.S. 1094 (1990).
\144\Currin v. Wallace, 306 U.S. 1, 15, 16 (1939).
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Less consistency has been displayed with regard to the more
modern delegations. The Schechter case condemned the involvement of
private trade groups in the drawing up of binding codes of competition
in conjunction with governmental agencies.\145\ In
[[Page 88]]
Carter v. Carter Coal Co.,\146\ the Court struck down the Bituminous
Coal Conservation Act in part because the statute penalized persons who
failed to observe minimum wage and maximum hour regulations drawn up by
prescribed majorities of coal producers and coal employees. But earlier
the Court had upheld a statute which delegated to the American Railway
Association, a trade group, the authority to determine the standard
height of draw bars for freight cars and to certify the figure to the
Interstate Commerce Commission, which was required to accept it.\147\
The Court simply cited Buttfield v. Stranahan,\148\ in which it had
sustained a delegation to the Secretary of the Treasury to promulgate
minimum standards of quality and purity for imported tea, as a case
``completely in point'' and resolving the issue without need of further
consideration.\149\ Similarly, the Court had earlier still enforced
statutes that gave legal effect to local customs of miners with respect
to claims on public lands.\150\
\145\A. L. A. Schechter Poultry Corp. v. United States, 295 U.S.
495 (1935). Schechter was predominantly a lack-of-standards case, but
the Court more recently has recurred to the private delegation issue.
Mistretta v. United States, 488 U.S. 361, 373 n. 7 (1989).
\146\298 U.S. 238 (1936). But compare Sunshine Anthracite Coal
Co. v. Adkins, 310 U.S. 381 (1940).
\147\St. Louis, Iron Mt. & Southern Ry. Co. v. Taylor, 210 U.S.
281 (1908).
\148\192 U.S. 470 (1904).
\149\210 U.S., 287.
\150\Jackson v. Roby, 109 U.S. 440 (1883); Erhardt v. Boaro, 113
U.S. 527 (1885); Butte City Water Co. v. Baker, 196 U.S. 119 (1905).
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The issue has remained muddled since Carter Coal, the Court
having had no opportunity to attempt to reconcile the two lines of
cases.\151\
\151\But see Schweiker v. McClure, 456 U.S. 188 (1982) (hearing
officer appointed by private insurance carrier adjudicating Medicare
claims); Association of Amer. Physicians & Surgeons v. Weinberger, 395
F.Supp. 125 (N.D.Ill.) (three-judge court) (delegation to Professional
Standards Review Organization), affd. per curiam, 423 U.S. 975 (1975);
Noblecraft Industries v. Secretary of Labor, 614 F.2d 199 (9th Cir.
1980) (Secretary required to adopt interim OSHA standards produced by
private organization). Again, the Executive Branch objections to these
kinds of delegations have involved appointments clause arguments, see
supra, n.142, rather than delegation issues per se.
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Delegation and Individual Liberties.--It has been argued in
separate opinions by some Justices that delegations by Congress of power
to affect the exercise of ``fundamental freedoms'' by citizens must
particularly be scrutinized to require the exercise of a congressional
judgment about meaningful standards.\152\ The only pronouncement in a
majority opinion, however, is that even with regard to the regulation of
liberty the standards of the delegation ``must be adequate to pass
scrutiny by the accepted tests.''\153\ The
[[Page 89]]
standard practice, indeed, of the majority has been to interpret
narrowly the delegation so as to avoid constitutional problems.\154\
\152\United States v. Robel, 389 U.S. 258, 269 (1967) (Justice
Brennan concurring). The view was specifically rejected by Justices
White and Harlan in dissent, id., 288-289, and ignored by the majority.
\153\Kent v. Dulles, 357 U.S. 116, 129 (1958).
\154\Kent v. Dulles, 357 U.S. 116 (1958); Schneider v. Smith,
390 U.S. 17 (1968). More recently, the Court has eschewed even this
limited mode of construction. Haig v. Agee, 453 U. S. 280 (1981).
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Perhaps refining the delegation doctrine, at least in cases
where Fifth Amendment due process interests are implicated, the Court
held that a government agency charged with the efficient administration
of the executive branch could not assert the broader interests that
Congress or the President might have in barring lawfully resident aliens
from government employment. The agency could assert only its own
interests, and if the action could be justified by other interests the
office with responsibility for promoting those interests must take the
action.\155\
\155\Hampton v. Mow Sun Wong, 426 U.S. 88 (1976) (5-to-4
decision). The regulation was reissued by the President, E. O. 11935, 3
C.F.R. 146 (1976), reprinted in 5 U.S.C. Sec. 3301 (app.), sustained in
Vergara v. Hampton, 581 F. 2d 1281 (C. A. 7, 1978).
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Punishment of Violations
If Congress so provides, violations of valid administrative
regulations may be punished as crimes.\156\ But the penalties must be
provided in the statute itself; additional punishment cannot be imposed
by administrative action.\157\ In an early case, the Court held that a
section prescribing penalties for any violation of a statute did not
warrant a prosecution for wilful disobedience of regulations authorized
by, and lawfully issued pursuant to, the act.\158\ Without disavowing
this general proposition, the Court, in 1944, upheld a suspension order
issued by the OPA whereby a dealer in fuel oil who had violated
rationing regulations was forbidden to receive or deal in that
commodity.\159\ Although such an order was not explicitly authorized by
statute, it was sustained as being a reasonable measure for effecting a
fair allocation of fuel oil, rather than as a means of punishment of an
offender. In another OPA case, the Court ruled that in a criminal
prosecution, a price regulation was subject to the same rule of strict
construction as a statute, and that omissions from, or indefiniteness
in, such a regulation, could not be cured by the Administrator's
interpretation thereof.\160\
\156\United States v. Grimaud, 220 U.S. 506 (1911). See also
Touby v. United States, 500 U.S. 160 (1991).
\157\L. P. Steuart & Bro. v. Bowles, 322 U.S. 398, 404 (1944).
\158\United States v. Eaton, 144 U.S. 677 (1892).
\159\L.P. Steuart & Bro. v. Bowles, 322 U.S. 398 (1944).
\160\M. Kraus & Bros. v. United States, 327 U.S. 614 (1946).
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Investigatory Power
[[Page 90]]
CONGRESSIONAL INVESTIGATIONS
Source of the Power to Investigate
No provision of the Constitution expressly authorizes either
House of Congress to make investigations and exact testimony to the end
that it may exercise its legislative functions effectively and
advisedly. But such a power had been frequently exercised by the British
Parliament and by the Assemblies of the American Colonies prior to the
adoption of the Constitution.\161\ It was asserted by the House of
Representatives as early as 1792 when it appointed a committee to
investigate the defeat of General St. Clair and his army by the Indians
in the Northwest and empowered it to ``call for such persons, papers,
and records, as may be necessary to assist their inquiries.''\162\
\161\Landis, Constitutional Limitations on the Congressional
Power of Investigation, 40 Harv. L. Rev. 153, 159-166 (1926); M. Dimock,
Congressional Investigating Committees (Baltimore: 1929), ch. 2.
\162\3 Annals of Congress 490-494 (1792); 3 A. Hinds' Precedents
of the House of Representatives (Washington: 1907), 1725.
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The Court has long since accorded its agreement with Congress
that the investigatory power is so essential to the legislative function
as to be implied from the general vesting of legislative power in
Congress. ``We are of the opinion,'' wrote Justice Van Devanter, for a
unanimous Court, ``that the power of inquiry--with process to enforce
it--is an essential and appropriate auxiliary to the legislative
function. . . . A legislative body cannot legislate wisely or
effectively in the absence of information respecting the conditions
which the legislation is intended to affect or change; and where the
legislative body does not itself possess the requisite information--
which not infrequently is true--recourse must be had to others who
possess it. Experience has taught that mere requests for such
information often are unavailing, and also that information which is
volunteered is not always accurate or complete; so some means of
compulsion are essential to obtain what is needed. All this was true
before and when the Constitution was framed and adopted. In that period
the power of inquiry--with enforcing process--was regarded and employed
as a necessary and appropriate attribute of the power to legislate--
indeed, was treated as inhering in it. Thus there is ample warrant for
thinking, as we do, that the constitutional provisions which commit the
legislative function to the two houses are intended to include this
attribute to the end that the function may be effectively
exercised.''\163\
\163\McGrain v. Daugherty, 273 U.S. 135, 174-175 (1927).
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And in a 1957 opinion generally hostile to the exercise of the
investigatory power in the post-War years, Chief Justice Warren
[[Page 91]]
did not question the basic power. ``The power of the Congress to conduct
investigations is inherent in the legislative process. That power is
broad. It encompasses inquiries concerning the administration of
existing laws as well as proposed or possibly needed statutes. It
includes surveys of defects in our social, economic or political system
for the purpose of enabling the Congress to remedy them. It comprehends
probes into departments of the Federal Government to expose corruption,
inefficiency or waste.''\164\ Justice Harlan summarized the matter in
1959. ``The power of inquiry has been employed by Congress throughout
our history, over the whole range of the national interests concerning
which Congress might legislate or decide upon due investigation not to
legislate; it has similarly been utilized in determining what to
appropriate from the national purse, or whether to appropriate. The
scope of the power of inquiry, in short, is as penetrating and far-
reaching as the potential power to enact and appropriate under the
Constitution.''\165\
\164\Watkins v. United States, 354 U.S. 178, 187 (1957).
\165\Barenblatt v. United States, 360 U.S. 109, 111 (1959). See
also Eastland v. United States Servicemen's Fund, 421 U.S. 491, 503-507
(1975).
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Broad as the power of inquiry is, it is not unlimited. The power
of investigation may properly be employed only ``in aid of the
legislative function.''\166\ Its outermost boundaries are marked, then,
by the outermost boundaries of the power to legislate. In principle, the
Court is clear on the limitations, clear ``that neither house of
Congress possesses a `general power of making inquiry into the private
affairs of the citizen'; that the power actually possessed is limited to
inquiries relating to matters of which the particular house `has
jurisdiction' and in respect of which it rightfully may take other
action; that if the inquiry relates to `a matter wherein relief or
redress could be had only by a judicial proceeding' it is not within the
range of this power, but must be left to the courts, conformably to the
constitutional separation of governmental powers; and that for the
purpose of determining the essential character of the inquiry recourse
must be had to the resolution or order under which it is made.''\167\
\166\Kilbourn v. Thompson, 103 U.S. 168, 189 (1881).
\167\McGrain v. Daugherty, 273 U.S. 135, 170 (1927). The
internal quotations are from Kilbourn v. Thompson, 103 U.S. 168, 190,
193 (1881).
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In practice, much of the litigated dispute has been about the
reach of the power to inquire into the activities of private citizens;
inquiry into the administration of laws and departmental corruption,
while of substantial political consequence, has given rise to fewer
judicial precedents.
[[Page 92]]
Investigations of Conduct of Executive Department
For many years the investigating function of Congress was
limited to inquiries into the administration of the Executive Department
or of instrumentalities of the Government. Until the administration of
Andrew Jackson, this power was not seriously challenged.\168\ During the
controversy over renewal of the charter of the Bank of the United
States, John Quincy Adams contended that an unlimited inquiry into the
operations of the bank would be beyond the power of the House.\169\ Four
years later, the legislative power of investigation was challenged by
the President. A committee appointed by the House of Representatives
``with power to send for persons and papers, and with instructions to
inquire into the condition of the various executive departments, the
ability and integrity with which they have been conducted, . . .''\170\
called upon the President and the heads of departments for lists of
persons appointed without the consent of the Senate and the amounts paid
to them. Resentful of this attempt ``to invade the just rights of the
Executive Departments,'' the President refused to comply and the
majority of the committee acquiesced.\171\ Nevertheless, congressional
investigations of Executive Departments have continued to the present
day. Shortly before the Civil War, contempt proceedings against a
witness who refused to testify in an investigation of John Brown's raid
upon the arsenal at Harper's Ferry occasioned a thorough consideration
by the Senate of the basis of this power. After a protracted debate,
which cut sharply across sectional and party lines, the Senate voted
overwhelmingly to imprison the contumacious witness.\172\
Notwithstanding this firmly established legislative practice, the
Supreme Court took a narrow view of the power in the case of Kilbourn v.
Thompson.\173\ It held that the House of Representatives had overstepped
its jurisdiction when it instituted an investigation of losses suffered
by the United States as a creditor of Jay Cooke and Company, whose
estate was being administered in bankruptcy by a federal court.\174\ But
nearly half
[[Page 93]]
a century later, in McGrain v. Daugherty,\175\ it ratified in sweeping
terms, the power of Congress to inquire into the administration of an
executive department and to sift charges of malfeasance in such
administration.\176\
\168\In 1800, Secretary of the Treasury, Oliver Wolcott, Jr.,
addressed a letter to the House of Representatives advising them of his
resignation from office and inviting an investigation of his office.
Such an inquiry was made. 10 Annals of Congress 786-788 (1800).
\169\8 Cong. Deb. 2160 (1832).
\170\13 Cong. Deb. 1057-1067 (1836).
\171\H.R. Rep. No. 194, 24th Congress, 2d sess., 1, 12, 31
(1837).
\172\Cong. Globe, 36th Congress, 1st sess., 1100-1109 (1860).
\173\103 U.S. 168 (1881).
\174\The Court held that inasmuch as the entire proceedings
arising out of the bankruptcy were pending in court, as the authorizing
resolution contained no suggestion of contemplated legislation, as in
fact no valid legislation could be enacted on the subject, and as the
only relief which the United States could seek was judicial relief in
the bankruptcy proceeding, the House had exceeded its powers in
authorizing the inquiry. But see Hutcheson v. United States, 369 U.S.
599 (1962).
\175\273 U.S. 135, 177, 178 (1927).
\176\We consider elsewhere the topic of executive privilege, the
claimed right of the President and at least some of his executive branch
officers to withhold from Congress information desired by it or by one
of its committees. Although the issue has been one of contention between
the two branches of Government since Washington's refusal in 1796 to
submit certain correspondence to the House of Representatives relating
to treaty negotiations, it has only recently become a judicial issue.
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Investigations of Members of Congress
When either House exercises a judicial function, as in judging
of elections or determining whether a member should be expelled, it is
clearly entitled to compel the attendance of witnesses to disclose the
facts upon which its action must be based. Thus, the Court held that
since a House had a right to expel a member for any offense which it
deemed incompatible with his trust and duty as a member, it was entitled
to investigate such conduct and to summon private individuals to give
testimony concerning it.\177\ The decision in Barry v. United States ex
rel. Cunningham\178\ sanctioned the exercise of a similar power in
investigating a senatorial election.
\177\In re Chapman, 166 U.S. 661 (1897).
\178\279 U.S. 597 (1929).
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Investigations in Aid of Legislation
Purpose.--Beginning with the resolution adopted by the House of
Representatives in 1827, which vested its Committee on Manufactures
``with the power to send for persons and papers with a view to ascertain
and report to this House in relation to a revision of the tariff duties
on imported goods,''\179\ the two Houses have asserted the right to
collect information from private persons as well as from governmental
agencies when necessary to enlighten their judgment on proposed
legislation. The first case to review the assertion saw a narrow view of
the power taken and the Court held that the purpose of the inquiry was
to pry improperly into private affairs without any possibility of
legislating on the basis of what might be learned and further that the
inquiry overstepped the bounds of legislative jurisdiction and invaded
the provinces of the judiciary.\180\
\179\4 Cong. Deb. 862, 868, 888, 889 (1827).
\180\Kilbourn v. Thompson, 103 U.S. 168 (1881).
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[[Page 94]]
Subsequent cases, however, have given the Congress the benefit
of a presumption that its object is legitimate and related to the
possible enactment of legislation. Shortly after Kilbourn, the Court
declared that ``it was certainly not necessary that the resolution
should declare in advance what the Senate meditated doing when the
investigation was concluded'' in order that the inquiry be under a
lawful exercise of power.\181\ Similarly, in McGrain v. Daugherty,\182\
the investigation was presumed to have been undertaken in good faith to
aid the Senate in legislating. Then, in Sinclair v. United States,\183\
on its facts presenting a close parallel to Kilbourn, the Court affirmed
the right of the Senate to carry out investigations of fraudulent leases
of government property after suit for recovery had been instituted. The
president of the lessee corporation had refused to testify on the ground
that the questions related to his private affairs and to matters
cognizable only in the courts wherein they were pending, asserting that
the inquiry was not actually in aid of legislation. The Senate had
prudently directed the investigating committee to ascertain what, if
any, legislation might be advisable. Conceding ``that Congress is
without authority to compel disclosures for the purpose of aiding the
prosecution of pending suits,'' the Court declared that the authority
``to require pertinent disclosures in aid of its own constitutional
power is not abridged because the information sought to be elicited may
also be of use in such suits.''\184\
\181\In re Chapman, 166 U.S. 661, 670 (1897).
\182\273 U.S. 135, 178 (1927).
\183\279 U.S. 263 (1929).
\184\Id., 295.
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While Sinclair and McGrain involved inquiries into the
activities and dealings of private persons, these activities and
dealings were in connection with property belonging to the United States
Government, so that it could hardly be said that the inquiries concerned
the merely personal or private affairs of any individual.\185\ But where
the business, the activities and conduct, the behavior of individuals
are subject to congressional regulation, there exists the power of
inquiry,\186\ and in practice the areas of any individual's life immune
from inquiry are probably fairly limited. ``In the decade following
World War II, there appeared a new kind of congressional inquiry unknown
in prior periods of American history. Principally this was the result of
the various investigations into the threat of subversion of the United
States Government, but other
[[Page 95]]
subjects of congressional interest also contributed to the changed
scene. This new phase of legislative inquiry involved a broad-scale
intrusion into the lives and affairs of private citizens.''\187\Inasmuch
as Congress clearly has power to legislate to protect the Nation and its
citizens from subversion, espionage, and sedition,\188\ it has power to
inquire into the existence of the dangers of domestic or foreign-based
subversive activities in many areas of American life--in education,\189\
in labor and industry,\190\ and other areas.\191\ Because its powers to
regulate interstate commerce afford Congress the power to regulate
corruption in labor-management relations, congressional committees may
inquire into the extent of corruption in labor unions.\192\ Because of
its powers to legislate to protect the civil rights of its citizens,
Congress may investigate organizations which allegedly act to deny those
civil rights.\193\ It is difficult in fact to conceive of areas into
which congressional inquiry might not be carried, which is not the same,
of course, as saying that the exercise of the power is unlimited.
\185\Id., 294.
\186\The first case so holding is ICC v. Brimson, 154 U.S. 447
(1894), which asserts that inasmuch as Congress could itself have made
the inquiry to appraise its regulatory activities it could delegate the
power of inquiry to the agency to which it had delegated the regulatory
function.
\187\Watkins v. United States, 354 U.S. 178, 195 (1957).
\188\See Dennis v. United States, 341 U.S. 494 (1951);
Barenblatt v. United States, 360 U.S. 109, 127 (1959); American
Communications Assn. v. Douds, 339 U.S. 382 (1950).
\189\Barenblatt v. United States, 360 U.S. 109, 129-132 (1959);
Deutch v. United States, 367 U.S. 456 (1961); cf. Sweezy v. New
Hampshire, 354 U.S. 234 (1957) (state inquiry).
\190\Watkins v. United States, 354 U.S. 178 (1957); Flaxer v.
United States, 358 U.S. 147 (1958); Wilkinson v. United States, 365 U.S.
399 (1961).
\191\McPhaul v. United States, 364 U.S. 372 (1960).
\192\Hutcheson v. United States, 369 U.S. 599 (1962).
\193\Shelton v. United States, 404 F. 2d 1292 (D.C.Cir. 1968),
cert. den., 393 U.S. 1024 (1969).
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One limitation on the power of inquiry which has been much
discussed in the cases concerns the contention that congressional
investigations often have no legislative purpose but rather are aimed at
achieving results through ``exposure'' of disapproved persons and
activities: ``We have no doubt,'' wrote Chief Justice Warren, ``that
there is no congressional power to expose for the sake of
exposure.''\194\ Although some Justices, always in dissent, have
[[Page 96]]
attempted to assert limitations in practice based upon this concept, the
majority of Justices has adhered to the traditional precept that courts
will not inquire into legislators' motives but will look\195\ only to
the question of power.\196\ ``So long as Congress acts in pursuance of
its constitutional power, the Judiciary lacks authority to intervene on
the basis of the motives which spurred the exercise of that
power.''\197\
\194\Watkins v. United States, 354 U.S. 178, 200 (1957). The
Chief Justice, however, noted: ``We are not concerned with the power of
the Congress to inquire into and publicize corruption, maladministration
or inefficiency in agencies of the Government. That was the only kind of
activity described by Woodrow Wilson in Congressional Government when he
wrote: `The informing function of Congress should be preferred even to
its legislative function.' Id., at 303. From the earliest times in its
history, the Congress has assiduously performed an `informing function'
of this nature.'' Id., 200 n. 33.
In his book, Wilson continued, following the sentence quoted by
the Chief Justice: ``The argument is not only that discussed and
interrogated administration is the only pure and efficient
administration, but, more than that, that the only really self-governing
people is that people which discusses and interrogates its
administration. . . . It would be hard to conceive of there being too
much talk about the practical concerns . . . of government.''
Congressional Government (Boston: 1885), 303-304. For contrasting views
of the reach of this statement, compare United States v. Rumely, 345
U.S. 41, 43 (1953), with Russell v. United States, 369 U.S. 749, 777-778
(1962) (Justice Douglas dissenting).
\195\Barenblatt v. United States, 360 U.S. 109, 153-162, 166
(1959); Wilkinson v. United States, 365 U.S. 399, 415, 423 (1961);
Braden v. United States, 365 U.S. 431, 446 (1961); but see DeGregory v.
Attorney General, 383 U.S. 825 (1966) (a state investigative case).
\196\``Legislative committees have been charged with losing
sight of their duty of disinterestedness. In times of political passion,
dishonest or vindicative motives are readily attributable to legislative
conduct and as readily believed. Courts are not the place for such
controversies.'' Tenney v. Brandhove, 341 U.S. 367, 377-378 (1951). For
a statement of the traditional unwillingness to inquire into
congressional motives in the judging of legislation, see United States
v. O'Brien, 391 U.S. 367, 382-386 (1968). But note that in Jenkins v.
McKeithen, 395 U.S. 411 (1969), in which the legislation establishing a
state crime investigating commission clearly authorized the commission
to designate individuals as law violators, due process was violated by
denying witnesses the rights existing in adversary criminal proceedings.
\197\Barenblatt v. United States, 360 U.S. 109, 132 (1959).
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Protection of Witnesses: Pertinency and Related Matters.--A
witness appearing before a congressional committee is entitled to
require of the committee a demonstration of its authority to inquire
with regard to his activities and a showing that the questions asked of
him are pertinent to the committee's area of inquiry. A congressional
committee possesses only those powers delegated to it by its parent
body. The enabling resolution that has given it life also contains the
grant and limitations of the committee's power.\198\ In Watkins v.
United States,\199\ Chief Justice Warren cautioned that ``[b]roadly
drafted and loosely worded . . . resolutions can leave tremendous
latitude to the discretion of the investigators. The more vague the
committee's charter is, the greater becomes the possibility that the
committee's specific actions are not in conformity with the will of the
parent House of Congress.'' Speaking directly of the authorizing
resolution, which created the House Un-American Activities
Committee,\200\ the Chief Justice thought it ``difficult to imagine a
less explicit authorizing resolution.''\201\ But the far-reaching
implications of these remarks were circumscribed by Barenblatt v. United
States,\202\ in which the
[[Page 97]]
Court, ``[g]ranting the vagueness of the Rule,'' noted that Congress had
long since put upon it a persuasive gloss of legislative history through
practice and interpretation, which, read with the enabling resolution,
showed that ``the House has clothed the Un-American Activities Committee
with pervasive authority to investigate Communist activities in this
country.''\203\ ``[W]e must conclude that [the Committee's] authority to
conduct the inquiry presently under consideration is unassailable, and
that . . . the Rule cannot be said to be constitutionally infirm on the
score of vagueness.''\204\
\198\United States v. Rumely, 345 U.S. 41, 44 (1953).
\199\354 U.S. 178, 201 (1957).
\200\The Committee has since been abolished.
\201\Watkins v. United States, 354 U.S. 178, 202 (1957).
\202\360 U.S. 109 (1959).
\203\Id., 117-118.
\204\Id., 122-123. But note that in Stamler v. Willis, 415 F. 2d
1365 (7th Cir., 1969), cert. den., 399 U.S. 929 (1970), the court
ordered to trial a civil suit contesting the constitutionality of the
Rule establishing the Committee on allegations of overbreadth and
overbroad application, holding that Barenblatt did not foreclose the
contention.
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Because of the usual precision with which authorizing
resolutions have generally been drafted, few controversies have arisen
about whether a committee has projected its inquiry into an area not
sanctioned by the parent body.\205\ But in United States v. Rumely,\206\
the Court held that the House of Representatives, in authorizing a
select committee to investigate lobbying activities devoted to the
promotion or defeat of legislation, did not thereby intend to empower
the committee to probe activities of a lobbyist that were unconnected
with his representations directly to Congress but rather designed to
influence public opinion by distribution of literature. Consequently the
committee was without authority to compel the representative of a
private organization to disclose the names of all who had purchased such
literature in quantity.\207\
\205\But see Tobin v. United States, 306 F. 2d 270 (D.C.Cir.),
cert. den., 371 U.S. 902 (1962).
\206\345 U.S. 41 (1953).
\207\The Court intimated that if the authorizing resolution did
confer such power upon the committee, the validity of the resolution
would be subject to doubt on First Amendment principles. Justices Black
and Douglas would have construed the resolution as granting the
authority and would have voided it under the First Amendment. Id., 48
(concurring opinion).
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Still another example of lack of proper authority is Gojack v.
United States,\208\ in which the Court reversed a contempt citation
because there was no showing that the parent committee had delegated to
the subcommittee before whom the witness had appeared the authority to
make the inquiry and neither had the full committee specified the area
of inquiry.
\208\384 U.S. 702 (1966).
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Watkins v. United States,\209\ remains the leading case on
pertinency, although it has not the influence on congressional
investigations that some hoped and some feared in the wake of its
[[Page 98]]
announcement. When questioned by a Subcommittee of the House Un-American
Activities Committee, Watkins refused to supply the names of past
associates, who, to his knowledge, had terminated their membership in
the Communist Party and supported his noncompliance by, inter alia,
contending that the questions were unrelated to the work of the
Committee. Sustaining the witness, the Court emphasized that inasmuch as
a witness by his refusal exposes himself to a criminal prosecution for
contempt, he is entitled to be informed of the relation of the question
to the subject of the investigation with the same precision as the due
process clause requires of statutes defining crimes.\210\
\209\354 U.S. 178 (1957).
\210\Id., 208-209.
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For ascertainment of the subject matter of an investigation, the
witness might look, noted the Court, to several sources, including (1)
the authorizing resolution, (2) the resolution by which the full
committee authorized the subcommittee to proceed, (3) the introductory
remarks of the chairman or other members, (4) the nature of the
proceedings, (5) the chairman's response to the witness when the witness
objects to the line of question on grounds of pertinency.\211\ Whether a
precise delineation of the subject matter of the investigation in but
one of these sources would satisfy the requirements of due process was
left unresolved, since the Court ruled that in this case all of them
were deficient in providing Watkins with the guidance to which he was
entitled. The sources had informed Watkins that the questions were asked
in a course of investigation of something that ranged from a narrow
inquiry into Communist infiltration into the labor movement to a vague
and unlimited inquiry into ``subversion and subversive
propaganda.''\212\
\211\Id., 209-215.
\212\Ibid. See also Sacher v. United States, 356 U.S. 576
(1958), a per curiam reversal of a contempt conviction on the ground
that the questions did not relate to a subject ``within the
subcommittee's scope of inquiry,'' arising out of a hearing pertaining
to a recantation of testimony by a witness in which the inquiry drifted
into a discussion of legislation barring Communists from practice at the
federal bar, the unanswered questions being asked then; and Flaxer v.
United States, 358 U.S. 147 (1958), a reversal for refusal to produce
membership lists because of an ambiguity in the committee's ruling on
the time of performance; and Scull v. Virginia ex rel. Committee, 359
U.S. 344 (1959), a reversal on a contempt citation before a state
legislative investigating committee on pertinency grounds.
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By and large, the subsequent cases demonstrated that Watkins did
not represent a determination by the Justices to restrain broadly the
course of congressional investigations, though several contempt
citations were reversed on narrow holdings. But with regard to
pertinency, the implications of Watkins were held in check and, without
amending its rules or its authorizing resolution, the Un-American
Activities Committee was successful in convincing a ma
[[Page 99]]
jority of the Court that its subsequent investigations were authorized
and that the questions asked of recalcitrant witnesses were pertinent to
the inquiries.\213\
\213\Notice should be taken, however, of two cases which, though
decided four and five years after Watkins, involved persons who were
witnesses before the Un-American Activities Committee either shortly
prior to or shortly following Watkins' appearance and who were cited for
contempt before the Supreme Court decided Watkins' case.
In Deutch v. United States, 367 U.S. 456 (1961), involving an
otherwise cooperative witness who had refused to identify certain
persons with whom he had been associated at Cornell in Communist Party
activities, the Court agreed that Deutch had refused on grounds of moral
scruples to answer the questions and had not challenged them as not
pertinent to the inquiry, but the majority ruled that the Government had
failed to establish at trial the pertinency of the questions, thus
vitiating the conviction. Justices Frankfurter, Clark, Harlan, and
Whittaker dissented, arguing that any argument on pertinency had been
waived but in any event thinking it had been established. Id., 472, 475.
In Russell v. United States, 369 U.S. 749 (1962), the Court
struck down contempt convictions for insufficiency of the indictments.
Indictments, which merely set forth the offense in the words of the
contempt statute, the Court asserted, in alleging that the unanswered
questions were pertinent to the subject under inquiry but not
identifying the subject in detail, are defective because they do not
inform defendants what they must be prepared to meet and do not enable
courts to decide whether the facts alleged are sufficient to support
convictions. Justice Stewart for the Court noted that the indicia of
subject matter under inquiry were varied and contradictory, thus
necessitating a precise governmental statement of particulars. Justices
Harlan and Clark in dissent contended that it was sufficient for the
Government to establish pertinency at trial and noted that no objections
relating to pertinency had been made at the hearings. Id., 781, 789-793.
Russell was cited in the per curiam reversals in Grumman v. United
States, 370 U.S. 288 (1962), and Silber v. United States, 370 U.S. 717
(1962).
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Thus, in Barenblatt v. United States,\214\ the Court concluded
that the history of the Un-American Activities Committee's activities,
viewed in conjunction with the Rule establishing it, evinced clear
investigatory authority to inquire into Communist infiltration in the
field of education, an authority with which the witness had shown
familiarity. Additionally, the opening statement of the chairman had
pinpointed that subject as the nature of the inquiry that day and the
opening witness had testified on the subject and had named Barenblatt as
a member of the Communist Party at the University of Michigan. Thus,
pertinency and the witness' knowledge of the pertinency of the questions
asked him was shown. Similarly, in Wilkinson v. United States,\215\ the
Court held that when the witness was apprised at the hearing that the
Committee was empowered to investigate Communist infiltration of the
textile industry in the South, that it was gathering information with a
view to ascertaining the manner of administration and need to amend
various laws directed at subversive activities, that Congress hitherto
had enacted many of its recommendations in this field, and
[[Page 100]]
that it was possessed of information about his Party membership, he was
notified effectively that a question about that affiliation was relevant
to a valid inquiry. A companion case was held to be controlled by
Wilkinson,\216\ and in both cases the majority rejected the contention
that the Committee inquiry was invalid because both Wilkinson and
Braden, when they were called, were engaged in organizing activities
against the Committee.\217\
\214\360 U.S. 109 (1959).
\215\365 U.S. 399 (1961).
\216\Braden v. United States, 365 U.S. 431 (1961).
\217\The majority denied that the witness' participation in a
lawful and protected course of action, such as petitioning Congress to
abolish the Committee, limited the Committee's right of inquiry. ``[W]e
cannot say that, simply because the petitioner at the moment may have
been engaged in lawful conduct, his Communist activities in connection
therewith could not be investigated. The subcommittee had reasonable
ground to suppose that the petitioner was an active Communist Party
member, and that as such he possessed information that would
substantially aid it in its legislative investigation. As the Barenblatt
opinion makes clear, it is the nature of the Communist activity
involved, whether the momentary conduct is legitimate or illegitimate
politically, that establishes the Government's overbalancing interest.''
Wilkinson v. United States, 365 U.S. 399, 414 (1961). In both cases, the
dissenters, Chief Justice Warren and Justices Black, Douglas, and
Brennan argued that the Committee action was invalid because it was
intended to harass persons who had publicly criticized committee
activities. Id., 415, 423, 429.
---------------------------------------------------------------------------
Related to the cases discussed in this section are those cases
requiring that congressional committees observe strictly their own
rules. Thus, in Yellin v. United States,\218\ a contempt conviction was
reversed because the Committee had failed to observe its rule providing
for a closed session if a majority of the Committee believed that a
witness' appearance in public session might unjustly injure his
reputation. The Court ruled that the Committee had ignored the rule when
it subpoenaed the witness for a public hearing and then in failing to
consider as a Committee his request for a closed session.\219\
\218\374 U.S. 109 (1963).
\219\Failure to follow its own rules was again an issue in
Gojack v. United States, 384 U.S. 702 (1966), in which the Court noted
that while a committee rule required the approval of a majority of the
Committee before a ``major'' investigation was initiated, such approval
had not been sought before a Subcommittee proceeded.
---------------------------------------------------------------------------
Finally, it should be noted that the Court has blown hot and
cold on the issue of a quorum as a prerequisite to a valid contempt
citation and that no firm statement of a rule is possible, although it
seems probable that ordinarily no quorum is necessary.\220\
\220\In Christoffel v. United States, 338 U.S. 84 (1949), the
Court held that a witness can be found guilty of perjury only where a
quorum of the committee is present at the time the perjury is committed;
it is not enough to prove that a quorum was present when the hearing
began. But in United States v. Bryan, 339 U.S. 323 (1950), the Court
ruled that a quorum was not required under the statute punishing refusal
to honor a valid subpoena issued by an authorized committee.
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Protection of Witnesses; Constitutional Guarantees.--``[T]he
Congress, in common with all branches of the Government, must exercise
its powers subject to the limitations placed by the
[[Page 101]]
Constitution on governmental action, more particularly in the context of
this case, the relevant limitations of the Bill of Rights.''\221\ Just
as the Constitution places limitations on Congress' power to legislate,
so it limits the power to investigate. In this section, we are concerned
with the limitations the Bill of Rights places on the scope and nature
of the congressional power to inquire.
\221\Barenblatt v. United States, 360 U.S. 109, 112 (1959).
---------------------------------------------------------------------------
The most extensive amount of litigation in this area has
involved the privilege against self-incrimination guaranteed against
governmental abridgment by the Fifth Amendment. Observance of the
privilege by congressional committees has been so uniform that no Court
holding has ever held that it must be observed, though the dicta is
plentiful.\222\ Thus, the cases have explored not the issue of the right
to rely on the privilege but rather the manner and extent of its
application.
\222\Id., 126; Watkins v. United States, 354 U.S. 178, 196
(1957); Quinn v. United States, 349 U.S. 155, 161 (1955).
---------------------------------------------------------------------------
There is no prescribed form in which one must plead the
privilege. When a witness refused to answer a question about Communist
Party affiliations and based his refusal upon the assertion by a prior
witness of ``the first amendment supplemented by the fifth,'' the Court
held that he had sufficiently invoked the privilege, at least in the
absence of committee inquiry seeking to force him to adopt a more
precise stand.\223\ If the committee suspected that the witness was
being purposely vague, in order perhaps to avoid the stigma attached to
a forthright claim of the privilege, it should have requested him to
state specifically the ground of his refusal to testify. Another
witness, who was threatened with prosecution for his Communist
activities, could claim the privilege even to some questions the answers
to which he might have been able to explain away as unrelated to
criminal conduct; if an answer might tend to be incriminatory, the
witness is not deprived of the privilege merely because he might have
been able to refute inferences of guilt.\224\ In still another case, the
Court held that the Committee had not clearly overruled the claim of
privilege and directed an answer.\225\
\223\Quinn v. United States, 349 U.S. 155 (1955).
\224\Emspak v. United States, 349 U.S. 190 (1955).
\225\Bart v. United States, 349 U.S. 219 (1955).
---------------------------------------------------------------------------
The privilege against self-incrimination is not available as a
defense to an organizational officer who refuses to turn over
organization documents and records to an investigating committee.\226\
\226\McPhaul v. United States, 364 U.S. 372 (1960).
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In Hutcheson v. United States,\227\ the Court rejected a
challenge to a Senate Committee inquiry into union corruption on the
[[Page 102]]
part of a witness who was under indictment in state court on charges
relating to the same matters about which the Committee sought to
interrogate him. The witness did not plead his privilege against self-
incrimination but contended that by questioning him about matters which
would aid the state prosecutor the Committee had denied him due process.
The plurality opinion of the Court rejected his ground for refusing to
answer, noting that if the Committee's public hearings rendered the
witness' state trial unfair, then he could properly raise that issue on
review of his state conviction.\228\ Following behind the privilege
against self-incrimination, claims relating to the First Amendment have
been frequently asserted and as frequently denied. It is not that the
First Amendment is inapplicable to congressional investigations, it is
that under the prevailing Court interpretation the First Amendment does
not bar all legislative restrictions of the rights guaranteed by
it.\229\ ``[T]he protections of the First Amendment, unlike a proper
claim of the privilege against self-incrimination under the Fifth
Amendment, do not afford a witness the right to resist inquiry in all
circumstances. Where First Amendment rights are asserted to bar
governmental interrogation resolution of the issue always involves a
balancing by the courts of the competing private and public interests at
stake in the particular circumstances shown.''\230\
\227\369 U.S. 599 (1962).
\228\Justice Harlan wrote the opinion of the Court which
Justices Clark and Stewart joined. Justice Brennan concurred solely
because the witness had not claimed the privilege against self-
incrimination but he would have voted to reverse the conviction had
there been a claim. Chief Justice Warren and Justice Douglas dissented
on due process grounds. Justices Black, Frankfurter, and White did not
participate. At the time of the decision, the self-incrimination clause
did not restrain the States through the Fourteenth Amendment so that it
was no violation of the clause for either the Federal Government or the
States to compel testimony which would incriminate the witness in the
other jurisdiction. Cf. United States v. Murdock, 284 U.S. 141 (1931);
Knapp v. Schweitzer, 357 U.S. 371 (1958). The Court has since reversed
itself, Malloy v. Hogan, 378 U.S. 1 (1964); Murphy v. Waterfront
Commission, 378 U.S. 52 (1964), thus leaving the vitality of Hutcheson
doubtful.
\229\The matter is discussed fully in the section on the First
Amendment but a good statement of the balancing rule may be found in
Younger v. Harris, 401 U.S. 37, 51 (1971), by Justice Black, supposedly
an absolutist on the subject: ``Where a statute does not directly
abridge free speech, but--while regulating a subject within the State's
power--tends to have the incidental effect of inhibiting First Amendment
rights, it is well settled that the statute can be upheld if the effect
on speech is minor in relation to the need for control of the conduct
and the lack of alternative means for doing so.''
\230\Barenblatt v. United States, 360 U.S. 109, 126 (1959).
---------------------------------------------------------------------------
Thus, the Court has declined to rule that under the
circumstances of the cases investigating committees are precluded from
making inquiries simply because the subject area was education\231\ or
because the witnesses at the time they were called were engaged in
protected activities such as petitioning Congress
[[Page 103]]
to abolish the inquiring committee.\232\ However, in an earlier case,
the Court intimated that it was taking a narrow view of the committee's
authority because a determination that authority existed would raise a
serious First Amendment issue.\233\ And in a state legislative
investigating committee case, the majority of the Court held that an
inquiry seeking the membership lists of the National Association for the
Advancement of Colored People was so lacking in a ``nexus'' between the
organization and the Communist Party that the inquiry infringed the
First Amendment.\234\
\231\Barenblatt v. United States, 360 U.S. 109 (1959).
\232\Wilkinson v. United States, 365 U.S. 399 (1961); Braden v.
United States, 365 U.S. 431 (1961).
\233\United States v. Rumely, 345 U.S. 41 (1953).
\234\Gibson v. Florida Legislative Investigation Committee, 372
U.S. 539 (1963). See also DeGregory v. Attorney General, 383 U.S. 825
(1966).
---------------------------------------------------------------------------
Dicta in the Court's opinions acknowledge that the Fourth
Amendment guarantees against unreasonable searches and seizures are
applicable to congressional committees.\235\ The issue would most often
arise in the context of subpoenas, inasmuch as that procedure is the
usual way by which committees obtain documentary material and inasmuch
as Fourth Amendment standards apply as well to subpoenas as to search
warrants.\236\ But there are no cases in which a holding turns on this
issue.\237\
\235\Watkins v. United States, 354 U.S. 178, 188 (1957).
\236\See Oklahoma Press Publishing Co. v. Walling, 327 U.S. 186
(1946), and cases cited.
\237\Cf. McPhaul v. United States, 364 U.S. 372 (1960).
---------------------------------------------------------------------------
Other issues of the constitutional rights of witnesses have been
raised at various times, but none has been successfully asserted or have
even gained substantial minority strength.
Sanctions of the Investigatory Power: Contempt
Explicit judicial recognition of the right of either House of
Congress to commit for contempt a witness who ignores its summons or
refuses to answer its inquiries dates from McGrain v. Daugherty.\238\
But the principle there applied had its roots in an early case, Anderson
v. Dunn,\239\ which stated in broad terms the right of either branch of
the legislature to attach and punish a person other than a member for
contempt of its authority.\240\ The
[[Page 104]]
right to punish a contumacious witness was conceded in Marshall v.
Gordon,\241\ although the Court there held that the implied power to
deal with contempt did not extend to the arrest of a person who
published matter defamatory of the House.
\238\273 U.S. 135 (1927).
\239\6 Wheat (19 U.S.) 204 (1821).
\240\The contempt consisted of an alleged attempt to bribe a
Member of the House for his assistance in passing a claims bill. The
case was a civil suit brought by Anderson against the Sergeant at Arms
of the House for assault and battery and false imprisonment. Cf.
Kilbourn v. Thompson, 103 U.S. 168 (1881). The power of a legislative
body to punish for contempt one who disrupts legislative business was
reaffirmed in Groppi v. Leslie, 404 U.S. 496 (1972), but a unanimous
Court there held that due process required a legislative body to give a
contemnor notice and an opportunity to be heard prior to conviction and
sentencing. Although this case dealt with a state legislature, there is
no question it would apply to Congress as well.
\241\243 U.S. 521 (1917).
---------------------------------------------------------------------------
The cases emphasize that the power to punish for contempt rests
upon the right of self-preservation. That is, in the words of Chief
Justice White, ``the right to prevent acts which in and of themselves
inherently obstruct or prevent the discharge of legislative duty or the
refusal to do that which there is inherent legislative power to compel
in order that legislative functions may be performed'' necessitates the
contempt power.\242\ Thus, in Jurney v. MacCracken,\243\ the Court
turned aside an argument that the Senate had no power to punish a
witness who, having been commanded to produce papers, destroyed them
after service of the subpoena. The punishment would not be efficacious
in obtaining the papers in this particular case, but the power to punish
for a past contempt is an appropriate means of vindicating ``the
established and essential privilege of requiring the production of
evidence.''\244\
\242\Id., 542.
\243\294 U.S. 125 (1935).
\244\Id., 150.
---------------------------------------------------------------------------
Under the rule laid down by Anderson v. Dunn,\245\ imprisonment
by one of the Houses of Congress could not extend beyond the adjournment
of the body which ordered it. Because of this limitation and because
contempt trials before the bar of the House charging were time
consuming, in 1857 Congress enacted a statute providing for criminal
process in the federal courts with prescribed penalties for contempt of
Congress.\246\
\245\6 Wheat. (19 U.S.) 204 (1821).
\246\Act of January 24, 1857, 11 Stat. 155. With only minor
modification, this statute is now 2 U.S.C. Sec. 192.
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The Supreme Court has held that the purpose of this statute is
merely supplementary of the power retained by Congress and all
constitutional objections to it were overruled. ``We grant that Congress
could not divest itself, or either of its Houses, of the essential and
inherent power to punish for contempt, in cases to which the power of
either House properly extended; but because Congress, by the Act of
1857, sought to aid each of the Houses in the discharge of its
constitutional functions, it does not follow that any delegation of the
power in each to punish for contempt was involved.''\247\
\247\In re Chapman, 166 U.S. 661, 671-672 (1897).
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[[Page 105]]
Because Congress has invoked the aid of the federal judicial
system in protecting itself against contumacious conduct, the
consequence, the Court has asserted numerous times, is that the duty has
been conferred upon the federal courts to accord a person prosecuted for
his statutory offense every safeguard which the law accords in all other
federal criminal cases\248\ and the discussion in previous sections of
many reversals of contempt convictions bears witness to the assertion in
practice. What constitutional protections ordinarily necessitated by due
process requirements, such as notice, right to counsel, confrontation,
and the like, prevail in a contempt trial before the bar of one House or
the other is an open question.\249\
\248\Sinclair v. United States, 279 U.S. 263, 296-297 (1929);
Watkins v. United States, 354 U.S. 178, 207 (1957); Sacher v. United
States, 356 U.S. 576, 577 (1958); Flaxer v. United States, 358 U.S. 147,
151 (1958); Deutch v. United States, 367 U.S. 456, 471 (1961); Russell
v. United States, 369 U.S. 749, 755 (1962). Protesting the Court's
reversal of several contempt convictions over a period of years, Justice
Clark was moved to suggest that ``[t]his continued frustration of the
Congress in the use of the judicial process to punish those who are
contemptuous of its committees indicates to me that the time may have
come for Congress to revert to `its original practice of utilizing the
coercive sanction of contempt proceedings at the bar of the House
[affected].''' Id., 781; Watkins, supra, 225.
\249\Cf. Groppi v. Leslie, 404 U.S. 496 (1972).
---------------------------------------------------------------------------
It has long been settled that the courts may not intervene
directly to restrain the carrying out of an investigation or the manner
of an investigation and that a witness who believes the inquiry to be
illegal or otherwise invalid in order to raise the issue must place
himself in contempt and raise his beliefs as affirmative defenses on his
criminal prosecution. This understanding was sharply reinforced when the
Court held that the speech-or-debate clause utterly foreclosed judicial
interference with the conduct of a congressional investigation, through
review of the propriety of subpoenas or otherwise.\250\ It is only with
regard to the trial of contempts that the courts may review the carrying
out of congressional investigations and may impose constitutional and
other constraints.
\250\Eastland v. United States Servicemen's Fund, 421 U.S. 491
(1975).
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ARTICLE I
LEGISLATIVE DEPARTMENT
Section 2. Clause 1. The House of Representatives shall be composed of
Members chosen every second Year by the People of the several States,
and the Electors in each State shall have the Qualifications requisite
for Electors of the most numerous Branch of the State Legislature.
[[Page 106]]
CONGRESSIONAL DISTRICTING
A major innovation in constitutional law in recent years has
been the development of a requirement that election districts in each
State be so structured that each elected representative should represent
substantially equal populations.\251\ While this requirement has
generally been gleaned from the equal protection clause of the
Fourteenth Amendment,\252\ in Wesberry v. Sanders,\253\ the Court held
that ``construed in its historical context, the command of Art. 1,
Sec. 2, that Representatives be chosen `by the People of the several
States' means that as nearly as is practicable one man's vote in a
congressional election is to be worth as much as another's.''\254\
\251\The phrase ``one person, one vote'' which came out of this
litigation might well seem to refer to election districts drawn to
contain equal numbers of voters rather than equal numbers of persons.
But it seems clear from a consideration of all the Court's opinions and
the results of its rulings that the statement in the text accurately
reflects the constitutional requirement. The case expressly holding that
total population, or the exclusion only of transients, is the standard
is Burns v. Richardson, 384 U.S. 73 (1966), a legislative apportionment
case. Notice that considerable population disparities exist from State
to State, as a result of the requirement that each State receive at
least one Member and the fact that state lines cannot be crossed in
districting. At least under present circumstances, these disparities do
not violate the Constitution. U.S. Department of Commerce v. Montana,
112 S.Ct. 1415 (1992).
\252\Reynolds v. Sims, 377 U.S. 533 (1964) (legislative
apportionment and districting); Hadley v. Junior College District, 397
U.S. 50 (1970) (local governmental units).
\253\376 U.S. 1 (1964). See also Martin v. Bush, 376 U.S. 222
(1964).
\254\376 U.S., 7.
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Court involvement in this issue developed slowly. In our early
history, state congressional delegations were generally elected at-large
instead of by districts and even when Congress required single-member
districting\255\ and later added a provision for equally populated
districts\256\ the relief sought by voters was action by the House
refusing to seat Members-elect selected under systems not in compliance
with the federal laws.\257\ The first series of cases did not reach the
Supreme Court, in fact, until the States began redistricting through the
1930 Census, and these were resolved without reaching constitutional
issues and indeed without resolving the issue whether such voter
complaints were justiciable at all.\258\ In the late 1940s and the early
1950s, the Court utilized the ``political
[[Page 107]]
question'' doctrine to decline to adjudicate districting and
apportionment suits, a position changed in Baker v. Carr.\259\
\255\Act of June 25, 1842, 5 Stat. 491.
\256\Act of February 2, 1872, 17 Stat. 28.
\257\The House uniformly refused to grant any such relief. 1 A.
Hinds' Precedents of the House of Representatives (Washington: 1907),
310. See L. Schmeckebier, Congressional Apportionment (Washington:
1941), 135-138.
\258\Smiley v. Holm, 285 U.S. 355 (1932); Koenig v. Flynn, 285
U.S. 375 (1932); Carroll v. Becker, 285 U.S. 380 (1932); Wood v. Broom,
287 U.S. 1 (1932); Mahan v. Hume, 287 U.S. 575 (1932).
\259\369 U.S. 186 (1962).
---------------------------------------------------------------------------
For the Court in Wesberry,\260\ Justice Black argued that a
reading of the debates of the Constitutional Convention conclusively
demonstrated that the Framers had meant, in using the phrase ``by the
People,'' to guarantee equality of representation in the election of
Members of the House of Representatives.\261\ Justice Harlan in dissent
argued contrarily that the statements relied on by the majority had
uniformly been in the context of the Great Compromise--Senate
representation of the States with Members elected by the state
legislatures, House representation according to the population of the
States, qualified by the guarantee of at least one Member per State and
the counting of slaves as three-fifths of persons--and not at all in the
context of intrastate districting. Further, he thought the Convention
debates clear to the effect that Article I, Sec. 4, had vested exclusive
control over state districting practices in Congress and that the Court
action overrode a congressional decision not to require equally-
populated districts.\262\
\260\Wesberry v. Sanders, 376 U.S. 1 (1964).
\261\Id., 7-18.
\262\Id., 20-49.
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The most important issue, of course, was how strict a standard
of equality the Court would adhere to. At first, the Justices seemed
inclined to some form of de minimis rule with a requirement that the
State present a principled justification for the deviations from
equality which any districting plan presented.\263\ But in Kirkpatrick
v. Preisler,\264\ a sharply divided Court announced the rule that a
State must make a ``good-faith effort to achieve precise mathematical
equality.''\265\ Therefore, ``[u]nless population variances among
congressional districts are shown to have resulted despite such [good-
faith] effort [to achieve precise mathematical equality], the State must
justify each variance, no matter how small.''\266\ The strictness of the
test was revealed not only by the phrasing of the test but by the fact
that the majority rejected every proffer of a justification which the
State had made and which could likely be made. Thus, it was not an
adequate justification that deviations resulted from (1) an effort to
draw districts to maintain in
[[Page 108]]
tact areas with distinct economic and social interests,\267\ (2) the
requirements of legislative compromise,\268\ (3) a desire to maintain
the integrity of political subdivision lines,\269\ (4) the exclusion
from total population figures of certain military personnel and students
not residents of the areas in which they were found,\270\ (5) an attempt
to compensate for population shifts since the last census,\271\ or (6)
an effort to achieve geographical compactness.\272\
\263\Kirkpatrick v. Preisler, 385 U.S. 450 (1967), and
Duddleston v. Grills, 385 U.S. 455 (1967), relying on the rule set out
in Swann v. Adams, 385 U.S. 440 (1967), a state legislative case.
\264\394 U.S. 526 (1969). See also Wells v. Rockefeller, 394
U.S. 542 (1969).
\265\Kirkpatrick v. Preisler, 394 U.S. 526, 530 (1969).
\266\Id., 531.
\267\Id., 533. People vote as individuals, Justice Brennan said
for the Court, and it is the equality of individual voters that is
protected.
\268\Ibid. Political ``practicality'' may not interfere with a
rule of ``practicable'' equality.
\269\Id., 533-534. The argument is not ``legally acceptable.''
\270\Id., 534-535. Justice Brennan questioned whether anything
less than a total population basis was permissible but noted that the
legislature in any event had made no consistent application of the
rationale.
\271\Id., 535. This justification would be acceptable if an
attempt to establish shifts with reasonable accuracy had been made.
\272\Id., 536. Justifications based upon ``the unaesthetic
appearance'' of the map will not be accepted.
---------------------------------------------------------------------------
Illustrating the strictness of the standard, the Court upheld a
lower court voiding of a Texas congressional districting plan in which
the population difference between the most and least populous districts
was 19,275 persons and the average deviation from the ideally populated
district was 3,421 persons.\273\ Adhering to the principle of strict
population equality in a subsequent case, the Court refused to find
valid a plan simply because the variations were smaller than the
estimated census undercount. Rejecting the plan, the difference in
population between the most and least populous districts being 3,674
people, in a State in which the average district population was 526,059
people, the Court opined that, given rapid advances in computer
technology, it is now ``relatively simple to draw contiguous districts
of equal population and at the same time . . . further whatever
secondary goals the State has.''\274\
\273\White v. Weiser, 412 U.S. 783 (1973). The Court did set
aside the district court's own plan for districting, instructing that
court to adhere more closely to the legislature's own plan insofar as it
reflected permissible goals of the legislators, reflecting an ongoing
deference in legislatures in this area to the extent possible.
\274\Karcher v. Daggett, 462 U.S. 725 (1983). Illustrating the
point about computer-generated plans containing absolute population
equality is Hastert v. State Board of Elections, 777 F.Supp. 634
(N.D.Ill. 1991) (three-judge court), in which the court adopted a
congressional-districting plan in which 18 of the 20 districts had
571,530 people each and each of the other two had 571,531 people.
---------------------------------------------------------------------------
Attacks on partisan gerrymandering have proceeded under equal-
protection analysis, and, while the Court has held justiciable claims
based on claims of denial of effective representation, the standards are
so high neither voters nor minority parties have yet benefitted from the
development.\275\
\275\The principal case was Davis v. Bandemer, 478 U.S. 109
(1986), a legislative apportionment case, but no doubt should exist that
congressional districting is covered. See Badham v. Eu, 694 F.Supp. 664
(N.D.Calif.) (three-judge court) (adjudicating partisan gerrymandering
claim as to congressional districts but deciding against plaintiffs on
merits), affd., 488 U.S. 1024 (1988); Pope v. Blue, 809 F.Supp. 392
(W.D.N.C.) (three-judge court) (same), affd, 113 S.Ct. 650 (1992).
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[[Page 109]]
ELECTOR QUALIFICATIONS
It was the original constitutional scheme to vest the
determination of qualifications for electors in congressional
elections\276\ solely in the discretion of the States, save only for the
express requirement that the States could prescribe no qualifications
other than those provided for voters for the more numerous branch of the
legislature.\277\ This language has never been expressly changed, but
the discretion of the States, and not only with regard to the
qualifications of congressional electors, has long been circumscribed by
express constitutional limitations\278\ and by judicial decisions.\279\
Further, beyond the limitation of discretion on the part of the States,
Congress has assumed the power, with judicial acquiescence, to legislate
itself to provide qualifications at least with regard to some
elections.\280\ Thus, in the Voting Rights Act of 1965,\281\ Congress
legislated changes of a limited nature in the literacy laws of some of
the States,\282\ and in the Voting Rights Act Amendments of 1970,\283\
Congress successfully lowered the minimum voting age in federal
elections\284\ and prescribed residency qualifications for presidential
elections,\285\ the Court striking down an attempt to lower the minimum
voting age for all elections.\286\ These developments greatly limited
the discretion granted in Arti
[[Page 110]]
cle I, Sec. 2, cl. 1, and are more fully dealt with subsequently in the
treatment of Sec. 5 of the Fourteenth Amendment.
\276\The clause refers only to elections to the House of
Representatives, of course, and, inasmuch as Senators were originally
chosen by state legislatures and presidential electors as the States
would provide, it was only with the qualifications for these voters with
which the Constitution was originally concerned.
\277\Minor v. Happersett, 21 Wall. (88 U.S.) 162, 171 (1875);
Breedlove v. Suttles, 302 U.S. 277, 283 (1937). See 2 J. Story,
Commentaries on the Constitution of the United States (Boston: 1833),
576-585.
\278\The Fifteenth, Nineteenth, Twenty-fourth, and Twenty-sixth
Amendments limited the States in the setting of qualifications in terms
of race, sex, payment of poll taxes, and age.
\279\The Supreme Court's interpretation of the equal protection
clause has excluded certain qualifications. E.g., Carrington v. Rash,
380 U.S. 89 (1965); Kramer v. Union Free School District, 395 U.S. 621
(1969); City of Phoenix v. Kolodziejski, 399 U.S. 204 (1970). The
excluded qualifications were in regard to all elections.
\280\The power has been held to exist under Sec. 5 of the
Fourteenth Amendment. Katzenbach v. Morgan, 384 U.S. 641 (1966); Oregon
v. Mitchell, 400 U.S. 112 (1970); City of Rome v. United States, 446
U.S. 156 (1980).
\281\Sec. 4(e), 79 Stat. 437, 439, 42 U.S.C. Sec. 1973b(e), as
amended.
\282\Upheld in Katzenbach v. Morgan, 384 U.S. 641 (1966).
\283\Titles 2 and 3, 84 Stat. 314, 42 U.S.C. Sec. 1973bb.
\284\Oregon v. Mitchell, 400 U.S. 112, 119-131, 135-144, 239-281
(1970).
\285\Oregon v. Mitchell, 400 U.S. 112, 134, 147-150, 236-239,
285-292 (1970).
\286\Oregon v. Mitchell, 400 U.S. 112, 119-131, 152-213, 293-296
(1970).
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Notwithstanding the vesting of discretion to prescribe voting
qualifications in the States, conceptually the right to vote for United
States Representatives is derived from the Federal Constitution,\287\
and Congress has had the power under Article I, Sec. 4, to legislate to
protect that right against both official\288\ and private denial.\289\
\287\``The right to vote for members of the Congress of the
United States is not derived merely from the constitution and laws of
the state in which they are chosen, but has its foundation in the
Constitution of the United States.'' Ex parte Yarbrough, 110 U.S. 651,
663 (1884). See also Wiley v. Sinkler, 179 U.S. 58, 62 (1900); Swafford
v. Templeton, 185 U.S. 487, 492 (1902); United States v. Classic, 313
U.S. 299, 315, 321 (1941).
\288\United States v. Mosley, 238 U.S. 383 (1915).
\289\United States v. Classic, 313 U.S. 299, 315 (1941).
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Clause 2. No person shall be a Representative who shall not have
attained to the Age of twenty-five Years, and been seven Years a Citizen
of the United States, and who shall not, when elected, be an inhabitant
of the State in which he shall be chosen.
QUALIFICATIONS OF MEMBERS OF CONGRESS
When the Qualifications Must Be Possessed
A question much disputed but now seemingly settled is whether a
condition of eligibility must exist at the time of the election or
whether it is sufficient that eligibility exist when the Member-elect
presents himself to take the oath of office. While the language of the
clause expressly makes residency in the State a condition at the time of
election, it now appears established in congressional practice that the
age and citizenship qualifications need only be met when the Member-
elect is to be sworn.\290\ Thus, persons elected to either the House of
Representatives or the Senate before attaining the required age or term
of citizenship have been admitted as soon as they became qualified.\291\
\290\See S. Rept. No. 904, 74th Congress, 1st sess. (1935),
reprinted in 79 Cong. Rec. 9651-9653 (1935).
\291\1 A. Hinds' Precedents of the House of Representatives
(Washington: 1907), Sec. 418; 79 Cong. Rec. 9841-9842 (1935); cf. Hinds'
Precedents, supra, Sec. 429.
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Exclusivity of Constitutional Qualifications
Congressional Additions.--Writing in The Federalist with
reference to the election of Members of Congress, Hamilton firmly
[[Page 111]]
stated that ``[t]he qualifications of the persons who may . . . be
chosen . . . are defined and fixed in the constitution; and are
unalterable by the legislature.''\292\ Until the Civil War, the issue
was not raised, the only actions taken by either House conforming to the
idea that the qualifications for membership could not be enlarged by
statute or practice.\293\ But in the passions aroused by the fratricidal
conflict, Congress enacted a law requiring its members to take an oath
that they had never been disloyal to the National Government.\294\
Several persons were refused seats by both Houses because of charges of
disloyalty,\295\ and thereafter House practice, and Senate practice as
well, was erratic.\296\ But in Powell v. McCormack,\297\ it was
conclusively established that the qualifications listed in cl. 2 are
exclusive\298\ and that Congress could not add to them by excluding
Members-elect not meeting the additional qualifications.\299\
\292\No. 60 (J. Cooke ed. 1961), 409. See also 2 J. Story,
Commentaries on the Constitution of the United States (Boston: 1833),
Sec. Sec. 623-627 (relating to the power of the States to add
qualifications).
\293\All the instances appear to be, however, cases in which the
contest arose out of a claimed additional state qualification.
\294\Act of July 2, 1862, 12 Stat. 502. Note also the
disqualification written into Sec. 3 of the Fourteenth Amendment.
\295\1 A. Hinds' Precedents of the House of Representatives
(Washington: 1907), Sec. Sec. 451, 449, 457.
\296\In 1870, the House excluded a Member-elect who had been re-
elected after resigning earlier in the same Congress when expulsion
proceedings were instituted against him for selling appointments to the
Military Academy. Id., Sec. 464. A Member-elect was excluded in 1899
because of his practice of polygamy, id., 474-480, but the Senate
refused, after adopting a rule requiring a two-thirds vote, to exclude a
Member-elect on those grounds. Id., Sec. Sec. 481-483. The House twice
excluded a socialist Member-elect in the wake of World War I on
allegations of disloyalty. 6 C. Cannon's Precedents of the House of
Representatives (Washington: 1935), Sec. Sec. 56-58. See also S. Rept.
No. 1010, 77th Congress 2d sess. (1942), and R. Hupman, Senate Election,
Expulsion and Censure Cases From 1789 to 1960, S. Doc. No. 71, 87th
Congress, 2d sess. (1962), 140 (dealing with the effort to exclude
Senator Langer of North Dakota).
\297\395 U.S. 486 (1969). The Court divided eight to one,
Justice Stewart dissenting on the ground the case was moot.
\298\The Court declined to reach the question whether the
Constitution in fact does impose other qualifications. 395 U.S., 520 n.
41 (possibly Article I, Sec. 3, cl. 7, disqualifying persons impeached,
Article I, Sec. 6, cl. 2, incompatible offices, and Sec. 3 of the
Fourteenth Amendment). It is also possible that the oath provision of
Article VI, cl. 3, could be considered a qualification. See Bond v.
Floyd, 385 U.S. 116, 129-131 (1966).
\299\Id., 395 U.S., 550.
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Powell was excluded from the 90th Congress on grounds that he
had asserted an unwarranted privilege and immunity from the process of a
state court, that he had wrongfully diverted House funds for his own
uses, and that he had made false reports on the expenditures of foreign
currency.\300\ The Court determination that
[[Page 112]]
he had been wrongfully excluded proceeded in the main from the Court's
analysis of historical developments, the Convention debates, and textual
considerations. This process led the Court to conclude that Congress'
power under Article I, Sec. 5 to judge the qualifications of its Members
was limited to ascertaining the presence or absence of the standing
qualifications prescribed in Article I, Sec. 2, cl. 2, and perhaps in
other express provisions of the Constitution.\301\ The conclusion
followed because the English parliamentary practice and the colonial
legislative practice at the time of the drafting of the Constitution,
after some earlier deviations, had settled into a policy that exclusion
was a power exercisable only when the Member-elect failed to meet a
standing qualifications,\302\ because in the Constitutional Convention
the Framers had defeated provisions allowing Congress by statute either
to create property qualifications or to create additional qualifications
without limitation,\303\ and because both Hamilton and Madison in the
Federalist Papers and Hamilton in the New York ratifying convention had
strongly urged that the Constitution prescribed exclusive qualifications
for Members of Congress.\304\
\300\H. Rept. No. 27, 90th Congress, 1st sess. (1967); Id., 395
U.S., 489-493.
\301\Powell v. McCormack, 395 U.S. 486, 518-547 (1969).
\302\Id., 522-531.
\303\Id., 532-539.
\304\Id., 539-541.
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Further, the Court observed that the early practice of Congress,
with many of the Framers serving, was consistently limited to the view
that exclusion could be exercised only with regard to a Member-elect
failing to meet a qualification expressly prescribed in the
Constitution. Not until the Civil War did contrary precedents appear and
later practice was mixed.\305\ Finally, even were the intent of the
Framers less clear, said the Court, it would still be compelled to
interpret the power to exclude narrowly. ``A fundamental principle of
our representative democracy is, in Hamilton's words, `that the people
should choose whom they please to govern them' 2 Elliot's Debates 257.
As Madison pointed out at the Convention, this principle is undermined
as much by limiting whom the people can select as by limiting the
franchise itself. In apparent agreement with this basic philosophy, the
Convention adopted his suggestion limiting the power to expel. To allow
essentially that same power to be exercised under the guise of judging
qualifications, would be to ignore Madison's warning, borne out in the
Wilkes case and some of Congress' own post-Civil War exclusion cases,
against `vesting an improper and dangerous power in the Legislature.' 2
Farrand 249.''\306\ Thus, the Court appears to
[[Page 113]]
say, to allow the House to exclude Powell on this basis of
qualifications of its own choosing would impinge on the interests of his
constituents in effective participation in the electoral process, an
interest which could be protected by a narrow interpretation of
Congressional power.\307\
\305\Id., 541-547.
\306\Id., 547-548.
\307\The protection of the voters' interest in being represented
by the person of their choice is thus analogized to their
constitutionally secured right to cast a ballot and have it counted in
general elections, Ex parte Yarbrough, 110 U.S. 651 (1884), and in
primary elections, United States v. Classic, 313 U.S. 299 (1941), to
cast a ballot undiluted in strength because of unequally populated
districts, Wesberry v. Sanders. 376 U.S. 1 (1964), and to cast a vote
for candidates of their choice unfettered by onerous restrictions on
candidate qualification for the ballot. Williams v. Rhodes, 393 U.S. 23
(1968).
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The result in the Powell case had been foreshadowed earlier when
the Court held that the exclusion of a Member-elect by a state
legislature because of objections he had uttered to certain national
policies constituted a violation of the First Amendment and was
void.\308\ In the course of that decision, the Court denied state
legislators the power to look behind the willingness of any legislator
to take the oath to support the Constitution of the United States,
prescribed by Article VI, cl. 3, to test his sincerity in taking
it.\309\ The unanimous Court noted the views of Madison and Hamilton on
the exclusivity of the qualifications set out in the Constitution and
alluded to Madison's view that the unfettered discretion of the
legislative branch to exclude members could be abused in behalf of
political, religious or other orthodoxies.\310\ The First Amendment
holding and the holding with regard to testing the sincerity with which
the oath of office is taken is no doubt as applicable to the United
States Congress as to state legislatures.
\308\Bond v. Floyd, 385 U.S. 116 (1966).
\309\Id., 129-131, 132, 135.
\310\Id., 135 n. 13.
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State Additions.--However much Congress may have deviated from
the principle that the qualifications listed in the Constitution are
exclusive when the issue has been congressional enlargement of those
qualifications, it has been uniform in rejecting efforts by the States
to enlarge the qualifications. Thus, the House in 1807 seated a Member-
elect who was challenged as not being in compliance with a state law
imposing a twelve-month durational residency requirement in the
district, rather than the federal requirement of being an inhabitant of
the State at the time of election; the state requirement, the House
resolved, was unconstitutional.\311\ Similarly, both the House and
Senate have seated other Members-elect who did not meet additional state
qualifications or
[[Page 114]]
who suffered particular state disqualifications on eligibility, such as
running for Congress while holding particular state offices.\312\
\311\1 A. Hinds' Precedents of the House of Representatives
(Washington: 1907), Sec. 414.
\312\Id., Sec. Sec. 415-417. The court holdings, predominantly
state courts, appear almost uniformly to be that the States may not add
to the qualifications. E.g., Shub v. Simpson, 196 Md. 177, 76 A. 2d 332,
appeal dismd. 340 U.S. 881 (1950); Odegard v. Olson, 264 Minn, 439, 119
N.W. 2d 717 (1963); State ex rel. Johnson v. Crane, 65 Wyo. 189, 197 P.
2d 864 (1948); Florida ex rel. Davis v. Adams, 238 So. 2d 415 (Fla.
1970), stay granted, 400 U.S. 1203 (1970) (Justice Black in Chambers);
Stack v. Adams, 315 F. Supp. 1295 (D.C. N.D. Fla. 1970), interim relief
granted, 400 U.S. 1203 (1970) (Justice Black in Chambers).
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Clause 3. [Representatives and direct Taxes shall be apportioned among
the several States which may be included within this Union, according to
their respective Numbers, which shall be determined by adding to the
whole Number of free Persons, including those bound to Service for a
Term of Years, and excluding Indians not taxed, three fifths of all
other Persons].\313\ The actual Enumeration shall be made within three
Years after the first Meeting of the Congress of the United States, and
within every subsequent Term of ten Years, in such Manner as they shall
by Law direct. The Number of Representatives shall not exceed one for
every thirty Thousand, but each State shall have at Least one
Representative; and until such enumeration shall be made, the State of
New Hampshire shall be entitled to chuse three, Massachusetts eight,
Rhode Island and Providence Plantations one, Connecticut, five, New York
six, New Jersey four, Pennsylvania eight, Delaware one, Maryland six,
Virginia ten, North Carolina five, South Carolina five, and Georgia
three.
\313\The part of this clause relating to the mode of
apportionment of representatives among the several States, was changed
by the Fourteenth Amendment, Sec. 2 and as to taxes on incomes without
apportionment, by the Sixteenth Amendment.
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APPORTIONMENT OF SEATS IN THE HOUSE
The Census Requirement
While Sec. 2 expressly provides for an enumeration of persons,
Congress has repeatedly directed an enumeration not only of the
[[Page 115]]
free persons in the States, but also of those in the territories, and
has required all persons over eighteen years of age to answer an ever-
lengthening list of inquiries concerning their personal and economic
affairs. This extended scope of the census has received the implied
approval of the Supreme Court;\314\ it is one of the methods whereby the
national legislature exercises its inherent power to obtain the
information necessary for intelligent legislative action. Although
taking an enlarged view of its power in making the enumeration of
persons called for by this section, Congress has not always complied
with its positive mandate to reapportion representatives among the
States after the census is taken.\315\ It failed to make such a
reapportionment after the census of 1920, being unable to reach
agreement for allotting representation without further increasing the
size of the House. Ultimately, by the act of June 18, 1929,\316\ it
provided that the membership of the House of Representatives should
henceforth be restricted to 435 members, to be distributed among the
States by the so-called ``method of major fractions,'' which had been
earlier employed in the apportionment of 1911 and which has now been
replaced with the ``method of equal proportions.'' Following the 1990
census, a State that had lost a House seat as a result of the use of
this formula sued, alleging a violation of the ``one person, one vote''
rule. Exhibiting considerable deference to Congress and a stated
appreciation of the difficulties in achieving interstate equalities, the
Supreme Court upheld the formula and the resultant apportionment.\317\
\314\Knox v. Lee (Legal Tender Cases). 12 Wall. (79 U.S.) 457,
536 (1871).
\315\For an extensive history of the subject, see L.
Schmeckebier, Congressional Apportionment (Washington: 1941).
\316\46 Stat. 26, 22, as amended by 55 Stat. 761 (1941), 2
U.S.C. Sec. 2a.
\317\U.S. Department of Commerce v. Montana, 112 S.Ct. 1415
(1992). The practice of the Secretary of Commerce in allocating overseas
federal employees and military personnel to the States of last residence
was attacked but upheld in Franklin v. Massachusetts, 112 S.Ct. 2767
(1992). The mandate of the clause of an enumeration of ``their
respective numbers'' was complied with, it having been the practice
since the first enumeration to allocate persons to the place of their
``usual residence,'' and to construe both this term and the word
``inhabitant'' broadly to include people temporarily absent.
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While requiring the election of Representatives by districts,
Congress has left it to the States to define the areas from which
members should be chosen. This has occasioned a number of disputes
concerning the validity of action taken by the States. In Ohio ex rel.
Davis v. Hildebrant,\318\ a requirement that a redistricting law be
submitted to a popular referendum was challenged and sustained. After
the reapportionment made pursuant to the 1930 census, deadlocks between
the Governor and legislature in several States produced a series of
cases in which the right of the Governor
[[Page 116]]
to veto a reapportionment bill was questioned. Contrasting this function
with other duties committed to state legislatures by the Constitution,
the Court decided that it was legislative in character and subject to
gubernatorial veto to the same extent as ordinary legislation under the
terms of the state constitution.\319\
\318\241 U.S. 565 (1916).
\319\Smiley v. Holm, 285 U.S. 355 (1932); Koenig v. Flynn, 285
U.S. 375 (1932); Carroll v. Becker, 285 U.S. 380 (1932).
Clause 4. When vacancies happen in the Representation from any State,
the Executive Authority thereof shall issue Writs of Election to fill
such Vacancies.
Clause 5. The House of Representatives shall chuse their Speaker and
other Officers; and shall have the sole Power of Impeachment.
ARTICLE I
LEGISLATIVE DEPARTMENT
Section 3. Clause 1. [The Senate of the United States shall be
composed of two Senators from each State, chosen by the legislature
thereof, for six Years; and each Senator shall have one vote].\320\
\320\See Seventeenth Amendment.
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Clause 2. Immediately after they shall be assembled in Consequence of
the first Election, they shall be divided as equally as may be into
three classes. The Seats of the Senators of the first Class shall be
vacated at the Expiration of the second Year, of the second Class at the
Expiration of the fourth Year, and of the third Class at the Expiration
of the sixth Year, so that one third may be chosen every second
Year,\321\ [and if Vacancies happen by Resignation or otherwise, during
the Recess of the Legislature of any State, the Executive thereof may
make temporary Appointments until the next Meeting of the Legislature,
which shall then fill such Vacancies].\322\
\321\See Seventeenth Amendment.
\322\See Seventeenth Amendment.
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[[Page 117]]
Clause 3. No Person shall be a Senator who shall not have attained to
the Age of thirty Years, and been nine Years a Citizen of the United
States, and who shall not, when elected, be an Inhabitant of that State
for which he shall be chosen.
Clause 4. The Vice President of the United States shall be President
of the Senate but shall have no Vote, unless they be equally divided.
Clause 5. The Senate shall chuse their other Officers, and also a
President pro tempore, in the absence of the Vice President, or when he
shall exercise the Office of the President of the United States.
Clause 6. The Senate shall have the sole Power to try all
Impeachments. When sitting for that Purpose, they shall be on Oath or
Affirmation. When the President of the United States is tried, the Chief
Justice shall preside: And no Person shall be convicted without the
Concurrence of two thirds of the Members present.
Clause 7. Judgment in Cases of Impeachment shall not extend further
than to removal from Office, and disqualification to hold and enjoy any
Office of honor, Trust or Profit under the United States; but the Party
convicted shall nevertheless be liable and subject to Indictment, Trial,
Judgment and Punishment, according to Law.
ARTICLE I
LEGISLATIVE DEPARTMENT
Section 4. Clause 1. The Times, Places and Manner of holding Elections
for Senators and Representatives, shall be prescribed in each State by
the Legislature thereof; but Congress may at any time make or alter such
Regulations, except as to the Place of chusing Senators.
[[Page 118]]
FEDERAL LEGISLATION PROTECTING ELECTORAL PROCESS
Not until 1842 did Congress undertake to exercise the power to
regulate the ``times, places and manner of holding elections for
Senators and Representatives.'' In that year, it passed a law requiring
the election of Representatives by districts.\323\ In subsequent years,
Congress expanded on the requirements, successively adding contiguity,
compactness, and substantial equality of population to the districting
requirements.\324\ However, no challenge to the seating of Members-elect
selected in violation of these requirements was ever successful,\325\
and Congress deleted the standards from the 1929 apportionment act.\326\
More success attended a congressional resolution in 1866 of deadlocks in
state legislatures over the election of Senators, often resulting in
vacancies for months. The act required the two houses of each
legislature to meet in joint session on a specified day and to meet
every day thereafter until a Senator was selected.\327\
\323\5 Stat. 491 (1842). The requirement was omitted in 1850, 9
Stat. 428, but was adopted again in 1862. 12 Stat. 572.
\324\The 1872 Act, 17 Stat. 28, provided that districts should
contain ``as nearly as practicable'' equal numbers of inhabitants, a
provision thereafter retained. In 1901, 31 Stat. 733, a requirement that
districts be composed of ``compact territory'' was added. These
provisions were repeated in the next Act, 37 Stat. 13 (1911), there was
no apportionment following the 1920 Census, and the permanent 1929 Act
omitted the requirements. 46 Stat. 13. Cf. Wood v. Broom, 287 U.S. 1
(1932).
\325\The first challenge was made in 1843. The committee
appointed to inquire into the matter divided, the majority resolving
that Congress had no power to bind the States in regard to their manner
of districting, the minority contending to the contrary. H. Rept. No.
60, 28th Congress, 1st sess. (1843). The basis of the majority view was
that while Article I, Sec. 4 might give Congress the power to lay off
the districts itself, the clause did not authorize Congress to tell the
state legislatures how to do it if the legislatures were left the task
of drawing the lines. L. Schmeckebier, Congressional
Apportionment(Washington: 1941), 135-138. This argument would not appear
to be maintainable in light of the language inEx parte Siebold, 100 U.S.
371, 383-386 (1880).
\326\46 Stat. 13 (1929). In 1967, Congress restored the single-
member district requirement. 81 Stat. 581, 2 U.S.C. Sec. 2c.
\327\14 Stat. 243 (1866). Still another such regulation was the
congressional specification of a common day for the election of
Representatives in all the States. 17 Stat. 28 (1872), 2 U.S.C. Sec. 7.
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The first comprehensive federal statute dealing with elections
was adopted in 1870 as a means of enforcing the Fifteenth Amendment's
guarantee against racial discrimination in granting suffrage
rights.\328\ Under the Enforcement Act of 1870, and subsequent
[[Page 119]]
laws, false registration, bribery, voting without legal right, making
false returns of votes cast, interference in any manner with officers of
election, and the neglect by any such officer of any duty required of
him by state or federal law were made federal offenses.\329\Provision
was made for the appointment by federal judges of persons to attend at
places of registration and at elections with authority to challenge any
person proposing to register or vote unlawfully, to witness the counting
of votes, and to identify by their signatures the registration of voters
and election talley sheets.\330\When the Democratic Party regained
control of Congress, these pieces of Reconstruction legislation dealing
specifically with elections were repealed,\331\ but other statutes
prohibiting interference with civil rights generally were retained and
these were utilized in later years. More recently, Congress has enacted,
in 1957, 1960, 1964, 1965, 1968, 1970, 1975, 1980, and 1982, legislation
to protect the right to vote in all elections, federal, state, and
local, through the assignment of federal registrars and poll watchers,
suspension of literacy and other tests, and the broad proscription of
intimidation and reprisal, whether with or without state action.\332\
\328\Article I, Sec. 4, and the Fifteenth Amendment have had
quite different applications. The Court insisted that under the latter,
while Congress could legislate to protect the suffrage in all elections,
it could do so only against state interference based on race, color, or
previous condition of servitude, James v. Bowman, 190 U.S. 127
(1903);United States v. Reese, 92 U.S. 214 (1876), whereas under the
former it could legislate against private interference as well for
whatever motive but only in federal elections.Ex parte Siebold, 100 U.S.
371 (1880);Ex parte Yarbrough, 110 U.S. 651 (1884).
\329\The Enforcement Act of May 31, 1870, 16 Stat. 140; The
Force Act of February 28, 1871, 16 Stat. 433; The Ku Klux Klan Act of
April 20, 1871, 17 Stat. 13. The text of these and other laws and the
history of the enactments and subsequent developments are set out in R.
Carr, Federal Protection of Civil Rights: Quest for a Sword(Ithaca:
1947).
\330\The constitutionality of sections pertaining to federal
elections was sustained inEx parte Siebold, 100 U.S. 371 (1880), andEx
parte Yarbrough, 110 U.S. 651 (1884). The legislation pertaining to all
elections was struck down as going beyond Congress' power to enforce the
Fifteenth Amendment.United States v. Reese, 92 U.S. 214 (1876).
\331\28 Stat. 144 (1894).
\332\P.L. 85-315, Part IV, Sec. 131, 71 Stat. 634, 637 (1957);
P.L. 86-449, Title III, Sec. 301, Title VI, 601, 74 Stat. 86, 88, 90
(1960); P.L. 88-352, Title I, Sec. 101, 78 Stat. 241 (1964); P.L. 89-
110, 79 Stat. 437 (1965); P.L. 90-284, Title I, Sec. 101, 82 Stat. 73
(1968); P.L. 91-285, 84 Stat. 314 (1970);P.L. 94-73, 89 Stat. 400
(1975); P.L. 97-205, 96 Stat. 131 (1982). Most of these statutes are
codified in 42 U.S.C. Sec. 1971et seq.The penal statutes are in 18
U.S.C. Sec. Sec. 241-245.
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Another chapter was begun in 1907 when Congress passed the
Tillman Act, prohibiting national banks and corporations from making
contributions in federal elections.\333\The Corrupt Practices Act, first
enacted in 1910 and replaced by another law in 1925, extended federal
regulation of campaign contributions and expendi
[[Page 120]]
tures in federal elections\334\ and other acts have similarly provided
other regulations.\335\
\333\Act of January 26, 1907, 34 Stat. 864, now a part of 18
U.S.C. Sec. 610.
\334\Act of February 28, 1925, 43 Stat. 1070, 2 U.S.C.
Sec. Sec. 241-256. Comprehensive regulation is now provided by the
Federal Election Campaign Act of 1971, 86 Stat. 3, and the Federal
Election Campaign Act Amendments of 1974, 88 Stat. 1263, as amended, 90
Stat. 475, found in titles 2, 5, 18, and 26 of the U.S. Code. SeeBuckley
v. Valeo, 424 U.S. 1 (1976).
\335\E.g., the Hatch Act, relating principally to federal
employees and state and local governmental employees engaged in programs
at least partially financed with federal funds, 5 U.S.C. Sec. Sec. 7324-
7327.
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As we have noted above, although Sec. 2, cl. 1, of this Article
vests in the States the responsibility, now limited, to establish voter
qualifications for congressional elections, the Court has held that the
right to vote for Members of Congress is derived from the Federal
Constitution,\336\ and that Congress therefore may legislate under this
section of the Article to protect the integrity of this right. Congress
may protect the right of suffrage against both official and private
abridgment.\337\Where a primary election is an integral part of the
procedure of choice, the right to vote in that primary election is
subject to congressional protection.\338\The right embraces, of course,
the opportunity to cast a ballot and to have it counted honestly.\339\
Freedom from personal violence and intimidation may be secured.\340\The
integrity of the process may be safeguarded against a failure to count
ballots lawfully cast\341\ or the dilution of their value by the
stuffing of the ballot box with fraudulent ballots.\342\ But the bribery
of voters, although within reach of congressional power under other
clauses of the Constitution, has been held not to be an interference
with the rights guaranteed by this section to other qualified
voters.\343\
\336\United States v. Classic, 313 U.S. 299, 314-315 (1941), and
cases cited.
\337\Id., 315;Buckley v. Valeo, 424 U. S. 1, 13 n. 16 (1976).
\338\United States v. Classic, 313 U.S. 299, 315-321 (1941). The
authority ofNewberry v. United States, 256 U.S. 232 (1921), to the
contrary has been vitiated.Cf. United States v. Wurzbach, 280 U.S. 396
(1930).
\339\United States v. Mosley, 238 U.S. 383 (1915);United States
v. Saylor, 322 U.S. 385, 387 (1944).
\340\Ex parte Yarbrough, 110 U.S. 651 (1884).
\341\United States v. Mosley, 238 U.S. 383 (1915).
\342\United States v. Saylor, 322 U.S. 385 (1944).
\343\United States v. Bathgate, 246 U.S. 220 (1918);United
States v. Gradwell, 243 U.S. 476 (1917).
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To accomplish the ends under this clause, Congress may adopt the
statutes of the States and enforce them by its own sanctions.\344\ It
may punish a state election officer for violating his duty under a state
law governing congressional elections.\345\It may, in short, utilize its
power under this clause, combined with the nec
[[Page 121]]
essary-and-proper clause, to regulate the times, places, and manner of
electing Members of Congress so as to fully safeguard the integrity of
the process; it may not, however, under this clause, provide different
qualifications for electors than those provided by the States.\346\
\344\Ex parte Siebold, 100 U.S. 371 (1880);Ex parte Clarke, 100
U.S. 399 (1880);United States v. Gale, 109 U.S. 65 (1883);In re Coy, 127
U.S. 731 (1888).
\345\Ibid.
\346\But inOregon v. Mitchell, 400 U.S. 112 (1970), Justice
Black grounded his vote to uphold the age reduction in federal elections
and the presidential voting residency provision sections of the Voting
Rights Act Amendments of 1970 on this clause. Id., 119-135. Four
Justices specifically rejected this construction, id., 209-212, 288-292,
and the other four implicitly rejected it by relying on totally
different sections of the Constitution in coming to the same conclusions
as did Justice Black.
Clause 2. [The Congress shall assemble at least once in every Year,
and such Meeting shall be on the first Monday in December, unless they
shall by law appoint a different Day].
ARTICLE I
LEGISLATIVE DEPARTMENT
Section 5. Clause 1. Each House shall be the Judge of the Elections,
Returns and Qualifications of its own Members, and a Majority of each
shall constitute a Quorum to do Business; but a smaller Number may
adjourn from day to day, and may be authorized to compel the Attendance
of absent Members, in such Manner, and under such Penalties as each
House may provide.
Clause 2. Each House may determine the Rules of its Proceedings,
punish its Members for disorderly Behaviour, and, with the Concurrence
of two thirds, expel a Member.
Clause 3. Each House shall keep a Journal of its Proceedings and from
time to time publish the same, excepting such Parts as may in their
Judgment require Secrecy; and the Yeas and Nays of the Members of either
House on any question shall, at the Desire of one fifth of those
Present, be entered on the Journal.
Clause 4. Neither House, during the Session of Congress, shall,
without the Consent of the other, adjourn for more than
[[Page 122]]
three days, nor to any other Place than that in which the two Houses
shall be sitting.
POWERS AND DUTIES OF THE HOUSES
Judge Elections
Power To Judge Elections
Each House, in judging of elections under this clause, acts as a
judicial tribunal, with like power to compel attendance of witnesses. In
the exercise of its discretion, it may issue a warrant for the arrest of
a witness to procure his testimony, without previous subpoena, if there
is good reason to believe that otherwise such witness would not be
forthcoming.\347\ It may punish perjury committed in testifying before a
notary public upon a contested election.\348\ The power to judge
elections extends to an investigation of expenditures made to influence
nominations at a primary election.\349\Refusal to permit a person
presenting credentials in due form to take the oath of office does not
oust the jurisdiction of the Senate to inquire into the legality of the
election.\350\Nor does such refusal unlawfully deprive the State which
elected such person of its equal suffrage in the Senate.\351\
\347\Barry v. United States ex rel. Cunningham, 279 U.S. 597,
616 (1929).
\348\In re Loney, 134 U.S. 372 (1890).
\349\6 C. Cannon'sPrecedents of the House of
Representatives(Washington: 1936), Sec. Sec. 72-74, 180.Cf. Newberry v.
United States, 256 U.S. 232, 258 (1921).
\350\Barry v. United States ex rel. Cunningham, 279 U.S. 597,
614 (1929).
\351\Id., 615. The existence of this power in both houses of
Congress does not prevent a State from conducting a recount of ballots
cast in such an election any more than it prevents the initial counting
by a State.Roudebush v. Hartke, 405 U.S. 15 (1972).
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Quorum
``A Quorum To Do Business''
For many years the view prevailed in the House of
Representatives that it was necessary for a majority of the members to
vote on any proposition submitted to the House in order to satisfy the
constitutional requirement for a quorum. It was a common practice for
the opposition to break a quorum by refusing to vote. This was changed
in 1890, by a ruling made by Speaker Reed, and later embodied in Rule XV
of the House, that members present in the chamber but not voting would
be counted in determining the presence of a quorum.\352\The Supreme
Court upheld this rule inUnited States v. Ballin,\353\ saying that the
capacity of the House to transact business is ``created by the mere
presence of a majority,'' and that since the Constitution does not
prescribe any method for de
[[Page 123]]
termining the presence of such majority ``it is therefore within the
competency of the House to prescribe any method which shall be
reasonably certain to ascertain the fact.''\354\The rules of the Senate
provide for the ascertainment of a quorum only by a roll call,\355\ but
in a few cases it has held that if a quorum is present, a proposition
can be determined by the vote of a lesser number of members.\356\
\352\A. Hinds'Precedents of the House of
Representatives(Washington: 1907), Sec. Sec. 2895-2905.
\353\144 U.S. 1 (1892).
\354\Id., 5-6.
\355\Rule V.
\356\4 A. Hinds'Precedents of the House of
Representatives(Washington: 1907), Sec. Sec. 2910-2915; 6 C.
Cannon'sPrecedents of the House of Representatives(Washington: 1936),
Sec. Sec. 645, 646.
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Rules of Proceedings
Rules of Proceedings
In the exercise of their constitutional power to determine their
rules of proceedings, the Houses of Congress may not ``ignore
constitutional restraints or violate fundamental rights, and there
should be a reasonable relation between the mode or method of proceeding
established by the rule and the result which is sought to be attained.
But within these limitations all matters of method are open to the
determination of the House . . . The power to make rules is not one
which once exercised is exhausted. It is a continuous power, always
subject to be exercised by the House, and within the limitations
suggested, absolute and beyond the challenge of any other body or
tribunal.''\357\Where a rule affects private rights, the construction
thereof becomes a judicial question. InUnited States v. Smith,\358\ the
Court held that the Senate's attempt to reconsider its confirmation of a
person nominated by the President as Chairman of the Federal Power
Commission was not warranted by its rules and did not deprive the
appointee of his title to the office. InChristoffel v. United
States,\359\ a sharply divided Court upset a conviction for perjury in
the district courts of one who had denied under oath before a House
committee any affiliation with Communism. The reversal was based on the
ground that inasmuch as a quorum of the committee, while present at the
outset, was not present at the time of the alleged perjury, testimony
before it was not before a ``competent tribunal'' within the sense of
the District of Columbia Code.\360\ Four Justices, speaking by Justice
Jackson, dissented, arguing that under the rules and practices of the
House, ``a quorum once established is presumed to continue unless and
[[Page 124]]
until a point of no quorum is raised'' and that the Court, was in
effect, invalidating this rule, thereby invalidating at the same time
the rule of self-limitation observed by courts ``where such an issue is
tendered.''\361\
\357\United States v. Ballin, 144 U.S. 1, 5 (1892). The Senate
is ``a continuing body.''McGrain v. Daugherty, 273 U.S. 135, 181-182
(1927). Hence its rules remain in force from Congress to Congress except
as they are changed from time to time, whereas those of the House are
readopted at the outset of each new Congress.
\358\286 U.S. 6 (1932).
\359\338 U.S. 84 (1949).
\360\Id., 87-90.
\361\Id., 92-95.
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Power Over Members
Powers of the Houses Over Members
Congress has authority to make it an offense against the United
States for a Member, during his continuance in office, to receive
compensation for services before a government department in relation to
proceedings in which the United States is interested. Such a statute
does not interfere with the legitimate authority of the Senate or House
over its own Members.\362\In upholding the power of the Senate to
investigate charges that some Senators had been speculating in sugar
stocks during the consideration of a tariff bill, the Supreme Court
asserted that ``the right to expel extends to all cases where the
offence is such as in the judgment of the Senate is inconsistent with
the trust and duty of a Member.''\363\It cited with apparent approval
the action of the Senate in expelling William Blount in 1797 for
attempting to seduce from his duty an American agent among the
Indiansand for negotiating for services in behalf of the British
Government among the Indians--conduct which was not a ``statutable
offense'' and which was not committed in his official character, nor
during the session of Congress nor at the seat of government.\364\
\362\Burton v. United States, 202 U.S. 344 (1906).
\363\In re Chapman, 166 U.S. 661 (1897).
\364\Id., 669-670.See2 J. Story, Commentaries on the
Constitution of the United States(Boston: 1833), Sec. 836.
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InPowell v. McCormack,\365\ a suit challenging theexclusionof a
Member-elect from the House of Representatives, it was argued that
inasmuch as the vote to exclude was actually in excess of two-thirds of
the Members it should be treated simply as anexpulsion.The Court
rejected the argument, noting that the House precedents were to the
effect that it had no power to expel for misconduct occurring prior to
the Congress in which the expulsion is proposed, as was the case of Mr.
Powell's alleged misconduct, but basing its rejection on its inability
to conclude that if the Members of the House had been voting to expel
they would still have cast an affirmative vote in excess of two-
thirds.\366\
\365\395 U.S. 486 (1969).
\366\Id., 506-512.
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Journal
[[Page 125]]
Duty To Keep a Journal
The object of the clause requiring the keeping of a Journal is
``to insure publicity to the proceedings of the legislature, and a
correspondent responsibility of the members to their respective
constituents.''\367\When the Journal of either House is put in evidence
for the purpose of determining whether the yeas and nays were ordered,
and what the vote was on any particular question, the Journal must be
presumed to show the truth, and a statement therein that a quorum was
present, though not disclosed by the yeas and nays, is final.\368\But
when an enrolled bill, which has been signed by the Speaker of the House
and by the President of the Senate, in open session receives the
approval of the President and is deposited in the Department of State,
its authentication as a bill that has passed Congress is complete and
unimpeachable, and it is not competent to show from the Journals of
either House that an act so authenticated, approved, and deposited, in
fact omitted one section actually passed by both Houses of
Congress.\369\
\367\2 J. Story, Commentaries on the Constitution of the United
States(Boston: 1833), Sec. 840, quoted with approval inField v. Clark,
143 U.S. 649, 670 (1892).
\368\United States v. Ballin, 144 U.S. 1, 4 (1892).
\369\Field v. Clark, 143 U.S. 649 (1892);Flint v. Stone Tracy
Co., 220 U.S. 107, 143 (1911). See the dispute in the Court with regard
to the application of Field in an origination clause dispute. United
States v. Munoz-Flores, 495 U.S. 385, 391 n. 4 (1990), and id., 408
(Justice Scalia concurring in the judgment). A parallel rule holds in
the case of a duly authenticated official notice to the Secretary of
State that a state legislature has ratified a proposed amendment to the
Constitution.Leser v. Garnett, 258 U.S. 130, 137 (1922);see also Coleman
---------------------------------------------------------------------------
v. Miller, 307 U.S. 433 (1939).
ARTICLE I
LEGISLATIVE DEPARTMENT
Section 6. Clause 1. The Senators and Representatives shall receive a
Compensation for their Services, to be ascertained by Law, and paid out
of the Treasury of the United States. They shall in all Cases, except
Treason, Felony and Breach of the Peace, be privileged from Arrest
during their Attendance at the Session of their respective Houses and in
going to and returning from the same; and for any Speech or Debate in
either House, they shall not be questioned in any other Place.
Clause 2. No Senator or Representative shall, during the Time for
which he was elected, be appointed to any civil Office
[[Page 126]]
under the Authority of the United States, which shall have been created,
or the Emoluments whereof shall have been increased during such time;
and no Person holding any Office under the United States, shall be a
Member of either House during his Continuance in Office.
Compensation, Privileges
COMPENSATION, IMMUNITIES AND DISABILITIES OF MEMBERS
Congressional Pay
With the surprise ratification of the Twenty-Seventh
Amendment,\370\ it is now the rule that congressional legislation
``varying''--note that the Amendment applies to decreases as well as
increases--the level of legislators' pay may not take effect until an
intervening election has occurred. The only real controversy likely to
arise in the interpretation of the new rule is whether pay increases
that result from automatic alterations in pay are subject to the same
requirement or whether it is only the initial enactment of the automatic
device that is covered.
\370\See infra.
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That is, from the founding to 1967, congressional pay was
determined directly by Congress in specific legislation setting specific
rates of pay. In 1967, a law was passed that created a quadrennial
commission with the responsibility to propose to the President salary
levels for top officials of the Government, including Members of
Congress.\371\ In 1975, Congress legislated to bring Members of Congress
within a separate commission system authorizing the President to
recommend annual increases for civil servants to maintain pay
comparability with private-sector employees.\372\ These devices were
attacked by dissenting Members of Congress as violating the mandate of
clause 1 that compensation be ``ascertained by Law[.]'' However, these
challenges were rejected.\373\ Thereafter, prior to ratification of the
Amendment, Congress in the Ethics Reform Act of 1989,\374\ altered both
the pay-increase and the cost-of-living-increase provisions of law,
making quadrennial pay increases effective only after an intervening con
[[Page 127]]
gressional election and making cost-of-living increases dependent upon a
specific congressional vote. Litigation of the effect of the Amendment
is on-going.\375\
\371\P. L. 90-206, Sec. 225, 81 Stat. 642 (1967), as amended, P.
L. 95-19, Sec. 401, 91 Stat. 45 (1977), as amended, P. L. 99-190,
Sec. 135(e), 99 Stat. 1322 (1985).
\372\P. L. 94-82, Sec. 204(a), 89 Stat. 421.
\373\Pressler v. Simon, 428 F.Supp. 302 (D.D.C. 1976) (three-
judge court), affd. summarily, 434 U.S. 1028 (1978); Humphrey v. Baker,
848 F.2d 211 (D.C.Cir.), cert. den. 488 U.S. 966 (1988).
\374\P.L. 101-194, 103 Stat. 1716, 2 U.S.C. Sec. 31(2), 5 U.S.C.
Sec. 5318 note, and 2 U.S.C. Sec. Sec. 351-363.
\375\Boehner v. Anderson, 809 F.Supp. 138 (D.D.C. 1992) (holding
Amendment has no effect on present statutory mechanism).
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Privilege From Arrest
This clause is practically obsolete. It applies only to arrests
in civil suits, which were still common in this country at the time the
Constitution was adopted.\376\It does not apply to service of process in
either civil\377\ or criminal cases.\378\Nor does it apply to arrest in
any criminal case. The phrase ``treason, felony or breach of the peace''
is interpreted to withdraw all criminal offenses from the operation of
the privilege.\379\
\376\Long v. Ansell, 293 U.S. 76 (1934).
\377\Id., 83.
\378\United States v. Cooper, 4 Dall. (4 U.S.) 341 (C.C. Pa.
1800).
\379\Williamson v. United States, 207 U.S. 425, 446 (1908).
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Privilege of Speech or Debate
Members.--This clause represents ``the culmination of a long
struggle for parliamentary supremacy. Behind these simple phrases lies a
history of conflict between the Commons and the Tudor and Stuart
monarchs during which successive monarchs utilized the criminal and
civil law to suppress and intimidate critical legislators. Since the
Glorious Revolution in Britain, and throughout United States history,
the privilege has been recognized as an important protection of the
independence and integrity of the legislature.''\380\So Justice Harlan
explained the significance of the speech-and-debate clause, the ancestry
of which traces back to a clause in the English Bill of Rights of 1689
\381\ and the history of which traces back almost to the beginning of
the development of Parliament as an independent force.\382\``In the
American governmental structure the clause serves the additional
function of reinforcing the separation of powers so deliberately
established by the Founders.''\383\ ``The immunities of the Speech or
Debate Clause were not written into the Constitution simply for the
personal or private benefit of Members of Congress, but to protect the
integrity
[[Page 128]]
of the legislative process by insuring the independence of individual
legislators.''\384\
\380\United States v. Johnson, 383 U.S. 169, 178 (1966).
\381\``That the Freedom of Speech, and Debates or Proceedings in
Parliament, ought not to be impeached or questioned in any Court or
Place out of Parliament.'' 1 W. & M., Sess. 2, c. 2.
\382\United States v. Johnson, 383 U.S. 169, 177-179, 180-183
(1966);Powell v. McCormack, 395 U.S. 486, 502 (1969).
\383\United States v. Johnson, 383 U.S. 169, 178 (1966).
\384\United States v. Brewster, 408 U.S. 501, 507 (1972). This
rationale was approvingly quoted fromCoffin v. Coffin, 4 Mass. 1, 28
(1808), inKilbourn v. Thompson, 103 U.S. 168, 203 (1881).
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The protection of this clause is not limited to words spoken in
debate. ``Committee reports, resolutions, and the act of voting are
equally covered, as are `things generally done in a session of the House
by one of its members in relation to the business before
it.'''\385\Thus, so long as legislators are ``acting in the sphere of
legitimate legislative activity,'' they are ``protected not only from
the consequence of litigation's results but also from the burden of
defending themselves.''\386\ But the scope of the meaning of
``legislative activity'' has its limits. ``The heart of the clause is
speech or debate in either House, and insofar as the clause is construed
to reach other matters, they must be an integral part of the
deliberative and communicative processes by which Members participate in
committee and House proceedings with respect to the consideration and
passage or rejection of proposed legislation or with respect to other
matters which the Constitution places within the jurisdiction of either
House.''\387\ Immunity from civil suit, both in law and equity, and from
criminal action based on the performance of legislative duties flows
from a determination that a challenged act is within the definition of
legislative activity, but the Court in the more recent cases appears to
have narrowed the concept somewhat.
\385\Powell v. McCormack, 395 U.S. 486, 502 (1969),
quotingKilbourn v. Thompson, 103 U.S. 168, 204 (1881).
\386\Tenney v. Brandhove, 341 U.S. 367, 376-377
(1972);Dombrowski v. Eastland, 387 U.S. 82, 85 (1967);Powell v.
McCormack, 395 U.S. 486, 505 (1969);Eastland v. United States
Servicemen's Fund, 421 U.S. 491, 503 (1975).
\387\Gravel v. United States, 408 U.S. 606, 625 (1972). The
critical nature of the clause is shown by the holding inDavis v.
Passman, 442 U.S. 228, 235 n. 11 (1979), that when a Member is sued
under the Fifth Amendment for employment discrimination on the basis of
gender, onlythe clause could shield such an employment decision, and not
the separation of powers doctrine or emanations from it. Whether the
clause would be a shield the Court had no occasion to decide and the
case was settled on remand without a decision being reached.
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InKilbourn v. Thompson,\388\ Members of the House of
Representatives were held immune in a suit for false imprisonment
brought about by a vote of the Members on a resolution charging contempt
of one of its committees and under which the plaintiff was arrested and
detained, even though the Court found that the contempt was wrongly
voted.Kilbournwas relied on inPowell v. McCormack,\389\ in which the
plaintiff was not allowed to maintain
[[Page 129]]
an action for declaratory judgment against certain Members of the House
of Representatives to challenge his exclusion by a vote of the entire
House. Because the power of inquiry is so vital to performance of the
legislative function, the Court held that the clause precluded suit
against the Chairman and Members of a Senate subcommittee and staff
personnel, to enjoin enforcement of a subpoena directed to a third
party, a bank, to obtain the financial records of the suing
organization. The investigation was a proper exercise of Congress' power
of inquiry, the subpoena was a legitimate part of the inquiry, and the
clause therefore was an absolute bar to judicial review of the
subcommittee's actions prior to the possible institution of contempt
actions in the courts.\390\And inDombrowski v. Eastland,\391\ the Court
affirmed the dismissal of an action against the chairman of a Senate
committee brought on allegations that he wrongfully conspired with state
officials to violate the civil rights of plaintiff.
\388\103 U.S. 168 (1881). But seeGravel v. United States, 408 U.
S. 606, 618-619 (1972).
\389\395 U.S. 486 (1969). The Court found sufficient the
presence of other defendants to enable it to review Powell's exclusion
but reserved the question whether in the absence of someone the clause
would still preclude suit. Id., 506 n. 26. See alsoKilbourn v. Thompson,
103 U.S. 168, 204 (1881).
\390\Eastland v. United States Servicemen's Fund, 421 U.S. 491
(1975).
\391\387 U.S. 82 (1967). But see the reinterpretation of this
case inGravel v. United States, 408 U.S. 606, 619-620 (1972).And see
McSurely v. McClellan, 553 F. 2d 1277 (D.C.Cir. 1976)(en banc), cert.
dismd. as improvidently granted, sub nom. McAdams v. McSurely, 438 U.S.
189 (1978).
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Through an inquiry into the nature of the ``legislative acts''
performed by Members and staff, the Court held that the clause did not
defeat a suit to enjoin the public dissemination of legislative
materials outside the halls of Congress.\392\A committee had conducted
an authorized investigation into conditions in the schools of the
District of Columbia and had issued a report that the House of
Representatives routinely ordered printed. In the report, named students
were dealt with in an allegedly defamatory manner, and their parents
sued various committee Members and staff and other personnel, including
the Superintendent of Documents and the Public Printer, seeking to
restrain further publication, dissemination, and distribution of the
report until the objectionable material was deleted and also seeking
damages. The Court held that the Members of Congress and the staff
employees had been properly dismissed from the suit, inasmuch as their
actions--conducting the hearings, preparing the report, and authorizing
its publication--were protected by the clause. The Superintendent of
Documents and the Public Printer were held, however, to have been
properly named, because, as congressional employees, they had no broader
immunity than Members of Congress would have. At this point, the Court
distinguished between those legislative acts, such as voting,
[[Page 130]]
speaking on the floor or in committee, issuing reports, which are within
the protection of the clause, and those acts which enjoy no such
protection. Public dissemination of materials outside the halls of
Congress is not protected, the Court held, because it is unnecessary to
the performance of official legislative actions. Dissemination of the
report within the body was protected, whereas dissemination in normal
channels outside it was not.\393\
\392\Doe v. McMillan, 412 U.S. 306 (1973).
\393\Difficulty attends an assessment of the effect of the
decision, inasmuch as the Justices in the majority adopted mutually
inconsistent stands, id., 325 (concurring opinion), and four Justices
dissented. Id., 331, 332, 338. The case leaves unresolved as well the
propriety of injunctive relief. Compare id., 330 (Justice Douglas
concurring), with id., 343-345 (three dissenters arguing that separation
of powers doctrine forbade injunctive relief). Also compareDavis v.
Passman, 442 U.S. 228, 245, 246 n. 24 (1979), with id., 250-251 (Chief
Justice Burger dissenting).
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Bifurcation of the legislative process in this way resulted in
holding unprotected the republication by a Member of allegedly
defamatory remarks outside the legislative body, here through
newsletters and press releases.\394\The clause protects more than speech
or debate in either House, the Court affirmed, but in order for the
other matters to be covered ``they must be an integral part of the
deliberative and communicative processes by which Members participate in
committee and House proceedings with respect to the consideration and
passage or rejection of proposed legislation or with respect to other
matters which the Constitution places within the jurisdiction of either
House.''\395\Press releases and newsletters are ``[v]aluable and
desirable'' in ``inform[ing] the public and other Members'' but neither
are essential to the deliberations of the legislative body nor part of
the deliberative process.\396\
\394\Hutchinson v. Proxmire, 441 U.S. 111 (1979).
\395\Id., 126, quotingGravel v. United States, 408 U.S. 606, 625
(1972).
\396\Hutchinson v. Proxmire, 443 U.S. 111, 130, 132-133 (1979).
The Court distinguished between the more important ``informing''
function of Congress, i.e., its efforts to inform itself in order to
exercise its legislative powers, and the less important ``informing''
function of acquainting the public about its activities. The latter
function the Court did not find an integral part of the legislative
process. See alsoDoe v. McMillan, 412 U.S. 306, 314-317 (1973). But
compare id., 325 (concurring). For consideration of the ``informing''
function in its different guises in the context of legislative
investigations, seeWatkins v. United States, 354 U.S. 178, 200
(1957);United States v. Rumely, 345 U.S. 41, 43 (1953);Russell v. United
States, 369 U.S. 749, 777-778 (1962) (Justice Douglas dissenting).
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Parallel developments may be discerned with respect to the
application of a general criminal statute to call into question the
legislative conduct and motivation of a Member. Thus, inUnited States v.
Johnson,\397\ the Court voided the conviction of a Member for conspiracy
to impair lawful governmental functions, in the course of seeking to
divert a governmental inquiry into alleged wrongdoing, by accepting a
bribe to make a speech on the floor of the House
[[Page 131]]
of Representatives. The speech was charged as part of the conspiracy and
extensive evidence concerning it was introduced at a trial. It was this
examination into the context of the speech--its authorship, motivation,
and content--which the Court found foreclosed by the speech-or-debate
clause.\398\
\397\383 U.S. 169 (1966).
\398\Reserved was the question whether a prosecution that
entailed inquiry into legislative acts or motivation could be founded
upon ``a narrowly drawn statute passed by Congress in the exercise of
its legislative power to regulate the conduct of its members.'' Id.,
185. The question was similarly reserved inUnited States v. Brewster,
408 U.S. 501, 529 n. 18 (1972), although Justices Brennan and Douglas
would have answered negatively. Id., 529, 540.
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However, inUnited States v. Brewster,\399\ while continuing to
assert that the clause ``must be read broadly to effectuate its purpose
of protecting the independence of the Legislative branch,''\400\ the
Court substantially reduced the scope of the coverage of the clause. In
upholding the validity of an indictment of a Member, which charged that
he accepted a bribe to be ``influenced in his performance of official
acts in respect to his action, vote, and decision'' on legislation, the
Court drew a distinction between a prosecution that caused an inquiry
into legislative acts or the motivation for performance of such acts and
a prosecution for taking or agreeing to take money for a promise to act
in a certain way. The former is proscribed, the latter is not. ``Taking
a bribe is, obviously, no part of the legislative process or function;
it is not a legislative act. It is not, by any conceivable
interpretation, an act performed as a part of or even incidental to the
role of a legislator . . . Nor is inquiry into a legislative act or the
motivation for a legislative act necessary to a prosecution under this
statute or this indictment. When a bribe is taken, it does not matter
whether the promise for which the bribe was given was for the
performance of a legislative act as here or, as inJohnson, for use of a
Congressman's influence with the Executive Branch.''\401\ In other
words, it is the fact of having taken a bribe, not the act the bribe is
intended to influence, which is the subject of the prosecution and the
speech-or-debate clause interposes no obstacle to this type of
prosecution.\402\
\399\408 U.S. 501 (1972).
\400\Id., 516.
\401\Id., 526.
\402\The holding was reaffirmed inUnited States v. Helstoski,
442 U.S. 477 (1979). On the other hand, the Court did hold that the
protection of the clause is so fundamental that, assuming a Member may
waive it, a waiver could be found only after explicit and unequivocal
renunciation, rather than by failure to assert it at any particular
point. Similarly, Helstoski v. Meanor, 442 U.S. 500 (1979), held that
since the clause properly applied is intended to protect a Member from
even having to defend himself he may appeal immediately from a judicial
ruling of nonapplicability rather than wait to appeal after conviction.
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[[Page 132]]
Applying in the criminal context the distinction developed in
the civil cases between protected ``legislative activity'' and
unprotected conduct prior to or subsequent to engaging in ``legislative
activity,'' the Court inGravel v. United States,\403\ held that a grand
jury could validly inquire into the processes by which the Member
obtained classified government documents and into the arrangements for
subsequent private republication of these documents, since neither
action involved protected conduct. ``While the Speech or Debate Clause
recognizes speech, voting and other legislative acts as exempt from
liability that might otherwise attach, it does not privilege either
Senator or aide to violate an otherwise valid criminal law in preparing
for or implementing legislative acts.''\404\
\403\408 U.S. 606 (1972).
\404\Id., 626.
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Congressional Employees.--Until the most recent decision, it was
seemingly the basis of the decisions that while Members of Congress may
be immune from suit arising out of their legislative activities,
legislative employees who participate in the same activities under the
direction of the Member or otherwise are responsible for their acts if
those acts be wrongful.\405\ Thus, inKilbourn v. Thompson,\406\ the
sergeant at arms of the House was held liable for false imprisonment
because he executed the resolution ordering Kilbourn arrested and
imprisoned.Dombrowski v. Eastland\407\ held that a subcommittee counsel
might be liable in damages for actions as to which the chairman of the
committee was immune from suit. And inPowell v. McCormack,\408\ the
Court held that the presence of House of Representative employees as
defendants in a suit for declaratory judgment gave the federal courts
jurisdiction to review the propriety of the plaintiff's exclusion from
office by vote of the House. Upon full consideration of the question,
however, the Court, inGravel v. United States,\409\ accepted a series of
contentions urged upon it not only by the individual Senator but by the
Senate itself appearing by counsel asamicus:``that it is literally
impossible, in view of the complexities of the modern legislative
process, with
[[Page 133]]
Congress almost constantly in session and matters of legislative concern
constantly proliferating, for Members of Congress to perform their
legislative tasks without the help of aides and assistants; that the
day-to-day work of such aides is so critical to the Members' performance
that they must be treated as the latters' alter ego; and that if they
are not so recognized, the central role of the Speech or Debate clause
. . . will inevitably be diminished and frustrated.''\410\ Therefore,
the Court held ``that the Speech or Debate Clause applies not only to a
Member but also to his aides insofar as the conduct of the latter would
be a protected legislative act if performed by the Member
himself.''\411\
\405\Language in some of the Court's earlier opinions had
indicated that the privilege ``is less absolute, although applicable,''
when a legislative aide is sued, without elaboration of what was
meant.Dombrowski v. Eastland, 387 U.S. 82, 85 (1967);Tenney v.
Brandhove, 341 U.S. 367, 378 (1951). InWheeldin v. Wheeler, 373 U.S. 647
(1963), the Court had imposed substantial obstacles to the possibility
of recovery in appropriate situations by holding that a federal cause of
action was lacking and remitting litigants to state courts and state law
grounds. The case is probably no longer viable, however, afterBivens v.
Six Unknown Named Agents of the Bureau of Narcotics, 403 U.S. 388
(1971).
\406\103 U.S. 168 (1881).
\407\387 U.S. 82 (1967).
\408\395 U.S. 486 (1969).
\409\408 U.S. 606 (1972).
\410\Id., 616-617.
\411\Id., 618.
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TheGravelholding, however, does not so much extend congressional
immunity to employees as it narrows the actual immunity available to
both aides and Members in some important respects. Thus, the Court says,
the legislators inKilbournwere immune because adoption of the resolution
was clearly a legislative act but the execution of the resolution--the
arrest and detention--was not a legislative act immune from liability,
so that the House officer was in fact liable as would have been any
Member who had executed it.\412\Dombrowskiwas interpreted as having held
that no evidence implicated the Senator involved, whereas the committee
counsel had been accused of ``conspiring to violate the constitutional
rights of private parties. Unlawful conduct of this kind the Speech or
Debate Clause simply did not immunize.''\413\AndPowellwas interpreted as
simply holding that voting to exclude plaintiff, which was all the House
defendants had done, was a legislative act immune from Member liability
but not from judicial inquiry. ``None of these three cases adopted the
simple proposition that immunity was unavailable to House or committee
employees because they were not Representatives; rather, immunity was
unavailable because they engaged in illegal conduct which was not
entitled to Speech or Debate Clause protection. . . . [N]o prior case
has held that Members of Congress would be immune if they execute an
invalid resolution by themselves carrying out an illegal arrest, or if,
in order to secure information for a hearing, themselves seize the
property or invade the privacy of a citizen. Neither they nor their
aides should be immune from liability or questioning in such
circumstances.''\414\
\412\Id., 618-619.
\413\Id., 619-620.
\414\Id., 620-621.
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[[Page 134]]
Appointment to Executive Office
``The reasons for excluding persons from offices, who have been
concerned in creating them, or increasing their emoluments, are to take
away, as far as possible, any improper bias in the vote of the
representative, and to secure to the constituents some solemn pledge of
his disinterestedness. The actual provision, however, does not go to the
extent of the principle; for his appointment is restricted only `during
the time, for which he was elected'; thus leaving in full force every
influence upon his mind, if the period of his election is short, or the
duration of it is approaching its natural termination.''\415\As might be
expected, there is no judicial interpretation of the language of the
clause and indeed it has seldom surfaced as an issue.
\415\2 J. Story, Commentaries on the Constitution of the United
States(Boston: 1833), Sec. 864.
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In 1909, after having increased the salary of the Secretary of
State,\416\ Congress reduced it to the former figure so that a Member of
the Senate at the time the increase was voted would be eligible for that
office.\417\The clause became a subject of discussion in 1937, when
Justice Black was appointed to the Court, because Congress had recently
increased the amount of pension available to Justices retiring at
seventy and Mr. Black's Senate term had still some time to run. The
appointment was defended, however, with the argument that inasmuch as
Mr. Black was only fifty-one years of age at the time, he would be
ineligible for the ``increased emolument'' for nineteen years and it was
not as to him an increased emolument.\418\In 1969, it was briefly
questioned whether a Member of the House of Representatives could be
appointed Secretary of Defense because, under a salary bill enacted in
the previous Congress, the President would propose a salary increase,
including that of cabinet officers, early in the new Congress which
would take effect if Congress did not disapprove it. The Attorney
General ruled that inasmuch as the clause would not apply if the
increase were proposed and approved subsequent to the appointment, it
[[Page 135]]
similarly would not apply in a situation in which it was uncertain
whether the increase would be approved.\419\
\416\34 Stat. 948 (1907).
\417\35 Stat. 626 (1909). Congress followed this precedent when
the President wished to appoint a Senator as Attorney General and the
salary had been increased pursuant to a process under which Congress did
not need to vote to approve but could vote to disapprove. The salary was
temporarily reduced to its previous level. 87 Stat. 697 (1975). See also
89 Stat. 1108 (1975) (reducing the salary of a member of the Federal
Maritime Commission in order to qualify a Representative).
\418\The matter gave rise to a case, Ex parte Albert Levitt, 302
U.S. 633 (1937), in which the Court declined to pass upon the validity
of Justice Black's appointment. The Court denied the complainant
standing, but strangely it did not advert to the fact that it was being
asked to assume original jurisdiction contrary toMarbury v. Madison, 1
Cr. (5 U.S.) 137 (1803).
\419\42 Op. Atty. Gen. No. 36 (January 3, 1969).
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Incompatible Offices
This second part of the second clause elicited little discussion
at the Convention and was universally understood to be a safeguard
against executive influence on Members of Congress and the prevention of
the corruption of the separation of powers.\420\ Congress has at various
times confronted the issue in regard to seating or expelling persons who
have or obtain office in another branch. Thus, it has determined that
visitors to academies, regents, directors, and trustees of public
institutions, and members of temporary commissions who receive no
compensation as members are not officers within the constitutional
inhibition.\421\Government contractors and federal officers who resign
before presenting their credentials may be seated as Members of
Congress.\422\
\420\The Federalist, No. 76 (Hamilton) (J. Cooke ed. 1961), 514;
2 J. Story, Commentaries on the Constitution of the United
States(Boston: 1833), Sec. Sec. 866-869.
\421\1 A. Hinds'Precedents of the House of
Representatives(Washington: 1907), Sec. 493; 6 C. Cannon'sPrecedents of
the House of Representatives(Washington: 1936), Sec. Sec. 63-64.
\422\Hinds', supra, Sec. Sec. 496-499.
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One of the more recurrent problems which Congress has had with
this clause is the compatibility of congressional office with service as
an officer of some military organization--militia, reserves, and the
like.\423\Members have been unseated for accepting appointment to
military office during their terms of congressional office,\424\ but
there are apparently no instances in which a Member-elect has been
excluded for this reason. Because of the difficulty of successfully
claiming standing, the issue has never been a litigatible matter.\425\
\423\Cf.Right of a Representative in Congress To Hold Commission
in National Guard, H. Rept. No. 885, 64th Congress, 1st sess. (1916).
\424\Hinds', supra, Sec. Sec. 486-492, 494; Cannon's, supra,
Sec. Sec. 60-62.
\425\An effort to sustain standing was rebuffed inSchlesinger v.
Reservists Committee to Stop the War, 418 U.S. 208 (1974).
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ARTICLE I
LEGISLATIVE DEPARTMENT
Section 7. Clause 1. All Bills for raising Revenue shall originate in
the House of Representatives; but the Senate may propose or concur with
Amendments as on other Bills.
Clause 2. Every Bill which shall have passed the House of
Representatives and the Senate, shall, before it become a Law,
[[Page 136]]
be presented to the President of the United States; If he approves he
shall sign it, but if not he shall return it, with his Objections to
that House in which it shall have originated, who shall enter the
Objections at large on their Journal, and proceed to reconsider it. If
after such Reconsideration two thirds of that House shall agree to pass
the Bill, it shall be sent, together with the Objections, to the other
House, by which it shall likewise be reconsidered, and if approved by
two thirds of that House, it shall become a Law. But in all such Cases
the Votes of both Houses shall be determined by Yeas and Nays, and the
Names of the Persons voting for and against the Bill shall be entered on
the Journal of each House respectively. If any Bill shall not be
returned by the President within ten Days (Sundays excepted) after it
shall have been presented to him, the Same shall be a Law, in like
Manner as if he had signed it, unless the Congress by their Adjournment
prevent its Return in which Case it shall not be a Law.
Legislative Process
Clause 3. Every Order, Resolution, or Vote to which the Concurrence of
the Senate and House of Representatives may be necessary (except on a
question of Adjournment) shall be presented to the President of the
United States; and before the Same shall take Effect, shall be approved
by him, or being disapproved by him, shall be repassed by two thirds of
the Senate and House of Representatives, according to the Rules and
Limitation prescribed in the Case of a Bill.
THE LEGISLATIVE PROCESS
Revenue Bills
Insertion of this clause was another of the devices sanctioned
by the Framers to preserve and enforce the separation of pow
[[Page 137]]
ers.\426\ It applies, in the context of the permissibility of Senate
amendments to a House-passed bill, to all bills for collecting revenue--
revenue decreasing as well as revenue increasing--rather than simply to
just those bills that increase revenue.\427\
\426\The Federalist, No. 58 (J. Cooke ed. 1961), 392-395
(Madison). See United States v. Munoz-Flores, 495 U.S. 385, 393-395
(1990).
\427\The issue of coverage is sometimes important, as in the
case of the TaxEquity and Fiscal Responsibility Act of 1982, 96 Stat.
324, in which the House passed a bill that provided for a net loss in
revenue and the Senate amended the bill to provide a revenue increase of
more than $98 billion over three years. Attacks on the law as a
violation of the origination clause failed before assertions of
political question, standing, and other doctrines. E.g., Texas Assn. of
Concerned Taxpayers v. United States, 772 F.2d 163 (5th Cir. 1985);
Moore v. U.S. House of Representatives, 733 F.2d 946 (D.C.Cir. 1984),
cert.den., 469 U.S. 1106 (1985).
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Only bills to levy taxes in the strict sense of the word are
comprehended by the phrase ``all bills for raising revenue;'' bills for
other purposes, which incidentally create revenue, are not
included.\428\ Thus, a Senate-initiated bill that provided for a
monetary ``special assessment'' to pay into a crime victims fund did not
violate the clause, because it was a statute that created and raised
revenue to support a particular governmental program and was not a law
raising revenue to support Government generally.\429\An act providing a
national currency secured by a pledge of bonds of the United States,
which, ``in the furtherance of that object, and also to meet the
expenses attending the execution of the act,'' imposed a tax on the
circulating notes of national banks was held not to be a revenue measure
which must originate in the House of Representatives.\430\Neither was a
bill that provided that the District of Columbia should raise by
taxation and pay to designated railroad companies a specified sum for
the elimination of grade crossings and the construction of a railway
station.\431\The substitution of a corporation tax for an inheritance
tax,\432\ and the addition of a section imposing an excise tax upon the
use of foreign-built pleasure yachts,\433\ have been held to be within
the Senate's constitutional power to propose amendments.
\428\2 J. Story, Commentaries on the Constitution of the United
States(Boston: 1833), Sec. 880.
\429\United States v. Munoz-Flores, 495 U.S. 385 (1990).
\430\Twin City National Bank v. Nebeker, 167 U.S. 196 (1897).
\431\Millard v. Roberts, 202 U.S. 429 (1906).
\432\Flint v. Stone Tracy Co., 220 U.S. 107, 143 (1911).
\433\Rainey v. United States, 232 U.S. 310 (1914).
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Approval by the President
The President is not restricted to signing a bill on a day when
Congress is in session.\434\He may sign within ten days (Sundays
excepted) after the bill is presented to him, even if that period ex
[[Page 138]]
tends beyond the date of the final adjournment of Congress.\435\ His
duty in case of approval of a measure is merely to sign it. He need not
write on the bill the word ``approved'' nor the date. If no date appears
on the face of the roll, the Court may ascertain the fact by resort to
any source of information capable of furnishing a satisfactory
answer.\436\A bill becomes a law on the date of its approval by the
President.\437\When no time is fixed by the act it is effective from the
date of its approval,\438\ which usually is taken to be the first moment
of the day, fractions of a day being disregarded.\439\
\434\La Abra Silver Mining Co. v. United States, 175 U.S. 423,
453 (1899).
\435\Edwards v. United States, 286 U.S. 482 (1932). On one
occasion in 1936, delay in presentation of a bill enabled the President
to sign it 23 days after the adjournment of Congress. Schmeckebier,
Approval of Bills After Adjournment of Congress, 33 Am. Pol. Sci. Rev.
52-53 (1939).
\436\Gardner v. Collector, 6 Wall. (73 U.S.) 499 (1868).
\437\Id., 504.See also Burgess v. Salmon, 97 U.S. 381, 383
(1878).
\438\Matthews v. Zane, 7 Wheat. (20 U.S.) 164, 211 (1822).
\439\Lapeyre v. United States, 17 Wall. (84 U.S.) 191, 198
(1873).
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The Veto Power
The veto provisions, the Supreme Court has told us, serve two
functions. On the one hand, they ensure that ``the President shall have
suitable opportunity to consider the bills presented to him. . . . It is
to safeguard the President's opportunity that Paragraph 2 of Sec. 7 of
Article I provides that bills which he does not approve shall not become
law if the adjournment of the Congress prevents their return.''\440\At
the same time, the sections ensure ``that the Congress shall have
suitable opportunity to consider his objections to bills and on such
consideration to pass them over his veto provided there are the
requisite votes.''\441\The Court asserted that ``[w]e should not adopt a
construction which would frustrate either of these purposes.''\442\
\440\Wright v. United States, 302 U. S. 583, 596 (1938).
\441\Ibid.
\442\Ibid.
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In one major respect, however, the President's actual desires
may be frustrated by the presentation to him of omnibus bills or of
bills containing extraneous riders. During the 1980s, on several
occasions, Congress lumped all the appropriations for the operation of
the Government into one gargantuan bill. But the President must sign or
veto the entire bill; doing the former may mean he has to accept
provisions he would not sign standing alone, and doing the latter may
have other adverse consequences. Numerous Presidents from Grant on have
unsuccessfully sought by constitutional amendment a ``line-item veto''
by which individual items in an appropriations bill or a substantive
bill could be extracted and vetoed. More recently, beginning in the FDR
Administration, it has
[[Page 139]]
been debated whether Congress could by statute authorize a form of the
line-item veto, but, again, nothing passed.\443\
\443\See Line Item Veto, Hearing before the Senate Committee on
Rules and Administration, 99th Cong., 1st sess. (1985), esp. 10-20 (CRS
memoranda detailing the issues). Some publicists have even contended,
through a strained interpretation of clause 3, actually from its
intended purpose to prevent Congress from subverting the veto power by
calling a bill by some other name, that the President already possesses
the line-item veto, but no President could be brought to test the
thesis. See Pork Barrels and Principles - The Politics of the
Presidential Veto, (Natl.Legal Center for the Public Interest, 1988)
(collecting essays).
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That the interpretation of the provisions has not been entirely
consistent is evident from a review of the only two Supreme Court
decisions construing them. InThe Pocket Veto Case,\444\ the Court held
that the return of a bill to the Senate, where it originated, had been
prevented when the Congress adjourned its first sessionsine diefewer
than ten days after presenting the bill to the President. The word
``adjournment'' was seen to have been used in the Constitution not in
the sense of final adjournments but to any occasion on which a House of
Congress is not in session. ``We think that under the constitutional
provision the determinative question in reference to an `adjournment' is
not whether it is a final adjournment of Congress or an interim
adjournment, such as an adjournment of the first session, but whether it
is one that `prevents' the President from returning the bill to the
House in which it originated within the time allowed.''\445\Because
neither House was in session to receive the bill, the President was
prevented from returning it. It had been argued to the Court that the
return may be validly accomplished to a proper agent of the house of
origin for consideration when that body convenes. After first noting
that Congress had never authorized an agent to receive bills during
adjournment, the Court opined that ``delivery of the bill to such
officer or agent, even if authorized by Congress itself, would not
comply with the constitutional mandate.''\446\
\444\279 U.S. 655 (1929).
\445\Id., 680.
\446\Id., 684.
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However, inWright v. United States,\447\ the Court held that the
President's return of a bill on the tenth day after presentment, during
a three-day adjournment by the originating House only, to the Secretary
of the Senate was an effective return. In the first place, the Court
thought, the pocket veto clause referred only to an adjournment of ``the
Congress,'' and here only the Senate, the originating body, had
adjourned. The President can return the bill to the originating House if
that body be in an intrasession adjournment, because there is no
``practical difficulty'' in effectuating the
[[Page 140]]
return. ``The organization of the Senate continued and was intact. The
Secretary of the Senate was functioning and was able to receive, and did
receive the bill.''\448\Such a procedure complied with the
constitutional provisions. ``The Constitution does not define what shall
constitute a return of a bill or deny the use of appropriate agencies in
effecting the return.''\449\The concerns activating the Court inThe
Pocket Veto Casewere not present. There was no indefinite period in
which a bill was in a state of suspended animation with public
uncertainty over the outcome. ``When there is nothing but such a
temporary recess the organization of the House and its appropriate
officers continue to function without interruption, the bill is properly
safeguarded for a very limited time and is promptly reported and may be
reconsidered immediately after the short recess is over.''\450\
\447\302 U.S. 583 (1938).
\448\Id., 589-590.
\449\Id., 589.
\450\Id., 595.
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The tension between the two cases, even though at a certain
level of generality they are consistent because of factual differences,
has existed without the Supreme Court yet having occasion to review the
issue again. But inKennedy v. Sampson,\451\ an appellate court held that
a return is not prevented by an intrasession adjournment of any length
by one or both Houses of Congress, so long as the originating House
arranged for receipt of veto messages. The court stressed that the
absence of the evils deemed to bottom the Court's premises inThe Pocket
Veto Case--long delay and public uncertainty--made possible the result.
\451\511 F. 2d 430 (D.C.Cir. 1974). The Administration declined
to appeal the case to the Supreme Court. The adjournment here was for
five days. Subsequently, the President attempted to pocket veto two
other bills, one during a 32 day recess and one during the period which
Congress had adjournedsine diefrom the first to the second session of
the 93d Congress. After renewed litigation, the Administration entered
its consent to a judgment that both bills had become law, Kennedy v.
Jones, Civil Action No. 74-194 (D.D.C., decree entered April 13, 1976),
and it was announced that President Ford ``will use the return veto
rather than the pocket veto during intra-session and intersession
recesses and adjournments of the Congress'', provided that the House to
which the bill must be returned has authorized an officer to receive
vetoes during the period it is not in session. President Reagan
repudiated this agreement and vetoed a bill during an intersession
adjournment. Although the lower court applied Kennedy v. Sampson to
strike down the exercise of the power, but the case was mooted prior to
Supreme Court review. Barnes v. Kline, 759 F.2d 51 (D.C.Cir. 1985),
vacated and remanded to dismiss sub nom. Burke v. Barnes, 479 U.S. 361
(1987).
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The two-thirds vote of each House required to pass a bill over a
veto means two-thirds of a quorum.\452\After a bill becomes law, of
course, the President has no authority to repeal it. Asserting this
truism, the Court inThe Confiscation Cases\453\ held that the immu
[[Page 141]]
nity proclamation issued by the President in 1868 did not require
reversal of a decree condemning property seized under the Confiscation
Act of 1862.\454\
\452\Missouri Pacific Ry. Co. v. Kansas, 248 U.S. 276 (1919).
\453\20 Wall. (87 U.S.) 92 (1874).
\454\12 Stat. 589 (1862).
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Presentation of Resolutions
Concerned that Congress might endeavor to evade the veto clause
by designating a measure having legislative import as something other
than a bill, the Framers inserted cl. 3.\455\ Obviously, if construed
literally, the clause could have bogged down the intermediate stages of
the legislative process, and Congress made practical adjustments
regarding it. On the request of the Senate, the Judiciary Committee in
1897 published a comprehensive report detailing how the clause had been
interpreted over the years, and in the same manner it is treated today.
Briefly, it was shown that the word ``necessary'' in the clause had come
to refer to the necessity required by the Constitution of law-making;
that is, any ``order, resolution, or vote'' if it is to have the force
of law must be submitted. But ``votes'' taken in either House
preliminary to the final passage of legislation need not be submitted to
the other House or to the President nor must resolutions passed by the
Houses concurrently expressing merely the views of Congress.\456\Also,
it was settled as early as 1789 that resolutions of Congress proposing
amendments to the Constitution need not be submitted to the President,
the Bill of Rights having been referred to the States without being laid
before President Washington for his approval--a procedure the Court
ratified in due course.\457\
\455\See 2 M. Farrand, The Records of the Federal Convention of
1787 (rev. ed. 1937), 301-302, 304-305.
\456\S. Rept. No. 1335, 54th Congress, 2d Sess.; 4 A.
Hinds'Precedents of the House of Representatives(Washington: 1907),
Sec. 3483.
\457\Hollingsworth v. Virginia, 3 Dall. (3 U.S.) 378 (1798).
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The Legislative Veto.--Beginning in the 1930s, the concurrent
resolution (as well as the simple resolution) was put to a new use--
serving as the instrument to terminate powers delegated to the Chief
Executive or to disapprove particular exercises of power by him or his
agents. The ``legislative veto'' or ``congressional veto'' was first
developed in context of the delegation to the Executive of power to
reorganize governmental agencies,\458\ and was really furthered by the
necessities of providing for national security and foreign affairs
immediately prior to and during World War II.\459\
[[Page 142]]
The proliferation of ``congressional veto'' provisions in legislation
over the years raised a series of interrelated constitutional
questions.\460\Congress until relatively recently had applied the veto
provisions to some action taken by the President or another executive
officer--such as a reorganization of an agency, the lowering or raising
of tariff rates, the disposal of federal property--then began expanding
the device to give itself a negative over regulations issued by
executive branch agencies, and proposals were made to give Congress a
negative over all regulations issued by executive branch independent
agencies.\461\
\458\Act of June 30, 1932, Sec. 407, 47 Stat. 414.
\459\See, e.g., Lend Lease Act of March 11, 1941, 55 Stat. 31;
First War Powers Act of December 18, 1941, 55 Stat. 838; Emergency Price
Control Act of January 30, 1942, 56 Stat. 23; Stabilization Act of
October 2, 1942, 56 Stat. 765; War Labor Disputes Act of June 25, 1943,
57 Stat. 163, all providing that the powers granted to the President
should come to an end upon adoption of concurrent resolutions to that
effect.
\460\From 1932 to 1983, by one count, nearly 300 separate
provisions giving Congress power to halt or overturn executive action
had been passed in nearly 200 acts; substantially more than half of
these had been enacted since 1970. A partial listing was included inThe
Constitution, Jefferson's Manual and Rules of the House of
Representatives, H. Doc. No. 96-398, 96th Congress, 2d Sess. (1981),
731-922. A more up-to-date listing, in light of the Supreme Court's
ruling, is contained in id., H.Doc.No. 101-256, 101st Cong., 2d sess.
(1991), 907-1054.Justice White's dissent in INS v. Chadha, 462 U.S. 919,
968-974, 1003-1013 (1983), describes and lists many kinds of such
vetoes. The types of provisions varied widely. Many required
congressional approval before an executive action took effect, but more
commonly they provided for a negative upon executive action, by
concurrent resolution of both Houses, by resolution of only one House,
or even by a committee of one House.
\461\A bill providing for this failed to receive the two-thirds
vote required to pass under suspension of the rules by only three votes
in the 94th Congress. H.R. 12048, 94th Congress, 2d sess. See H. Rept.
No. 94-1014, 94th Congress, 2d sess. (1976), and 122 Cong. Rec. 31615-
641, 31668. Considered extensively in the 95th and 96th Congresses,
similar bills were not adopted. SeeRegulatory Reform and Congressional
Review of Agency Rules, Hearings before the Subcommittee on Rules of the
House of the House Rules Committee, 96th Congress, 1st sess.
(1979);Regulatory Reform Legislation, Hearings before the Senate
Committee on Governmental Affairs, 96th Congress, 1st sess. (1979).
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In INS v. Chadha,\462\ the Court held a one-House congressional
veto to be unconstitutional as violating both the bicameralism
principles reflected in Art. I, Sec. Sec. 1 and 7, and the presentment
provisions of Sec. 7, cl. 2 and 3.The provision in question was
Sec. 244(c)(2) of the Immigration and Nationality Act, which authorized
either House of Congress by resolution to veto the decision of the
Attorney General to allow a particular deportable alien to remain in the
country.The Court's analysis of the presentment issue made clear,
however, that two-House veto provisions, despite their compliance with
bicameralism, and committee veto provisions suffer the same
constitutional infirmity.\463\In the words of dissenting
[[Page 143]]
Justice White, the Court in Chadha ``sound[ed] the death knell for
nearly 200 other statutory provisions in which Congress has reserved a
`legislative veto.'''\464\
\462\462 U.S. 919 (1983).
\463\Shortly after deciding Chadha, the Court removed any doubts
on this score with summary affirmance of an appeals court's invalidation
of a two-House veto in Consumers Union v. FTC, 691 F.2d 575 (D.C.Cir.
1982), affd. sub nom. Process Gas Consumers Group v. Consumer Energy
Council, 463 U.S. 1216 (1983). Prior to Chadha, an appellate court in
AFGE v. Pierce, 697 F.2d 303 (D.C.Cir. 1982), had voided a form of
committee veto, a provision prohibiting the availability of certain
funds for a particular purpose without the prior approval of the
Committees on Appropriations.
\464\Chadha, supra, 967.Justice Powell concurred separately,
asserting that Congress had violated separation of powers principles by
assuming a judicial function in determining that a particular individual
should be deported.Justice Powell therefore found it unnecessary to
express his view on ``the broader question of whether legislative vetoes
are invalid under the Presentment Clauses.'' Id., 959.
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In determining that veto of the Attorney General's decision on
suspension of deportation was a legislative action requiring presentment
to the President for approval or veto, the Court set forth the general
standard.``Whether actions taken by either House are, in law and in
fact, an exercise of legislative power depends not on their form but
upon `whether they contain matter which is properly to be regarded as
legislative in its character and effect.'[T]he action taken here . . .
was essentially legislative,'' the Court concluded, because ``it had the
purpose and effect of altering the legal rights, duties and relations of
persons, including the Attorney General, Executive Branch officials and
Chadha, all outside the legislative branch.''\465\
\465\Id., 952 (citation omitted).
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The other major component of the Court's reasoning in Chadha
stemmed from its reading of the Constitution as making only ``explicit
and unambiguous'' exceptions to the bicameralism and presentment
requirements.Thus the House alone was given power of impeachment, and
the Senate alone was given power to convict upon impeachment, to advise
and consent to executive appointments, and to advise and consent to
treaties; similarly, the Congress may propose a constitutional amendment
without the President's approval, and each House is given autonomy over
certain ``internal matters,'' e.g., judging the qualifications of its
members.By implication then, exercises of legislative power not falling
within any of these ``narrow, explicit, and separately justified''
exceptions must conform to the prescribed procedures: ``passage by a
majority of both Houses and presentment to the President.''\466\
\466\Id., 955-56.
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The breadth of the Court's ruling in Chadha was evidenced in its
1986 decision in Bowsher v. Synar.\467\Among the rationales for holding
the Deficit Control Act unconstitutional was the Court's assertion that
Congress had, in effect, retained control over executive action in a
manner resembling a congressional veto.``[A]s Chadha makes clear, once
Congress makes its choice in enacting legislation,
[[Page 144]]
its participation ends.Congress can thereafter control the execution of
its enactment only indirectly--by passing new
legislation.''\468\Congress had offended this principle by retaining
removal authority over the Comptroller General, charged with executing
important aspects of the Budget Act.
\467\478 U.S. 714 (1986).See also Metropolitan Washington
Airports Auth. v. Citizens for the Abatement of Aircraft Noise, 501 U.S.
252 (1991).
\468\Bowsher v. Synar, 478 U.S. 714, 733 (1986).This position
was developed at greater length in the concurring opinion of Justice
Stevens. Id., 736.
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That Chadha does not spell the end of some forms of the
legislative veto is evident from events since 1983, which have seen the
enactment of various devices, such as ``report and wait'' provisions and
requirements for various consultative steps before action may be
undertaken. But the decision has stymied the efforts in Congress to
confine the discretion it confers through delegation by giving it a
method of reviewing and if necessary voiding actions and rules
promulgated after delegations.
ARTICLE I
LEGISLATIVE DEPARTMENT
Section 8. Clause 1. The Congress shall have Power to lay and collect
Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the
common Defence and general Welfare of the United States; but all Duties,
Imposts and Excises shall be uniform throughout the United States.
POWER TO TAX AND SPEND
Kinds of Taxes Permitted
By the terms of the Constitution, the power of Congress to levy
taxes is subject to but one exception and two qualifications. Articles
exported from any State may not be taxed at all. Direct taxes must be
levied by the rule of apportionment and indirect taxes by the rule of
uniformity. The Court has emphasized the sweeping character of this
power by saying from time to time that it ``reaches every
subject,''\469\ that it is ``exhaustive''\470\ or that it ``embraces
every conceivable power of taxation.''\471\ Despite these
generalizations, the power has been at times substantially curtailed by
judicial decision with respect to the subject matter of taxation, the
manner in which taxes are imposed, and the objects for which they may be
levied.
\469\License Tax Cases, 5 Wall. (72 U.S.) 462, 471 (1867).
\470\Brushaber v. Union Pacific R. Co., 240 U.S. 1 (1916).
\471\Id., 12.
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Decline of the Forbidden Subject Matter Test.--In recent years
the Supreme Court has restored to Congress the power to tax most of the
subject matter which had previously been withdrawn
[[Page 145]]
from its reach by judicial decision. The holding of Evans v. Gore\472\
and Miles v. Graham\473\ that the inclusion of the salaries received by
federal judges in measuring the liability for a nondiscriminatory income
tax violated the constitutional mandate that the compensation of such
judges should not be diminished during their continuance in office was
repudiated in O'Malley v. Woodrough.\474\ The specific ruling of
Collector v. Day\475\ that the salary of a state officer is immune to
federal income taxation also has been overruled.\476\ But the principle
underlying that decision--that Congress may not lay a tax which would
impair the sovereignty of the States--is still recognized as retaining
some vitality.\477\
\472\253 U.S. 245 (1920).
\473\268 U.S. 501 (1925).
\474\307 U.S. 277 (1939).
\475\11 Wall. (78 U.S.) 113 (1871).
\476\Graves v. New York ex rel. O'Keefe, 306 U.S. 466 (1939).
Collector v. Day was decided in 1871 while the country was still in the
throes of Reconstruction. As noted by Chief Justice Stone in a footnote
to his opinion in Helvering v. Gerhardt, 304 U.S. 405, 414 n. 4 (1938),
the Court had not determined how far the Civil War Amendments had
broadened the federal power at the expense of the States, but the fact
that the taxing power had recently been used with destructive effect
upon notes issued by the state banks, Veazie Bank v. Fenno, 8 Wall. (75
U.S.) 533 (1869), suggested the possibility of similar attacks upon the
existence of the States themselves. Two years later, the Court took the
logical step of holding that the federal income tax could not be imposed
on income received by a municipal corporation from its investments.
United States v. Railroad Company, 17 Wall. (84 U.S.) 322 (1873). A far-
reaching extension of private immunity was granted in Pollock v.
Farmers' Loan & Trust Co., 157 U.S. 429 (1895), where interest received
by a private investor on state or municipal bonds was held to be exempt
from federal taxation. (Though relegated to virtual desuetude, Pollock
was not expressly overruled until South Carolina v. Baker, 485 U.S. 505
(1988)). As the apprehension of this era subsided, the doctrine of these
cases was pushed into the background. It never received the same wide
application as did McCulloch v. Maryland, 4 Wheat. (17 U.S.) 316 (1819),
in curbing the power of the States to tax operations or
instrumentalities of the Federal Government. Only once since the turn of
the century has the national taxing power been further narrowed in the
name of dual federalism. In 1931 the Court held that a federal excise
tax was inapplicable to the manufacture and sale to a municipal
corporation of equipment for its police force. Indian Motorcycle v.
United States, 283 U.S. 570 (1931). Justice Stone and Brandeis dissented
from this decision, and it is doubtful whether it would be followed
today. Cf. Massachusetts v. United States, 435 U.S. 444 (1978).
\477\At least, if the various opinions in New York v. United
States, 326 U.S. 572 (1946), retain force, and they may in view of (a
later) New York v. United States, 112 S.Ct. 2408 (1992), a commerce
clause case rather than a tax case.
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Federal Taxation of State Interests.--In 1903 a succession tax
upon a bequest to a municipality for public purposes was upheld on the
ground that the tax was payable out of the estate before distribution to
the legatee. Looking to form and not to substance, in disregard of the
mandate of Brown v. Maryland,\478\ a closely divided Court declined to
``regard it as a tax upon the municipality, though it might operate
incidentally to reduce the be
[[Page 146]]
quest by the amount of the tax.''\479\ When South Carolina embarked upon
the business of dispensing alcoholic beverages, its agents were held to
be subject to the national internal revenue tax, the ground of the
holding being that in 1787 such a business was not regarded as one of
the ordinary functions of government.\480\
\478\12 Wheat. (25 U.S.) 419, 444 (1827).
\479\Snyder v. Bettman, 190 U.S. 249, 254 (1903).
\480\South Carolina v. United States, 199 U.S. 437 (1905). See
also Ohio v. Helvering, 292 U.S. 360 (1934).
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Another decision marking a clear departure from the logic of
Collector v. Day was Flint v. Stone Tracy Co.,\481\ where the Court
sustained an act of Congress taxing the privilege of doing business as a
corporation, the tax being measured by the income. The argument that the
tax imposed an unconstitutional burden on the exercise by a State of its
reserved power to create corporate franchises was rejected, partly in
consideration of the principle of national supremacy, and partly on the
ground that the corporate franchises were private property. This case
also qualified Pollock v. Farmers' Loan & Trust Company to the extent of
allowing interest on state bonds to be included in measuring the tax on
the corporation.
\481\220 U.S. 107 (1911).
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Subsequent cases have sustained an estate tax on the net estate
of a decedent, including state bonds,\482\ excise taxes on the
transportation of merchandise in performance of a contract to sell and
deliver it to a county,\483\ on the importation of scientific apparatus
by a state university,\484\ on admissions to athletic contests sponsored
by a state institution, the net proceeds of which were used to further
its educational program,\485\ and on admissions to recreational
facilities operated on a nonprofit basis by a municipal
corporation.\486\ Income derived by independent engineering contractors
from the performance of state functions,\487\ the compensation of
trustees appointed to manage a street railway taken over and operated by
a State,\488\ profits derived from the sale of state bonds,\489\ or from
oil produced by lessees of state lands,\490\ have all been held to be
subject to federal taxation despite a possible economic burden on the
State.
\482\Greiner v. Lewellyn, 258 U.S. 384 (1922).
\483\Wheeler Lumber Co. v. United States, 281 U.S. 572 (1930).
\484\Board of Trustees v. United States, 289 U.S. 48 (1933).
\485\Allen v. Regents, 304 U.S. 439 (1938).
\486\Wilmette Park Dist. v. Campbell, 338 U.S. 411 (1949).
\487\Metcalf & Eddy v. Mitchell, 269 U.S. 514 (1926).
\488\Helvering v. Powers, 293 U.S. 214 (1934).
\489\Willcuts v. Bunn, 282 U.S. 216 (1931).
\490\Helvering v. Producers Corp., 303 U.S. 376 (1938),
overruling Burnet v. Coronado Oil & Gas Co., 285 U.S. 393 (1932).
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In finally overruling Pollock, the Court stated that Pollock had
``merely represented one application of the more general rule that
[[Page 147]]
neither the federal nor the state governments could tax income an
individual directly derived from any contract with another
government.''\491\ That rule, the Court observed, had already been
rejected in numerous decisions involving intergovernmental immunity.
``We see no constitutional reason for treating persons who receive
interest on governmental bonds differently than persons who receive
income from other types of contracts with the government, and no tenable
rationale for distinguishing the costs imposed on States by a tax on
state bond interest from the costs imposed by a tax on the income from
any other state contract.''\492\
\491\South Carolina v. Baker, 485 U.S. 505, 517 (1988).
\492\Id., 524.
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Scope of State Immunity From Federal Taxation.--Although there
have been sharp differences of opinion among members of the Supreme
Court in cases dealing with the tax immunity of state functions and
instrumentalities, it has been stated that ``all agree that not all of
the former immunity is gone.''\493\ Twice, the Court has made an effort
to express its new point of view in a statement of general principles by
which the right to such immunity shall be determined. However, the
failure to muster a majority in concurrence with any single opinion in
the latter case leaves the question very much in doubt. In Helvering v.
Gerhardt,\494\ where, without overruling Collector v. Day, it narrowed
the immunity of salaries of state officers from federal income taxation,
the Court announced ``two guiding principles of limitation for holding
the tax immunity of State instrumentalities to its proper function. The
one, dependent upon the nature of the function being performed by the
State or in its behalf, excludes from the immunity activities thought
not to be essential to the preservation of State governments even though
the tax be collected from the State treasury. . . . The other principle,
exemplified by those cases where the tax laid upon individuals affects
the State only as the burden is passed on to it by the taxpayer, forbids
recognition of the immunity when the burden on the State is so
speculative and uncertain that if allowed it would restrict the federal
taxing power without affording any corresponding tangible protection to
the State government; even though the function be thought important
enough to demand immunity from a tax upon the State itself, it is not
necessarily protected from a tax which well may be substantially or
entirely absorbed by private persons.''\495\
\493\New York v. United States, 326 U.S. 572, 584 (1946)
(concurring opinion of Justice Rutledge).
\494\304 U.S. 405 (1938).
\495\Id., 419-420.
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[[Page 148]]
The second attempt to formulate a general doctrine was made in
New York v. United States,\496\ where, on review of a judgment affirming
the right of the United States to tax the sale of mineral waters taken
from property owned and operated by the State of New York, the Court
reconsidered the right of Congress to tax business enterprises carried
on by the States. Justice Frankfurter, speaking for himself and Justice
Rutledge, made the question of discrimination vel non against state
activities the test of the validity of such a tax. They found ``no
restriction upon Congress to include the States in levying a tax exacted
equally from private persons upon the same subject matter.''\497\ In a
concurring opinion in which Justices Reed, Murphy, and Burton joined,
Chief Justice Stone rejected the criterion of discrimination. He
repeated what he had said in an earlier case to the effect that ``the
limitation upon the taxing power of each, so far as it affects the
other, must receive a practical construction which permits both to
function with the minimum of interference each with the other; and that
limitation cannot be so varied or extended as seriously to impair either
the taxing power of the government imposing the tax . . . or the
appropriate exercise of the functions of the government affected by
it.''\498\ Justices Douglas and Black dissented in an opinion written by
the former on the ground that the decision disregarded the Tenth
Amendment, placed ``the sovereign States on the same plane as private
citizens,'' and made them ``pay the Federal Government for the privilege
of exercising powers of sovereignty guaranteed them by the
Constitution.''\499\ In a later case dealing with state immunity the
Court sustained the tax on the second ground mentioned in Helvering v.
Gerhardt--that the burden of the tax was borne by private persons--and
did not consider whether the function was one which the Federal
Government might have taxed if the municipality had borne the burden of
the exaction.\500\
\496\326 U.S. 572 (1946).
\497\Id., 584.
\498\Id., 589-590.
\499\Id., 596.
\500\Wilmette Park Dist. v. Campbell, 338 U.S. 411 (1949). Cf.
Massachusetts v. United States, 435 U.S. 444 (1978).
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Articulation of the current approach may be found in South
Carolina v. Baker.\501\ The rules are ``essentially the same'' for
federal immunity from state taxation and for state immunity from federal
taxation, except that some state activities may be subject to direct
federal taxation, while States may ``never'' tax the United States
directly. Either government may tax private parties doing business with
the other government, ``even though the financial
[[Page 149]]
burden falls on the [other government], as long as the tax does not
discriminate against the [other government] or those with which it
deals.''\502\ Thus, ``the issue whether a nondiscriminatory federal tax
might nonetheless violate state tax immunity does not even arise unless
the Federal Government seeks to collect the tax directly from a
State.''\503\
\501\485 U.S. 505 (1988).
\502\Id., 523.
\503\Id., 524 n. 14.
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Uniformity Requirement.--Whether a tax is to be apportioned
among the States according to the census taken pursuant to Article I,
Sec. 2, or imposed uniformly throughout the United States depends upon
its classification as direct or indirect.\504\ The rule of uniformity
for indirect taxes is easy to obey. It exacts only that the subject
matter of a levy be taxed at the same rate wherever found in the United
States; or, as it is sometimes phrased, the uniformity required is
``geographical,'' not ``intrinsic.''\505\ Even the geographical
limitation is a loose one, at least if United States v. Ptasynski\506\
is followed. There, the Court upheld an exemption from a crude-oil
windfall-profits tax of ``Alaskan oil,'' defined geographically to
include oil produced in Alaska (or elsewhere) north of the Arctic
Circle. What is prohibited, the Court said, is favoritism to particular
States in the absence of valid bases of classification. Because Congress
could have achieved the same result, allowing for severe climactic
difficulties, through a classification tailored to the
``disproportionate costs and difficulties . . . associated with
extracting oil from this region,''\507\the fact that Congress described
the exemption in geographic terms did not condemn the provision.
\504\See also Article I, Sec. 9, cl. 4.
\505\LaBelle Iron Works v. United States, 256 U.S. 377 (1921);
Brushaber v. Union Pacific R. Co., 240 U.S. 1 (1916); Head Money Cases,
112 U.S. 580 (1884).
\506\462 U.S. 74 (1983).
\507\Id., 85.
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The clause accordingly places no obstacle in the way of
legislative classification for the purpose of taxation, nor in the way
of what is called progressive taxation.\508\ A taxing statute does not
fail of the prescribed uniformity because its operation and incidence
may be affected by differences in state laws.\509\ A federal estate tax
law which permitted deduction for a like tax paid to a State was not
rendered invalid by the fact that one State levied no such tax.\510\ The
term ``United States'' in this clause refers only to the States of the
Union, the District of Columbia, and incorporated
[[Page 150]]
territories. Congress is not bound by the rule of uniformity in framing
tax measures for unincorporated territories.\511\ Indeed, in Binns v.
United States,\512\ the Court sustained license taxes imposed by
Congress but applicable only in Alaska, where the proceeds, although
paid into the general fund of the Treasury, did not in fact equal the
total cost of maintaining the territorial government.
\508\Knowlton v. Moore, 178 U.S. 41 (1900).
\509\Fernandez v. Wiener, 326 U.S. 340 (1945); Riggs v. Del
Drago, 317 U.S. 95 (1942); Phillips v. Commissioner, 283 U.S. 589
(1931); Poe v. Seaborn, 282 U.S. 101, 117 (1930).
\510\Florida v. Mellon, 273 U.S. 12 (1927).
\511\Downes v. Bidwell, 182 U.S. 244 (1901).
\512\194 U.S. 486 (1904). The Court recognized that Alaska was
an incorporated territory but took the position that the situation in
substance was the same as if the taxes had been directly imposed by a
territorial legislature for the support of the local government.
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PURPOSES OF TAXATION
Regulation by Taxation
The discretion of Congress in selecting the objectives of
taxation has also been held at times to be subject to limitations
implied from the nature of the Federal System. Apart from matters that
Congress is authorized to regulate, the national taxing power, it has
been said, ``reaches only existing subjects.''\513\ Congress may tax any
activity actually carried on, such as the business of accepting
wagers,\514\ regardless of whether it is permitted or prohibited by the
laws of the United States\515\ or by those of a State.\516\ But so-
called federal ``licenses,'' so far as they relate to trade within state
limits, merely express, ``the purpose of the government not to interfere
. . . with the trade nominally licensed, if the required taxes are
paid.'' Whether the ``licensed'' trade shall be permitted at all is a
question for decision by the State.\517\ This, nevertheless, does not
signify that Congress may not often regulate to some extent a business
within a State in order to tax it more effectively. Under the necessary-
and-proper clause, Congress may do this very thing. Not only has the
Court sustained regulations concerning the packaging of taxed articles
such as tobacco\518\ and oleomargarine,\519\ ostensibly designed to
prevent fraud in the collection of the tax, it has also upheld measures
taxing drugs\520\ and fire
[[Page 151]]
arms,\521\ which prescribed rigorous restrictions under which such
articles could be sold or transferred, and imposed heavy penalties upon
persons dealing with them in any other way. These regulations were
sustained as conducive to the efficient collection of the tax though
they clearly transcended in some respects this ground of
justification.\522\
\513\License Tax Cases, 5 Wall. (72 U.S.) 462, 471 (1867).
\514\United States v. Kahriger, 345 U.S. 22 (1953). Dissenting,
Justice Frankfurter maintained that this was not a bona fide tax, but
was essentially an effort to check, if not stamp out, professional
gambling, an activity left to the responsibility of the States. Justices
Jackson and Douglas noted partial agreement with this conclusion. See
also Lewis v. United States, 348 U.S. 419 (1955).
\515\United States v. Yuginovich, 256 U.S. 450 (1921).
\516\United States v. Constantine, 296 U.S. 287, 293 (1935).
\517\License Tax Cases, 5 Wall. (72 U.S.) 462, 471 (1867).
\518\Felsenheld v. United States, 186 U.S. 126 (1902).
\519\In re Kollock, 165 U.S. 526 (1897).
\520\United States v. Doremus, 249 U.S. 86 (1919). Cf. Nigro v.
United States, 276 U.S. 332 (1928).
\521\Sonzinsky v. United States, 300 U.S. 506 (1937).
\522\Without casting doubt on the ability of Congress to
regulate or punish through its taxing power, the Court has overruled
Kahriger, Lewis, Doremus, Sonzinsky, and similar cases on the ground
that the statutory scheme compelled self-incrimination through
registration. Marchetti v. United States, 390 U.S. 39 (1968); Grosso v.
United States, 390 U.S. 62 (1968); Haynes v. United States, 390 U.S. 85
(1968); Leary v. United States, 395 U.S. 6 (1969).
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Extermination by Taxation
A problem of a different order is presented where the tax itself
has the effect of suppressing an activity or where it is coupled with
regulations that clearly have no possible relation to the collection of
the tax. Where a tax is imposed unconditionally, so that no other
purpose appears on the face of the statute, the Court has refused to
inquire into the motives of the lawmakers and has sustained the tax
despite its prohibitive proportions.\523\ ``It is beyond serious
question that a tax does not cease to be valid merely because it
regulates, discourages, or even definitely deters the activities taxed.
. . . The principle applies even though the revenue obtained is
obviously negligible . . . or the revenue purpose of the tax may be
secondary. . . . Nor does a tax statute necessarily fall because it
touches on activities which Congress might not otherwise regulate. As
was pointed out in Magnano Co. v. Hamilton, 292 U.S. 40, 47 (1934):
`From the beginning of our government, the courts have sustained taxes
although imposed with the collateral intent of effecting ulterior ends
which, considered apart, were beyond the constitutional power of the
lawmakers to realize by legislation directly addressed to their
accomplishments.'''\524\
\523\McCray v. United States, 195 U.S. 27 (1904).
\524\United States v. Sanchez, 340 U.S. 42, 44 (1950). See also
Sonzinsky v. United States, 300 U.S. 506, 513-514 (1937).
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But where the tax is conditional, and may be avoided by
compliance with regulations set out in the statute, the validity of the
measure is determined by the power of Congress to regulate the subject
matter. If the regulations are within the competence of Congress, apart
from its power to tax, the exaction is sustained as an appropriate
sanction for making them effective;\525\ otherwise it
[[Page 152]]
is invalid.\526\ During the Prohibition Era, Congress levied a heavy tax
upon liquor dealers who operated in violation of state law. In United
States v. Constantine,\527\ the Court held that this tax was
unenforceable after the repeal of the Eighteenth Amendment, since the
National Government had no power to impose an additional penalty for
infractions of state law.
\525\Sunshine Coal Co. v. Adkins, 310 U.S. 381, 383 (1940). See
also Head Money Cases, 112 U.S. 580, 596 (1884).
\526\Child Labor Tax Case (Bailey v. Drexel Furniture Co.), 259
U.S. 20 (1922); Hill v. Wallace, 259 U.S. 44 (1922); Helwig v. United
States, 188 U.S. 605 (1903).
\527\296 U.S. 287 (1935).
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Promotion of Business: Protective Tariff
The earliest examples of taxes levied with a view to promoting
desired economic objectives in addition to raising revenue were, of
course, import duties. The second statute adopted by the first Congress
was a tariff act reciting that ``it is necessary for the support of
government, for the discharge of the debts of the United States, and the
encouragement and protection of manufactures, that duties be laid on
goods, wares and merchandise imported.''\528\ After being debated for
nearly a century and a half, the constitutionality of protective tariffs
was finally settled by the unanimous decision of the Supreme Court in J.
W. Hampton & Co. v. United States,\529\ where Chief Justice Taft wrote:
``The second objection to Sec. 315 is that the declared plan of
Congress, either expressly or by clear implication, formulates its rule
to guide the President and his advisory Tariff Commission as one
directed to a tariff system of protection that will avoid damaging
competition to the country's industries by the importation of goods from
other countries at too low a rate to equalize foreign and domestic
competition in the markets of the United States. It is contended that
the only power of Congress in the levying of customs duties is to create
revenue, and that it is unconstitutional to frame the customs duties
with any other view than that of revenue raising.''
\528\1 Stat. 24 (1789).
\529\276 U.S. 394 (1928).
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The Chief Justice then observed that the first Congress in 1789
had enacted a protective tariff. ``In this first Congress sat many
members of the Constitutional Convention of 1787. This Court has
repeatedly laid down the principle that a contemporaneous legislative
exposition of the Constitution when the founders of our Government and
framers of our Constitution were actively participating in public
affairs, long acquiesced in, fixes the construction to be given its
provisions. . . . The enactment and enforcement of a number of customs
revenue laws drawn with a motive of maintaining a system of protection,
since the revenue law of 1789, are mat
[[Page 153]]
ters of history. . . . Whatever we may think of the wisdom of a
protection policy, we cannot hold it unconstitutional. So long as the
motive of Congress and the effect of its legislative action are to
secure revenue for the benefit of the general government, the existence
of other motives in the selection of the subject of taxes cannot
invalidate Congressional action.''\530\
\530\Id., 411-412.
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SPENDING FOR THE GENERAL WELFARE
Scope of the Power
The grant of power to ``provide . . . for the general welfare''
raises a two-fold question: How may Congress provide for ``the general
welfare'' and what is ``the general welfare'' that it is authorized to
promote? The first half of this question was answered by Thomas
Jefferson in his opinion on the Bank as follows: ``[T]he laying of taxes
is the power, and the general welfare the purpose for which the power is
to be exercised. They [Congress] are not to lay taxes ad libitum for any
purpose they please; but only to pay the debts or provide for the
welfare of the Union. In like manner, they are not to do anything they
please to provide for the general welfare, but only to lay taxes for
that purpose.''\531\ The clause, in short, is not an independent grant
of power, but a qualification of the taxing power. Although a broader
view has been occasionally asserted,\532\ Congress has not acted upon it
and the Court has had no occasion to adjudicate the point.
\531\3 Writings of Thomas Jefferson (Library Edition, 1904),
147-149.
\532\See W. Crosskey, Politics and the Constitution in the
History of the United States (Chicago: 1953).
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With respect to the meaning of ``the general welfare'' the pages
of The Federalist itself disclose a sharp divergence of views between
its two principal authors. Hamilton adopted the literal, broad meaning
of the clause;\533\ Madison contended that the powers of taxation and
appropriation of the proposed government should be regarded as merely
instrumental to its remaining powers, in other words, as little more
than a power of self-support.\534\ From an early date Congress has acted
upon the interpretation espoused by Hamilton. Appropriations for
subsidies\535\ and for an ever increasing variety of ``internal
improvements''\536\ constructed by the Federal Government, had their
beginnings in the adminis
[[Page 154]]
trations of Washington and Jefferson.\537\ Since 1914, federal grants-
in-aid, sums of money apportioned among the States for particular uses,
often conditioned upon the duplication of the sums by the recipient
State, and upon observance of stipulated restrictions as to its use,
have become commonplace.
\533\The Federalist, Nos. 30 and 34 (J. Cooke ed. 1961) 187-193,
209-215.
\534\Id., No. 41, 268-278.
\535\1 Stat. 229 (1792).
\536\2 Stat. 357 (1806).
\537\In an advisory opinion, which it rendered for President
Monroe at his request on the power of Congress to appropriate funds for
public improvements, the Court answered that such appropriations might
be properly made under the war and postal powers. See Albertsworth,
Advisory Functions in the Supreme Court, 23 Geo. L. J. 643, 644-647
(1935). Monroe himself ultimately adopted the broadest view of the
spending power, from which, however, he carefully excluded any element
of regulatory or police power. See his Views of the President of the
United States on the Subject of Internal Improvements, of May 4, 1822, 2
Messages and Papers of the Presidents (Richardson ed. 1906), 713-752.
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The scope of the national spending power was brought before the
Supreme Court at least five times prior to 1936, but the Court disposed
of four of the suits without construing the ``general welfare'' clause.
In the Pacific Railway Cases (California v. Pacific Railroad Co.)\538\
and Smith v. Kansas City Title Co.,\539\ it affirmed the power of
Congress to construct internal improvements, and to charter and purchase
the capital stock of federal land banks, by reference to the powers of
the National Government over commerce, and post roads and fiscal
operations, and to its war powers. Decisions on the merits were withheld
in two other cases, Massachusetts v. Mellon and Frothingham v.
Mellon,\540\ on the ground that neither a State nor an individual
citizen is entitled to a remedy in the courts against an alleged
unconstitutional appropriation of national funds. In United States v.
Gettysburg Electric Ry.,\541\ however, the Court had invoked ``the great
power of taxation to be exercised for the common defence and general
welfare''\542\ to sustain the right of the Federal Government to acquire
land within a State for use as a national park.
\538\127 U.S. 1 (188).
\539\255 U.S. 180 (1921).
\540\262 U.S. 447 (1923). See also Alabama Power Co. v. Ickes,
302 U.S. 464 (1938). These cases were limited by Flast v. Cohen, 392
U.S. 83 (1968).
\541\160 U.S. 668 (1896).
\542\Id., 681.
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Finally, in United States v. Butler,\543\ the Court gave its
unqualified endorsement to Hamilton's views on the taxing power. Wrote
Justice Roberts for the Court: ``Since the foundation of the Nation
sharp differences of opinion have persisted as to the true
interpretation of the phrase. Madison asserted it amounted to no more
than a reference to the other powers enumerated in the subsequent
clauses of the same section; that, as the United States is a government
of limited and enumerated powers, the grant of
[[Page 155]]
power to tax and spend for the general national welfare must be confined
to the numerated legislative fields committed to the Congress. In this
view the phrase is mere tautology, for taxation and appropriation are or
may be necessary incidents of the exercise of any of the enumerated
legislative powers. Hamilton, on the other hand, maintained the clause
confers a power separate and distinct from those later enumerated, is
not restricted in meaning by the grant of them, and Congress
consequently has a substantive power to tax and to appropriate, limited
only by the requirement that it shall be exercised to provide for the
general welfare of the United States. Each contention has had the
support of those whose views are entitled to weight. This court had
noticed the question, but has never found it necessary to decide which
is the true construction. Justice Story, in his Commentaries, espouses
the Hamiltonian position. We shall not review the writings of public men
and commentators or discuss the legislative practice. Study of all these
leads us to conclude that the reading advocated by Justice Story is the
correct one. While, therefore, the power to tax is not unlimited, its
confines are set in the clause which confers it, and not in those of
Sec. 8 which bestow and define the legislative powers of the Congress.
It results that the power of Congress to authorize expenditure of public
moneys for public purposes is not limited by the direct grants of
legislative power found in the Constitution.''\544\
\543\297 U.S. 1 (1936). See also Cleveland v. United States, 323
U.S. 329 (1945).
\544\United States v. Butler, 297 U.S. 1, 65, 66 (1936). So
settled is the issue that recent attacks on federal grants-in-aid omit
any challenge on the broad level and rely on specific prohibitions,
i.e., the religion clauses of the First Amendment. Flast v. Cohen, 392
U.S. 83 (1968); Tilton v. Richardson, 403 U.S. 672 (1971).
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Social Security Act Cases.--Although holding that the spending
power is not limited by the specific grants of power contained in
Article I, Sec. 8, the Court found, nevertheless, that it was qualified
by the Tenth Amendment, and on this ground ruled in the Butler case that
Congress could not use moneys raised by taxation to ``purchase
compliance'' with regulations ``of matters of State concern with respect
to which Congress has no authority to interfere.''\545\ Within little
more than a year this decision was reduced to narrow proportions by
Steward Machine Co. v. Davis,\546\ which sustained the tax imposed on
employers to provide unemployment benefits, and the credit allowed for
similar taxes paid to a State. To the argument that the tax and credit
in combination were ``weapons of coercion, destroying or impairing the
autonomy
[[Page 156]]
of the States,'' the Court replied that relief of unemployment was a
legitimate object of federal expenditure under the ``general welfare''
clause, that the Social Security Act represented a legitimate attempt to
solve the problem by the cooperation of State and Federal Governments,
that the credit allowed for state taxes bore a reasonable relation ``to
the fiscal need subserved by the tax in its normal operation,''\547\
since state unemployment compensation payments would relieve the burden
for direct relief borne by the national treasury. The Court reserved
judgment as to the validity of a tax ``if it is laid upon the condition
that a State may escape its operation through the adoption of a statute
unrelated in subject matter to activities fairly within the scope of
national policy and power.''\548\
\545\Justice Stone, speaking for himself and two other Justices,
dissented on the ground that Congress was entitled when spending the
national revenues for the ``general welfare'' to see to it that the
country got its money's worth thereof, and that the condemned provisions
were ``necessary and proper'' to that end. United States v. Butler, 297
U.S. 1, 84-86 (1936).
\546\301 U.S. 548 (1937).
\547\Id., 591.
\548\Id., 590. See also Buckley v. Valeo, 424 U.S. 1, 90-92
(1976); Fullilove v. Klutznick, 448 U.S. 448, 473-475 (1980); Pennhurst
State School & Hospital v. Halderman, 451 U.S. 1 (1981).
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An Unrestrained Federal Spending Power.--Little if any
constitutional controversy marks the debate over the modern exercise of
the spending power. There are, of course, ``general restrictions,'' the
first of which is that the power must be used in pursuit of the general
welfare.\549\ However, great deference is judicially accorded Congress'
decision that a spending program advances the general welfare,\550\ and
the Court has suggested that the question whether a spending program
provides for the general welfare may not even be judicially
noticeable.\551\ Dispute, such as it is, turns on the conditioning of
funds.
\549\South Dakota v. Dole, 483 U.S. 203, 207 (1987).
\550\Id., 207 (citing Helvering v. Davis, 301 U.S. 619, 640, 645
(1937)).
\551\Buckley v. Valeo, 424 U.S. 1, 90-91 (1976).
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Conditional Grants-in-Aid.--In the Steward Machine Company case,
it was a taxpayer who complained of the invasion of the state
sovereignty, and the Court put great emphasis on the fact that the State
was a willing partner in the plan of cooperation embodied in the Social
Security Act.\552\ A decade later the right of Congress to impose
conditions upon grants-in-aid over the objection of a State was squarely
presented in Oklahoma v. CSC.\553\ The State objected to the enforcement
of a provision of the Hatch Act, whereby its right to receive federal
highway funds would be diminished in consequence of its failure to
remove from office a member of the State Highway Commission found to
have taken an active part in party politics while in office. Although it
found that the State had asserted a legal right which entitled it to an
adjudication
[[Page 157]]
of its objection, the Court denied the relief sought on the ground that
``[w]hile the United States is not concerned with, and has no power to
regulate local political activities as such of State officials, it does
have power to fix the terms upon which its money allotments to State
shall be disbursed. . . . The end sought by Congress through the Hatch
Act is better public service by requiring those who administer funds for
national needs to abstain from active political partisanship. So even
though the action taken by Congress does have effect upon certain
activities within the State, it has never been thought that such effect
made the federal act invalid.''\554\
\552\301 U.S. 548, 589, 590 (1937).
\553\330 U.S. 127 (1947).
\554\Id., 143.
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``Congress has frequently employed the Spending Power to further
broad policy objectives by conditioning receipt of federal moneys upon
compliance by the recipient with federal statutory and administrative
directives. This Court has repeatedly upheld against constitutional
challenge the use of this technique to induce governments and private
parties to cooperate voluntarily with federal policy.''\555\ Standards
purporting to channel Congress' discretion have been announced by the
Court, but they amount to little more than hortatory admonitions.\556\
First, the conditions, like the spending itself, must advance the
general welfare, but the decision of that rests largely if not wholly
with Congress.\557\ Second, since the States may choose to receive or
not receive the proffered funds, Congress must set out the conditions
unambiguously, so that the States may rationally decide.\558\ Third, it
is suggested in the cases that the conditions must be related to the
federal interest for which the funds are expended,\559\ but, though it
continues to repeat this standard, it has never found a spending
condition that did not survive scrutiny under this part of the
test.\560\ Fourth, the power to condition funds may not be used to
induce the States to engage in
[[Page 158]]
activities that would themselves be unconstitutional.\561\Fifth, the
Court has suggested that in some circumstances the financial inducement
offered by Congress might be so coercive as to pass the point at which
``pressure turns into compulsion,''\562\ but again the Court has never
found a congressional condition to be coercive in this sense.\563\
Certain federalism restraints on other federal powers seem not to be
relevant to spending conditions.\564\
\555\Fullilove v. Klutznick, 448 U.S. 448, 474 (1980) (Chief
Justice Burger announcing judgment of the Court).
\556\See South Dakota v. Dole, 483 U.S. 203, 207-212 (1987).
\557\Id., 207. See supra, nn. 549-551.
\558\Ibid. The requirement appeared in Pennhurst State School &
Hosp. v. Halderman, 451 U.S. 1, 17 (1981). See also Atascadero State
Hosp. v. Scanlon, 473 U.S. 234 (1985).
\559\South Dakota v. Dole, 483 U.S. 203, 207-208 (1987). See
Steward Machine Co. v. Davis, 301 U.S. 548, 590 (1937); Ivanhoe
Irrigation Dist. v. McCracken, 357 U.S. 275, 295 (1958).
\560\The relationship in South Dakota v. Dole, 483 U.S. 203,
208-209 (1987), in which Congress conditioned access to certain highway
funds on establishing a 21-years-of-age drinking qualification was that
the purpose of both funds and condition was safe interstate travel. The
federal interest in Oklahoma v. CSC, 330 U.S. 127, 143 (1947), as we
have noted, was assuring proper administration of federal highway funds.
\561\South Dakota v. Dole, 483 U.S. 203, 210-211 (1987).
\562\Steward Machine Co. v. Davis, 301 U.S. 548, 589-590 (1937);
South Dakota v. Dole, 483 U.S. 203, 211-212 (1987).
\563\See North Carolina ex rel. Morrow v. Califano, 445 F.Supp.
532 (E.D.N.C. 1977) (three-judge court), affd. 435 U.S. 962 (1978).
\564\South Dakota v. Dole, 483 U.S. 203, 210 (1987).
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If a State accepts federal funds on conditions and then fails to
follow the requirements, the usual remedy is federal administrative
action to terminate the funding and to recoup funds the State has
already received.\565\ But it is also clear that recipients and
potential recipients in a particular program may ordinarily sue to
compel the States to observe the standards.\566\ Finally, it should be
noted that Congress has enacted a range of laws forbidding
discrimination in federal assistance programs, that has considerable
effect.\567\
\565\Bell v. New Jersey, 461 U.S. 773 (1983); Bennett v. New
Jersey, 470 U.S. 632 (1985); Bennett v. Kentucky Dept. of Education, 470
U.S. 656 (1985).
\566\E.g., King v. Smith, 392 U.S. 309 (1968); Rosado v. Wyman,
397 U.S. 397 (1970); Lau v. Nichols, 414 U.S. 563 (1974); Miller v.
Youakim, 440 U.S. 125 (1979). Suits may be brought under 42 U.S.C.
Sec. 1983, see Maine v. Thiboutot, 448 U.S. 1 (1980), although in some
instances the statutory conferral of rights may be too imprecise or
vague for judicial enforcement. Compare Suter v. Artist M., 112 S.Ct.
1360 (1992), with Wright v. Roanoke Redevelopment & Housing Auth., 479
U.S. 418 (1987).
\567\E.g., Title VI of the Civil Rights Act of 1964, 42 U.S.C.
Sec. 2000d; Title IX of the Educational Amendments of 1972, 20 U.S.C.
Sec. 1681; Title V of the Rehabilitation Act of 1973, 29 U.S.C.
Sec. 794.
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Earmarked Funds.--The appropriation of the proceeds of a tax to
a specific use does not affect the validity of the exaction, if the
general welfare is advanced and no other constitutional provision is
violated. Thus a processing tax on coconut oil was sustained despite the
fact that the tax collected upon oil of Philippine production was
segregated and paid into the Philippine Treasury.\568\ In Helvering v.
Davis,\569\ the excise tax on employers, the proceeds of which were not
earmarked in any way, although intended to provide funds for payments to
retired workers, was upheld under the ``general welfare'' clause, the
Tenth Amendment being found to be inapplicable.
\568\Cincinnati Soap Co. v. United States, 301 U.S. 308 (1937).
\569\301 U.S. 619 (1937).
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Debts of the United States.--The power to pay the debts of the
United States is broad enough to include claims of citizens aris
[[Page 159]]
ing on obligations of right and justice.\570\ The Court sustained an act
of Congress which set apart for the use of the Philippine Islands, the
revenue from a processing tax on coconut oil of Philippine production,
as being in pursuance of a moral obligation to protect and promote the
welfare of the people of the Islands.\571\ Curiously enough, this power
was first invoked to assist the United States to collect a debt due to
it. In United States v. Fisher,\572\ the Supreme Court sustained a
statute which gave the Federal Government priority in the distribution
of the estates of its insolvent debtors. The debtor in that case was the
endorser of a foreign bill of exchange that apparently had been
purchased by the United States. Invoking the ``necessary and proper''
clause, Chief Justice Marshall deduced the power to collect a debt from
the power to pay its obligations by the following reasoning: ``The
government is to pay the debt of the Union, and must be authorized to
use the means which appear to itself most eligible to effect that
object. It has, consequently, a right to make remittances by bills or
otherwise, and to take those precautions which will render the
transaction safe.''\573\
\570\United States v. Realty Company, 163 U.S. 427 (1896); Pope
v. United States, 323 U.S. 1, 9 (1944).
\571\Cincinnati Soap Co. v. United States, 301 U.S. 308 (1937).
\572\2 Cr. (6 U.S.) 358 (1805).
\573\Id., 396.
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Clause 2. The Congress shall have Power * * * To borrow Money on the
credit of the United States.
BORROWING POWER
The original draft of the Constitution reported to the
convention by its Committee of Detail empowered Congress ``To borrow
money and emit bills on the credit of the United States.''\574\ When
this section was reached in the debates, Gouverneur Morris moved to
strike out the clause ``and emit bills on the credit of the United
States.'' Madison suggested that it might be sufficient ``to prohibit
the making them a tender.'' After a spirited exchange of views on the
subject of paper money, the convention voted, nine States to two, to
delete the words ``and emit bills.''\575\ Nevertheless, in 1870, the
Court relied in part upon this clause in holding that Congress had
authority to issue treasury notes and to make them legal tender in
satisfaction of antecedent debts.\576\
\574\2 M. Farrand, The Records of the Federal Convention of 1787
(New Haven: rev. ed. 1937), 144, 308-309.
\575\Id., 310.
\576\Knox v. Lee (Legal Tender Cases), 12 Wall. (79 U.S.) 457
(1871), overruling Hepburn v. Griswold, 8 Wall. (75 U.S.) 603 (1870).
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[[Page 160]]
When it borrows money ``on the credit of the United States,''
Congress creates a binding obligation to pay the debt as stipulated and
cannot thereafter vary the terms of its agreement. A law purporting to
abrogate a clause in government bonds calling for payment in gold coin
was held to contravene this clause, although the creditor was denied a
remedy in the absence of a showing of actual damage.\577\
\577\Perry v. United States, 294 U.S. 330, 351 (1935). See also
Lynch v. United States, 292 U.S. 571 (1934).
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Clause 3. The Congress shall have Power * * * To regulate Commerce
with foreign Nations, and among the several States, and with the Indian
Tribes.
POWER TO REGULATE COMMERCE
Purposes Served by the Grant
This clause serves a two-fold purpose: it is the direct source
of the most important powers that the Federal Government exercises in
peacetime, and, except for the due process and equal protection clauses
of the Fourteenth Amendment, it is the most important limitation imposed
by the Constitution on the exercise of state power. The latter,
restrictive operation of the clause was long the more important one from
the point of view of the constitutional lawyer. Of the approximately
1400 cases which reached the Supreme Court under the clause prior to
1900, the overwhelming proportion stemmed from state legislation.\578\
The result was that, generally, the guiding lines in construction of the
clause were initially laid down in the context of curbing state power
rather than in that of its operation as a source of national power. The
consequence of this historical progression was that the word
``commerce'' came to dominate the clause while the word ``regulate''
remained in the background. The so-called ``constitutional revolution''
of the 1930s, however, brought the latter word to its present
prominence.
\578\E. Prentice & J. Egan, The Commerce Clause of the Federal
Constitution (Chicago: 1898), 14.
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Definition of Terms
Commerce.--The etymology of the word ``commerce''\579\ carries
the primary meaning of traffic, of transporting goods across state lines
for sale. This possibly narrow constitutional conception was
[[Page 161]]
rejected by Chief Justice Marshall in Gibbons v. Ogden, \580\ which
remains one of the seminal cases dealing with the Constitution. The case
arose because of a monopoly granted by the New York legislature on the
operation of steam-propelled vessels on its waters, a monopoly
challenged by Gibbons who transported passengers from New Jersey to New
York pursuant to privileges granted by an act of Congress.\581\ The New
York monopoly was not in conflict with the congressional regulation of
commerce, argued the monopolists, because the vessels carried only
passengers between the two States and were thus not engaged in traffic,
in ``commerce'' in the constitutional sense.
\579\That is, ``cum merce (with merchandise).''
\580\9 Wheat. (22 U.S.) 1 (1824).
\581\Act of February 18, 1793, 1 Stat. 305, entitled ``An Act
for enrolling and licensing ships or vessels to be employed in the
coasting trade and fisheries, and for regulating the same.''
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``The subject to be regulated is commerce,'' the Chief Justice
wrote. ``The counsel for the appellee would limit it to traffic, to
buying and selling, or the interchange of commodities, and do not admit
that it comprehends navigation. This would restrict a general term,
applicable to many objects, to one of its significations. Commerce,
undoubtedly, is traffic, but it is something more--it is
intercourse.''\582\ The term, therefore, included navigation, a
conclusion that Marshall also supported by appeal to general
understanding, to the prohibition in Article I, Sec. 9, against any
preference being given ``by any regulation of commerce or revenue, to
the ports of one State over those of another,'' and to the admitted and
demonstrated power of Congress to impose embargoes.\583\
\582\Gibbons v. Ogden, 9 Wheat. (22 U.S.) 1, 189 (1824).
\583\Id., 190-194.
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Marshall qualified the word ``intercourse'' with the word
``commercial,'' thus retaining the element of monetary
transactions.\584\ But, today, ``commerce'' in the constitutional sense,
and hence ``interstate commerce,'' covers every species of movement of
persons and things, whether for profit or not, across state lines,\585\
every species of communication, every species of transmission of
intelligence, whether for commercial purposes or otherwise,\586\ every
species of commercial negotiation which will involve sooner or later an
act of transportation of persons or things, or the flow of services or
power, across state lines.\587\
\584\Id., 193.
\585\As we will see, however, the crossing of state lines gives
way in many later formulations, or, rather, is supplemented with, a
requirement of effect on interstate commerce which may result from a
wholly intrastate transaction.
\586\E.g., United States v. Simpson, 252 U.S. 465 (1920);
Caminetti v. United States, 242 U.S. 470 (1917).
\587\``Not only, then, may transactions be commerce though non-
commercial; they may be commerce though illegal and sporadic, and though
they do not utilize common carriers or concern the flow of anything more
tangible than electrons and information.'' United States v. South-
Eastern Underwriters Assn., 322 U.S. 533, 549-550 (1944).
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[[Page 162]]
There was a long period in the Court's history when a majority
of the Justices, seeking to curb the regulatory powers of the Federal
Government by various means, held that certain things were not
encompassed by the commerce clause because they were either not
interstate commerce or bore no sufficient nexus to interstate commerce.
Thus, at one time, the Court held that mining or manufacturing, even
when the product would move in interstate commerce, was not reachable
under the commerce clause;\588\ it held insurance transactions carried
on across state lines not commerce,\589\ and that exhibitions of
baseball between professional teams that travel from State to State were
not in commerce,\590\ and that similarly the commerce clause was not
applicable to the making of contracts for the insertion of
advertisements in periodicals in another State\591\ or to the making of
contracts for personal services to be rendered in another State.\592\
Later decisions either have overturned or have undermined all of these
holdings. The gathering of news by a press association and its
transmission to client newspapers are interstate commerce.\593\ The
activities of a Group Health Association, which serves only its own
members, are ``trade'' and capable of becoming interstate commerce;\594\
the business of
[[Page 163]]
insurance when transacted between an insurer and an insured in different
States is interstate commerce.\595\ But most important of all there was
the development of, or more accurately the return to,\596\ the
rationales by which manufacturing,\597\ mining,\598\ business
transactions,\599\ and the like, which are antecedent to or subsequent
to a move across state lines, are conceived to be part of an integrated
commercial whole and therefore subject to the reach of the commerce
power.
\588\Kidd v. Pearson, 128 U.S. 1 (1888); Oliver Iron Co. v.
Lord, 262 U.S. 172 (1923); United States v. E. C. Knight Co., 156 U.S. 1
(1895); and see Carter v. Carter Coal Co., 298 U.S. 238 (1936).
\589\Paul v. Virginia, 8 Wall. (75 U.S.) 168 (1869); and see the
cases to this effect cited in United States v. South-Eastern
Underwriters Assn., 322 U.S. 533, 543-545, 567-568, 578 (1944).
\590\Federal Baseball League v. National League of Professional
Baseball Clubs, 259 U.S. 200 (1922). When called on to reconsider its
decision, the Court declined, noting that Congress had not seen fit to
bring the business under the antitrust laws by legislation having
prospective effect and that the business had developed under the
understanding that it was not subject to these laws, a reversal of which
would have retroactive effect. Toolson v. New York Yankees, 346 U.S. 356
(1953). In Flood v. Kuhn, 407 U.S. 258 (1972), the Court recognized
these decisions as aberrations, but it thought the doctrine entitled to
the benefits of stare decisis inasmuch as Congress was free to change it
at any time. The same considerations not being present, the Court has
held that businesses, conducted on a multistate basis but built around
local exhibitions, are in commerce and subject to, inter alia, the
antitrust laws, in the instance of professional football, Radovich v.
National Football League, 352 U.S. 445 (1957), professional boxing,
United States v. International Boxing Club, 348 U.S. 236 (1955), and
legitimate theatrical productions. United States v. Shubert, 348 U.S.
222 (1955).
\591\Blumenstock Bros. v. Curtis Publishing Co., 252 U.S. 436
(1920).
\592\Williams v. Fears, 179 U.S. 270 (1900). See also Diamond
Glue Co. v. United States Glue Co., 187 U.S. 611 (1903); Browning v.
City of Waycross, 233 U.S. 16 (1914); General Railway Signal Co. v.
Virginia, 246 U.S. 500 (1918). But see York Manufacturing Co. v. Colley,
247 U.S. 21 (1918).
\593\Associated Press v. United States, 326 U.S. 1 (1945).
\594\American Medical Association v. United States, 317 U.S. 519
(1943). Cf. United States v. Oregon Medical Society, 343 U.S. 326
(1952).
\595\United States v. South-Eastern Underwriters Assn., 322 U.S.
533 (1944).
\596\``It has been truly said, that commerce, as the word is
used in the constitution, is a unit, every part of which is indicated by
the term.'' Gibbons v. Ogden, 9 Wheat. (22 U.S.) 1, 194 (1824). And see
id., 195-196.
\597\NLRB v. Jones & Laughlin Steel Corp., 301 U.S. 1 (1937).
\598\Sunshine Anthracite Coal Co. v. Adkins, 310 U.S. 381
(1940). And see Hodel v. Virginia Surface Mining & Reclamation Assn.,
452 U. S. 264, 275-283 (1981). See also Mulford v. Smith, 307 U.S. 38
(1939) (agricultural production).
\599\Swift & Co. v. United States, 196 U.S. 375 (1905); Stafford
v. Wallace, 258 U.S. 495 (1922); Chicago Board of Trade v. Olsen, 262
U.S. 1 (1923).
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Among the Several States.--Continuing in Gibbons v. Ogden, Chief
Justice Marshall observed that the phrase ``among the several States''
was ``not one which would probably have been selected to indicate the
completely interior traffic of a state.'' It must therefore have been
selected to demark ``the exclusively internal commerce of a state.''
While, of course, the phrase ``may very properly be restricted to that
commerce which concerns more states than one,'' it is obvious that
``[c]ommerce among the states, cannot stop at the exterior boundary line
of each state, but may be introduced into the interior.'' The Chief
Justice then succinctly stated the rule, which, though restricted in
some periods, continues to govern the interpretation of the clause.
``The genius and character of the whole government seem to be, that its
action is to be applied to all the external concerns of the nation, and
to those internal concerns which affect the states generally; but not to
those which are completely within a particular state, which do not
affect other states, and with which it is not necessary to interfere,
for the purpose of executing some of the general powers of the
government.''\600\
\600\9 Wheat. (22 U.S.) 1, 194, 195 (1824).
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Recognition of an ``exclusively internal'' commerce of a State,
or ``intrastate commerce'' in today's terms, was at times regarded as
setting out an area of state concern that Congress was precluded from
reaching.\601\ While these cases seemingly visualized Congress' power
arising only when there was an actual crossing of state
[[Page 164]]
boundaries, this view ignored the Marshall's equation of ``intrastate
commerce,'' which ``affect[s] other states'' or ``with which it is
necessary to interfere'' in order to effectuate congressional power,
with those actions that are ``purely'' interstate. This equation came
back into its own, both with the Court's stress on the ``current of
commerce'' bringing each element in the current within Congress'
regulatory power,\602\ with the emphasis on the interrelationships of
industrial production to interstate commerce\603\ but especially with
the emphasis that even minor transactions have an effect on interstate
commerce\604\ and that the cumulative effect of many minor transactions
with no separate effect on interstate commerce, when they are viewed as
a class, may be sufficient to merit congressional regulation.\605\
``Commerce among the states must, of necessity, be commerce with[in] the
states. . . . The power of congress, then, whatever it may be, must be
exercised within the territorial jurisdiction of the several
states.''\606\
\601\New York v. Miln, 11 Pet. (36 U.S.) 102 (1837); License
Cases, 5 How. (46 U.S.) 504 (1847); Passenger Cases, 7 How. (48 U.S.)
283 (1849); Patterson v. Kentucky, 97 U.S. 501 (1879); Trade-Mark Cases,
100 U.S. 82 (1879); Kidd v. Pearson, 128 U.S. 1 (1888); Illinois Central
Railroad v. McKendree, 203 U.S. 514 (1906); Keller v. United States, 213
U.S. 138 (1909); Hammer v. Dagenhart, 247 U.S. 251 (1918); Oliver Iron
Co. v. Lord, 262 U.S. 172 (1923).
\602\Swift & Co. v. United States, 196 U.S. 375 (1905); Stafford
v. Wallace, 258 U.S. 495 (1922); Chicago Board of Trade v. Olsen, 262
U.S. 1 (1923).
\603\NLRB v. Jones & Laughlin Steel Corp., 301 U.S. 1 (1937).
\604\NLRB v. Fainblatt, 306 U.S. 601 (1939); Kirschbaum v.
Walling, 316 U.S. 517 (1942); United States v. Wrightwood Dairy Co., 315
U.S. 110 (1942); Wickard v. Filburn, 317 U.S. 111 (1942); NLRB v.
Reliance Fuel Oil Co., 371 U.S. 224 (1963); Katzenbach v. McClung, 379
U.S. 294 (1964); Maryland v. Wirtz, 392 U.S. 183 (1968); McLain v. Real
Estate Bd., 444 U.S. 232, 241-243 (1980); Hodel v. Virginia Surface
Mining & Reclamation Assn., 452 U.S. 264 (1981).
\605\United States v. Darby, 312 U.S. 100 (1941); Heart of
Atlanta Motel v. United States, 379 U.S. 241 (1964); Maryland v. Wirtz,
392 U.S. 183 (1968); Perez v. United States, 402 U.S. 146 (1971);
Russell v. United States, 471 U.S. 858 (1985); Summit Health, Ltd. v.
Pinhas, 500 U.S. 322 (1991).
\606\Gibbons v. Ogden, 9 Wheat. (22 U.S.) 1, 196 (1824).
Commerce ``among the several States'' does not comprise commerce of the
District of Columbia nor of the territories of the United States.
Congress' power over their commerce is an incident of its general power
over them. Stoutenburgh v. Hennick, 129 U.S. 141 (1889); Atlantic
Cleaners & Dyers v. United States, 286 U.S. 427 (1932); In re Bryant, 4
Fed. Cas. 514 (No. 2067) (D. Oreg. 1865). Transportation between two
points in the same State, when a part of the route is a loop outside the
State, is interstate commerce. Hanley v. Kansas City Southern Ry. Co.,
187 U.S. 617 (1903); Western Union Telegraph Co. v. Speight, 254 U.S. 17
(1920). But such a deviation cannot be solely for the purpose of evading
a tax or regulation in order to be exempt from the State's reach.
Greyhound Lines v. Mealey, 334 U.S. 653, 660 (1948); Eichholz v. Public
Service Comm., 306 U.S. 268, 274 (1939). Red cap services performed at a
transfer point within the State of departure but in conjunction with an
interstate trip are reachable. New York, N.H. & N.R. Co. v. Nothnagle,
346 U.S. 128 (1953).
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Regulate.--``We are now arrived at the inquiry--'' continued the
Chief Justice, ``What is this power? It is the power to regulate; that
is, to prescribe the rule by which commerce is to be governed. This
power, like all others vested in congress, is complete in itself, may be
exercised to its utmost extent, and acknowledges no limitations, other
than are prescribed in the constitution . . . If, as has always been
understood, the sovereignty of congress, though lim
[[Page 165]]
ited to specified objects, is plenary as to those objects, the power
over commerce with foreign nations, and among the several states, is
vested in congress as absolutely as it would be in a single government,
having in its constitution the same restrictions on the exercise of the
power as are found in the constitution of the United States.''\607\
\607\Gibbons v. Ogden, 9 Wheat. (22 U.S.) 1, 196-197 (1824).
---------------------------------------------------------------------------
Of course, the power to regulate commerce is the power to
prescribe conditions and rules for the carrying-on of commercial
transactions, the keeping-free of channels of commerce, the regulating
of prices and terms of sale. Even if the clause granted only this power,
the scope would be wide, but it extends to include many more purposes
than these. ``Congress can certainly regulate interstate commerce to the
extent of forbidding and punishing the use of such commerce as an agency
to promote immorality, dishonesty, or the spread of any evil or harm to
the people of other states from the state of origin. In doing this, it
is merely exercising the police power, for the benefit of the public,
within the field of interstate commerce.''\608\ Thus, in upholding a
federal statute prohibiting the shipment in interstate commerce of goods
made with child labor, not because the goods were intrinsically harmful
but in order to extirpate child labor, the Court said: ``It is no
objection to the assertion of the power to regulate commerce that its
exercise is attended by the same incidents which attend the exercise of
the police power of the states.''\609\
\608\Brooks v. United States, 267 U.S. 432, 436-437 (1925).
\609\United States v. Darby, 312 U.S. 100, 114 (1941).
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The power has been exercised to enforce majority conceptions of
morality,\610\ to ban racial discrimination in public
accommodations,\611\ and to protect the public against evils both
natural and contrived by people.\612\ The power to regulate interstate
commerce is, therefore, rightly regarded as the most potent grant of
authority in Sec. 8.
\610\E.g., Caminetti v. United States, 242 U.S. 470 (1917)
(transportation of female across state line for noncommercial sexual
purposes); Cleveland v. United States, 329 U.S. 14 (1946)
(transportation of plural wives across state lines by Mormons); United
States v. Simpson, 252 U.S. 465 (1920) (transportation of five quarts of
whiskey across state line for personal consumption).
\611\Heart of Atlanta Motel v. United States, 379 U.S. 241
(1964); Katzenbach v. McClung, 379 U.S. 294 (1964); Daniel v. Paul, 395
U.S. 298 (1969).
\612\E.g., Reid v. Colorado, 187 U.S. 137 (1902) (transportation
of diseased livestock across state line); Perez v. United States, 402
U.S. 146 (1971) (prohibition of all loansharking).
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Necessary and Proper Clause.--All grants of power to Congress in
Sec. 8, as elsewhere, must be read in conjunction with the final clause,
cl. 18, of Sec. 8, which authorizes Congress ``[t]o make all
[[Page 166]]
Laws which shall be necessary and proper for carrying into Execution the
foregoing powers.''\613\ It will be recalled that Chief Justice Marshall
alluded to the power thus enhanced by this clause when he said that the
regulatory power did not extend ``to those internal concerns [of a
state] . . . with which it is not necessary to interfere, for thepurpose
of executing some of the general powers of the government.''\614\ There
are numerous cases permitting Congress to reach ``purely'' intrastate
activities on the theory, combined with the previously mentioned
emphasis on the cumulative effect of minor transactions, that it is
necessary to regulate them in order that the regulation of interstate
activities might be fully effectuated.\615\
\613\See infra.
\614\Gibbons v. Ogden, 9 Wheat. (22 U.S.) 1, 195 (1824).
\615\E.g., Houston & Texas Ry. v. United States, 234 U.S. 342
(1914) (necessary for ICC to regulate rates of an intrastate train in
order to effectuate its rate setting for a competing interstate train);
Wisconsin Railroad Commission v. Chicago, B. & Q. R. Co., 257 U.S. 563
(1922) (same); Southern Railway Co. v. United States, 222 U.S. 20 (1911)
(upholding requirement of same safety equipment on intrastate as
interstate trains). See also Wickard v. Filburn, 317 U.S. 111 (1942);
United States v. Wrightwood Dairy Co., 315 U.S. 110 (1942).
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Federalism Limits on Exercise of Commerce Power.--As is
recounted below, prior to reconsideration of the federal commerce power
in the 1930s, the Court in effect followed a doctrine of ``dual
federalism,'' under which Congress' power to regulate much activity
depended on whether it had a ``direct'' rather than an ``indirect''
effect on interstate commerce.\616\ When the restrictive interpretation
was swept away during and after the New Deal, the question of federalism
limits respecting congressional regulation of private activities became
moot. However, the States did in a number of instances engage in
commercial activities that would be regulated by federal legislation if
the enterprise were privately owned; the Court easily sustained
application of federal law to these state proprietary activities.\617\
However, as Congress began to extend regulation to state governmental
activities, the judicial response was inconsistent and wavering.\618\
While the Court may shift again to constrain federal power on federalism
grounds, at the present time
[[Page 167]]
the rule is that Congress lacks authority under the commerce clause to
regulate the States as States in some circumstances, when the federal
statutory provisions reach only the States and do not bring the States
under laws of general applicability.\619\
\616\E.g., United States v. E. G. Knight Co., 156 U.S. 1 (1895);
Hammer v. Dagenhart, 247 U.S. 251 (1918). Of course, there existed much
of this time a parallel doctrine under which federal power was not so
limited. E.g., Houston & Texas Ry. v. United States (The Shreveport Rate
Case), 234 U.S. 342 (1914).
\617\E.g., California v. United States, 320 U.S. 577 (1944);
California v. Taylor, 353 U.S. 553 (1957).
\618\For example, federal regulation of the wages and hours of
certain state and local governmental employees has alternatively been
upheld and invalidated. See Maryland v. Wirtz, 392 U.S. 183 (1968),
overruled in National League of Cities v. Usery, 426 U.S. 833 (1976),
overruled in Garcia v. San Antonio Metropolitan Transit Auth., 469 U.S.
528 (1985).
\619\New York v. United States, 112 S.Ct. 2408 (1992). For
eleboration, see the discussions under the supremacy clause and under
the Tenth Amendment.
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Illegal Commerce
That Congress' protective power over interstate commerce reaches
all kinds of obstructions and impediments was made clear in United
States v. Ferger.\620\ The defendants had been indicted for issuing a
false bill of lading to cover a fictitious shipment in interstate
commerce. Before the Court they argued that inasmuch as there could be
no commerce in a fraudulent bill of lading, Congress had no power to
exercise criminal jurisdiction over them. Said Chief Justice White:
``But this mistakenly assumes that the power of Congress is to be
necessarily tested by the intrinsic existence of commerce in the
particular subject dealt with, instead of by the relation of that
subject to commerce and its effect upon it. We say mistakenly assumes,
because we think it clear that if the proposition were sustained it
would destroy the power of Congress to regulate, as obviously that
power, if it is to exist, must include the authority to deal with
obstructions to interstate commerce . . . and with a host of other acts
which, because of their relation to and influence upon interstate
commerce, come within the power of Congress to regulate, although they
are not interstate commerce in and of themselves.''\621\ Much of
Congress' criminal legislation is based simply on the crossing of a
state line as creating federal jurisdiction.\622\
\620\250 U.S. 199 (1919).
\621\Id., 203.
\622\E.g., Hoke v. United States, 227 U.S. 308 (1913)
(transportation of women for purposes of prostitution); Gooch v. United
States, 297 U.S. 124 (1936) (kidnapping); Brooks v. United States, 267
U.S. 432 (1925) (stolen autos). For example, in Scarborough v. United
States, 431 U.S. 563 (1977), the Court upheld a conviction for
possession of a firearm by a felon upon a mere showing that the gun had
sometime previously traveled in interstate commerce, and Barrett v.
United States, 423 U.S. 212 (1976), upheld a conviction for receipt of a
firearm on the same showing. The Court does require Congress in these
cases to speak plainly, in order to reach such activity, inasmuch as
historic state police powers are involved. United States v. Bass, 404
U.S. 336 (1971).
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Interstate Versus Foreign Commerce
There are certain dicta urging or suggesting that Congress'
power to regulate interstate commerce restrictively is less than its
analogous power over foreign commerce, the argument being that whereas
the latter is a branch of the Nation's unlimited power over
[[Page 168]]
foreign relations, the former was conferred upon the National Government
primarily in order to protect freedom of commerce from state
interference. The four dissenting Justices in the Lottery Case endorsed
this view in the following words: ``The power to regulate commerce with
foreign nations and the power to regulate interstate commerce, are to be
taken diverso intuitu, for the latter was intended to secure equality
and freedom in commercial intercourse as between the States, not to
permit the creation of impediments to such intercourse; while the former
clothed Congress with that power over international commerce, pertaining
to a sovereign nation in its intercourse with foreign nations, and
subject, generally speaking, to no implied or reserved power in the
States. The laws which would be necessary and proper in the one case
would not be necessary or proper in the other.''\623\
\623\Lottery Case (Champion v. Ames), 188 U.S. 321, 373-374
(1903).
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And twelve years later Chief Justice White, speaking for the
Court, expressed the same view, as follows: ``In the argument reference
is made to decisions of this court dealing with the subject of the power
of Congress to regulate interstate commerce, but the very postulate upon
which the authority of Congress to absolutely prohibit foreign
importations as expounded by the decisions of this court rests is the
broad distinction which exists between the two powers and therefore the
cases cited and many more which might be cited announcing the principles
which they uphold have obviously no relation to the question in
hand.''\624\
\624\Brolan v. United States, 236 U.S. 216, 222 (1915). The most
recent dicta to this effect appears in Japan Line v. County of Los
Angeles, 441 U.S. 434, 448-451 (1979), a ``dormant'' commerce clause
case involving state taxation with an impact on foreign commerce. In
context, the distinction seems unexceptionable, but the language extends
beyond context.
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But dicta to the contrary are much more numerous and span a far
longer period of time. Thus Chief Justice Taney wrote in 1847: ``The
power to regulate commerce among the several States is granted to
Congress in the same clause, and by the same words, as the power to
regulate commerce with foreign nations, and is coextensive with
it.''\625\ And nearly fifty years later, Justice Field, speaking for the
Court, said: ``The power to regulate commerce among the several States
was granted to Congress in terms as absolute as is the power to regulate
commerce with foreign nations.''\626\ Today it is firmly established
doctrine that the power to regulate commerce, whether with foreign
nations or among the several States, comprises the power to restrain or
prohibit it at all times for the welfare of the public, provided only
the specific limita
[[Page 169]]
tions imposed upon Congress' powers, as by the due process clause of the
Fifth Amendment, are not transgressed.\627\
\625\License Cases, 5 How. (46 U.S.) 504, 578 (1847).
\626\Pittsburgh & Southern Coal Co. v. Bates, 156 U.S. 577, 587
(1895).
\627\United States v. Carolene Products Co., 304 U.S. 144, 147-
148 (1938).
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Instruments of Commerce
The applicability of Congress' power to the agents and
instruments of commerce is implied in Marshall's opinion in Gibbons v.
Ogden, \628\ where the waters of the State of New York in their quality
as highways of interstate and foreign transportation were held to be
governed by the overriding power of Congress. Likewise, the same opinion
recognizes that in ``the progress of things,'' new and other instruments
of commerce will make their appearance. When the Licensing Act of 1793
was passed, the only craft to which it could apply were sailing vessels,
but it and the power by which it was enacted were, Marshall asserted,
indifferent to the ``principle'' by which vessels were moved. Its
provisions therefore reached steam vessels as well. A little over half a
century later the principle embodied in this holding was given its
classic expression in the opinion of Chief Justice Waite in the case of
the Pensacola Telegraph Co. v. Western Union Telegraph Co., \629\ a case
closely paralleling Gibbons v. Ogden in other respects also. ``The
powers thus granted are not confined to the instrumentalities of
commerce, or the postal service known or in use when the Constitution
was adopted, but they keep pace with the progress of the country, and
adapt themselves to the new developments of times and circumstances.
They extend from the horse with its rider to the stage-coach, from the
sailing-vessel to the steamboat, from the coach and the steamboat to the
railroad, and from the railroad to the telegraph, as these new agencies
are successively brought into use to meet the demands of increasing
population and wealth. They were intended for the government of the
business to which they relate, at all times and under all circumstances.
As they were intrusted to the general government for the good of the
nation, it is not only the right, but the duty, of Congress to see to it
that intercourse among the States and the transmission of intelligence
are not obstructed or unnecessarily encumbered by State
legislation.''\630\
\628\9 Wheat. (22 U.S.) 1, 217, 221 (1824).
\629\96 U.S. 1 (1878). See also Western Union Telegraph Co. v.
Texas, 105 U.S. 460 (1882).
\630\Id., 9. ``Commerce embraces appliances necessarily employed
in carrying on transportation by land and water.'' Railroad Company v.
Fuller, 17 Wall. (84 U.S.) 560, 568 (1873).
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The Radio Act of 1927 \631\ whereby ``all forms of interstate
and foreign radio transmissions within the United States, its Terri
[[Page 170]]
tories and possessions'' were brought under national control, affords
another illustration. Because of the doctrine thus stated, the measure
met no serious constitutional challenge either on the floors of Congress
or in the Courts.\632\
\631\Act of March 28, 1927, 45 Stat. 373, superseded by the
Communications Act of 1934, 48 Stat. 1064, 47 U.S.C. Sec. 151 et seq.
\632\``No question is presented as to the power of the Congress,
in its regulation of interstate commerce, to regulate radio
communication.'' Chief Justice Hughes speaking for the Court in Federal
Radio Comm. v. Nelson Bros. Bond & Mortgage Co., 289 U.S. 266, 279
(1933). See also Fisher's Blend Station v. Tax Comm., 297 U. S. 650,
654-655 (1936).
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Congressional Regulation of Waterways
Navigation.--In Pennsylvania v. Wheeling & Belmont Bridge Co.,
\633\ the Court granted an injunction requiring that a bridge, erected
over the Ohio River under a charter from the State of Virginia, either
be altered so as to admit of free navigation of the river or else be
entirely abated. The decision was justified on the basis both of the
commerce clause and of a compact between Virginia and Kentucky, whereby
both these States had agreed to keep the Ohio River ``free and common to
the citizens of the United States.'' The injunction was promptly
rendered inoperative by an act of Congress declaring the bridge to be
``a lawful structure'' and requiring all vessels navigating the Ohio to
be so regulated as not to interfere with it.\634\ This act the Court
sustained as within Congress' power under the commerce clause, saying:
``So far . . . as this bridge created an obstruction to the free
navigation of the river, in view of the previous acts of Congress, they
are to be regarded as modified by this subsequent legislation; and,
although it still may be an obstruction in fact, [it] is not so in the
contemplation of law. . . . [Congress] having in the exercise of this
power, regulated the navigation consistent with its preservation and
continuation, the authority to maintain it would seem to be complete.
That authority combines the concurrent powers of both governments, State
and federal, which, if not sufficient, certainly none can be found in
our system of government.''\635\ In short, it is Congress, and not the
Court, which is authorized by the Constitution to regulate
commerce.\636\
\633\13 How. (54 U.S.) 518 (1852).
\634\10 Stat 112, 6 (1852).
\635\Pennsylvania v. Wheeling & Belmont Bridge Co., 18 How. (59
U.S.) 421, 430 (1856). ``It is Congress, and not the Judicial
Department, to which the Constitution has given the power to regulate
commerce with foreign nations and among the several States. The courts
can never take the initiative on this subject.'' Transportation Co. v.
Parkersburg, 107 U.S. 691, 701 (1883). See also Prudential Ins. Co. v.
Benjamin, 328 U.S. 408 (1946); Robertson v. California, 328 U.S. 440
(1946).
\636\But see In re Debs, 158 U.S. 564 (1895), in which the Court
held that in the absence of legislative authorization the Executive had
power to seek and federal courts to grant injunctive relief to remove
obstructions to interstate commerce and the free flow of the mail.
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[[Page 171]]
The law and doctrine of the earlier cases with respect to the
fostering and protection of navigation are well summed up in a
frequently cited passage from the Court's opinion in Gilman v.
Philadelphia.\637\ ``Commerce includes navigation. The power to regulate
commerce comprehends the control for that purpose, and to the extent
necessary, of all the navigable waters of the United States which are
accessible from a State other than those in which they lie. For this
purpose they are the public property of the nation, and subject to all
requisite legislation by Congress. This necessarily includes the power
to keep them open and free from any obstruction to their navigation,
interposed by the States or otherwise; to remove such obstructions when
they exist; and to provide, by such sanctions as they may deem proper,
against the occurrence of the evil and for the punishment of offenders.
For these purposes, Congress possesses all the powers which existed in
the States before the adoption of the national Constitution, and which
have always existed in the Parliament in England.''\638\
\637\3 Wall. (70 U.S.) 713 (1866).
\638\Id., 724-725.
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Thus, Congress was within its powers in vesting the Secretary of
War with power to determine whether a structure of any nature in or over
a navigable stream is an obstruction to navigation and to order its
abatement if he so finds.\639\ Nor is the United States required to
compensate the owners of such structures for their loss, since they were
always subject to the servitude represented by Congress' powers over
commerce, and the same is true of the property of riparian owners that
is damaged.\640\ And while it was formerly held that lands adjoining
nonnavigable streams were not
[[Page 172]]
subject to the above mentioned servitude,\641\ this rule has been
impaired by recent decisions;\642\ and at any rate it would not apply as
to a stream rendered navigable by improvements.\643\
\639\Union Bridge Co. v. United States, 204 U.S. 364 (1907). See
also Monongahela Bridge Co. v. United States, 216 U.S. 177 (1910);
Wisconsin v. Illinois, 278 U.S. 367 (1929). The United States may seek
injunctive or declaratory relief requiring the removal of obstructions
to commerce by those negligently responsible for them or it may itself
remove the obstructions and proceed against the responsible party for
costs. United States v. Republic Steel Corp., 362 U.S. 482 (1960);
Wyandotte Transportation Co. v. United States, 389 U.S. 191 (1967).
Congress' power in this area is newly demonstrated by legislation aimed
at pollution and environmental degradation. In confirming the title of
the States to certain waters under the Submerged Lands Act, 67 Stat. 29
(1953), 43 U.S.C. Sec. 1301 et seq., Congress was careful to retain
authority over the waters for purposes of commerce, navigation, and the
like. United States v. Rands, 389 U.S. 121, 127 (1967).
\640\Gibson v. United States, 166 U.S. 269 (1897). See also
Bridge Co. v. United States, 105 U.S. 470 (1882); United States v Rio
Grande Irrigation Co., 174 U.S. 690 (1899); United States v. Chandler-
Dunbar Co., 229 U.S. 53 (1913); Seattle v. Oregon & W.R.R., 255 U.S. 56,
63 (1921); Economy Light Co. v. United States, 256 U.S. 113 (1921);
United States v. River Rouge Co., 269 U.S. 411, 419 (1926); Ford & Son
v. Little Falls Co., 280 U.S. 369 (1930); United States v. Commodore
Park, 324 U.S. 386 (1945); United States v. Twin City Power Co., 350
U.S. 222 (1956); United States v. Rands, 389 U.S. 121 (1967).
\641\United States v. Cress, 243 U.S. 316 (1917).
\642\United States v. Chicago, M., St. P. & P.R. Co., 312 U.S.
592, 597 (1941); United States v. Willow River Co., 324 U.S. 499 (1945).
\643\United States v. Rio Grande Irrigation Co., 174 U.S. 690
(1899).
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In exercising its power to foster and protect navigation,
Congress legislates primarily on things external to the act of
navigation. But that act itself and the instruments by which it is
accomplished are also subject to Congress' power if and when they enter
into or form a part of ``commerce among the several States.'' When does
this happen? Words quoted above from the Court's opinion in the Gilman
case answered this question to some extent; but the decisive answer to
it was returned five years later in the case of The Daniel Ball.\644\
Here the question at issue was whether an act of Congress, passed in
1838 and amended in 1852, which required that steam vessels engaged in
transporting passengers or merchandise upon the ``bays, lakes, rivers,
or other navigable waters of the United States,'' applied to the case of
a vessel that navigated only the waters of the Grand River, a stream
lying entirely in the State of Michigan. The Court ruled: ``In this case
it is admitted that the steamer was engaged in shipping and transporting
down Grand River, goods destined and marked for other States than
Michigan, and in receiving and transporting up the river goods brought
within the State from without its limits; . . . . So far as she was
employed in transporting goods destined for other States, or goods
brought from without the limits of Michigan and destined to places
within that State, she was engaged in commerce between the States, and
however limited that commerce may have been, she was, so far as it went,
subject to the legislation of Congress. She was employed as an
instrument of that commerce; for whenever a commodity has begun to move
as an article of trade from one State to another, commerce in that
commodity between the States has commenced.''\645\
\644\10 Wall. (77 U.S.) 557 (1871).
\645\Id., 565.
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Counsel had suggested that if the vessel was in commerce because
it was part of a stream of commerce then all transportation within a
State was commerce. Turning to this point, the Court added: ``We answer
that the present case relates to transportation on the navigable waters
of the United States, and we are not called upon to express an opinion
upon the power of Congress over interstate commerce when carried on by
land transportation. And we answer further, that we are unable to draw
any clear and distinct
[[Page 173]]
line between the authority of Congress to regulate an agency employed in
commerce between the States, when the agency extends through two or more
States, and when it is confined in its action entirely within the limits
of a single State. If its authority does not extend to an agency in such
commerce, when that agency is confined within the limits of a State, its
entire authority over interstate commerce may be defeated. Several
agencies combining, each taking up the commodity transported at the
boundary line at one end of a State, and leaving it at the boundary line
at the other end, the federal jurisdiction would be entirely ousted, and
the constitutional provision would become a dead letter.''\646\ In
short, it was admitted, inferentially, that the principle of the
decision would apply to land transportation, but the actual
demonstration of the fact still awaited some years.\647\
\646\Id., 566. ``The regulation of commerce implies as much
control, as far-reaching power, over an artificial as over a natural
highway.'' Justice Brewer for the Court in Monongahela Navigation Co. v.
United States, 148 U.S. 312, 342 (1893).
\647\Congress had the right to confer upon the Interstate
Commerce Commission the power to regulate interstate ferry rates, N.Y.
Central R.R. v. Hudson County, 227 U.S. 248 (1913), and to authorize the
Commission to govern the towing of vessels between points in the same
State but partly through waters of an adjoining State. Cornell Steamboat
Co. v. United States, 321 U.S. 634 (1944). Congress' power over
navigation extends to persons furnishing wharfage, dock, warehouse, and
other terminal facilities to a common carrier by water. Hence an order
of the United States Maritime Commission banning certain allegedly
``unreasonable practices'' by terminals in the Port of San Francisco,
and prescribing schedules of maximum free time periods and of minimum
charges was constitutional. California v. United States, 320 U.S. 577
(1944). The same power also comprises regulation of the registry
enrollment, license, and nationality of ships and vessels, the method of
recording bills of sale and mortgages thereon, the rights and duties of
seamen, the limitations of the responsibility of shipowners for the
negligence and misconduct of their captains and crews, and many other
things of a character truly maritime. See The Lottawanna, 21 Wall. (88
U.S.) 558, 577 (1875); Providence & N.Y. SS. Co. v. Hill Mfg. Co., 109
U.S. 578, 589 (1883); The Hamilton, 207 U.S. 398 (1907); O'Donnell v.
Great Lakes Co., 318 U.S. 36 (1943).
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Hydroelectric Power; Flood Control.--As a consequence, in part,
of its power to forbid or remove obstructions to navigation in the
navigable waters of the United States, Congress has acquired the right
to develop hydroelectric power and the ancillary right to sell it to all
takers. By a long-standing doctrine of constitutional law, the States
possess dominion over the beds of all navigable streams within their
borders,\648\ but because of the servitude that Congress' power to
regulate commerce imposes upon such streams, the States, without the
assent of Congress, practically are unable to utilize their prerogative
for power development purposes. Sensing no doubt that controlling power
to this end must be attributed to some government in the United States
and that ``in such matters
[[Page 174]]
there can be no divided empire,''\649\ the Court held in United States
v. Chandler-Dunbar Co.,\650\ that in constructing works for the
improvement of the navigability of a stream, Congress was entitled, as
part of a general plan, to authorize the lease or sale of such excess
water power as might result from the conservation of the flow of the
stream. ``If the primary purpose is legitimate,'' it said, ``we can see
no sound objection to leasing any excess of power over the needs of the
Government. The practice is not unusual in respect to similar public
works constructed by State governments.''\651\
\648\Pollard v. Hagan, 3 How. (44 U.S.) 212 (1845); Shively v.
Bowlby, 152 U.S. 1 (1894).
\649\Green Bay & Miss. Canal Co. v. Patten Paper Co., 172 U.S.
58, 80 (1898).
\650\229 U.S. 53 (1913).
\651\Id., 73, citing Kaukauna Water Power Co. v. Green Bay &
Miss. Canal Co., 142 U.S. 254 (1891).
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Since the Chandler-Dunbar case, the Court has come, in effect,
to hold that it will sustain any act of Congress, which purports to be
for the improvement of navigation, whatever other purposes it may also
embody, nor does the stream involved have to be one ``navigable in its
natural state.'' Such, at least, seems to be the sum of its holdings in
Arizona v. California,\652\ and United States v. Appalachian Power
Co.\653\ In the former, the Court, speaking through Justice Brandeis,
said that it was not free to inquire into the motives ``which induced
members of Congress to enact the Boulder Canyon Project Act,'' adding:
``As the river is navigable and the means which the Act provides are not
unrelated to the control of navigation . . . the erection and
maintenance of such dam and reservoir are clearly within the powers
conferred upon Congress. Whether the particular structures proposed are
reasonably necessary, is not for this Court to determine. . . . And the
fact that purposes other than navigation will also be served could not
invalidate the exercise of the authority conferred, even if those other
purposes would not alone have justified an exercise of congressional
power.''\654\
\652\283 U.S. 423 (1931).
\653\311 U.S. 377 (1940).
\654\283 U.S., 455-456. See also United States v. Twin City
Power Co., 350 U.S. 222, 224 (1956).
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And in the Appalachian Power case, the Court, abandoning
previous holdings laying down the doctrine that to be subject to
Congress' power to regulate commerce a stream must be ``navigable in
fact,'' said: ``A waterway, otherwise suitable for navigation, is not
barred from that classification merely because artificial aids must make
the highway suitable for use before commercial navigation may be
undertaken,'' provided there must be a ``balance between cost and need
at a time when the improvement would be useful. . . . Nor is it
necessary that the improvements should be actually
[[Page 175]]
completed or even authorized. The power of Congress over commerce is not
to be hampered because of the necessity for reasonable improvements to
make an interstate waterway available for traffic. . . . Nor is it
necessary for navigability that the use should be continuous. . . . Even
absence of use over long periods of years, because of changed
conditions, . . . does not affect the navigability of rivers in the
constitutional sense.''\655\
\655\311 U.S., 407, 409-410.
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Furthermore, the Court defined the purposes for which Congress
may regulate navigation in the broadest terms. ``It cannot properly be
said that the constitutional power of the United States over its waters
is limited to control for navigation. . . . That authority is as broad
as the needs of commerce. . . . Flood protection, watershed development,
recovery of the cost of improvements through utilization of power are
likewise parts of commerce control.''\656\ These views the Court has
since reiterated.\657\ Nor is it by virtue of Congress' power over
navigation alone that the National Government may develop water power.
Its war powers and powers of expenditure in furtherance of the common
defense and the general welfare supplement its powers over commerce in
this respect.\658\
\656\Id., 426.
\657\Oklahoma v. Atkinson Co., 313 U.S. 508, 523-533 passim
(1941).
\658\Ashwander v. Tennessee Valley Authority, 297 U.S. 288
(1936).
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Congressional Regulation of Land Transportation
Federal Stimulation of Land Transportation.--The settlement of
the interior of the country led Congress to seek to facilitate access by
first encouraging the construction of highways. In successive acts, it
authorized construction of the Cumberland and the National Road from the
Potomac across the Alleghenies to the Ohio, reserving certain public
lands and revenues from land sales for construction of public roads to
new States granted statehood.\659\ Acquisition and settlement of
California stimulated interest in railway lines to the west, but it was
not until the Civil War that Congress voted aid in the construction of a
line from the Missouri River to the Pacific; four years later, it
chartered the Union Pacific Company.\660\
\659\Cf. Indiana v. United States, 148 U.S. 148 (1893).
\660\12 Stat. 489 (1862); 13 Stat. 356 (1864); 14 Stat. 79
(1866).
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The litigation growing out of these and subsequent activities
settled several propositions. First, Congress may provide highways and
railways for interstate transportation;\661\ second, it may char
[[Page 176]]
ter private corporations for that purpose; third, it may vest such
corporations with the power of eminent domain in the States; and fourth,
it may exempt their franchises from state taxation.\662\
\661\The result then as well as now might have followed from
Congress' power of spending, independently of the commerce clause, as
well as from its war and postal powers, which were also invoked by the
Court in this connection.
\662\Thomson v. Union Pacific Railroad, 9 Wall. (76 U.S.) 579
(1870); California v. Pacific Railroad Co. (Pacific Ry. Cases), 127 U.S.
1 (1888); Cherokee Nation v. Southern Kansas Railway Co., 135 U.S. 641
(1890); Luxton v. North River Bridge Co., 153 U.S. 525 (1894).
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Federal Regulation of Land Transportation.--Congressional
regulation of railroads may be said to have begun in 1866. By the
Garfield Act, Congress authorized all railroad companies operating by
steam to interconnect with each other ``so as to form continuous lines
for the transportation of passengers, freight, troops, governmental
supplies, and mails, to their destination.''\663\ An act of the same
year provided federal chartering and protection from conflicting state
regulations to companies formed to construct and operate telegraph
lines.\664\ Another act regulated the transportation by railroad of
livestock so as to preserve the health and safety of the animals.\665\
\663\14 Stat. 66 (1866).
\664\14 Stat. 221 (1866).
\665\17 Stat. 353 (1873).
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Congress' entry into the rate regulation field was preceded by
state attempts to curb the abuses of the rail lines in the Middle West,
which culminated in the ``Granger Movement.'' Because the businesses
were locally owned, the Court at first upheld state laws as not
constituting a burden on interstate commerce;\666\ but after the various
business panics of the 1870s and 1880s drove numerous small companies
into bankruptcy and led to consolidation, there emerged great interstate
systems. Thus in 1886, the Court held that a State may not set charges
for carriage even within its own boundaries of goods brought from
without the State or destined to points outside it; that power was
exclusively with Congress.\667\ In the following year, Congress passed
the original Interstate Commerce Act.\668\ A Commission was authorized
to pass upon the ``reasonableness'' of all rates by railroads for the
transportation of goods or persons in interstate commerce and to order
the discontinuance of all charges found to be ``unreasonable.'' The
Commission's basic
[[Page 177]]
authority was upheld in ICC v. Brimson,\669\ in which the Court upheld
the validity of the Act as a means ``necessary and proper'' for the
enforcement of the regulatory commerce power and in which it also
sustained the Commission's power to go to court to secure compliance
with its orders. Later decisions circumscribed somewhat the ICC's
power.\670\
\666\Munn v. Illinois, 94 U.S. 113 (1877); Chicago B. & Q. R.
Co. v. Iowa, 94 U.S. 155 (1877); Peik v. Chicago & Nw. Ry. Co., 94 U.S.
164 (1877); Pickard v. Pullman Southern Car Co., 117 U.S. 34 (1886).
\667\Wabash, St. L. & P. Ry. Co. v. Illinois, 118 U.S. 557
(1886). A variety of state regulations have been struck down on the
burdening-of-commerce rationale. E.g., Southern Pacific Co. v. Arizona
ex rel. Sullivan, 325 U.S. 761 (1945) (train length); Napier v. Atlantic
Coast Line R., 272 U.S. 605 (1926) (locomotive accessories);
Pennsylvania R. v. Public Service Comm., 250 U.S. 566 (1919). But the
Court has largely exempted regulations with a safety purpose, even a
questionable one. Brotherhood of Firemen v. Chicago, R. I. & P. R. Co.,
393 U.S. 129 (1968).
\668\24 Stat. 379 (1887).
\669\154 U.S. 447 (1894).
\670\ICC v. Alabama Midland Ry., 168 U.S. 144 (1897);
Cincinnati, N.O. & Texas Pacific Ry. v. ICC, 162 U.S. 184 (1896).
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Expansion of the Commission's authority came in the Hepburn Act
of 1906\671\ and the Mann-Elkins Act of 1910.\672\ By the former, the
Commission was explicitly empowered, after a full hearing on a
complaint, ``to determine and prescribe just and reasonable'' maximum
rates; by the latter, it was authorized to set rates on its own
initiative and empowered to suspend any increase in rates by a carrier
until it reviewed the change. At the same time, the Commission's
jurisdiction was extended to telegraphs, telephones, and cables.\673\ By
the Motor Carrier Act of 1935,\674\ the ICC was authorized to regulate
the transportation of persons and property by motor vehicle common
carriers.
\671\34 Stat. 584 (1906).
\672\36 Stat. 539 (1910).
\673\These regulatory powers are now vested, of course, in the
Federal Communications Commission.
\674\49 Stat. 543 (1935).
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The powers of the Commission today are largely defined by the
Transportation Acts of 1920\675\ and 1940.\676\ The jurisdiction of the
Commission covers not only the characteristics of the rail, motor, and
water carriers in commerce among the States but also the issuance of
securities by them and all consolidations of existing companies or
lines.\677\ Further, the Commission was charged with regulating so as to
foster and promote the meeting of the transportation needs of the
country. Thus, from a regulatory exercise originally
[[Page 178]]
begun as a method of restraint there has emerged a policy of encouraging
a consistent national transportation policy.\678\
\675\41 Stat. 474 (1920).
\676\54 Stat. 898 (1940), U.S.C. Sec. 1 et seq. The two acts
were ``intended . . . to provide a completely integrated interstate
regulatory system over motor, railroad, and water carriers.'' United
States v. Pennsylvania Railroad Co., 323 U.S. 612, 618-619 (1945). The
ICC's powers include authority to determine the reasonableness of a
joint through international rate covering transportation in the United
States and abroad and to order the domestic carriers to pay reparations
in the amount by which the rate is unreasonable. Canada Packers v.
Atchison, T. & S. F. Ry. Co., 385 U.S. 182 (1966), and cases cited.
\677\Disputes between the ICC and other Government agencies over
mergers have occupied a good deal of the Court's time. Cf. United States
v. ICC, 396 U.S. 491 (1970). See also County of Marin v. United States,
356 U.S. 412 (1958); McLean Trucking Co. v. United States, 321 U.S. 67
(1944); Penn-Central Merger & N & W Inclusion Cases, 389 U.S. 486
(1968).
\678\Among the various provisions of the Interstate Commerce Act
which have been upheld are: a section penalizing shippers for obtaining
transportation at less than published rates, Armour Packing Co. v.
United States, 209 U.S. 56 (1908); a section construed as prohibiting
the hauling of commodities in which the carrier had at the time of haul
a proprietary interest, United States v. Delaware & Hudson Co., 213 U.S.
366 (1909); a section abrogating life passes, Louisville & Nashville R.
Co. v. Mottley, 219 U.S. 467 (1911); a section authorizing the ICC to
regulate the entire bookkeeping system of interstate carriers, including
intrastate accounts, ICC v. Goodrich Transit Co., 224 U.S. 194 (1912); a
clause affecting the charging of rates different for long and short
hauls. Intermountain Rate Cases, 234 U.S. 476 (1914).
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Federal Regulation of Intrastate Rates (The Shreveport
Doctrine).--Although its statutory jurisdiction did not apply to
intrastate rate systems, the Commission early asserted the right to pass
on rates, which, though in effect on intrastate lines, gave these lines
competitive advantages over interstate lines the rates of which the
Commission had set. This power the Supreme Court upheld in a case
involving a line operating wholly intrastate in Texas but which
paralleled within Texas an interstate line operating between Louisiana
and Texas; the Texas rate body had fixed the rates of the intrastate
line substantially lower than the rate fixed by the ICC on the
interstate line. ``Wherever the interstate and intrastate transactions
of carriers are so related that the government of the one involves the
control of the other, it is Congress, and not the State, that is
entitled to prescribe the final and dominant rule, for otherwise
Congress would be denied the exercise of its constitutional authority
and the States and not the Nation, would be supreme in the national
field.''\679\
\679\Houston & Texas Railway v. United States, 234 U.S. 342,
351-352 (1914). See also, American Express Co. v. Caldwell, 244 U.S. 617
(1917); Pacific Tel. & Tel. Co. v. Tax Comm., 297 U.S. 403 (1936); Weiss
v. United States, 308 U.S. 321 (1939); Bethlehem Steel Co. v. State
Board, 330 U.S. 767 (1947); United States v. Walsh, 331 U.S. 432 (1947).
---------------------------------------------------------------------------
The same holding was applied in a subsequent case in which the
Court upheld the Commission's action in annulling intrastate passenger
rates it found to be unduly low in comparison with the rates the
Commission had established for interstate travel, thus tending to
thwart, in deference to a local interest, the general purpose of the act
to maintain an efficient transportation service for the benefit of the
country at large.\680\
\680\Wisconsin Railroad Comm. v. Chicago, B. & Q. R. Co., 257
U.S. 563 (1922). Cf. Colorado v. United States, 271 U.S. 153 (1926),
upholding an ICC order directing abandonment of an intrastate branch of
an interstate railroad. But see North Carolina v. United States, 325
U.S. 507 (1945), setting aside an ICC disallowance of intrastate rates
set by a state commission as unsupported by the evidence and findings.
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[[Page 179]]
Federal Protection of Labor in Interstate Rail Transportation.--
Federal entry into the field of protective labor legislation and the
protection of organization efforts of workers began in connection with
the railroads. The Safety Appliance Act of 1893,\681\ applying only to
cars and locomotives engaged in moving interstate traffic, was amended
in 1903 so as to embrace much of the intrastate rail systems on which
there was any connection with interstate commerce.\682\ The Court
sustained this extension in language much like that it would use in the
Shreveport case three years later.\683\ These laws were followed by the
Hours of Service Act of 1907,\684\ which prescribed maximum hours of
employment for rail workers in interstate or foreign commerce. The Court
sustained the regulation as a reasonable means of protecting workers and
the public from the hazards which could develop from long, tiring hours
of labor.\685\
\681\27 Stat. 531, 45 U.S.C. Sec. Sec. 1-7.
\682\32 Stat. 943, 45 U.S.C. Sec. Sec. 8-10.
\683\Southern Railway Co. v. United States, 222 U.S. 20 (1911).
See also Texas & Pacific Ry. Co. v. Rigsby, 241 U.S. 33 (1916); United
States v. California, 297 U.S. 175 (1936); United States v. Seaboard Air
Line R., 361 U.S. 78 (1959).
\684\34 Stat. 1415, 45 U.S.C. Sec. Sec. 61-64.
\685\Baltimore & Ohio Railroad v. ICC, 221 U.S. 612 (1911).
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Most far-reaching of these regulatory measures were the Federal
Employers Liability Acts of 1906\686\ and 1908.\687\ These laws were
intended to modify the common-law rules with regard to the liability of
employers for injuries suffered by their employees in the course of
their employment and under which employers were generally not liable.
Rejecting the argument that regulation of such relationships between
employers and employees was a reserved state power, the Court adopted
the argument of the United States that Congress was empowered to do
anything it might deem appropriate to save interstate commerce from
interruption or burdening and that inasmuch as the labor of employees
was necessary for the function of commerce Congress could certainly act
to ameliorate conditions that made labor less efficient, less
economical, and less reliable. Assurance of compensation for injuries
growing out of negligence in the course of employment was such a
permissible regulation.\688\
\686\34 Stat. 232, held unconstitutional in part in the
Employers' Liability Cases, 207 U.S. 463 (1908).
\687\35 Stat. 65, 45 U.S.C. Sec. Sec. 51-60.
\688\The Second Employers Liability Cases, 223 U.S. 1 (1912).
For a longer period, a Court majority reviewed a surprising large number
of FELA cases, almost uniformly expanding the scope of recovery under
the statute. Cf. Rogers v. Missouri Pacific R., 352 U.S. 500 (1957).
This practice was criticized both within and without the Court, cf.
Ferguson v. Moore-McCormack Lines, 352 U.S. 521, 524 (1957) (Justice
Frankfurter dissenting); Hart, ``Foreword: The Time Chart of the
Justices,'' 73 Harv. L. Rev. 84, 96-98 (1959), and has been
discontinued.
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[[Page 180]]
Legislation and litigation dealing with the organizational
rights of rail employees are dealt with elsewhere.\689\
\689\Infra, pp. 189-190, 191 n. 739.
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Regulation of Other Agents of Carriage and Communications.--In
1914, the Court affirmed the power of Congress to regulate the
transportation of oil and gas in pipe lines from one State to another
and held that this power applied to the transportation even though the
oil or gas was the property of the lines.\690\ Subsequently, the Court
struck down state regulation of rates of electric current generated
within that State and sold to a distributor in another State as a burden
on interstate commerce.\691\ Proceeding on the assumption that the
ruling meant the Federal Government had the power, Congress in the
Federal Power Act of 1935 conferred on the Federal Power Commission
authority to regulate the wholesale distribution of electricity in
interstate commerce\692\ and three years later vested the FPC with like
authority over natural gas moving in interstate commerce.\693\
Thereafter, the Court sustained the power of the Commission to set the
prices at which gas originating in one State and transported into
another should be sold to distributors wholesale in the latter
State.\694\ ``The sale of natural gas originating in the State and its
transportation and delivery to distributors in any other State
constitutes interstate commerce, which is subject to regulation by
Congress. . . . The authority of Congress to regulate the prices of
commodities in interstate commerce is at least as great under the Fifth
Amendment as is that of the States under the Fourteenth to regulate the
prices of commodities in intrastate commerce.''\695\
\690\The Pipe Line Cases, 234 U.S. 548 (1914). See also State
Comm. v. Wichita Gas Co., 290 U.S. 561 (1934); Eureka Pipe Line Co. v.
Hallanan, 257 U.S. 265 (1921); United Fuel Gas Co. v. Hallanan, 257 U.S.
277 (1921); Pennsylvania v. West Virginia, 262 U.S. 553 (1923); Missouri
ex rel. Barrett v. Kansas Gas Co., 265 U.S. 298 (1924).
\691\Public Utilities Comm. v. Attleboro Co., 273 U.S. 83
(1927). See also Utah Power & Light Co. v. Pfost, 286 U.S. 165 (1932);
Pennsylvania Power Co. v. FPC, 343 U.S. 414 (1952).
\692\49 Stat. 863, 16 U.S.C. Sec. Sec. 791a-825u.
\693\52 Stat. 821, 15 U.S.C. Sec. Sec. 717-717w.
\694\FPC v. Natural Gas Pipeline Co., 315 U.S. 575 (1942).
\695\Id., 582. Sales to distributors by a wholesaler of natural
gas delivered to it from out-of-state sources are subject to FPC
jurisdiction. Colorado-Wyoming Co. v. FPC, 324 U.S. 626 (1945). See also
Illinois Gas Co. v. Public Service Co., 314 U.S. 498 (1942); FPC v. East
Ohio Gas Co., 338 U.S. 464 (1950). In Phillips Petroleum Co. v.
Wisconsin, 347 U.S. 672 (1954), the Court ruled that an independent
company engaged in one State in production, gathering, and processing of
natural gas, which it thereafter sells in the same State to pipelines
that transport and sell the gas in other States is subject to FPC
jurisdiction. See also California v. Lo-Vaca Gathering Co., 379 U.S. 366
(1965).
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Other acts regulating commerce and communication originating in
this period have evoked no basic constitutional challenge.
[[Page 181]]
These include the Federal Communications Act of 1934, providing for the
regulation of interstate and foreign communication by wire and
radio,\696\ and the Civil Aeronautics Act of 1938, providing for the
regulation of all phases of airborne commerce, foreign and
interstate.\697\
\696\48 Stat. 1064, 47 U.S.C. Sec. 151 et seq. Cf. United States
v. Southwestern Cable Co., 392 U.S. 157 (1968), on the regulation of
community antenna television systems (CATV).
\697\52 Stat. 973, as amended. The CAB has now been abolished
and its functions are exercised by the Federal Aviation Commission, 49
U.S.C. Sec. 106, as part of the Department of Transportation.
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Congressional Regulation of Commerce as Traffic
The Sherman Act: Sugar Trust Case.--Congress' chief effort to
regulate commerce in the primary sense of ``traffic'' is embodied in the
Sherman Antitrust Act of 1890, the opening section of which declares
``every contract, combination in the form of trust or otherwise,'' or
``conspiracy in restraint of trade and commerce among the several
States, or with foreign nations'' to be ``illegal,'' while the second
section makes it a misdemeanor for anybody to ``monopolize or attempt to
monopolize any part of such commerce.''\698\ The act was passed to curb
the growing tendency to form industrial combinations and the first case
to reach the Court under it was the famous Sugar Trust Case, United
States v. E. C. Knight Co.\699\ Here the Government asked for the
cancellation of certain agreements, whereby the American Sugar Refining
Company, had ``acquired,'' it was conceded, ``nearly complete control of
the manufacture of refined sugar in the United States.''
\698\26 Stat. 209 (1890); 15 U.S.C. Sec. Sec. 1-7.
\699\156 U.S. 1 (1895).
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The question of the validity of the Act was not expressly
discussed by the Court but was subordinated to that of its proper
construction. The Court, in pursuance of doctrines of constitutional law
then dominant with it, turned the Act from its intended purpose and
destroyed its effectiveness for several years, as that of the Interstate
Commerce Act was being contemporaneously impaired. The following passage
early in Chief Justice Fuller's opinion for the Court, sets forth the
conception of the federal system that controlled the decision: ``It is
vital that the independence of the commercial power and of the police
power, and the delimination between them, however sometimes perplexing,
should always be recognized and observed, for while the one furnishes
the strongest bond of union, the other is essential to the preservation
of the autonomy of the States as required by our dual form of
government; and acknowledged evils, however grave and urgent they may ap
[[Page 182]]
pear to be, had better be borne, than the risk be run, in the effort to
suppress them, of more serious consequences by resort to expedients of
even doubtful constitutionality.''\700\
\700\Id., 13.
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In short, what was needed, the Court felt, was a hard and fast
line between the two spheres of power, and in a series of propositions
it endeavored to lay down such a line: (1) production is always local,
and under the exclusive domain of the States; (2) commerce among the
States does not begin until goods ``commence their final movement from
their State of origin to that of their destination;'' (3) the sale of a
product is merely an incident of its production and, while capable of
``bringing the operation of commerce into play,'' affects it only
incidentally; (4) such restraint as would reach commerce, as above
defined, in consequence of combinations to control production ``in all
its forms,'' would be ``indirect, however inevitable and whatever its
extent,'' and as such beyond the purview of the Act.\701\ Applying the
above reasoning to the case before it, the Court proceeded: ``The object
[of the combination] was manifestly private gain in the manufacture of
the commodity, but not through the control of interstate or foreign
commerce. It is true that the bill alleged that the products of these
refineries were sold and distributed among the several States, and that
all the companies were engaged in trade or commerce with the several
States and with foreign nations; but this was no more than to say that
trade and commerce served manufacture to fulfill its function.
\701\Id., 13-16.
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``Sugar was refined for sale, and sales were probably made at
Philadelphia for consumption, and undoubtedly for resale by the first
purchasers throughout Pennsylvania and other States, and refined sugar
was also forwarded by the companies to other States for sale.
Nevertheless it does not follow that an attempt to monopolize, or the
actual monopoly of, the manufacture was an attempt, whether executory or
consummated, to monopolize commerce, even though, in order to dispose of
the product, the instrumentality of commerce was necessarily invoked.
There was nothing in the proofs to indicate any intention to put a
restraint upon trade or commerce, and the fact, as we have seen that
trade or commerce might be indirectly affected was not enough to entitle
complainants to a decree.''\702\
\702\Id., 17. The doctrine of the case boiled down to the
proposition that commerce was transportation only, a doctrine that
Justice Harlan undertook to refute in his notable dissenting opinion.
``Interstate commerce does not, therefore, consist in transportation
simply. It includes the purchase and sale of articles that are intended
to be transported from one State to another--every species of commercial
intercourse among the States and with foreign nations'' Id., 22. ``Any
combination, therefore, that disturbs or unreasonably obstructs freedom
in buying and selling articles manufactured to be sold to persons in
other States or to be carried to other States--a freedom that cannot
exist if the right to buy and sell is fettered by unlawful restraints
that crush out competition--affects, not incidentally, but directly, the
people of all the States; and the remedy for such an evil is found only
in the exercise of powers confided to a government which, this court has
said, was the government of all, exercising powers delegated by all,
representing all, acting for all. McCulloch v. Maryland, 4 Wheat. 316,
405,'' Id., 33.
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[[Page 183]]
Sherman Act Revived.--Four years later came the case of Addyston
Pipe and Steel Co. v. United States,\703\ in which the Antitrust Act was
successfully applied as against an industrial combination for the first
time. The agreements in the case, the parties to which were
manufacturing concerns, effected a division of territory among them, and
so involved, it was held, a ``direct'' restraint on the distribution and
hence of the transportation of the products of the contracting firms.
The holding, however, did not question the doctrine of the earlier case,
which in fact continued substantially undisturbed until 1905, when Swift
and Co. v. United States,\704\ was decided.
\703\175 U.S. 211 (1899).
\704\196 U.S. 375 (1905). The Sherman Act was applied to break
up combinations of interstate carriers in United States v. Trans-
Missouri Freight Assn., 166 U.S. 290 (1897); United States v. Joint-
Traffic Association, 171 U.S. 505 (1898); and Northern Securities Co. v.
United States, 193 U.S. 197 (1904).
In Mandeville Island Farms v. American Crystal Sugar Co., 334
U.S. 219, 229-239 (1948), Justice Rutledge, for the Court, critically
reviewed the jurisprudence of the limitations on the Act and and the
deconstruction of the judicial constraints. In recent years, the Court's
decisions have permitted the reach of the Sherman Act to expand along
with the expanding notions of congressional power. Gulf Oil Corp. v.
Copp Paving Co., 419 U.S. 186 (1974); Hospital Building Co. v. Rex
Hospital Trustees, 425 U.S. 738 (1976); McLain v. Real Estate Board of
New Orleans, 444 U.S. 232 (1980); Summit Health, Ltd. v. Pinhas, 500
U.S. 322 (1991). The Court, however, does insist that plaintiffs
alleging that an intrastate activity violates the Act prove the
relationship to interstate commerce set forth in the Act. Gulf Oil Corp,
supra, 194-199.
---------------------------------------------------------------------------
The ``Current of Commerce'' Concept: The Swift Case.--Defendants
in Swift were some thirty firms engaged in Chicago and other cities in
the business of buying livestock in their stockyards, in converting it
at their packing houses into fresh meat, and in the sale and shipment of
such fresh meat to purchasers in other States. The charge against them
was that they had entered into a combination to refrain from bidding
against each other in the local markets, to fix the prices at which they
would sell, to restrict shipments of meat, and to do other forbidden
acts. The case was appealed to the Supreme Court on defendants'
contention that certain of the acts complained of were not acts of
interstate commerce and so did not fall within a valid reading of the
Sherman Act. The Court, however, sustained the Government on the ground
that the
[[Page 184]]
``scheme as a whole'' came within the act, and that the local activities
alleged were simply part and parcel of this general scheme.\705\
\705\Swift and Co. v. United States, 196 U.S. 375, 396 (1905).
---------------------------------------------------------------------------
Referring to the purchase of livestock at the stockyards, the
Court, speaking by Justice Holmes, said: ``Commerce among the States is
not a technical legal conception, but a practical one, drawn from the
course of business. When cattle are sent for sale from a place in one
State, with the expectation that they will end their transit, after
purchase, in another, and when in effect they do so, with only the
interruption necessary to find a purchaser at the stockyards, and when
this is a typical, constantly recurring course, the current thus
existing is a current of commerce among the States, and the purchase of
the cattle is a part and incident of such commerce.''\706\ Likewise the
sales alleged of fresh meat at the slaughtering places fell within the
general design. Even if they imported a technical passing of title at
the slaughtering places, they also imported that the sales were to
persons in other States, and that shipments to such States were part of
the transaction.\707\ Thus, sales of the type that in the Sugar Trust
case were thrust to one side as immaterial from the point of view of the
law, because they enabled the manufacturer ``to fulfill its function,''
were here treated as merged in an interstate commerce stream.
\706\Id., 398-399.
\707\Id., 399-401.
---------------------------------------------------------------------------
Thus, the concept of commerce as trade, that is, as traffic,
again entered the constitutional law picture, with the result that
conditions directly affecting interstate trade could not be dismissed on
the ground that they affected interstate commerce, in the sense of
interstate transportation, only ``indirectly.'' Lastly, the Court added
these significant words: ``But we do not mean to imply that the rule
which marks the point at which State taxation or regulation becomes
permissible necessarily is beyond the scope of interference by Congress
in cases where such interference is deemed necessary for the protection
of commerce among the States.''\708\ That is to say, the line that
confines state power from one side does not always confine national
power from the other. Even though the line accurately divides the
subject matter of the complementary spheres, national power is always
entitled to take on the additional extension that is requisite to
guarantee its effective exercise and is furthermore supreme.
\708\Id., 400.
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The Danbury Hatters Case.--In this respect, the Swift case only
states what the Shreveport case was later to declare more explicitly,
and the same may be said of an ensuing series of cases in
[[Page 185]]
which combinations of employees engaged in such intrastate activities as
manufacturing, mining, building, construction, and the distribution of
poultry were subjected to the penalties of the Sherman Act because of
the effect or intended effect of their activities on interstate
commerce.\709\
\709\Loewe v. Lawlor (The Danbury Hatters Case), 208 U.S. 274
(1908); Duplex Printing Press Co. v. Deering, 254 U.S. 443 (1921);
Coronado Co. v. United Mine Workers, 268 U.S. 295 (1925); United States
v. Bruins, 272 U.S. 549 (1926); Bedford Co. v. Stone Cutters Assn., 274
U.S. 37 (1927); Local 167 v. United States, 291 U.S. 293 (1934); Allen
Bradley Co. v. Union, 325 U.S. 797 (1945); United States v. Employing
Plasterers Assn., 347 U.S. 186 (1954); United States v. Green, 350 U.S.
415 (1956); Callanan v. United States, 364 U.S. 587 (1961).
---------------------------------------------------------------------------
Stockyards and Grain Futures Acts.--In 1921, Congress passed the
Packers and Stockyards Act\710\ whereby the business of commission men
and livestock dealers in the chief stockyards of the country was brought
under national supervision, and in the year following it passed the
Grain Futures Act\711\ whereby exchanges dealing in grain futures were
subjected to control. The decisions of the Court sustaining these
measures both built directly upon the Swift case.
\710\42 Stat. 159, 7 U.S.C. Sec. Sec. 171-183, 191-195, 201-203.
\711\42 Stat. 998 (1922), 7 U.S.C. Sec. Sec. 1-9, 10a-17.
---------------------------------------------------------------------------
In Stafford v. Wallace,\712\ which involved the former act,
Chief Justice Taft, speaking for the Court, said: ``The object to be
secured by the act is the free and unburdened flow of livestock from the
ranges and farms of the West and Southwest through the great stockyards
and slaughtering centers on the borders of that region, and thence in
the form of meat products to the consuming cities of the country in the
Middle West and East, or, still as livestock, to the feeding places and
fattening farms in the Middle West or East for further preparation for
the market.''\713\ The stockyards, therefore, were ``not a place of rest
or final destination.'' They were ``but a throat through which the
current flows,'' and the sales there were not merely local transactions.
``They do not stop the flow;--but, on the contrary'' are ``indispensable
to its continuity.''\714\
\712\258 U.S. 495 (1922).
\713\Id., 514.
\714\Id., 515-516. See also Lemke v. Farmers' Grain Co., 258
U.S. 50 (1922); Minnesota v. Blasius, 290 U.S. 1 (1933).
---------------------------------------------------------------------------
In Chicago Board of Trade v. Olsen,\715\ involving the Grain
Futures Act, the same course of reasoning was repeated. Speaking of the
Swift case, Chief Justice Taft remarked: ``That case was a milestone in
the interpretation of the commerce clause of the Constitution. It
recognized the great changes and development in the business of this
vast country and drew again the dividing line between interstate and
intrastate commerce where the Constitution in
[[Page 186]]
tended it to be. It refused to permit local incidents of a great
interstate movement, which taken alone are intrastate, to characterize
the movement as such.''\716\
\715\262 U.S. 1 (1923).
\716\Id., 35.
---------------------------------------------------------------------------
Of special significance, however, is the part of the opinion
devoted to showing the relation between future sales and cash sales, and
hence the effect of the former upon the interstate grain trade. The
test, said the Chief Justice, was furnished by the question of price.
``The question of price dominates trade between the States. Sales of an
article which affect the country-wide price of the article directly
affect the country-wide commerce in it.''\717\ Thus a practice which
demonstrably affects prices would also affect interstate trade
``directly,'' and so, even though local in itself, would fall within the
regulatory power of Congress. In the following passage, indeed, Chief
Justice Taft whittled down, in both cases, the ``direct-indirect''
formula to the vanishing point: ``Whatever amounts to more or less
constant practice, and threatens to obstruct or unduly to burden the
freedom of interstate commerce is within the regulatory power of
Congress under the commerce clause, and it is primarily for Congress to
consider and decide the fact of the danger to meet it. This court will
certainly not substitute its judgment for that of Congress in such a
matter unless the relation of the subject to interstate commerce and its
effect upon it are clearly nonexistent.''\718\
\717\Id., 40.
\718\Id., 37, quoting Stafford v. Wallace, 258 U.S. 495, 521
(1922).
---------------------------------------------------------------------------
It was in reliance on the doctrine of these cases that Congress
first set to work to combat the Depression in 1933 and the years
immediately following. But in fact, much of its legislation at this time
marked a wide advance upon the measures just passed in review. They did
not stop with regulating traffic among the States and the
instrumentalities thereof; they also essayed to govern production and
industrial relations in the field of production. Confronted with this
expansive exercise of Congress' power, the Court again deemed itself
called upon to define a limit to the commerce power that would save to
the States their historical sphere, and especially their customary
monopoly of legislative power in relation to industry and labor
management.
Securities and Exchange Commission.--Not all antidepression
legislation, however, was of this new approach. The Securities Exchange
Act of 1934\719\ and the Public Utility Company Act (``Wheeler-Rayburn
Act'') of 1935\720\ were not. The former cre
[[Page 187]]
ated the Securities and Exchange Commission and authorized it to lay
down regulations designed to keep dealing in securities honest and
aboveboard and closed the channels of interstate commerce and the mails
to dealers refusing to register under the act. The latter required the
companies governed by it to register with the Securities and Exchange
Commission and to inform it concerning their business, organization and
financial structure, all on pain of being prohibited use of the
facilities of interstate commerce and the mails; while by Sec. 11, the
so-called ``death sentence'' clause, the same act closed after a certain
date the channels of interstate communication to certain types of public
utility companies whose operations, Congress found, were calculated
chiefly to exploit the investing and consuming public. All these
provisions have been sustained,\721\ Gibbons v. Ogden furnishing the
Court its principle reliance.
\719\48 Stat. 881, 15 U.S.C. Sec. 77b et seq.
\720\49 Stat. 803, 15 U.S.C. Sec. Sec. 79-79z-6.
\721\Electric Bond Co. v. SEC, 303 U.S. 419 (1938); North
American Co. v. SEC, 327 U.S. 686 (1946); American Power Co., v. SEC,
329 U.S. 90 (1946).
---------------------------------------------------------------------------
Congressional Regulation of Production and Industrial Relations:
Antidepression Legislation
In the words of Chief Justice Hughes, spoken in a case decided a
few days after President Franklin D. Roosevelt's first inauguration, the
problem then confronting the new Administration was clearly set forth.
``When industry is grievously hurt, when producing concerns fail, when
unemployment mounts and communities dependent upon profitable production
are prostrated, the wells of commerce go dry.''\722\
\722\Appalachian Coals v. United States, 288 U.S. 344, 372
(1933).
---------------------------------------------------------------------------
National Industrial Recovery Act.--The initial effort of
Congress to deal with this situation was embodied in the National
Industrial Recovery Act of June 16, 1933.\723\ The opening section of
the Act asserted the existence of ``a national emergency productive of
widespread unemployment and disorganization of industry which'' burdened
``interstate and foreign commerce,'' affected ``the public welfare,''
and undermined ``the standards of living of the American people.'' To
affect the removal of these conditions the President was authorized,
upon the application of industrial or trade groups, to approve ``codes
of fair competition,'' or to prescribe the same in cases where such
applications were not duly forthcoming. Among other things such codes,
of which eventually more than 700 were promulgated, were required to lay
down rules of fair dealing with customers and to furnish labor certain
guarantees respect
[[Page 188]]
ing hours, wages and collective bargaining. For the time being, business
and industry were to be cartelized on a national scale.
\723\48 Stat. 195.
---------------------------------------------------------------------------
In A.L.A. Schechter Poultry Corp. v. United States,\724\ one of
these codes, the Live Poultry Code, was pronounced unconstitutional.
Although it was conceded that practically all poultry handled by the
Schechters came from outside the State, and hence via interstate
commerce, the Court held, nevertheless, that once the chickens came to
rest in the Schechter's wholesale market, interstate commerce in them
ceased. The act, however, also purported to govern business activities
which ``affected'' interstate commerce. This, Chief Justice Hughes held,
must be taken to mean ``directly'' affect such commerce: ``the
distinction between direct and indirect effects of intrastate
transactions upon interstate commerce must be recognized as a
fundamental one, essential to the maintenance of our constitutional
system. Otherwise, . . . there would be virtually no limit to the
federal power and for all practical purposes we should have a completely
centralized government.''\725\ In short, the case was governed by the
ideology of the Sugar Trust case, which was not mentioned in the
Court's opinion.\726\
\724\295 U.S. 495 (1935).
\725\Id., 548. See also id., 546.
\726\In United States v. Sullivan, 332 U.S. 689 (1948), the
Court interpreted the Federal Food, Drug, and Cosmetics Act of 1938 as
applying to the sale by a retailer of drugs purchased from his
wholesaler within the State nine months after their interstate shipment
had been completed. The Court, speaking by Justice Black, cited United
States v. Walsh, 331 U.S. 432 (1947); Wickard v. Filburn, 317 U.S. 111
(1942); United States v. Wrightwood Dairy Co., 315 U.S. 110 (1942);
United States v. Darby, 312 U.S. 100 (1941). Justice Frankfurter
dissented on the basis of FTC v. Bunte Bros., 312 U.S. 349 (1941). It is
apparent that the Schechter case has been thoroughly repudiated so far
as the distinction between ``direct'' and ``indirect'' effects is
concerned. Cf. Perez v. United States, 402 U.S. 146 (1971). See also
McDermott v. Wisconsin, 228 U.S. 115 (1913), which preceded the
Schechter decision by more than two decades.
The NIRA, however, was found to have several other
constitutional infirmities besides its disregard, as illustrated by the
Live Poultry Code, of the ``fundamental'' distinction between ``direct''
and ``indirect'' effects, namely, the delegation of uncanalized
legislative power, the absence of any administrative procedural
safeguards, the absence of judicial review, and the dominant role played
by private groups in the general scheme of regulation.
---------------------------------------------------------------------------
Agricultural Adjustment Act.--Congress' second attempt to combat
the Depression comprised the Agricultural Adjustment Act of 1933.\727\
As is pointed out elsewhere, the measure was set aside as an attempt to
regulate production, a subject held to be ``prohibited'' to the United
States by the Tenth Amendment.\728\
\727\48 Stat. 31 (1933).
\728\United States v. Butler, 297 U.S. 1, 63-64, 68 (1936).
---------------------------------------------------------------------------
Bituminous Coal Conservation Act.--The third measure to be
disallowed was the Guffey-Snyder Bituminous Coal Conserva
[[Page 189]]
tion Act of 1935.\729\ The statute created machinery for the regulation
of the price of soft coal, both that sold in interstate commerce and
that sold ``locally,'' and other machinery for the regulation of hours
of labor and wages in the mines. The clauses of the act dealing with
these two different matters were declared by the act itself to be
separable so that the invalidity of the one set would not affect the
validity of the other, but this strategy was ineffectual. A majority of
the Court, speaking by Justice Sutherland, held that the act constituted
one connected scheme of regulation, which, inasmuch as it invaded the
reserved powers of the States over conditions of employment in
productive industry, was violative of the Constitution.\730\ Justice
Sutherland's opinion set out from Chief Justice Hughes' assertion in the
Schechter case of the ``fundamental'' character of the distinction
between ``direct'' and ``indirect'' effects, that is to say, from the
doctrine of the Sugar Trust case. It then proceeded: ``Much stress is
put upon the evils which come from the struggle between employers and
employees over the matter of wages, working conditions, the right of
collective bargaining, etc., and the resulting strikes, curtailment and
irregularity of production and effect on prices; and it is insisted that
interstate commerce is greatly affected thereby. But . . . the
conclusive answer is that the evils are all local evils over which the
Federal Government has no legislative control. The relation of employer
and employee is a local relation. At common law, it is one of the
domestic relations. The wages are paid for the doing of local work.
Working conditions are obviously local conditions. The employees are not
engaged in or about commerce, but exclusively in producing a commodity.
And the controversies and evils, which it is the object of the act to
regulate and minimize, are local controversies and evils affecting local
work undertaken to accomplish that local result. Such effect as they may
have upon commerce, however extensive it may be, is secondary and
indirect. An increase in the greatness of the effect adds to its
importance. It does not alter its character.''\731\
\729\49 Stat. 991 (1935).
\730\Carter v. Carter Coal Co., 298 U.S. 238 (1936).
\731\Id., 308-309.
---------------------------------------------------------------------------
Railroad Retirement Act.--Still pursuing the idea of protecting
commerce and the labor engaged in it concurrently, Congress, by the
Railroad Retirement Act of June 27, 1934,\732\ ordered the compulsory
retirement of superannuated employees of interstate carriers, and
provided that they be paid pensions out of a fund comprising compulsory
contributions from the carriers and their present and future employees.
In Railroad Retirement Board v.
[[Page 190]]
Alton R. Co.,\733\ however, a closely divided Court held this
legislation to be in excess of Congress' power to regulate commerce and
contrary to the due process clause of the Fifth Amendment. Said Justice
Roberts for the majority: ``We feel bound to hold that a pension plan
thus imposed is in no proper sense a regulation of the activity of
interstate transportation. It is an attempt for social ends to impose by
sheer fiat noncontractual incidents upon the relation of employer and
employee, not as a rule or regulation of commerce and transportation
between the States, but as a means of assuring a particular class of
employees against old age dependency. This is neither a necessary nor an
appropriate rule or regulation affecting the due fulfillment of the
railroads' duty to serve the public in interstate transportation.''\734\
\732\48 Stat. 1283 (1934).
\733\295 U.S. 330 (1935).
\734\Id., 374.
---------------------------------------------------------------------------
Chief Justice Hughes, speaking for the dissenters, contended, on
the contrary, that ``the morale of the employees [had] an important
bearing upon the efficiency of the transportation service.'' He added:
``The fundamental consideration which supports this type of legislation
is that industry should take care of its human wastage, whether that is
due to accident or age. That view cannot be dismissed as arbitrary or
capricious. It is a reasoned conviction based upon abundant experience.
The expression of that conviction in law is regulation. When expressed
in the government of interstate carriers, with respect to their
employees likewise engaged in interstate commerce, it is a regulation of
that commerce. As such, so far as the subject matter is concerned, the
commerce clause should be held applicable.''\735\ Under subsequent
legislation, an excise is levied on interstate carriers and their
employees, while by separate but parallel legislation a fund is created
in the Treasury out of which pensions are paid along the lines of the
original plan. The constitutionality of this scheme appears to be taken
for granted in Railroad Retirement Board v. Duquesne Warehouse Co.\736\
\735\Id., 379, 384.
\736\326 U.S. 446 (1946). Indeed, in a case decided in June,
1948, Justice Rutledge, speaking for a majority of the Court, listed the
Alton case as one ``foredoomed to reversal,'' though the formal reversal
has never taken place. See Mandeville Island Farms v. American Crystal
Sugar Co., 334 U.S. 219, 230 (1948). Cf. Usery v. Turner Elkhorn Mining
Co., 428 U.S. 1, 19 (1976).
---------------------------------------------------------------------------
National Labor Relations Act.--The case in which the Court
reduced the distinction between ``direct'' and ``indirect'' effects to
the vanishing point and thereby placed Congress in the position to
regulate productive industry and labor relations in these industries was
NLRB v. Jones & Laughlin Steel Corp.\737\ Here the
[[Page 191]]
statute involved was the National Labor Relations Act of 1935,\738\
which declared the right of workers to organize, forbade unlawful
employer interference with this right, established procedures by which
workers could choose exclusive bargaining representatives with which
employers were required to bargain, and created a board to oversee all
these processes.\739\
\737\301 U.S. 1 (1937). A major political event had intervened
between this decision and those described in the preceding pages.
President Roosevelt, angered at the Court's invalidation of much of his
depression program, proposed a ``reorganization'' of the Court by which
he would have been enabled to name one new Justice for each Justice on
the Court who was more than 70 years old, in the name of ``judicial
efficiency.'' The plan was defeated in the Senate, in part, perhaps,
because in such cases as Jones & Laughlin a Court majority began to
demonstrate sufficient ``judicial efficiency.'' See Leuchtenberg, The
Origins of Franklin D. Roosevelt's ``Court-Packing'' Plan, 1966 Sup. Ct.
Rev. 347 (P. Kurland ed.); Mason, Harlan Fiske Stone and FDR's Court
Plan,'' 61 Yale L. J. 791 (1952); 2 M. Pusey, Charles Evans Hughes
(Cambridge: 1951), 759-765.
\738\49 Stat. 449, as amended, 29 U.S.C. Sec. 151 et seq.
\739\The NLRA was enacted not only against the backdrop of
depression, although obviously it went far beyond being a mere
antidepression measure, but Congress could as well look to its
experience in railway labor legislation. In 1898, Congress passed the
Erdman Act, 30 Stat. 424, which attempted to influence the unionization
of railroad workers and facilitate negotiations with employers through
mediation. The statute fell largely into disuse because the railroads
refused to mediate. Additionally, in Adair v. United States, 208 U.S.
161 (1908), the Court struck down a section of the law outlawing
``yellow-dog contracts,'' by which employers exacted promises of workers
to quit or not to join unions as a condition of employment. The Court
held the section not to be a regulation of commerce, there being no
connection between an employee's membership in a union and the carrying
on of interstate commerce. Cf. Coppage v. Kansas, 236 U.S. 1 (1915).
The Court did uphold in Wilson v. New, 243 U.S. 332 (1917), a
congressional settlement of a threatened rail strike through the
enactment of an eight-hour day and a time-and-a-half for overtime for
all interstate railway employees. The national emergency confronting the
Nation was cited by the Court but with the implication that the power
existed in more normal times, suggesting that Congress' powers were not
as limited as some judicial decisions had indicated.
Congress' enactment of the Railway Labor Act in 1926, 44 Stat.
577, as amended, 45 U.S.C. Sec. 151 et seq., was sustained by a Court
decision admitting the connection between interstate commerce and union
membership as a substantial one. Texas & N.L.R. Co. v. Brotherhood of
Railway Clerks, 281 U.S. 548 (1930). A subsequent decision sustained the
application of the Act to ``back shop'' employees of an interstate
carrier who engaged in making heavy repairs on locomotives and cars
withdrawn from service for long periods, the Court finding that the
activities of these employees were related to interstate commerce.
Virginian Ry. Co. v. System Federation No. 40, 300 U.S. 515 (1937).
---------------------------------------------------------------------------
The Court, speaking through Chief Justice Hughes, upheld the Act
and found the corporation to be subject to the Act. ``The close and
intimate effect,'' he said, ``which brings the subject within the reach
of federal power may be due to activities in relation to productive
industry although the industry when separately viewed is local.'' Nor
will it do to say that such effect is ``indirect.'' Considering
defendant's ``far-flung activities,'' the effect of strife between it
and its employees ``would be immediate and [it] might be catastrophic.
We are asked to shut our eyes to the plainest facts of our national life
and to deal with the question of direct and indirect ef
[[Page 192]]
fects in an intellectual vacuum. . . . When industries organize
themselves on a national scale, making their relation to interstate
commerce the dominant factor in their activities, how can it be
maintained that their industrial labor relations constitute a forbidden
field into which Congress may not enter when it is necessary to protect
interstate commerce from the paralyzing consequences of industrial war?
We have often said that interstate commerce itself is a practical
conception. It is equally true that interferences with that commerce
must be appraised by a judgment that does not ignore actual
experience.''\740\
\740\NLRB v. Jones & Laughlin Steel Corp., 301 U.S. 1, 38, 41-42
(1937).
---------------------------------------------------------------------------
While the Act was thus held to be within the constitutional
powers of Congress in relation to a productive concern because the
interruption of its business by strike ``might be catastrophic,'' the
decision was forthwith held to apply also to two minor concerns,\741\
and in a later case the Court stated specifically that the smallness of
the volume of commerce affected in any particular case is not a material
consideration.\742\ Subsequently, the act was declared to be applicable
to a local retail auto dealer on the ground that he was an integral part
of the manufacturer's national distribution system,\743\ to a labor
dispute arising during alteration of a county courthouse because one-
half of the cost--$225,000--was attributable to materials shipped from
out-of-State,\744\ and to a dispute involving a retail distributor of
fuel oil, all of whose sales were local, but who obtained the oil from a
wholesaler who imported it from another State.\745\
\741\NLRB v. Fruehauf Trailer Co., 301 U.S. 49 (1937); NLRB v.
Friedman-Harry Marks Clothing Co., 301 U.S. 58 (1937).
\742\NLRB v. Fainblatt, 306 U.S. 601, 606 (1939).
\743\Howell Chevrolet Co. v. NLRB, 346 U.S. 482 (1953).
\744\Journeymen Plumbers' Union v. County of Door, 359 U.S. 354
(1959).
\745\NLRB v. Reliance Fuel Oil Co., 371 U.S. 224 (1963).
---------------------------------------------------------------------------
Indeed, ``[t]his Court has consistently declared that in passing
the National Labor Relations Act, Congress intended to and did vest in
the Board the fullest jurisdictional breadth constitutionally
permissible under the Commerce Clause.''\746\ Thus, the Board has
formulated jurisdictional standards which assume the requisite effect on
interstate commerce from a prescribed dollar volume of business and
these standards have been implicitly approved by the Court.\747\
\746\Id., 226. See also Guss v. Utah Labor Board, 353 U.S. 1, 3
(1957); NLRB v. Fainblatt, 306 U.S. 601, 607 (1939).
\747\NLRB v. Reliance Fuel Oil Co., 371 U.S. 224, 225 n. 2
(1963); Liner v. Jafco, 375 U.S. 301, 303 n. 2 (1964).
---------------------------------------------------------------------------
Fair Labor Standards Act.--In 1938, Congress enacted the Fair
Labor Standards Act. The measure prohibited not only the
[[Page 193]]
shipment in interstate commerce of goods manufactured by employees whose
wages are less than the prescribed maximum but also the employment of
workmen in the production of goods for such commerce at other than the
prescribed wages and hours. Interstate commerce was defined by the act
to mean ``trade, commerce, transportation, transmission, or
communication among the several States or from any State to any place
outside thereof.''
It was further provided that ``for the purposes of this act an
employee shall be deemed to have been engaged in the production of goods
[that is, for interstate commerce] if such employee was employed . . .
in any process or occupation directly essential to the production
thereof in any State.''\748\ Sustaining an indictment under the act, a
unanimous Court, speaking through Chief Justice Stone, said: ``The
motive and purpose of the present regulation are plainly to make
effective the congressional conception of public policy that interstate
commerce should not be made the instrument of competition in the
distribution of goods produced under substandard labor conditions, which
competition is injurious to the commerce and to the States from and to
which the commerce flows.''\749\ In support of the decision the Court
invoked Chief Justice Marshall's reading of the necessary-and-proper
clause in McCulloch v. Maryland and his reading of the commerce clause
in Gibbons v. Ogden.\750\ Objections purporting to be based on the Tenth
Amendment were met from the same point of view: ``Our conclusion is
unaffected by the Tenth Amendment which provides: `The powers not
delegated to the United States by the Constitution, nor prohibited by it
to the States, are reserved to the States respectively, or to the
people.' The amendment states but a truism that all is retained which
has not been surrendered. There is nothing in the history of its
adoption to suggest that it was more than declaratory of the
relationship between the national and State governments as it had been
established by the Constitution before the amendment or that its purpose
was other than to allay fears that
[[Page 194]]
the new National Government might seek to exercise powers not granted,
and that the States might not be able to exercise fully their reserved
powers.''\751\
\748\52 Stat. 1060, as amended, 63 Stat. 910 (1949). The 1949
amendment substituted the phrase ``in any process or occupation directly
essential to the production thereof in any State'' for the original
phrase ``in any process or occupation necessary to the production
thereof in any State.'' In Mitchell v. H. B. Zachry Co., 362 U.S. 310,
317 (1960), the Court noted that the change ``manifests the view of
Congress that on occasion courts . . . had found activities to be
covered, which . . . [Congress now] deemed too remote from commerce or
too incidental to it.'' The 1961 amendments to the Act, 75 Stat. 65,
departed from previous practices of extending coverage to employees
individually connected to interstate commerce to cover all employees of
any ``enterprise'' engaged in commerce or production of commerce; thus,
there was an expansion of employees covered but not, of course, of
employers, 29 U.S.C. Sec. 201 et seq. See 29 U.S.C. Sec. Sec. 203(r),
203(s), 206(a), 207(a).
\749\United States v. Darby, 312 U.S. 100, 115 (1941).
\750\Id., 113, 114, 118.
\751\Id., 123-124.
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Subsequent decisions of the Court took a very broad view of
which employees should be covered by the Act,\752\ and in 1949 Congress
to some degree narrowed the permissible range of coverage and
disapproved some of the Court's decisions.\753\ But in 1961,\754\ with
extensions in 1966,\755\ Congress itself expanded by several million
persons the coverage of the Act, introducing the ``enterprise'' concept
by which all employees in a business producing anything in commerce or
affecting commerce were brought within the protection of the minimum
wage-maximum hours standards.\756\ The ``enterprise concept'' was
sustained by the Court in Maryland v. Wirtz.\757\ Justice Harlan, for a
unanimous Court on this issue, found the extension entirely proper on
the basis of two theories: one, a business' competitive position in
commerce is determined in part by all its significant labor costs, and
not just those costs attributable to its employees engaged in production
in interstate commerce, and, two, labor peace and thus smooth
functioning of interstate commerce was facilitated by the termination of
substandard labor conditions affecting all employees and not just those
actually engaged in interstate commerce.\758\
\752\E.g., Kirschbaum v. Walling, 316 U.S. 517 (1942) (operating
and maintenance employees of building, part of which was rented to
business producing goods for interstate commerce); Walton v. Southern
Package Corp., 320 U.S. 540 (1944) (night watchman in a plant the
substantial portion of the production of which was shipped in interstate
commerce); Armour & Co. v. Wantock, 323 U.S. 126 (1944) (employees on
stand-by auxiliary fire-fighting service of an employer engaged in
interstate commerce); Borden Co. v. Borella, 325 U.S. 679 (1945)
(maintenance employees in building housing company's central offices
where management was located though the production of interstate
commerce was elsewhere); Martino v. Michigan Window Cleaning Co., 327
U.S. 173 (1946) (employees of a window-cleaning company the principal
business of which was performed on windows of industrial plants
producing goods for interstate commerce); Mitchell v. Lublin, McGaughy &
Associates, 358 U.S. 207 (1959) (nonprofessional employees of
architectural firm working on plans for construction of air bases, bus
terminals, and radio facilities).
\753\Cf. Mitchell v. H. B. Zachry Co., 362 U.S. 310, 316-318
(1960).
\754\75 Stat. 65.
\755\80 Stat. 830.
\756\29 U.S.C. Sec. Sec. 203(r), 203(s).
\757\392 U.S. 183 (1968).
\758\Another aspect of this case was overruled in National
League of Cities v. Usery, 426 U.S. 833 (1976), which itself was
overruled in Garcia v. San Antonio Metropolitan Transit Auth., 469 U.S.
528 (1985).
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Agricultural Marketing Agreement Act.--After its initial
frustrations, Congress returned to the task of bolstering agriculture by
passing the Agricultural Marketing Agreement Act of June 3,
[[Page 195]]
1937,\759\ authorizing the Secretary of Agriculture to fix the minimum
prices of certain agricultural products, when the handling of such
products occurs ``in the current of interstate or foreign commerce or
. . . directly burdens, obstructs or affects interstate or foreign
commerce in such commodity or product thereof.'' In United States v.
Wrightwood Dairy Co.,\760\ the Court sustained an order of the Secretary
of Agriculture fixing the minimum prices to be paid to producers of milk
in the Chicago ``marketing area.'' The dairy company demurred to the
regulation on the ground it applied to milk produced and sold
intrastate. Sustaining the order, the Court said: ``Congress plainly has
power to regulate the price of milk distributed through the medium of
interstate commerce . . . and it possesses every power needed to make
that regulation effective. The commerce power is not confined in its
exercise to the regulation of commerce among the States. It extends to
those activities intrastate which so affect interstate commerce, or the
exertion of the power of Congress over it, as to make regulation of them
appropriate means to the attainment of a legitimate end, the effective
execution of the granted power to regulate interstate commerce. The
power of Congress over interstate commerce is plenary and complete in
itself, may be exercised to its utmost extent, and acknowledges no
limitations other than are prescribed in the Constitution. . . . It
follows that no form of State activity can constitutionally thwart the
regulatory power granted by the commerce clause to Congress. Hence the
reach of that power extends to those intrastate activities which in a
substantial way interfere with or obstruct the exercise of the granted
power.''\761\
\759\50 Stat. 246, 7 U.S.C. Sec. 601 et seq.
\760\315 U.S. 110 (1942). The Court had previously upheld other
legislation that regulated agricultural production through limitations
on sales in or affecting interstate commerce. Currin v. Wallace, 306
U.S. 1 (1939); Mulford v. Smith, 307 U.S. 38 (1939).
\761\Id., 315 U.S., 118-119.
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In Wickard v. Filburn,\762\ a still deeper penetration by
Congress into the field of production was sustained. As amended by the
act of 1941, the Agricultural Adjustment Act of 1938,\763\ regulated
production even when not intended for commerce but wholly for
consumption on the producer's farm. Sustaining this extension of the
act, the Court pointed out that the effect of the statute was to support
the market. ``It can hardly be denied that a factor of such volume and
variability as home-consumed wheat would have a substantial influence on
price and market conditions. This may arise because being in marketable
condition such wheat overhangs the
[[Page 196]]
market and, if induced by rising prices, tends to flow into the market
and check price increases. But if we assume that it is never marketed,
it supplies a need of the man who grew it which would otherwise be
reflected by purchases in the open market. Home-grown wheat in this
sense competes with wheat in commerce. The stimulation of commerce is a
use of the regulatory function quite as definitely as prohibitions or
restrictions thereon. This record leaves us in no doubt that Congress
may properly have considered that wheat consumed on the farm grown, if
wholly outside the scheme of regulation, would have a substantial effect
in defeating and obstructing its purpose to stimulate trade therein at
increased prices.''\764\ And it elsewhere stated: ``Questions of the
power of Congress are not to be decided by reference to any formula
which would give controlling force to nomenclature such as `production'
and `indirect' and foreclose consideration of the actual effects of the
activity in question upon interstate commerce. . . . The Court's
recognition of the relevance of the economic effects in the application
of the Commerce Clause . . . has made the mechanical application of
legal formulas no longer feasible.''\765\
\762\317 U.S. 111 (1942).
\763\52 Stat. 31, 7 U.S.C. Sec. Sec. 612c, 1281-1282 et seq.
\764\Id., 317 U.S., 128-129.
\765\Id., 120-124. In United States v. Rock Royal Co-operative,
307 U.S. 533 (1939), the Court sustained an order under the Agricultural
Marketing Agreement Act of 1937, 50 Stat. 246, regulating the price of
milk in certain instances. Said Justice Reed for the majority of the
Court: ``The challenge is to the regulation `of the price to be paid
upon the sale by a dairy farmer who delivers his milk to some country
plant.' It is urged that the sale, a local transaction, is fully
completed before any interstate commerce begins and that the attempt to
fix the price or other elements of that incident violates the Tenth
Amendment. But where commodities are bought for use beyond State lines,
the sale is a part of interstate commerce. We have likewise held that
where sales for interstate transportation were commingled with
intrastate transactions, the existence of the local activity did not
interfere with the federal power to regulate inspection of the whole.
Activities conducted within State lines do not by this fact alone escape
the sweep of the Commerce Clause. Interstate commerce may be dependent
upon them. Power to establish quotas for interstate marketing gives
power to name quotas for that which is to be left within the State of
production. Where local and foreign milk alike are drawn into a general
plan for protecting the interstate commerce in the commodity from the
interferences, burdens and obstructions, arising from excessive surplus
and the social and sanitary evils of low values, the power of the
Congress extends also to the local sales.'' Id., 568-569.
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Acts of Congress Prohibiting Commerce
Foreign Commerce: Jefferson's Embargo.--``Jefferson's Embargo''
of 1807-1808, which cut all trade with Europe, was attacked on the
ground that the power to regulate commerce was the power to preserve it,
not the power to destroy it. This argument was rejected by Judge Davis
of the United States District Court for Massachusetts in the following
words: ``A national sovereignty is created [by the Constitution]. Not an
unlimited sovereignty, but a sov
[[Page 197]]
ereignty, as to the objects surrendered and specified, limited only by
the qualification and restrictions, expressed in the Constitution.
Commerce is one of those objects. The care, protection, management and
control, of this great national concern, is, in my opinion, vested by
the Constitution, in the Congress of the United States; and their power
is sovereign, relative to commercial intercourse, qualified by the
limitations and restrictions, expressed in that instrument, and by the
treaty making power of the President and Senate. . . . Power to
regulate, it is said, cannot be understood to give a power to
annihilate. To this it may be replied, that the acts under
consideration, though of very ample extent, do not operate as a
prohibition of all foreign commerce. It will be admitted that partial
prohibitions are authorized by the expression; and how shall the degree,
or extent, of the prohibition be adjusted, but by the discretion of the
National Government, to whom the subject appears to be committed? . . .
The term does not necessarily include shipping or navigation; much less
does it include the fisheries. Yet it never has contended, that they are
not the proper objects of national regulation; and several acts of
Congress have been made respecting them. . . . [Furthermore] if it be
admitted that national regulations relative to commerce, may apply it as
an instrument, and are not necessarily confined to its direct aid and
advancement, the sphere of legislative discretion is, of course, more
widely extended; and, in time of war, or of great impending peril, it
must take a still more expanded range.
``Congress has power to declare war. It, of course, has power to
prepare for war; and the time, the manner, and the measure, in the
application of constitutional means, seem to be left to its wisdom and
discretion. . . . Under the Confederation, . . . we find an express
reservation to the State legislatures of the power to pass prohibitory
commercial laws, and, as respects exportations, without any limitations.
Some of them exercised this power. . . . Unless Congress, by the
Constitution, possess the power in question, it still exists in the
State legislatures--but this has never been claimed or pretended, since
the adoption of the Federal Constitution; and the exercise of such a
power by the States, would be manifestly inconsistent with the power,
vested by the people in Congress, `to regulate commerce.' Hence I infer,
that the power, reserved to the States by the articles of Confederation,
is surrendered to Congress, by the Constitution; unless we suppose,
that, by some
[[Page 198]]
strange process, it has been merged or extinguished, and now exists no
where.''\766\
\766\United States v. The William, 28 Fed. Cas. 614, 620-623
(No. 16,700) (D. Mass. 1808). See also Gibbons v. Ogden, 9 Wheat. (22
U.S.) 1, 191 (1824); United States v. Marigold, 9 How. (50 U.S.) 560
(1850).
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Foreign Commerce: Protective Tariffs.--Tariff laws have
customarily contained prohibitory provisions, and such provisions have
been sustained by the Court under Congress' revenue powers and under its
power to regulate foreign commerce. For the Court in Board of Trustees
v. United States,\767\ in 1933, Chief Justice Hughes said: ``The
Congress may determine what articles may be imported into this country
and the terms upon which importation is permitted. No one can be said to
have a vested right to carry on foreign commerce with the United States.
. . . It is true that the taxing power is a distinct power; that it is
distinct from the power to regulate commerce. . . . It is also true that
the taxing power embraces the power to lay duties. Art. I, Sec. 8, cl.
1. But because the taxing power is a distinct power and embraces the
power to lay duties, it does not follow that duties may not be imposed
in the exercise of the power to regulate commerce. The contrary is well
established. Gibbons v. Ogden, 9 Wheat. 1, 202. `Under the power to
regulate foreign commerce Congress imposes duties on importations, give
drawbacks, pass embargo and nonintercourse laws, and make all other
regulations necessary to navigation, to the safety of passengers, and
the protection of property.' Groves v. Slaughter, 15 Pet. 449, 505. The
laying of duties is `a common means of executing the power.' 2 Story on
the Constitution, 1088.''\768\
\767\289 U.S. 48 (1933).
\768\Id., 57, 58.
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Foreign Commerce: Banned Articles.--The forerunners of more
recent acts excluding objectionable commodities from interstate commerce
are the laws forbidding the importation of like commodities from abroad.
This power Congress has exercised since 1842. In that year it forbade
the importation of obscene literature or pictures from abroad.\769\ Six
years later, it passed an act ``to prevent the importation of spurious
and adulterated drugs'' and to provide a system of inspection to make
the prohibition effective.\770\ Such legislation guarding against the
importation of noxiously adulterated foods, drugs, or liquor has been on
the statute books ever since. In 1887, the importation by Chinese
nationals of smoking opium was prohibited,\771\ and subsequent statutes
passed in
[[Page 199]]
1909 and 1914 made it unlawful for anyone to import it.\772\ In 1897,
Congress forbade the importation of any tea ``inferior in purity,
quality, and fitness for consumption'' as compared with a legal
standard.\773\ The Act was sustained in 1904, in the leading case of
Buttfield v. Stranahan.\774\ In ``The Abby Dodge'' an act excluding
sponges taken by means of diving or diving apparatus from the waters of
the Gulf of Mexico or Straits of Florida was sustained but construed as
not applying to sponges taken from the territorial water of a
State.\775\
\769\5 Stat. 566, 28.
\770\9 Stat. 237 (1848).
\771\24 Stat. 409.
\772\35 Stat. 614; 38 Stat. 275.
\773\29 Stat. 605.
\774\192 U.S. 470 (1904).
\775\223 U.S. 166 (1912); cf. United States v. California, 332
U.S. 19 (1947).
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In Weber v. Freed,\776\ an act prohibiting the importation and
interstate transportation of prize-fight films or of pictorial
representation of prize fights was upheld. Chief Justice White grounded
his opinion for a unanimous Court on the complete and total control over
foreign commerce possessed by Congress, in contrast implicitly to the
lesser power over interstate commerce.\777\ And in Brolan v. United
States,\778\ the Court rejected as wholly inappropriate citation of
cases dealing with interstate commerce on the question of Congress'
power to prohibit foreign commerce. It has been earlier noted, however,
that the purported distinction is one that the Court both previously to
and subsequent to these opinions has rejected.
\776\239 U.S. 325 (1915).
\777\Id., 329.
\778\236 U.S. 216 (1915).
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Interstate Commerce: Power to Prohibit Questioned.--The question
whether Congress' power to regulate commerce ``among the several
States'' embraced the power to prohibit it furnished the topic of one of
the most protracted debates in the entire history of the Constitution's
interpretation, a debate the final resolution of which in favor of
congressional power is an event of first importance for the future of
American federalism. The issue was as early as 1841 brought forward by
Henry Clay, in an argument before the Court in which he raised the
specter of an act of Congress forbidding the interstate slave
trade.\779\ The debate was concluded ninety-nine years later by the
decision in United States v. Darby,\780\ in which the Fair Labor
Standards Act was sustained.\781\
\779\Groves v. Slaughter, 15 Pet. (40 U.S.) 449, 488-489 (1841).
\780\312 U.S. 100 (1941).
\781\The judicial history of the argument may be examined in the
majority and dissenting opinions in Hammer v. Dagenhart, 247 U.S. 251
(1918), a five-to-four decision, in which the majority held Congress not
to be empowered to ban from the channels of interstate commerce goods
made with child labor, since Congress' power was to prescribe the rule
by which commerce was to be carried on and not to prohibit it, except
with regard to those things the character of which--diseased cattle,
lottery tickets--was inherently evil. With the majority opinion, compare
Justice Stone's unanimous opinion in United States v. Darby, 312 U.S.
100, 112-124 (1941), overruling Hammer v. Dagenhart. See also Corwin,
The Power of Congress to Prohibit Commerce, 3 Selected Essays on
Constitutional Law (Chicago: 1938), 103.
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[[Page 200]]
Interstate Commerce: National Prohibitions and State Police
Power.--The earliest such acts were in the nature of quarantine
regulations and usually dealt solely with interstate transportation. In
1884, the exportation or shipment in interstate commerce of livestock
having any infectious disease was forbidden.\782\ In 1903, power was
conferred upon the Secretary of Agriculture to establish regulations to
prevent the spread of such diseases through foreign or interstate
commerce.\783\ In 1905, the same official was authorized to lay an
absolute embargo or quarantine upon all shipments of cattle from one
State to another when the public necessity might demand it.\784\ A
statute passed in 1905 forbade the transportation in foreign and
interstate commerce and the mails of certain varieties of moths, plant
lice, and other insect pests injurious to plant crops, trees, and other
vegetation.\785\ In 1912, a similar exclusion of diseased nursery stock
was decreed,\786\ while by the same act and again by an act of
1917,\787\ the Secretary of Agriculture was invested with powers of
quarantine on interstate commerce for the protection of plant life from
disease similar to those above described for the prevention of the
spread of animal disease. While the Supreme Court originally held
federal quarantine regulations of this sort to be constitutionally
inapplicable to intrastate shipments of livestock, on the ground that
federal authority extends only to foreign and interstate commerce,\788\
this view has today been abandoned.
\782\23 Stat. 31.
\783\32 Stat. 791.
\784\33 Stat. 1264.
\785\33 Stat. 1269.
\786\37 Stat. 315.
\787\39 Stat. 1165.
\788\Illinois Central Railroad v. McKendree, 203 U.S. 514
(1906). See also United States v. DeWitt, 9 Wall. (76 U.S.) 41 (1870).
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The Lottery Case.--The first case to come before the Court in
which the issues discussed above were canvassed at all thoroughly was
Champion v. Ames,\789\ involving the act of 1895 ``for the suppression
of lotteries.''\790\ An earlier act excluding lottery tickets from the
mails had been upheld in the case of In re Rapier,\791\ on the
proposition that Congress clearly had the power to see that the very
facilities furnished by it were not put to bad use. But in the case of
commerce, the facilities are not ordinarily furnished by the
[[Page 201]]
National Government, and the right to engage in foreign and interestate
commerce comes from the Constitution itself or is anterior to it.
\789\Lottery Case (Champion v. Ames), 188 U.S. 321 (1903).
\790\28 Stat. 963.
\791\143 U.S. 110 (1892).
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How difficult the Court found the question produced by the act
of 1895, forbidding any person to bring within the United States or to
cause to be ``carried from one State to another'' any lottery ticket, or
an equivalent thereof, ``for the purpose of disposing of the same,'' was
shown by the fact that the case was argued three times before the Court
and the fact that the Court's decision finally sustaining the act was a
five-to-four decision. The opinion of the Court, on the other hand,
prepared by Justice Harlan, marked an almost unqualified triumph at the
time for the view that Congress' power to regulate commerce among the
States included the power to prohibit it, especially to supplement and
support state legislation enacted under the police power. Early in the
opinion, extensive quotation is made from Chief Justice Marshall's
opinion in Gibbons v. Ogden,\792\ with special stress upon the
definition there given of the phrase ``to regulate.'' Justice Johnson's
assertion on the same occasion is also given: ``The power of a sovereign
State over commerce, . . . amounts to nothing more than a power to limit
and restrain it at pleasure.'' Further along is quoted with evident
approval Justice Bradley's statement in Brown v. Houston,\793\ that
``[t]he power to regulate commerce among the several States is granted
to Congress in terms as absolute as is the power to regulate commerce
with foreign nations.''
\792\9 Wheat. (22 U.S.) 1, 227 (1824).
\793\114 U.S. 622, 630 (1885).
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Following the wake of the Lottery Case, Congress repeatedly
brought its prohibitory powers over interstate commerce and
communications to the support of certain local policies of the States in
the exercise of their reserved powers, thereby aiding them in the
repression of a variety of acts and deeds objectionable to public
morality. The conception of the Federal System on which the Court based
its validation of this legislation was stated by it in 1913 in
sustaining the Mann ``White Slave'' Act in the following words: ``Our
dual form of government has its perplexities, State and Nation having
different spheres of jurisdiction . . . but it must be kept in mind that
we are one people; and the powers reserved to the States and those
conferred on the Nation are adapted to be exercised, whether
independently or concurrently, to promote the general welfare, material,
and moral.''\794\ At the same time, the Court made it plain that in
prohibiting commerce among the States, Congress was equally free to
support state legislative policy or to de
[[Page 202]]
vise a policy of its own. ``Congress,'' it said, ``may exercise this
authority in aid of the policy of the State, if it sees fit to do so. It
is equally clear that the policy of Congress acting independently of the
States may induce legislation without reference to the particular policy
or law of any given State. Acting within the authority conferred by the
Constitution it is for Congress to determine what legislation will
attain its purpose. The control of Congress over interstate commerce is
not to be limited by State laws.''\795\
\794\Hoke v. United States, 227 U.S. 308, 322 (1913).
\795\United States v. Hill, 248 U.S. 420, 425 (1919).
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In Brooks v. United States,\796\ the Court sustained the
National Motor Vehicle Theft Act\797\ as a measure protective of owners
of automobiles; that is, of interests in ``the State of origin.'' The
statute was designed to repress automobile motor thefts, notwithstanding
that such thefts antedate the interstate transportation of the article
stolen. Speaking for the Court, Chief Justice Taft, at the outset,
stated the general proposition that ``Congress can certainly regulate
interstate commerce to the extent of forbidding and punishing the use of
such commerce as an agency to promote immorality, dishonesty, or the
spread of any evil or harm to the people of other States from the State
of origin.'' Noting ``the radical change in transportation'' brought
about by the automobile, and the rise of ``[e]laborately organized
conspiracies for the theft of automobiles . . . and their sale or other
disposition'' in another jurisdiction from the owner's, the Court
concluded that such activity ``is a gross misuse of interstate commerce.
Congress may properly punish such interstate transportation by anyone
with knowledge of the theft, because of its harmful result and its
defeat of the property rights of those whose machines against their will
are taken into other jurisdictions.'' The fact that stolen vehicles were
``harmless'' and did not spread harm to persons in other States on this
occasion was not deemed to present any obstacle to the exercise of the
regulatory power of Congress.\798\
\796\267 U.S. 432 (1925).
\797\41 Stat. 324 (1919), 18 U.S.C., Sec. Sec. 2311-2313.
\798\Id., 436-439. See also Kentucky Whip & Collar Co. v. I.C.R.
Co., 299 U.S. 334 (1937).
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The Darby Case.--In sustaining the Fair Labor Standards Act\799\
in 1941,\800\ the Court expressly overruled Hammer v. Dagenhart.\801\
``The distinction on which the [latter case] . . . was rested that
Congressional power to prohibit interstate commerce is limited to
articles which in themselves have some harmful or deleterious property--
a distinction which was novel when made and
[[Page 203]]
unsupported by any provision of the Constitution--has long since been
abandoned. . . . The thesis of the opinion that the motive of the
prohibition or its effect to control in some measure the use or
production within the States of the article thus excluded from the
commerce can operate to deprive the regulation of its constitutional
authority has long since ceased to have force. . . . The conclusion is
inescapable that Hammer v. Dagenhart, was a departure from the
principles which have prevailed in the interpretation of the Commerce
Clause both before and since the decision and that such vitality, was a
precedent, as it then had has long since been exhausted. It should be
and now is overruled.''\802\
\799\29 U.S.C. Sec. Sec. 201-219.
\800\United States v. Darby, 312 U.S. 100 (1941).
\801\247 U.S. 251 (1918).
\802\Id., 312 U.S., 116-117.
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The Commerce Clause as a Source of National Police Power
The Court has several times expressly noted that Congress'
exercise of power under the commerce clause is akin to the police power
exercised by the States.\803\ It should follow, therefore, that Congress
may achieve results unrelated to purely commercial aspects of commerce,
and this result in fact has often been accomplished. Paralleling and
contributing to this movement is the virtual disappearance of the
distinction between interstate and intrastate commerce.
\803\E.g., Brooks v. United States, 267 U.S. 432, 436-437
(1925); United States v. Darby, 312 U.S. 100, 114 (1941). See Cushman,
The National Police Power Under the Commerce Clause, 3 Selected Essays
on Constitutional Law (Chicago: 1938), 62.
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Is There an Intrastate Barrier to Congress' Commerce Power?--Not
only has there been legislative advancement and judicial acquiescence in
commerce clause jurisprudence, but the melding of the Nation into one
economic union has been more than a little responsible for the reach of
Congress' power. ``The volume of interstate commerce and the range of
commonly accepted objects of government regulation have . . . expanded
considerably in the last 200 years, and the regulatory authority of
Congress has expanded along with them. As interstate commerce has become
ubiquitous, activities once considered purely local have come to have
effects on the national economy, and have accordingly come within the
scope of Congress' commerce power.''\804\
\804\New York v. United States, 112 S.Ct. 2408, 2418-2419
(1992).
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Reviewing the doctrinal developments laid out in the prior
pages, it is evident that Congress' commerce power is fueled by four
very interrelated principles of decision, some old, some of recent
vintage.
[[Page 204]]
First, the commerce power attaches to the crossing of state
lines, and Congress has validly legislated to protect interstate
travelers from harm, to prevent such travelers from being deterred in
the exercise of interstate traveling, and to prevent them from being
burdened. Many of the 1964 public accommodations law applications have
been premised on the point that larger establishments do serve
interstate travelers and that even small stores, restaurants, and the
like may serve interstate travelers, and, therefore, it is permissible
to regulate them to prevent or deter discrimination.\805\
\805\Heart of Atlanta Motel v. United States, 379 U.S. 241
(1964); Katzenbach v. McClung, 379 U.S. 294 (1964); Daniel v. Paul, 395
U.S. 298 (1969).
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Second, it may not be persons who cross state lines but some
object that will or has crossed state lines, and the regulation of a
purely intrastate activity may be premised on the presence of the
object. Thus, the public accommodations law reached small establishments
that served food and other items that had been purchased from interstate
channels.\806\ Congress has validly penalized convicted felons, who had
no other connection to interstate commerce, for possession or receipt of
firearms, which had been previously transported in interstate commerce
independently of any activity by the two felons.\807\ This reach is not
of newly-minted origin. In United States v. Sullivan,\808\ the Court
sustained a conviction of misbranding, under the Federal Food, Drug and
Cosmetic Act. Sullivan, a Columbus, Georgia, druggist had bought a
properly labeled 1000-tablet bottle of sulfathiazole from an Atlanta
wholesaler. The bottle had been shipped to the Atlanta wholesaler by a
Chicago supplier six months earlier. Three months after Sullivan
received the bottle, he made two retail sales of 12 tablets each,
placing the tablets in boxes not labeled in strict accordance with the
law. Upholding the conviction, the Court concluded that there was no
question of ``the constitutional power of Congress under the commerce
clause to regulate the branding of articles that have
[[Page 205]]
completed an interstate shipment and are being held for future sales in
purely local or intrastate commerce.''\809\
\806\Katzenbach v. McClung, 379 U.S. 294, 298, 300-302 (1964);
Daniel v. Paul, 395 U.S. 298, 305 (1969).
\807\`Scarborough v. United States, 431 U.S. 563 (1977); Barrett
v. United States, 423 U.S. 212 (1976). However, because such laws reach
far into the traditional police powers of the States, the Court insists
Congress clearly speak to its intent to cover such local activities.
United States v. Bass, 404 U.S. 336 (1971). See also Rewis v. United
States, 401 U.S. 808 (1971); United States v. Enmons, 410 U.S. 396
(1973). A similar tenet of construction has appeared in the Court's
recent treatment of federal prosecutions of state officers for official
corruption under criminal laws of general applicability. E.g., McCormick
v. United States, 500 U.S. 257 (1991); McNally v. United States, 483
U.S. 350 (1987). Congress has overturned the latter case. 102 Stat.
4508, Sec. 7603, 18 U.S.C. Sec. 1346.
\808\332 U.S. 689 (1948).
\809\Id., 698-699.
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Third, Congress' power reaches not only transactions or actions
that occasion the crossing of state or national boundaries but extends
as well to activities that, though local, ``affect'' commerce, a
combination of the commerce power enhanced by the necessary and proper
clause. The seminal case, of course, is Wickard v. Filburn,\810\
sustaining federal regulation of a crop of wheat grown on a farm and
intended solely for home consumption. The premise was that if it were
never marketed, it supplied a need otherwise to be satisfied only in the
market, and that if prices rose it might be induced onto the market.
``Even activity that is purely intrastate in character may be regulated
by Congress, where the activity, combined with like conduct by others
similarly situated, affects commerce among the States or with foreign
nations.''\811\ Coverage under federal labor and wage-and-hour laws
after the 1930s showed the reality of this doctrine.\812\
\810\317 U.S. 111 (1942).
\811\Fry v. United States, 421 U.S. 542, 547 (1975).
\812\See Maryland v. Wirtz, 392 U.S. 183, 188-193 (1968).
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In upholding federal regulation of strip mining, the Court
demonstrated the breadth of the ``affects'' standard. One case dealt
with statutory provisions designed to preserve ``prime farmland.'' The
trial court had determined that the amount of such land disturbed
annually amounted to 0.006% of the total prime farmland acreage in the
Nation and, thus, that the impact on commerce was ``infinitesimal'' or
``trivial.'' Disagreeing, the Court said: ``A court may invalidate
legislation enacted under the Commerce Clause only if it is clear that
there is no rational basis for a congressional finding that the
regulated activity affects interstate commerce, or that there is no
reasonable connection between the regulatory means selected and the
asserted ends.''\813\ Moreover, ``[t]he pertinent inquiry therefore is
not how much commerce is involved but whether Congress could rationally
conclude that the regulated activity affects interstate commerce.''\814\
In a companion case, the Court reiterated that ``[t]he denomination of
an activity as a `local' or `intrastate' activity does not resolve the
question whether Congress may regulate it under the Commerce Clause. As
previously noted, the commerce power ` extends to those activities
intrastate which so affect interstate commerce, or the exertion of the
power of Congress over it, as to make regulation of them appropriate
means to the attainment of a legitimate end, the effective execution of
the granted power to
[[Page 206]]
regulate interstate commerce.''\815\ Judicial review is narrow.
Congress' determination of an ``effect'' must be deferred to if it is
rational, and Congress must have acted reasonably in choosing the
means.\816\
\813\Hodel v. Indiana, 452 U.S. 314, 323-324 (1981).
\814\Id., 324.
\815\Hodel v. Virginia Surface Mining & Reclamation Assn., 452
U.S. 264, 281 (1981) (quoting United States v. Wrightwood Dairy Co., 315
U.S. 110, 119 (1942)).
\816\Id., 276, 277. The scope of review is restated in Preseault
v. ICC, 494 U.S. 1, 17 (1990). Then-Justice Rehnquist, concurring in the
two Hodel cases, objected that the Court was making it appear that no
constitutional limits existed under the commerce clause, whereas in fact
it was necessary that a regulated activity must have a substantial
effect on interstate commerce, not just some effect. He thought it a
close case that the statutory provisions here met those tests. Supra,
452 U.S., 307-313.
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Fourth, a still more potent engine of regulation has been the
expansion of the class-of-activities standard, which began in the
``affecting'' cases. In Perez v. United States,\817\ the Court sustained
the application of a federal ``loan-sharking'' law to a local culprit.
The Court held that, although individual loan-sharking activities might
be intrastate in nature, still it was within Congress' power to
determine that the activity was within a class the activities of which
did affect interstate commerce, thus affording Congress the opportunity
to regulate the entire class. While the Perez Court and the
congressional findings emphasized that loan-sharking was generally part
of organized crime operating on a national scale and that loan-sharking
was commonly used to finance organized crime's national operations,
subsequent cases do not depend upon a defensible assumption of
relatedness in the class.
\817\402 U.S. 146 (1971).
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Thus, the Court applied the federal arson statute to the
attempted ``torching'' of a defendant's two-unit apartment building. The
Court merely pointed to the fact that the rental of real estate
``unquestionably'' affects interstate commerce and that ``the local
rental of an apartment unit is merely an element of a much broader
commercial market in real estate.''\818\ The apparent test of whether
aggregation of local activity can be said to affect commerce was made
clear next in an antitrust context.\819\ Allowing the continuation of an
antitrust suit challenging a hospital's exclusion of a surgeon from
practice in the hospital, the Court observed that in order to establish
the required jurisdictional nexus with commerce, the appropriate focus
is not on the actual effects of the conspiracy but instead is on the
possible consequences for the affected market if the conspiracy is
successful. The required nexus in this case was sufficient because
competitive significance is to be measured by a general evaluation of
the impact of the restraint on other partici
[[Page 207]]
pants and potential participants in the market from which the surgeon
was being excluded.\820\
\818\Russell v. United States, 471 U.S. 858, 862 (1985).
\819\Summit Health, Ltd. v. Pinhas, 500 U.S. 322 (1991).
\820\Id., 330-332. The decision was 5-to-4, with the dissenters,
however, of the view that Congress could reach the activity, only that
they thought Congress had not.
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Civil Rights.--It had been generally established some time ago
that Congress had power under the commerce clause to prohibit racial
discrimination in the use of the channels of commerce.\821\ The power
under the clause to forbid discrimination within the States was firmly
and unanimously sustained by the Court when Congress in 1964 enacted a
comprehensive measure outlawing discrimination because of race or color
in access to public accommodations with a requisite connection to
interstate commerce.\822\ Hotels and motels were declared covered, that
is, declared to ``affect commerce,'' if they provided lodging to
transient guests; restaurants, cafeterias, and the like, were covered
only if they served or offered to serve interstate travelers or if a
substantial portion of the food which they served had moved in
commerce.\823\ The Court sustained the Act as applied to a downtown
Atlanta motel which did serve interstate travelers,\824\ to an out-of-
the-way restaurant in Birmingham that catered to a local clientele but
which had spent 46 percent of its previous year's out-go on meat from a
local supplier who had procured it from out-of-state,\825\ and to a
rurally-located amusement area operating a snack bar and other
facilities, which advertised in a manner likely to attract an interstate
clientele and that served food a substantial portion of which came from
outside the State.\826\
\821\Boynton v. Virginia, 364 U.S. 454 (1960); Henderson v.
United States, 339 U.S. 816 (1950); Mitchell v. United States, 313 U.S.
80 (1941); Morgan v. Virginia, 328 U.S. 373 (1946).
\822\Civil Rights Act of 1964, Title II, 78 Stat. 241, 243, 42
U.S.C. Sec. 2000a et seq.
\823\42 U.S.C. Sec. 2000a (b).
\824\Heart of Atlanta Motel v. United States, 379 U.S. 241
(1964).
\825\Katzenbach v. McClung, 379 U.S. 294 (1964).
\826\Daniel v. Paul, 395 U.S. 298 (1969).
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Writing for the Court in Heart of Atlanta Motel and McClung,
Justice Clark denied that Congress was disabled from regulating the
operations of motels or restaurants because those operations may be, or
may appear to be, ``local'' in character. ``[T]he power of Congress to
promote interstate commerce also includes the power to regulate the
local incidents thereof, including local activities in both the States
of origin and destination, which might have a substantial and harmful
effect upon that commerce.''\827\
\827\Heart of Atlanta Motel v. United States, 379 U.S. 241, 258
(1964); Katzenbach v. McClung, 379 U.S. 294, 301-304 (1964).
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[[Page 208]]
But, it was objected, Congress is regulating on the basis of
moral judgments and not to facilitate commercial intercourse. ``That
Congress [may legislate] . . . against moral wrongs . . . rendered its
enactments no less valid. In framing Title II of this Act Congress was
also dealing with what it considered a moral problem. But that fact does
not detract from the overwhelming evidence of the disruptive effect that
racial discrimination has had on commercial intercourse. It was this
burden which empowered Congress to enact appropriate legislation, and,
given this basis for the exercise of its power, Congress was not
restricted by the fact that the particular obstruction to interstate
commerce with which it was dealing was also deemed a moral and social
wrong.''\828\ The evidence did, in fact, noted the Justice, support
Congress' conclusion that racial discrimination impeded interstate
travel by more than 20 million black citizens, which was an impairment
Congress could legislate to remove.\829\
\828\Heart of Atlanta Motel v. United States, 379 U.S. 241, 257
(1964).
\829\Id., 252-253; Katzenbach v. McClung, 379 U.S. 294, 299-301
(1964).
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The commerce clause basis for civil rights legislation in
respect to private discrimination was important because of the
understanding that Congress' power to act under the Fourteenth and
Fifteenth Amendments was limited to official discrimination.\830\ The
Court's subsequent determination that Congress is not necessarily so
limited in its power reduces greatly the importance of the commerce
clause in this area.\831\
\830\Civil Rights Cases, 109 U.S. 3 (1883); United States v.
Reese, 92 U.S. 214 (1876); Collins v. Hardyman, 341 U.S. 651 (1951).
\831\The ``open housing'' provision of the 1968 Civil Rights
Act, Title VIII, 82 Stat. 73, 81, 42 U.S.C. Sec. 3601, was based on the
commerce clause, but in Jones v. Alfred H. Mayer Co., 392 U.S. 409
(1968), the Court held that antidiscrimination-in-housing legislation
could be based on the Thirteenth Amendment and made operative against
private parties. Similarly, the Court has concluded that although Sec. 1
of the Fourteenth Amendment is judicially enforceable only against
``state action,'' Congress is not so limited under its enforcement
authorization of Sec. 5. United States v. Guest, 383 U.S. 745, 761, 774
(1966) (concurring opinions); Griffin v. Breckenridge, 403 U.S. 88
(1971).
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Criminal Law.--Federal criminal jurisdiction based on the
commerce power, and frequently combined with the postal power, has
historically been an auxiliary criminal jurisdiction. That is, Congress
has made federal crimes of acts that constitutes state crimes on the
basis of some contact, however tangential, with a matter subject to
congressional regulation even though the federal interest in the acts
may be minimal.\832\ Examples of this type of federal criminal statute
abound, including the Mann Act designed
[[Page 209]]
to outlaw interstate white slavery,\833\ the Dyer Act punishing
interstate transportation of stolen automobiles,\834\ and the Lindbergh
Law punishing interstate transportation of kidnapped persons.\835\ But,
just as in other areas, Congress has passed beyond a proscription of the
use of interstate facilities in the commission of a crime, it has in the
criminal law area expanded the scope of its jurisdiction. Typical of
this expansion is a statute making it a federal offense to ``in any way
or degree obstruct . . . delay . . . or affect . . . commerce . . . by
robbery or extortion. . . .''\836\ With the expansion of the scope of
the reach of ``commerce'' the statute potentially could reach crimes
involving practically all business concerns, although it appears to be
used principally against organized crime.
\832\E.g., Barrett v. United States, 423 U.S. 212 (1976);
Scarborough v. United States, 431 U.S. 563 (1977); Lewis v. United
States, 445 U.S. 55 (1980); McElroy v. United States, 455 U. S. 642
(1982).
\833\18 U.S.C. Sec. 2421.
\834\18 U.S.C. Sec. 2312.
\835\18 U.S.C. Sec. 1201.
\836\18 U.S.C. Sec. 1951. And see, 18 U.S.C. Sec. 1952.
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To date, the most far-reaching measure to be sustained by the
Court has been the ``loan-sharking'' prohibition of the Consumer Credit
Protection Act.\837\ The title affirmatively finds that extortionate
credit transactions affect interstate commerce because loan sharks are
in a class largely controlled by organized crime with a substantially
adverse effect on interstate commerce. Upholding the statute, the Court
found that though individual loan-sharking activities may be intrastate
in nature, still it is within Congress' power to determine that it was
within a class the activities of which did affect interstate commerce,
thus affording Congress power to regulate the entire class.\838\
\837\Title II, 82 Stat. 159 (1968), 18 U.S.C. Sec. 891 et seq.
\838\Perez v. United States, 402 U.S. 146 (1971). See also
Russell v. United States, 471 U.S. 858 (1985).
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Expansion of federal criminal jurisdiction proceeds apace with
the outflow from each Congress.\839\
\839\E.g., laws that bar firearms within a 1000 feet of a
school, 104 Stat. 4844 (1990), 18 U.S.C. Sec. 922(q), and that punish
carjacking when a firearm is used. 106 Stat. 3384 (1992), 18 U.S.C.
Sec. 2119.
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THE COMMERCE CLAUSE AS A RESTRAINT ON STATE POWERS
Doctrinal Background
The grant of power to Congress over commerce, unlike that of
power to levy customs duties, the power to raise armies, and some
others, is unaccompanied by correlative restrictions on state
power.\840\ This circumstance does not, however, of itself signify
[[Page 210]]
that the States were expected to participate in the power thus granted
Congress, subject only to the operation of the supremacy clause. As
Hamilton pointed out in The Federalist,\841\ while some of the powers
which are vested in the National Government admit of their
``concurrent'' exercise by the States, others are of their very nature
``exclusive,'' and hence render the notion of a like power in the States
``contradictory and repugnant.'' As an example of the latter kind of
power, Hamilton mentioned the power of Congress to pass a uniform
naturalization law. Was the same principle expected to apply to the
power over foreign and interstate commerce?
\840\Thus, by Article I, Sec. 10, cl. 2, States are denied the
power to ``lay any Imposts or Duties on Imports or Exports'' except by
the consent of Congress. The clause applies only to goods imported from
or exported to another country, not from or to another State, Woodruff
v. Parham, 8 Wall. (75 U.S.) 123 (1869), which prevents its application
to interstate commerce, although Chief Justice Marshall thought to the
contrary, Brown v. Maryland, 12 Wheat. (25 U.S.) 419, 449 (1827), and
the contrary has been strongly argued. W. Crosskey, Politics and the
Constitution in the History of the United States 295-323 (1953).
\841\The Federalist No. 32 (J. Cooke ed. 1961), 199-203. Note
that in connection with the discussion that follows, Hamilton avowed
that the taxing power of the States, save for imposts or duties on
imports or exports, ``remains undiminished.'' Id, 201. The States
``retain [the taxing] authority in the most absolute and unqualified
sense[.]'' Id., 199.
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Unquestionably one of the great advantages anticipated from the
grant to Congress of power over commerce was that state interferences
with trade, which had become a source of sharp discontent under the
Articles of Confederation, would be thereby brought to an end. As
Webster stated in his argument for appellant in Gibbons v. Ogden: ``The
prevailing motive was to regulate commerce; to rescue it from the
embarrassing and destructive consequences, resulting from the
legislation of so many different States, and to place it under the
protection of a uniform law.''\842\ In other words, the constitutional
grant was itself a regulation of commerce in the interest of
uniformity.\843\
\842\9 Wheat. (22 U.S.) 1, 11 (1824). Justice Johnson's
assertion, concurring, was to the same effect. Id., 226. Late in life,
James Madison stated that the power had been granted Congress mainly as
``a negative and preventive provision against injustice among the
States.'' 4 Letters and Other Writings of James Madison (Philadelphia:
1865), 14-15.
\843\It was evident from The Federalist that the principal aim
of the commerce clause was the protection of the national market from
the oppressive power of individual States acting to stifle or curb
commerce. Id., No. 7, 39-41 (Hamilton); No. 11, 65-73 (Hamilton); No.
22, 135-137 (Hamilton); No. 42, 283-284 (Madison); No. 53, 362-364
(Madison). See H. P. Hood & Sons, Inc. v. Du Mond, 336 U.S. 525, 533
(1949). For a comprehensive history of the adoption of the commerce
clause, which does not indicate a definitive answer to the question
posed, see Abel, The Commerce Clause in the Constitutional Convention
and in Contemporary Comment, 25 Minn. L. Rev. 432 (1941). Professor Abel
discovered only nine references in the Convention records to the
commerce clause, all directed to the dangers of interstate rivalry and
retaliation. Id., 470-471 & nn. 169-175.
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That, however, the commerce clause, unimplemented by
congressional legislation, took from the States any and all power over
foreign and interstate commerce was by no means conceded and
[[Page 211]]
was, indeed, counterintuitive, considering the extent of state
regulation that previously existed before the Constitution.\844\
Moreover, legislation by Congress regulative of any particular phase of
commerce would raise the question whether the States were entitled to
fill the remaining gaps, if not by virtue of a ``concurrent'' power over
interstate and foreign commerce, then by virtue of ``that immense mass
of legislation'' as Marshall termed it, ``which embraces everything
within the territory of a State, not surrendered to the general
government,''\845\ in a word, the ``police power.''
\844\The strongest suggestion of exclusivity found in the
Convention debates is a remark by Madison. ``Whether the States are now
restrained from laying tonnage duties depends on the extent of the power
`to regulate commerce.' These terms are vague but seem to exclude this
power of the States.'' 2 M. Farrand, The Records of the Federal
Convention of 1787 (New Haven: rev. ed. 1937), 625. However, the
statement is recorded during debate on the clause, Art. I, Sec. 10, cl.
3, prohibiting States from laying tonnage duties. That the Convention
adopted this clause, when tonnage duties would certainly be one facet of
regulating interstate and foreign commerce, casts doubt on the
assumption that the commerce power itself was intended to be exclusive.
\845\Gibbons v. Ogden, 9 Wheat. (22 U.S.) 1, 203 (1824).
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The text and drafting record of the commerce clause fails,
therefore, without more ado, to settle the question of what power is
left to the States to adopt legislation regulating foreign or interstate
commerce in greater or lesser measure. To be sure, in cases of flat
conflict between an act or acts of Congress regulative of such commerce
and a state legislative act or acts, from whatever state power ensuing,
the act of Congress is today recognized, and was recognized by Marshall,
as enjoying an unquestionable supremacy.\846\ But suppose, first, that
Congress has passed no act, or second, that its legislation does not
clearly cover the ground traversed by previously enacted state
legislation. What rules then apply? Since Gibbons v. Ogden, both of
these situations have confronted the Court, especially as regards
interstate commerce, hundreds of times, and in meeting them the Court
has, first, determined that it has power to decide when state power is
validly exercised, and, second, it has coined or given currency to
numerous formulas, some of which still guide, even when they do not
govern, its judgment.\847\
\846\Id., 210-211.
\847\The writings detailing the history are voluminous. See,
e.g., F. Frankfurter, The Commerce Clause under Marshall, Taney and
White (1937); B. Gavit, The Commerce Clause of the United States
Constitution (1932) (usefully containing appendices cataloguing every
commerce clause decision of the Supreme Court to that time); Sholleys,
The Negative Implications of the Commerce Clause, 3 U. Chi. L. Rev. 556
(1936). Among the recent writings, see Sedler, The Negative Commerce
Clause as a Restriction on State Regulation and Taxation: An Analysis in
Terms of Constitutional Structure, 31 Wayne L. Rev. 885 (1985) (a
disputed conceptualization arguing the Court followed a consistent line
over the years), and articles cited, id., 887 n. 4.
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[[Page 212]]
Thus, it has been judicially established that the commerce
clause is not only a ``positive'' grant of power to Congress, but it is
also a ``negative'' constraint upon the States; that is, the doctrine of
the ``dormant'' commerce clause, though what is dormant is the
congressional exercise of the power, not the clause itself, under which
the Court may police state taxation and regulation of interstate
commerce, became well established.
Webster, in Gibbons, argued that a state grant of a monopoly to
operate steamships between New York and New Jersey not only contravened
federal navigation laws but violated the commerce clause as well,
because that clause conferred an exclusive power upon Congress to make
the rules for national commerce, although he conceded that, the grant to
regulate interstate commerce was so broad as to reach much that the
States had formerly had jurisdiction over, the courts must be reasonable
in interpretation.\848\ But because he thought the state law was in
conflict with the federal legislation, Chief Justice Marshall was not
compelled to pass on Webster's arguments, although in dicta he indicated
his considerable sympathy with them and suggested that the power to
regulate commerce between the States might be an exclusively federal
power.\849\
\848\Id., 9 Wheat. (22 U.S.), 13-14, 16.
\849\Id., 17-18, 209. In Sturges v. Crowninshield, 4 Wheat. (17
U.S.) 122, 193-196 (1819), Chief Justice Marshall denied that the grant
of the bankruptcy power to Congress was exclusive. See also Houston v.
Moore, 5 Wheat. (18 U.S.) 1 (1820) (militia).
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Chief Justice Marshall originated the concept of the ``dormant
commerce clause'' in Willson v. Black Bird Creek Marsh Co.,\850\
although in dicta. Attacked before the Court was a state law authorizing
the building of a dam across a navigable creek, and it was claimed the
law was in conflict with the federal power to regulate interstate
commerce. Rejecting the challenge, Marshall said that the state act
could not be ``considered as repugnant to the [federal] power to
regulate commerce in its dormant state[.]''
\850\2 Pet. (27 U.S.) 245, 252 (1829).
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Returning to the subject in Cooley v. Board of Wardens of Port
of Philadelphia,\851\ the Court, upholding a state law that required
ships to engage a local pilot when entering or leaving the port of
[[Page 213]]
Philadelphia, enunciated a doctrine of partial federal exclusivity.
According to Justice Curtis' opinion, the state act was valid on the
basis of a distinction between those subjects of commerce which
``imperatively demand a single uniform rule'' operating throughout the
country and those which ``as imperatively'' demand ``that diversity
which alone can meet the local necessities of navigation,'' that is to
say, of commerce. As to the former, the Court held Congress' power to be
``exclusive,'' as to the latter, it held that the States enjoyed a power
of ``concurrent legislation.''\852\ The Philadelphia pilotage
requirement was of the latter kind.
\851\12 How. (53 U.S.) 299 (1851). The issue of exclusive
federal power and the separate issue of the dormant commerce clause was
present in the License Cases, 5 How. (46 U.S.) 504 (1847), and the
Passenger Cases, 7 How. (48 U.S.) 283 (1849), but, despite the fact that
much ink was shed in multiple opinions discussing the questions, nothing
definitive emerged. Chief Justice Taney, in contrast to Marshall, viewed
the clause only as a grant of power to Congress, containing no
constraint upon the States, and the Court's role was to void state laws
in contravention of federal legislation. Id., 5 How. (46 U.S.), 573;
Id., 7 How. (48 U.S.), 464.
\852\Id., 317-320. Chief Justice Taney had formerly taken the
strong position that Congress' power over commerce was not exclusive,
supra, n. 10, but he acquiesced silently in the Cooley opinion. A modern
echo of Cooley is Ray v. Atlantic Richfield Co., 435 U.S. 151, 179-180
(1978), in which the Court, inter alia, sustained a state requirement
that vessels not satisfying certain design requirements be escorted by
tugboats in Puget Sound. Noting the requirement's similarity ``to a
local pilotage requirement,'' the Court, following Cooley, pronounced it
``not the type of regulation that demands a uniform, national rule.''
But, in an apparent departure from Cooley, the Court also observed that
it did not appear that ``the requirement impedes the free and efficient
flow of interstate and foreign commerce. . . .'' See also Goldstein v.
California, 412 U.S. 546, 552-560 (1973), in which, in the context of
the copyright clause, the Court, approving Cooley for commerce clause
purposes, refused to find the copyright clause either fully or partially
exclusive.
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Thus, the contention that the federal power to regulate
interstate commerce was exclusive of state power yielded to a rule of
partial exclusivity. Among the welter of such cases, the first actually
to strike down a state law solely on commerce clause grounds was the
State Freight Tax Case.\853\ The question before the Court was the
validity of a nondiscriminatory\854\ statute that required every company
transporting freight within the State, with certain exceptions, to pay a
tax at specified rates on each ton of freight carried by it. Opining
that a tax upon freight, or any other article of commerce, transported
from State to State is a regulation of commerce among the States and,
further, that the transportation of merchandise or passengers through a
State or from State to State was a subject that required uniform
regulation, the Court held the tax in issue to be repugnant to the
commerce clause.
\853\Reading Railroad v. Pennsylvania, 15 Wall. (82 U.S.) 232
(1873). For cases in which the commerce clause basis was intermixed with
other express or implied powers, see Crandall v. Nevada, 6 Wall. (73
U.S.) 35 (1868); Steamship Co. v. Portwardens, 6 Wall. (73 U.S.) 31
(1867); Woodruff v. Parham, 8 Wall. (75 U.S.) 123 (1868). Chief Justice
Marshall, in Brown v. Maryland, 12 Wheat. (25 U.S.) 419, 488-489 (1827),
indicated, in dicta, that a state tax might violate the commerce clause.
\854\Just a few years earlier, the Court, in an opinion that
merged commerce clause and import-export clause analyses, had seemed to
suggest that it was a discriminatory tax or law that violates the
commerce clause and not simply a tax on interstate commerce. Woodruff v.
Parham, 8 Wall. (75 U.S.) 123 (1869).
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[[Page 214]]
Whether exclusive or partially exclusive, however, the commerce
clause as a restraint upon state exercises of power, absent
congressional action, received no sustained justification or
explanation; the clause, of course, empowers Congress to regulate
commerce among the States, not the courts. Often, as in Cooley, and
later cases, the Court stated or implied that the rule was imposed by
the commerce clause.\855\ In Welton v. Missouri,\856\ the Court
attempted to suggest a somewhat different justification. Challenged was
a state statute that required a ``peddler's'' license for merchants
selling goods that came from other states but that required no license
if the goods were produced in the State. Declaring that uniformity of
commercial regulation is necessary to protect articles of commerce from
hostile legislation and thus the power asserted by the State belonged
exclusively to Congress, the Court observed that ``[t]he fact that
Congress has not seen fit to prescribe any specific rules to govern
inter-State commerce does not affect the question. Its inaction on this
subject . . . is equivalent to a declaration that inter-State commerce
shall be free and untrammelled.''\857\
\855\``Where the subject matter requires a uniform system as
between the States, the power controlling it is vested exclusively in
Congress, and cannot be encroached upon by the State.'' Leisy v. Hardin,
135 U.S. 100, 108-109 (1890). The commerce clause ``remains in the
Constitution as a grant of power to Congress . . . and as a diminution
pro tanto of absolute state sovereignty over the same subject matter.''
Carter v. Virginia, 321 U.S. 131, 137 (1944). The commerce clause, the
Court has celebrated, ``does not say what the states may or may not do
in the absence of congressional action, nor how to draw the line between
what is and what is not commerce among the states. Perhaps even more
than by interpretation of its written word, this Court has advanced the
solidarity and prosperity of this Nation by the meaning it has given
these great silences of the Constitution.'' H. P. Hood & Sons, Inc. v.
Du Mond, 336 U.S. 525, 534-535 (1949). More recently, the Court has
taken to stating that ``[t]he Commerce Clause `has long been recognized
as a self-executing limitation on the power of the States to enact laws
imposing substantial burdens on such commerce.''' Dennis v. Higgins, 498
U.S. 439, 447 (1991) (quoting South-Central Timber Dev., Inc. v.
Wunnicke, 467 U.S. 82, 87 (1984) (emphasis supplied).
\856\91 U.S. 275 (1875).
\857\Id., 282. In Steamship Co. v. Portwardens, 6 Wall. (73
U.S.) 31, 33 (1867), the Court stated that congressional silence with
regard to matters of ``local'' concern, imported willingness that the
States regulate. Cf. Graves v. New York ex rel. O'Keefe, 306 U.S. 466,
479 n. 1 (1939)Justice Stone). The fullest development of the
``silence'' rationale was not by the Court but by a renowned academic,
Professor Dowling. Interstate Commerce and State Power, 29 Va. L. Rev. 1
(1940); Interstate Commerce and State Power--Revisited Version, 47
Colum. L. Rev. 546 (1947).
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It has been evidently of little importance to the Court to
explain. ``Whether or not this long recognized distribution of power
between the national and state governments is predicated upon the
implications of the commerce clause itself . . . or upon the presumed
intention of Congress, where Congress has not spoken . . . the result is
the same.''\858\ Thus, ``[f]or a hundred years it has been accepted
constitutional doctrine . . . that . . . where Congress has
[[Page 215]]
not acted, this Court, and not the state legislature, is under the
commerce clause the final arbiter of the competing demands of state and
national interests.''\859\
\858\Southern Pacific Co. v. Arizona, 325 U.S. 761, 768 (1945).
\859\Id., 769. See also California v. Zook, 336 U.S. 725, 728
(1949).
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Two other justifications can be found throughout the Court's
decisions, but they do not explain why the Court is empowered under a
grant of power to Congress to police state regulatory and taxing
decisions. For example, in Welton v. Missouri,\860\ the statute under
review, as observed several times by the Court, was clearly
discriminatory as between instate and interstate commerce, but that
point was not sharply drawn as the constitutional fault of the law. That
the commerce clause had been motivated by the Framers' apprehensions
about state protectionism has been frequently noted.\861\ A relatively
recent theme is that the Framers desired to create a national area of
free trade, so that unreasonable burdens on interstate commerce violate
the clause in and of themselves.\862\
\860\91 U.S. 275, 277, 278, 279, 280, 281, 282 (1876).
\861\Id., 280-281; Brown v. Maryland, 12 Wheat. (25 U.S.) 419,
446 (1827) (Chief Justice Marshall); Guy v. City of Baltimore, 100 U.S.
434, 440 (1879); Baldwin v. G.A.F. Seelig, Inc., 294 U.S. 550, 552
(1935); Maryland v. Louisiana, 451 U.S. 725, 754 (1981).
\862\E.g., Gwin, White & Prince, Inc. v. Henneford, 305 U.S.
434, 440 (1939); McLeod v. J. E. Dilworth Co., 322 U.S. 327, 330-331
(1944); Freeman v. Hewitt, 329 U.S. 249, 252, 256 (1946); H. P. Hood &
Sons v. Du Mond, 336 U.S. 525, 538, 539 (1949); Dennis v. Higgins, 498
U.S. 439, 447-450 (1991). ``[W]e have steadfastly adhered to the central
tenet that the Commerce Clause `by its own force created an area of
trade free from interference by the States.''' American Trucking Assns.,
Inc. v. Scheiner, 483 U.S. 266, 280 (1987) (quoting Boston Stock
Exchange v. State Tax Comm., 429 U.S. 318, 328 (1977)).
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Nonetheless, the power of the Court is established and is freely
exercised. No reservations can be discerned in the opinions for the
Court.\863\ Individual Justices, to be sure, have urged renunciation of
the power and remission to Congress for relief sought by litigants.\864\
That has not been the course followed.
\863\E.g., Fort Gratiot Sanitary Landfill, Inc. v. Michigan
Natural Resources Dept., 112 S.Ct. 2019, 2023-2024 (1992); Quill Corp.
v. North Dakota ex rel. Heitkamp, 112 S.Ct. 1904, 1911 (1992); Wyoming
v. Oklahoma, 112 S.Ct. 789, 800-801 (1992). Indeed, the Court, in Dennis
v. Higgins, 498 U.S. 439, 447-450 (1991), broadened its construction of
the clause, holding that it confers a ``right'' upon individuals and
companies to engage in interstate trade. With respect to the exercise of
the power, the Court has recognized Congress' greater expertise to act
and noted its hesitancy to impose uniformity on state taxation. Moorman
Mfg. Co. v. Bair, 437 U.S. 267, 280 (1978). Cf. Quill Corp. supra, 1916.
\864\In McCarroll v. Dixie Lines, 309 U.S. 176, 183 (1940),
Justice Black, for himself and Justices Frankfurter and Douglas,
dissented, taking precisely this view. See also Adams Mfg. Co. v.
Storen, 304 U.S. 307, 316 (1938) (Justice Black dissenting in part);
Gwin, White & Prince, Inc. v. Henneford, 305 U.S. 434, 442 (1939)
(Justice Black dissenting); Southern Pacific Co. v. Arizona, 325 U.S.
761, 784 (1945) (Justice Black dissenting); id., 795 (Justice Douglas
dissenting). Justices Douglas and Frankfurter subsequently wrote and
joined opinions applying the dormant commerce clause. In Michigan-
Wisconsin Pipe Line Co. v. Calvert, 347 U.S. 157, 166 (1954), the Court
rejected the urging that it uphold all not-patently discriminatory taxes
and let Congress deal with conflicts. More recently, Justice Scalia has
taken the view that, as a matter of original intent, a ``dormant'' or
``negative'' commerce power cannot be justified in either taxation or
regulation cases, but, yielding to the force of precedent, he will vote
to strike down state actions that discriminate against interstate
commerce or that are governed by the Court's precedents, without
extending any of those precedents. CTS Corp. v. Dynamics Corp. of
America, 481 U.S. 69, 94 (1987) (concurring); Tyler Pipe Industries,
Inc. v. Washington State Dept. of Revenue, 483 U.S. 232, 259 (1987)
(concurring in part and dissenting in part); Bendix Autolite Corp. v.
Midwesco Enterprises, Inc., 486 U.S. 888, 895 (1988) (concurring in
judgment); American Trucking Assn., inc. v. Smith, 496 U.S. 167, 200
(1990) (concurring).
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[[Page 216]]
The State Proprietary Activity Exception.--In a case of first
impression, the Court held unaffected by the commerce clause--``the kind
of action with which the Commerce Clause is not concerned''--a Maryland
bounty scheme by which the State paid scrap processors for each ``hulk''
automobile destroyed. As first enacted, the bounty plan did not
distinguish between in-state and out-of-state processors, but it was
subsequently amended to operate in such a manner that out-of-state
processors were substantially disadvantaged. The Court held that where a
State enters into the market itself as a purchaser, in effect, of a
potential article of interstate commerce, it does not, in creating a
burden upon that commerce by restricting its trade to its own citizens
or businesses within the State, violate the commerce clause.\865\
\865\Hughes v. Alexandria Scrap Corp., 426 U. S. 794 (1976).
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Affirming and extending somewhat this precedent, the Court held
that a State operating a cement plant could in times of shortage (as
well presumably at any time) confine the sale of cement by the state
plant to residents of the State.\866\ ``The Commerce Clause responds
principally to state taxes and regulatory measures impeding free private
trade in the national marketplace. . . . There is no indication of a
constitutional plan to limit the ability of the States themselves to
operate freely in the free market.''\867\ It is yet unclear how far this
concept of the State as market participant rather than market regulator
will be extended.\868\
\866\Reeves, Inc. v. Stake, 447 U.S. 429 (1980).
\867\Id., 436-437.
\868\See also White v. Massachusetts Council of Construction
Employers, 460 U.S. 204 (1983) (city may favor its own residents in
construction projects paid for with city funds); South-Central Timber
Dev., Inc. v. Wunnicke, 467 U.S. 82 (1984) (illustrating the deep
divisions in the Court respecting the scope of the exception).
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Congressional Authorization of Impermissible State Action.--The
Supreme Court has never forgotten the lesson that was administered to it
by the Act of Congress of August 31, 1852,\869\ which pronounced the
Wheeling Bridge ``a lawful structure,'' thereby setting aside the
Court's determination to the contrary earlier
[[Page 217]]
the same year.\870\ The lesson, subsequently observed the Court, is that
``[i]t is Congress, and not the Judicial Department, to which the
Constitution has given the power to regulate commerce.''\871\ Similarly,
when in the late eighties and the early nineties statewide prohibition
laws began making their appearance, Congress again approved state laws
the Court had found to violate the dormant commerce clause.
\869\10 Stat. 112, Sec. 6.
\870\Pennsylvania v. Wheeling & Belmont Bridge Co., 13 How. (54
U.S.) 518 (1856), statute sustained in Pennsylvania v. Wheeling &
Belmont Bridge Co., 18 How. (59 U.S.) 421 (1856). The latter decision
seemed facially contrary to a dictum of Justice Curtis in Cooley v.
Board of Wardens of Port of Philadelphia, 12 How. (53 U.S.) 299, 318
(1851), and cf. Tyler Pipe Industries, Inc. v. Washington State Dept. of
Revenue, 483 U.S. 232, 263 n. 4 (1987) (Justice Scalia concurring in
part and dissenting in part), but if indeed the Court is interpreting
the silence of Congress as a bar to action under the dormant commerce
clause, then when Congress speaks it is enacting a regulatory
authorization for the States to act.
\871\Transportation Co. v. Parkersburg, 107 U.S. 691, 701
(1883).
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The Court seized upon a previously rejected dictum of Chief
Justice Marshall\872\ and began applying it as a brake on the operation
of such laws with respect to interstate commerce in intoxicants, which
the Court denominated ``legitimate articles of commerce.'' While holding
that a State was entitled to prohibit the manufacture and sale within
its limits of intoxicants,\873\ even for an outside market, manufacture
being no part of commerce,\874\ it contemporaneously laid down the rule,
in Bowman v. Chicago & Northwestern Railway Co.,\875\ that, so long as
Congress remained silent in the matter, a State lacked the power, even
as part and parcel of a program of statewide prohibition of the traffic
in intoxicants, to prevent the shipment into it of intoxicants from a
sister State, and this holding was soon followed by another to the
effect that, so long as Congress remained silent, a State had no power
to prevent the sale in the original package of liquors introduced from
another State.\876\ The effect of the latter decision was soon overcome
by an act of Congress, the so-called Wilson Act, repealing its alleged
silence,\877\ but the Bowman decision still stood, the act in question
being interpreted by the Court not to subject liquors from sister States
to local authority until their arrival in the hands of the person to
whom consigned.\878\ Not until 1913 was the effect of
[[Page 218]]
the decision in the Bowman case fully nullified by the Webb-Kenyon
Act,\879\ which placed intoxicants entering a State from another State
under the control of the former for all purposes whatsoever.\880\
\872\In Brown v. Maryland, 12 Wheat. (25 U.S.) 419, 449 (1827),
in which the ``original package'' doctrine originated in the context of
state taxing powers exercised on imports from a foreign country,
Marshall in dictum indicated the same rule would apply to imports from
sister States. The Court refused to follow the dictum in Woodruff v.
Parham, 8 Wall. (75 U.S.) 123 (1869).
\873\Mugler v. Kansas, 123 U.S. 623 (1887).
\874\Kidd v. Pearson, 128 U.S. 1 (1888).
\875\125 U.S. 465 (1888).
\876\Leisy v. Hardin, 135 U.S. 100 (1890).
\877\26 Stat. 313 (1890), sustained in, In re Rahrer, 140 U.S.
545 (1891).
\878\Rhodes v. Iowa, 170 U.S. 412 (1898).
\879\37 Stat. 699 (1913), sustained in Clark-Distilling Co. v.
Western Md. Ry. Co., 242 U.S. 311 (1917). See also Dept. of Revenue v.
Beam Distillers, 377 U.S. 341 (1964).
\880\National Prohibition, under the Eighteenth Amendment, first
cast these conflicts into the shadows, and Sec. 2 of the Twenty-first
Amendment significantly altered the terms of the dispute. But that
section is no authorization for the States to engage in mere economic
protectionism separate from concerns about the effect of the traffic in
liquor. Bacchus Imports Ltd. v. Dias, 468 U.S. 263 (1984); Brown-Forman
Distillers Corp. v. New York State Liquor Auth., 476 U.S. 573 (1986);
Healy v. Beer Institute, 491 U.S. 324 (1989).
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Less than a year after the ruling in United States v. South-
Eastern Underwriters Assn.,\881\ that insurance transactions across
state lines constituted interstate commerce, thereby logically
establishing their immunity from discriminatory state taxation, Congress
passed the McCarran Act\882\ authorizing state regulation and taxation
of the insurance business. In Prudential Ins. Co. v. Benjamin,\883\ a
statute of South Carolina that imposed on foreign insurance companies,
as a condition of their doing business in the State, an annual tax of
three percent of premiums from business done in South Carolina, while
imposing no similar tax on local corporations, was sustained.
``Obviously,'' said Justice Rutledge for the Court, ``Congress' purpose
was broadly to give support to the existing and future State systems for
regulating and taxing the business of insurance. This was done in two
ways:
\881\322 U.S. 533 (1944).
\882\59 Stat. 33, 15 U.S.C. Sec. Sec. 1011-15.
\883\328 U.S. 408 (1946).
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``One was by removing obstructions which might be thought to
flow from its own power, whether dormant or exercised, except as
otherwise expressly provided in the Act itself or in future legislation.
The other was by declaring expressly and affirmatively that continued
State regulation and taxation of this business is in the public interest
and that the business and all who engage in it `shall be subject to' the
laws of the several States in these respects. . . . The power of
Congress over commerce exercised entirely without reference to
coordinated action of the States is not restricted, except as the
Constitution expressly provides, by any limitation which forbids it to
discriminate against interstate commerce and in favor of local trade.
Its plenary scope enables Congress not only to promote but also to
prohibit interstate commerce, as it has done frequently and for a great
variety of reasons. . . . This broad authority Congress may exercise
alone, subject to those limitations, or
[[Page 219]]
in conjunction with coordinated action by the States, in which case
limitations imposed for the preservation of their powers become
inoperative and only those designed to forbid action altogether by any
power or combination of powers in our governmental system remain
effective.''\884\
\884\Id., 429-430, 434-435. The Act restored state taxing and
regulatory powers over the insurance business to their scope prior to
South-Eastern Underwriters. Discriminatory state taxation otherwise
cognizable under the commerce clause must, therefore, be challenged
under other provisions of the Constitution. See Western, &, Southern
Life Ins. Co. v. State Bd. of Equalization, 451 U.S. 648 (1981). An
equal protection challenge was successful in Metropolitan Life Ins. Co.
v. Ward, 470 U.S. 869 (1985), invalidating a discriminatory tax and
stating that a favoring of local industries ``constitutes the very sort
of parochial discrimination that the Equal Protection Clause was
intended to prevent.'' Id., 878. Controversial when rendered, Ward may
be a sport in the law. See Northeast Bancorp v. Board of Governors of
the Federal Reserve System, 472 U.S. 159, 176-178 (1985).
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Thus, it is now well established that ``[w]hen Congress so
chooses, state actions which it plainly authorizes are invulnerable to
constitutional attack under the Commerce Clause.''\885\ But the Court
requires congressional intent to permit otherwise impermissible state
actions to ``be unmistakably clear.''\886\ The fact that federal
statutes and regulations had restricted commerce in timber harvested
from national forest lands in Alaska was, therefore, ``insufficient
indicium'' that Congress intended to authorize the State to apply a
similar policy for timber harvested from state lands. The rule requiring
clear congressional approval for state burdens on commerce was said to
be necessary in order to strengthen the likelihood that decisions
favoring one section of the country over another are in fact
``collective decisions'' made by Congress rather than unilateral choices
imposed on unrepresented out-of-state interests by individual
States.\887\ And Congress must be plain as well when the issue is not
whether it has exempted a state action from
[[Page 220]]
the commerce clause but whether it has taken the less direct form of
reduction in the level of scrutiny.\888\
\885\Northeast Bancorp v. Board of Governors of the Federal
Reserve System, 472 U.S. 159, 174 (1985) (interpreting a provision of
the Bank Holding Company Act, 12 U.S.C. Sec. 1842(d), permitting
regional interstate bank acquisitions expressly approved by the State in
which the acquired bank is located, as authorizing state laws that allow
only banks within the particular region to acquire an in-state bank, on
a reciprocal basis, since what the States could do entirely they can do
in part).
\886\South-Central Timber Dev., Inc. v. Wunnicke, 467 U.S. 82,
90 (1984).
\887\Id., 92. Earlier cases had required express statutory
sanction of state burdens on commerce but under circumstances arguably
less suggestive of congressional approval. E.g., Sporhase v. Nebraska ex
rel. Douglas, 458 U.S. 941, 958-960 (1982) (congressional deference to
state water law in 37 statutes and numerous interstate compacts did not
indicate congressional sanction for invalid state laws imposing a burden
on commerce); New England Power Co. v. New Hampshire, 455 U.S. 331, 341
(1982) (disclaimer in Federal Power Act of intent to deprive a State of
``lawful authority'' over interstate transmissions held not to evince a
congressional intent ``to alter the limits of state power otherwise
imposed by the Commerce Clause''). But see White v. Massachusetts
Council of Construction Employers, 460 U.S. 204 (1983) (Congress held to
have sanctioned municipality's favoritism of city residents through
funding statute under which construction funds were received).
\888\Maine v. Taylor, 477 U.S. 131 (1986) (holding that Lacey
Act's reinforcement of state bans on importation of fish and wildlife
neither authorizes state law otherwise invalid under the Clause nor
shifts analysis from the presumption of invalidity for discriminatory
laws to the balancing test for state laws that burden commerce only
incidentally).
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State Taxation and Regulation: The Old Law
Although in previous editions of this volume considerable
attention was paid to the development and circuitous paths of the law of
the negative commerce clause, the value of this exegesis was doubtlessly
quite limited. The Court itself has admitted that its ``some three
hundred full-dress opinions'' as of 1959 have not resulted in
``consistent or reconcilable'' doctrine but rather in something more
resembling a ``quagmire.''\889\ Although many of the principles still
applicable in constitutional law may be found in the older cases, in
fact the Court has worked a revolution in constitutional law in this
area, though at different times for taxation and for regulation. Thus,
in this section we summarize the ``old'' law and then deal more fully
with the ``modern'' law of the negative commerce clause.
\889\Northwestern States Portland Cement Co. v. Minnesota, 358
U.S. 450, 457-458 (1959) (in part quoting Miller Bros Co. v. Maryland,
347 U.S. 340, 344 (1954)). Justice Frankfurter was similarly skeptical
of definitive statements. ``To attempt to harmonize all that has been
said in the past would neither clarify what has gone before nor guide
the future. Suffice it to say that especially in this field opinions
must be read in the setting of the particular cases and as the product
pf preoccupation with their special facts.'' Freeman v. Hewit, 329 U.S.
249, 251-252 (1946). The comments in all three cases dealt with
taxation, but they could just as well have included regulation.
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General Considerations.--The task of drawing the line between
state power and the commercial interest has proved a comparatively
simple one in the field of foreign commerce, the two things being in
great part territorially distinct.\890\ With ``commerce among the
States'' affairs are very different. Interstate commerce is conducted in
the interior of the country, by persons and corporations that are
ordinarily engaged also in local business; its usual incidents are acts
that, if unconnected with commerce among the States, would fall within
the State's powers of police and taxation, while the things it deals in
and the instruments by which it is carried on comprise the most ordinary
subject matter of state power. In this field, the Court consequently has
been unable to rely upon sweeping solutions. To the contrary, its
judgments have often been fluctuating and tentative, even contradictory,
and this is particu
[[Page 221]]
larly the case with respect to the infringement on interstate commerce
by the state taxing power.\891\
\890\Infra, pp.240-242.
\891\In addition to the sources previously cited, see J.
Hellerstein & W. Hellerstein, State and Local Taxation--Cases and
Materials (5th ed. 1988), ch. 6, 241 passim. For a succinct description
of the history, see Hellerstein, State Taxation of Interstate Business:
Perspectives on Two Centuries of Constitutional Adjudication, 41 Tax
Law. 37 (1987).
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Taxation.--The leading case dealing with the relation of the
States' taxing power to interstate commerce, the case in which the Court
first struck down a state tax as violative of the commerce clause, was
the State Freight Tax Case.\892\ Before the Court was the validity of a
Pennsylvania statute that required every company transporting freight
within the State, with certain exceptions, to pay a tax at specified
rates on each ton of freight carried by it. The Court's reasoning was
forthright. Transportation of freight constitutes commerce.\893\ A tax
upon freight transported from one State to another effects a regulation
of interstate commerce.\894\ Under the Cooley doctrine, whenever the
subject of a regulation of commerce is in its nature of national
interest or admits of one uniform system or plan of regulation, that
subject is within the exclusive regulating control of Congress.\895\
Transportation of passengers or merchandise through a State, or from one
State to another, is of this nature.\896\ Hence, a state law imposing a
tax upon freight, taken up within the State and transported out of it or
taken up outside the State and transported into it, violates the
commerce clause.\897\
\892\Reading Railroad v. Pennsylvania, 15 Wall. (82 U.S.) 232
(1873).
\893\Id., 275.
\894\Id., 275-276, 279.
\895\Id., 279-280.
\896\Id., 280.
\897\Id., 281-282.
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The principle thus asserted, that a State may not tax interstate
commerce, confronted the principle that a State may tax all purely
domestic business within its borders and all property ``within its
jurisdiction.'' Inasmuch as most large concerns prosecute both an
interstate and a domestic business, while the instrumentalities of
interstate commerce and the pecuniary returns from such commerce are
ordinarily property within the jurisdiction of some State or other, the
task before the Court was to determine where to draw the line between
the immunity claimed by interstate business, on the one hand, and the
prerogatives claimed by local power on the other. In the State Tax on
Railway Gross Receipts Case,\898\ decided the same day as the State
Freight Tax Case, the issue was a tax upon gross receipts of all
railroads chartered by the State, part of
[[Page 222]]
the receipts having been derived from interstate transportation of the
same freight that had been held immune from tax in the first case. If
the latter tax were regarded as a tax on interstate commerce, it too
would fall. But to the Court, the tax on gross receipts of an interstate
transportation company was not a tax on commerce. ``[I]t is not
everything that affects commerce that amounts to a regulation of it,
within the meaning of the Constitution.''\899\ A gross receipts tax upon
a railroad company, which concededly affected commerce, was not a
regulation ``directly. Very manifestly it is a tax upon the railroad
company. . . . That its ultimate effect may be to increase the cost of
transportation must be admitted. . . . Still it is not a tax upon
transportation, or upon commerce. . . .''\900\
\898\Reading Railway Co. v. Pennsylvania, 15 Wall. (82 U.S.) 284
(1872).
\899\Id., 293.
\900\Id., 294. This case was overruled 14 years later, when the
Court voided substantially the same tax in Philadelphia Steamship Co. v.
Pennsylvania, 122 U.S. 326 (1887).
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Insofar as there is a distinction between these two cases, the
Court drew it in part on the basis of Cooley, that some subjects
embraced within the meaning of commerce demand uniform, national
regulation, while other similar subjects permit of diversity of
treatment, until Congress acts, and in part on the basis of a concept of
a ``direct'' tax on interstate commerce, which was impermissible, and an
``indirect'' tax, which was permissible until Congress acted.\901\
Confusingly, the two concepts were sometimes conflated, sometimes
treated separately. In any event, the Court itself was clear that
interstate commerce could not be taxed at all, even if the tax was a
nondiscriminatory levy applied alike to local commerce.\902\ ``Thus, the
States cannot tax interstate commerce, either by laying the tax upon the
business which constitutes such commerce or the privilege of engaging in
it, or upon the receipts, as such, derived from it . . . ; or upon
persons or property in transit in interstate commerce.''\903\ However,
some taxes imposed only an ``indirect'' burden and were sustained;
property taxes and taxes in lieu of property taxes applied to all
businesses, including instrumentalities of interstate commerce, were
sustained.\904\ A good rule
[[Page 223]]
of thumb in these cases is that taxation was sustained if the tax was
imposed on some local, rather than an interstate, activity or if the tax
was exacted before interstate movement had begun or after it had ended.
\901\See The Minnesota Rate Cases (Simpson v. Shepard), 230 U.S.
352, 398-412 (1913) (reviewing and summarizing at length both taxation
and regulation cases). See also Missouri ex rel. Barrett v. Kansas
Natural Gas Co., 265 U.S. 298, 307 (1924).
\902\Robbins v. Shelby County Taxing District, 120 U.S. 489, 497
(1887); Leloup v. Port of Mobile, 127 U.S. 640, 648 (1888).
\903\The Minnesota Rate Cases (Simpson v. Shepard), 230 U.S.
352, 400-401 (1913).
\904\The Delaware Railroad Tax, 18 Wall. (85 U.S.) 206, 232
(1873). See Cleveland, Cincinnati, Chicago & St. Louis Ry. Co. v.
Backus, 154 U.S. 439 (1894); Postal Telegraph Cable Co. v. Adams, 155
U.S. 688 (1895). See cases cited in J. Hellerstein & W. Hellerstein,
supra, n. 891, 215-219.
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An independent basis for invalidation was that the tax was
discriminatory, that its impact was intentionally or unintentionally
felt by interstate commerce and not by local, perhaps in pursuit of
parochial interests. Many of the early cases actually involving
discriminatory taxation were decided on the basis of the
impermissibility of taxing interstate commerce at all, but the category
was soon clearly delineated as a separate ground (and one of the most
important today).\905\
\905\E.g., Welton v. Missouri, 91 U.S. 275 (1875); Robbins v.
Shelby County Taxing District, 120 U.S. 489 (1887); Darnell & Son Co. v.
City of Memphis, 208 U.S. 113 (1908); Bethlehem Motors Corp. v. Flynt,
256 U.S. 421 (1921).
---------------------------------------------------------------------------
Following the Great Depression and under the leadership of
Justice, and later Chief Justice, Stone, the Court attempted to move
away from the principle that interstate commerce may not be taxed and
reliance on the direct-indirect distinction. Instead, a state or local
levy would be voided only if in the opinion of the Court it created a
risk of multiple taxation for interstate commerce not felt by local
commerce.\906\ It became much more important to the validity of a tax
that it be apportioned to an interstate company's activities within the
taxing State, so as to reduce the risk of multiple taxation.\907\ But,
just as the Court had achieved constancy in the area of regulation, it
reverted to the older doctrines in the taxation area and reiterated that
interstate commerce may not be taxed at all, even by a properly
apportioned levy, and reasserted the direct-indirect distinction.\908\
The stage was set, following a series of cases in which through
formalistic reasoning the States were permitted to evade the Court's
precedents,\909\ for the formulation of a more realistic doctrine.
\906\Western Live Stock v. Bureau of Revenue, 303 U.S. 250
(1938); McGoldrick v. Berwind-White Coal Mining Co., 309 U.S. 33 (1940);
International Harvester Co. v. Dept. of Treasury, 322 U.S. 340 (1944);
International Harvester Co. v. Evatt, 329 U.S. 416 (1947).
\907\E.g., Gwin, White & Prince, Inc. v. Henneford, 305 U.S. 434
(1939); Joseph v. Carter & Weekes Stevedoring Co., 330 U.S. 422 (1947);
Central Greyhound Lines, Inc. v. Mealey, 334 U.S. 653 (1948).
\908\Freeman v. Hewit, 329 U.S. 249 (1946); Spector Motor
Service, Inc. v. O'Connor, 340 U.S. 602 (1951).
\909\Thus, the States carefully phrased tax laws so as to impose
on interstate companies not a license tax for doing business in the
State, which was not permitted, Railway Express Agency v. Virginia, 347
U.S. 359 (1954), but a franchise tax on intangible property on the
privilege of doing business in a corporate form, which was permissible.
Railway Express Agency v. Virginia, 358 U.S. 434 (1959); Colonial
Pipeline Co. v. Traigle, 421 U.S. 100 (1975). Also, the Court
increasingly found the tax to be imposed on a local activity in
instances it would previously have seen to be an interstate activity.
E.g., Memphis Natural Gas Co. v. Stone, 335 U.S. 80 (1948); General
Motors Corp. v. Washington, 377 U.S. 436 (1964); Standard Pressed Steel
Co. v. Dept. of Revenue, 419 U.S. 560 (1975).
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[[Page 224]]
Regulation.--Much more diverse were the cases dealing with
regulation by the state and local governments. Taxation was one thing,
the myriad approaches and purposes of regulations another. Generally
speaking, if the state action was perceived by the Court to be a
regulation of interstate commerce itself, it was deemed to impose a
``direct'' burden on interstate commerce and impermissible. If the Court
saw it as something other than a regulation of interstate commerce, it
was considered only to ``affect'' interstate commerce or to impose only
an ``indirect'' burden on it in the proper exercise of the police powers
of the States.\910\ But the distinction between ``direct'' and
``indirect'' burdens was often perceptible only to the Court.\911\
\910\Sedler, The Negative Commerce Clause as a Restriction on
State Regulation and Taxation: An Analysis in Terms of Constitutional
Structure, 31 Wayne L. Rev. 885, 924-925 (1985). In addition to the
sources already cited, see the Court's summaries in The Minnesota Rate
Cases (Simpson v. Shepard), 230 U.S. 352, 398-412 (1913), and Southern
Pacific Co. v. Arizona, 325 U.S. 761, 766-770 (1945). In the latter
case, Chief Justice Stone was reconceptualizing the standards under the
clause, but the summary represents a faithful recitation of the law.
\911\See DiSanto v. Pennsylvania, 273 U.S. 34, 44 (1927)
(Justice Stone dissenting). The dissent was the precursor to Chief
Justice Stone's reformulation of the standard in 1945. DiSanto was
overruled in California v. Thompson, 313 U.S. 109 (1941).
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A corporation's status as a foreign entity did not immunize it
from state requirements, conditioning its admission to do a local
business, to obtain a local license, and to furnish relevant information
as well as to pay a reasonable fee.\912\ But no registration was
permitted of an out-of-state corporation, the business of which in the
host State was purely interstate in character.\913\ Neither did the
Court permit a State to exclude from the its courts a corporation
engaging solely in interstate commerce because of a failure to register
and to qualify to do business in that State.\914\
\912\Bank of Augusta v. Earle, 13 Pet. (38 U.S.) 519 (1839);
Hanover Fire Ins. Co. v. Harding, 272 U.S. 494 (1926); Union Brokerage
Co. v. Jensen, 322 U.S. 202 (1944).
\913\Crutcher v. Kentucky, 141 U.S. 47 (1891); International
Textbook Co. v. Pigg, 217 U.S. 91 (1910).
\914\Dahnke-Walker Co. v. Bondurant, 257 U.S. 282 (1921);
Allenberg Cotton Co. v. Pittman, 419 U.S. 20 (1974). But see Eli Lilly &
Co. v. Sav-on Drugs, 366 U.S. 276 (1961).
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Interstate transportation brought forth hundreds of cases. State
regulation of trains operating across state lines resulted in divergent
rulings. It was early held improper for States to prescribe charges for
transportation of persons and freight on the basis that
[[Page 225]]
the regulation must be uniform and thus could not be left to the
States.\915\ The Court deemed ``reasonable'' and therefore
constitutional many state regulations requiring a fair and adequate
service for its inhabitants by railway companies conducting interstate
service within its borders, as long as there was no unnecessary burden
on commerce.\916\ A marked tolerance for a class of regulations that
arguably furthered public safety was long exhibited by the Court,\917\
even in instances in which the safety connection was tenuous.\918\ Of
particular controversy were ``full-crew'' laws, represented as safety
measures, that were attacked by the companies as ``feather-bedding''
rules.\919\
\915\Wabash, S. L. & P. Ry. Co. v. Illinois, 118 U.S. 557
(1886). The power of the States generally to set rates had been approved
in Chicago, B. & Q. R. Co. v. Iowa, 94 U.S. 155 (1877), and Peik v.
Chicago & N. W. R. Co., 94 U.S. 164 (1877). After the Wabash decision,
States retained power to set rates for passengers and freight taken up
and put down within their borders. Wisconsin R. R. Comm. v. Chicago, B.
& Q. R. Co., 257 U.S. 563 (1922).
\916\Generally, the Court drew the line at regulations that
provided for adequate service, not any and all service. Thus, one class
of cases dealt with requirements that trains stop at designated cities
and towns. The regulations were upheld in such cases as Gladson v.
Minnesota, 166 U.S. 142 (1897), and Lake Shore & Mich. South. Ry. v.
Ohio, 173 U.S. 285 (1899), and invalidated in Illinois Central R. R. v.
Illinois, 142 (1896). See Chicago, B. & Q. Ry. v. Wisconsin R. R. Comm.,
237 U.S. 220, 226 (1915); St. Louis & S. F. Ry. v. Public Service Comm.,
254 U.S. 535, 536-537 (1921). The cases were extremely fact
particularistic.
\917\E.g., Smith v. Alabama, 124 U.S. 465 (1888) (required
locomotive engineers to be examined and licensed by the State, until
Congress should deem otherwise); New York, N. H. & H. Co. v. New York,
165 U.S. 628 (1897) (fobidding heating of passenger cars by stoves);
Chicago, R. I. & Pac. Ry. Co. v. Arkansas, 219 U.S. 453 (1911)
(requiring three brakemen on freight trains of more than 25 cars).
\918\E.g., Terminal Assn v. Trainmen, 318 U.S. 1 (1943)
(requiring railroad to provide caboose cars for its employees);
Hennington v. Georgia, 163 U.S. 299 (1896) (forbidding freight trains to
run on Sundays). But see Seaboard Air Line Ry. v. Blackwell, 244 U.S.
310 (1917) (voiding as too onerous on interstate transportation law
requiring trains to come to almost a complete stop at all grade
crossings, when there were 124 highway crossings at grade in 123 miles,
doubling the running time).
\919\Four cases over a lengthy period sustained the laws.
Chicago, R. I. & P. R. Co. v. Arkansas, 219 U.S. 453 (1911); St. Louis,
Iron Mt. & S. R. Co. v. Arkansas, 240 U.S. 518 (1916); Missouri Pacific
Co. v. Norwood, 283 U.S. 249 (1931); Brotherhood of Locomotive Firemen &
Enginemen v. Chicago, R. I. & P. R. Co., 382 U.S. 423 (1966). In the
latter case, the Court noted the extensive and conflicting record with
regard to safety, but it then ruled that with the issue in so much doubt
it was peculiarly a legislative choice.
---------------------------------------------------------------------------
Similarly, motor vehicle regulations have met mixed fates.
Basically, it has always been recognized that States, in the interest of
public safety and conservation of public highways, may enact and enforce
comprehensive licensing and regulation of motor vehicles using its
facilities.\920\ Indeed, States were permitted to regulate many of the
local activities of interstate firms and thus the
[[Page 226]]
interstate operations, in pursuit of these interests.\921\ Here, too,
safety concerns became overriding objects of deference, even in doubtful
cases.\922\ In regard to navigation, which had given rise to Gibbons v.
Ogden and Cooley, the Court generally upheld much state regulation on
the basis that the activities were local and did not demand uniform
rules.\923\
\920\Hendrick v. Maryland, 235 U.S. 610 (1915); Kane v. New
Jersey, 242 U.S. 160 (1916).
\921\E.g., Bradley v. Public Utility Comm., 289 U.S. 92 (1933)
(State could deny an interstate firm a necessary certificate of
convenience to operate as a common carrier on the basis that the route
was overcrowded); Welch Co. v. New Hampshire, 306 U.S. 79 (1939)
(maximum hours for drivers of motor vehicles); Eichholz v. Public
Service Comm., 306 U.S. 268 (1939) (reasonable regulations of traffic).
But compare Michigan Comm. v. Duke, 266 U.S. 570 (1925) (State may not
impose common-carrier responsibilities on business operating between
States that did not assume them); Buck v. Kuykendall, 267 U.S. 307
(1925) (denial of certificate of convenience under circumstances was a
ban on competition).
\922\E.g., Mauer v. Hamilton, 309 U.S. 598 (1940) (ban on
operation of any motor vehicle carrying any other vehicle above the head
of the operator). By far, the example of the greatest deference is South
Carolina Highway Dept. v. Barnwell Bros., 303 U.S. 177 (1938), in which
the Court upheld, in a surprising Stone opinion, truck weight and width
restrictions prescribed by practically no other State (in terms of the
width, no other).
\923\E.g., Transportation Co. v. City of Chicago, 99 U.S. 635
(1879); Williamette Iron Bridge Co. v. Hatch, 125 U.S. 1 (1888). See
Kelly v. Washington, 302 U.S. 1 (1937) (upholding state inspection and
regulation of tugs operating in navigable waters, in absence of federal
law).
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As a general rule, during this time, although the Court did not
permit States to regulate a purely interstate activity or prescribe
prices for purely interstate transactions,\924\ it did sustain a great
deal of price and other regulation imposed prior to or subsequent to the
travel in interstate commerce of goods produced for such commerce or
received from such commerce. For example, decisions late in the period
upheld state price-fixing schemes applied to goods intended for
interstate commerce.\925\
\924\E.g., Western Union Tel Co. v. Foster, 247 U.S. 105 (1918);
Lemke v. Framers Grain Co., 258 U.S. 50 (1922); State Corp. Comm. v.
Wichita Gas Co., 290 U.S. 561 (1934).
\925\Milk Control Board v. Eisenberg Co., 306 U.S. 346 (1939)
(milk); Parker v. Brown, 317 U.S. 341 (1943) (raisins).
---------------------------------------------------------------------------
However, the States always had an obligation to act
nondiscriminatorily. Just as in the taxing area, regulation that was
parochially oriented, to protect local producers or industries, for
instance, was not evaluated under ordinary standards but subjected to
practically per se invalidation. The mirror image of Welton v.
Missouri,\926\ the tax case, was Minnesota v. Barber,\927\ in which the
Court invalidated a facially neutral law that in its practical effect
discriminated against interstate commerce and in favor of local
commerce. The law required fresh meat sold in the State to have been
inspected by its own inspectors with 24 hours of slaughter.
[[Page 227]]
Thus, meat slaughtered in other States was excluded from the Minnesota
market. The principle of the case has a long pedigree of
application.\928\ State protectionist regulation on behalf of local milk
producers has occasioned judicial censure. Thus, in Baldwin v. G. A. F.
Seelig, Inc.,\929\ the Court had before it a complex state price-fixing
scheme for milk, in which the State, in order to keep the price of milk
artificially high within the State, required milk dealers buying out-of-
state to pay producers, wherever they were, what the dealers had to pay
within the State, and, thus, in-state producers were protected. And in
H. P. Hood & Sons v. Du Mond,\930\ the Court struck down a state refusal
to grant an out-of-state milk distributor a license to operate a milk
receiving station within the State on the basis that the additional
diversion of local milk to the other State would impair the supply for
the in-state market. A State may not bar an interstate market to protect
local interests.\931\
\926\91 U.S. 275 (1875).
\927\136 U.S. 313 (1890).
\928\E.g., Brimmer v. Rebman, 138 U.S. 78 (1891) (law requiring
postslaughter inspection in each county of meat transported over 100
miles from the place of slaughter); Dean Milk Co. v. City of Madison,
340 U.S. 349 (1951) (city ordinance preventing selling of milk as
pasteurized unless it had been processed and bottled at an approved
plant within a radius of five miles from the central square of Madison).
As the latter case demonstrates, it is constitutionally irrelevant that
other Wisconsin producers were also disadvantaged by the law. For a
modern application of the principle of these cases, see Fort Gratiot
Sanitary Landfill v. Michigan Natural Resources Dept., 112 S.Ct. 2019
(1992) (forbidding landfills from accepting out-of-county wastes).
\929\294 U.S. 511 (1935). See also Polar Ice Cream & Creamery
Co. v. Andrews, 375 U.S. 361 (1964). With regard to products originating
within the State, the Court had no difficulty with price fixing. Nebbia
v. New York, 291 U.S. 502 (1934).
\930\336 U.S. 525 (1949).
\931\And the Court does not permit a State to combat
discrimination against its own products by admitting only products
(here, again, milk) from States that have reciprocity agreements with it
to protect its own dealers. Great Atlantic & Pacific Tea Co. v.
Cottrell, 424 U.S. 366 (1976).
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State Taxation and Regulation: The Modern Law
General Considerations.--Transition from the old law to the
modern standard occurred relatively smoothly in the field of
regulation,\932\ but in the area of taxation the passage was choppy and
often witnessed retreats and advances.\933\ In any event, both taxation
and regulation now are evaluated under a judicial balancing
[[Page 228]]
formula comparing the burden on interstate commerce with the importance
of the state interest, save for discriminatory state action that cannot
be justified at all.
\932\Formulation of a balancing test was achieved in Southern
Pacific Co. v. Arizona, 325 U.S. 761 (1945),and was thereafter
maintained more or less consistently. The Court's current phrasing of
the test was in Pike v. Bruce Church, Inc., 397 U.S. 137 (1970).
\933\Indeed, scholars dispute just when the modern standard was
firmly adopted. The conventional view is that it was articulated in
Complete Auto Transit, Inc. v. Brady, 430 U.S. 274 (1977), but there
also seems little doubt that the foundation of the present law was laid
in Northwestern States Portland Cement Co. v. Minnesota, 358 U.S. 450
(1959).
---------------------------------------------------------------------------
Taxation.--During the 1940s and 1950s, there was engaged within
the Court a contest between the view that interstate commerce could not
be taxed at all, at least ``directly,'' and the view that the negative
commerce clause protected against the risk of double taxation.\934\ In
Northwestern States Portland Cement Co. v. Minnesota,\935\ the Court
reasserted the principle expressed earlier in Western Live Stock, that
the Framers did not intend to immunize interstate commerce from its just
share of the state tax burden even though it increased the cost of doing
business.\936\ Northwestern States held that a State could
constitutionally impose a nondiscriminatory, fairly apportioned net
income tax on an out-of-state corporation engaged exclusively in
interstate commerce in the taxing State. ``For the first time outside
the context of property taxation, the Court explicitly recognized that
an exclusively interstate business could be subjected to the states'
taxing powers.''\937\ Thus, in Northwestern States, foreign
corporations, which maintained a sales office and employed sales staff
in the taxing State for solicitation of orders for their merchandise
that, upon acceptance of the orders at their home office in another
jurisdiction, were shipped to customers in the taxing State, were held
liable to pay the latter's income tax on that portion of the net income
of their interstate business as was attributable to such solicitation.
\934\Compare Freeman v. Hewit, 329 U.S. 249, 252-256 (1946),
with Western Live Stock v. Bureau of Revenue, 303 U.S. 250, 258, 260
(1938).
\935\358 U.S. 450 (1959).
\936\Id., 461-462. See Western Live Stock v. Bureau of Revenue,
303 U.S. 250, 254 (1938). For recent reiterations of the principle, see
Quill Corp. v. North Dakota ex rel. Heitkamp, 112 S.Ct. 1904, 1912 n. 5
(1992) (citing cases).
\937\Hellerstein, State Taxation of Interstate Business:
Perspectives on Two Centuries of Constitutional Adjudication, 41 Tax
Law. 37, 54 (1987).
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Yet, the following years saw inconsistent rulings that turned
almost completely upon the use of or failure to use ``magic words'' by
legislative drafters. That is, it was constitutional for the States to
tax a corporation's net income, properly apportioned to the taxing
State, as in Northwestern States, but no State could levy a tax on a
foreign corporation for the privilege of doing business in the State,
both taxes alike in all respects.\938\ In Complete Auto Transit,
[[Page 229]]
Inc. v. Brady,\939\ the Court overruled the cases embodying the
distinction and articulated a standard that has governed the cases
since. The tax in Brady was imposed on the privilege of doing business
as applied to a corporation engaged in interstate transportation
services in the taxing State; it was measured by the corporation's gross
receipts from the service. The appropriate concern, the Court wrote, was
to pay attention to ``economic realities'' and to ``address the problems
with which the commerce clause is concerned.''\940\ The standard, a set
of four factors that was distilled from precedent but newly applied, was
firmly set out. A tax on interstate commerce will be sustained ``when
the tax is applied to an activity with a substantial nexus with the
taxing State, is fairly apportioned, does not discriminate against
interstate commerce, and is fairly related to the services provided by
the State.''\941\ All subsequent cases have been decided in this
framework.
\938\Spector Motor Service, Inc. v. O'Connor, 340 U.S. 602
(1951). The attenuated nature of the purported distinction was evidenced
in Colonial Pipeline Co. v. Traigle, 421 U.S. 100 (1975), in which the
Court sustained a nondiscriminatory, fairly apportioned franchise tax
that was measured by the taxpayer's capital stock, imposed on a pipeline
company doing an exclusively interstate business in the taxing State, on
the basis that it was a tax imposed on the privilege of conducting
business in the corporate form.
\939\430 U.S. 274 (1977).
\940\Id., 279, 288. ``In reviewing Commerce Clause challenges to
state taxes, our goal has instead been to `establish a consistent and
rational method of inquiry' focusing on `the practical effect of a
challenged tax.''' Commonwealth Edison Co. v. Montana, 453 U.S. 609, 615
(1981) (quoting Mobil Oil Corp. v. Comr. of Taxes, 445 U.S. 425, 443
(1980)).
\941\Id., 279. The rationale of these four parts of the test is
set out in Quill Corp. v. North Dakota ex rel. Heitkamp, 112 S.Ct. 1904,
1913 (1992).
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Nexus.--Nexus is a requirement that flows from both the commerce
clause and the due process clause of the Fourteenth Amendment.\942\ What
is required is ``some definite link, some minimum connection, between a
state and the person, property or transaction it seeks to tax.''\943\ In
its commerce-clause setting, the nexus requirement serves to effectuate
the ``structural concerns about the effects of state regulation on the
national economy.''\944\ That is, ``the `substantial-nexus' requirement
. . . limit[s] the reach of State taxing authority so as to ensure that
State taxation does not unduly burden interstate commerce.''\945\
\942\It had been thought that the tests of nexus under the
commerce clause and the due process clause were identical, but,
controversially, in Quill Corp. v. North Dakota ex rel. Heitkamp, 112
S.Ct. 1904, 1909-1911 (1992), but compare id., 1916 (Justice White
concurring in part and dissenting in part), the Court, stating that the
two ``are closely related,''(citing National Bellas Hess, Inc. v. Dept.
of Revenue of Illinois, 386 U.S. 753, 756 (1967)), held that the two
constitutionally requirements ``differ fundamentally'' and it found a
state tax met the due process test while violating the commerce clause.
\943\National Bellas Hess, Inc. v. Dept. of Revenue of Illinois,
386 U.S. 753, 756 (1967). The phraseology is quoted from a due process
case, Miller Bros. Co. v. Maryland, 347 U.S. 340, 344-345 (1954), but as
a statement it probably survives the bifurcation of the tests in Quill.
\944\Quill Corp. v. North Dakota ex rel. Heitkamp, 112 S.Ct.
1904, 1913 (1992).
\945\Ibid.
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Often surfacing in cases having to do with the imposition of an
obligation by a State on an out-of-state vendor to collect use taxes
[[Page 230]]
on goods sold to purchasers in the taxing State, the test is a
``physical presence'' standard. The Court has sustained the imposition
on mail order sellers with retail outlets, solicitors, or property
within the taxing State,\946\ but it has denied the power to a State
when the only connection is that the company communicates with customers
in the State by mail or common carrier as part of a general interstate
business.\947\ The validity of general business taxes on interstate
enterprises may also be determined by the nexus standard. However,
again, only a minimal contact is necessary.\948\ Thus, maintenance of
one full-time employee within the State (plus occasional visits by non-
resident engineers) to make possible the realization and continuance of
contractual relations seemed to the Court to make almost frivolous a
claim of lack of sufficient nexus.\949\ The application of a state
business-and-occupation tax on the gross receipts from a large wholesale
volume of pipe and drainage products in the State was sustained, even
though the company maintained no office, owned no property, and had no
employees in the State, its marketing activities being carried out by an
in-state independent contractor.\950\ Also, the Court upheld a State's
application of a use tax to aviation fuel stored temporarily in the
State prior to loading on aircraft for consumption in interstate
flights.\951\
\946\Scripto v. Carson, 362 U.S. 207 (1960); National Geographic
Society v. California Bd. of Equalization, 430 U.S. 551 (1977). The
agents in the State in Scripto were independent contractors, rather than
employees, but this distinction was irrelevant. See also Tyler Pipe
Industries v. Dept. of Revenue, 483 U.S. 232, 249-250 (1987)
(reaffirming Scripto on this point). See also D. H. Holmes Co. v.
McNamara, 486 U.S. 24 (1988) (imposition of use tax on catalogs, printed
outside State at direction of an in-state corporation and shipped to
prospective customers within the State, upheld).
\947\National Bellas Hess, Inc. v. Department of Revenue of
Illinois, 386 U.S. 753 (1967), reaffirmed with respect to the commerce
clause in Quill Corp. v. North Dakota ex rel. Heitkamp, 112 S.Ct. 1904
(1992).
\948\Some in-state contact is necessary in many instances by
statutory compulsion. Reacting to Northwestern States, Congress enacted
P.L. 86-272, 15 U.S.C. Sec. 381, providing that mere solicitation by a
company acting outside the State did not support imposition of a state
income tax on a company's proceeds. See Heublein, Inc. v. South Carolina
Tax Comm., 409 U.S. 275 (1972); Wisconsin Dept. of Revenue v. William
Wrigley, Jr., Co., 112 S.Ct. 2447 (1992).
\949\Standard Pressed Steel Co. v. Dept. of Revenue, 419 U.S.
560 (1975). See also General Motors Corp. v. Washington, 377 U.S. 436
(1964).
\950\Tyler Pipe Industries, Inc. v. Dept. of Revenue, 483 U.S.
232, 249-251 (1987). The Court noted its agreement with the state court
holding that ```the crucial factor governing nexus is whether the
activities performed in this state on behalf of the taxpayer are
significantly associated with the taxpayer's ability to establish and
maintain a market in this state for the sales.''' Id., 250.
\951\United Air lines v. Mahin, 410 U.S. 623 (1973).
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Given the complexity of modern corporations and their frequent
diversification and control of subsidiaries, state treatment of
businesses operating within and without their borders requires an
appropriate definition of the scope of business operations. Thus,
[[Page 231]]
States may impose a tax in accordance with a ``unitary business''
apportionment formula on concerns carrying on part of their business
within the taxing State based upon the company's entire proceeds. But
there must be a nexus, or minimal connection, between the interstate
activities and the taxing State and a rational relationship between the
income attributed to the State and the intrastate values of the
enterprise.\952\
\952\Container Corp. of America v. Franchise Tax Board, 463 U.S.
159, 165-169 (1983); ASARCO Inc. v. Idaho State Tax Comm., 458 U.S. 307,
316-17 (1982).
---------------------------------------------------------------------------
Apportionment.--This requirement is of long standing,\953\ but
its importance has broadened as the scope of the States' taxing powers
has enlarged. It is concerned with what formulas the States must use to
claim a share of a multistate business' tax base for the taxing State,
when the business carries on a single integrated enterprise both within
and without the State. A State may not exact from interstate commerce
more than the State's fair share. Avoidance of multiple taxation, or the
risk of multiple taxation, is the test of an apportionment formula.
Generally speaking, this factor is both a commerce clause and a due
process requisite, and it necessitates a rational relationship between
the income attributed to the State and the intrastate values of the
enterprise.\954\ The Court has declined to impose any particular formula
on the States, reasoning that to do so would be to require the Court in
engage in ``extensive judicial lawmaking,'' for which it was ill-suited
and for which Congress had ample power and ability to legislate.\955\
\953\E.g., Pullman's Palace Car Co. v. Pennsylvania, 141 U.S.
18, 26 (1891); Maine v. Grand Trunk Ry., 142 U.S. 217, 278 (1891).
\954\The recent cases are, Moorman Mfg. Co. v. Bair, 437 U.S.
267 (1978); Mobil Oil Corp. v. Comr. of Taxes, 445 U.S. 425 (1980);
Exxon Corp. v. Wisconsin Dept. of Revenue, 447 U.S. 207 (1980); ASARCO
v. Idaho State Tax Comm., 458 U.S. 307 (1982); F. W. Woolworth Co. v.
New Mexico TaxationRevenue Dept., 458 U.S. 354 (1982); Container Corp.
of America v. Franchise Tax Board, 463 U.S. 159 (1983); Tyler Pipe
Industries v. Dept. of Revenue, 483 U.S. 232, 251 (1987); Allied-Signal,
Inc. v. Director, Div. of Taxation, 112 S.Ct. 2251 (1992). Cf. American
Trucking Assns., Inc. v. Scheiner, 483 U.S. 266 (1987).
\955\Moorman Mfg. Co. v. Bair, 437 U.S. 267, 278-280 (1978).
---------------------------------------------------------------------------
Rather, ``we determine whether a tax is fairly apportioned by
examining whether it is internally and externally consistent.''\956\
``To be internally consistent, a tax must be structured so that if every
State were to impose an identical tax, no multiple taxation would
result. Thus, the internal consistency test focuses on the text of the
challenged statute and hypothesizes a situation where other States have
passed an identical statute. . . .
\956\Goldberg v. Sweet, 488 U.S. 252, 261 (1989).
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``The external consistency test asks whether the State has taxed
only that portion of the revenues from the interstate activity which
reasonably reflects the in-state component of the activity
[[Page 232]]
being taxed. We thus examine the in-state business activity which
triggers the taxable event and the practical or economic effect of the
tax on that interstate activity.''\957\ In the latter case, the Court
upheld as properly apportioned a state tax on the gross charge of any
telephone call originated or terminated in the State and charged to an
in-state service address, regardless of where the telephone call was
billed or paid.\958\A complex state tax imposed on trucks displays the
operation of the test. Thus, a state registration tax met the internal
consistency test because every State honored every other States', and a
motor fuel tax similarly was sustained because it was apportioned to
mileage traveled in the State, whereas lump-sum annual taxes, an axle
tax and an identification marker fee, being unapportioned flat taxes
imposed for the use of the State's roads, were voided, under the
internal consistency test, because if every State imposed them the
burden on interstate commerce would be great.\959\
\957\Id., 261, 262 (internal citations omitted).
\958\Id. The tax law provided a credit for any taxpayer who was
taxed by another State on the same call. Actual multiple taxation could
thus be avoided, the risks of other multiple taxation was small, and it
was impracticable to keep track of the taxable transactions.
\959\American Trucking Assns., Inc. v. Scheiner, 483 U.S. 266
(1987).
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Discrimination.--The ``fundamental principle'' governing this
factor is simple. ```No State may, consistent with the Commerce Clause,
impose a tax which discriminates against interstate commerce . . . by
providing a direct commercial advantage to local business.'''\960\ That
is, a tax which by its terms or operation imposes greater burdens on
out-of-state goods or activities than on competing in-state goods or
activities will be struck down as discriminatory under the commerce
clause.\961\ In Armco. Inc. v. Hardesty,\962\ the Court voided as
discriminatory the imposition on an out-of-state wholesaler of a state
tax that was levied on manufacturing and wholesaling but that relieved
manufacturers subject to the manufacturing tax of liability for paying
the wholesaling tax. Even though the former tax was higher than the
latter, the Court found the imposition discriminated against the
interstate wholesaler.\963\ A state excise tax on wholesale liquor
sales, which ex
[[Page 233]]
empted sales of specified local products, was held to violate the
commerce clause.\964\ A state statute that granted a tax credit for
ethanol fuel if the ethanol was produced in the State, or if produced in
another State that granted a similar credit to the State's ethanol fuel,
was found discriminatory in violation of the clause.\965\
\960\Boston Stock Exchange v. State Tax Comm., 429 U.S. 318, 329
(1977) (quoting Northwestern States Portland Cement Co. v. Minnesota,
358 U.S. 450, 457 (1959)). The principle, as we have observed above, is
a long-standing one under the commerce clause. E.g., Welton v. Missouri,
91 U.S. 275 (1876).
\961\Maryland v. Louisiana, 451 U.S. 725, 753-760 (1981). But
see Commonwealth Edison Co. v. Montana, 453 U.S. 609, 617-619 (1981).
\962\467 U.S. 638 (1984).
\963\The Court applied the ``internal consistency'' test here,
too, in order to determine the existence of discrimination. Id., 644-
645. Thus, the wholesaler did not have to demonstrate it had paid a like
tax to another State, only that if other States imposed like taxes it
would be subject to discriminatory taxation. See also Tyler Pipe
Industries v. Washington State Dept. of Revenue, 483 U.S. 232 (1987);
American Trucking Assns., Inc. v. Scheiner, 483 U.S. 266 (1987); Amerada
Hess Corp. v. Director, New Jersey Taxation Div., 490 U.S. 66 (1989);
Kraft General Foods v. Iowa Dept. of Revenue, 112 S.Ct. 2365 (1992)
\964\Bacchus Imports, Ltd. v. Dias, 468 U.S. 263 (1984).
\965\New Energy Co. of Indiana v. Limbach, 486 U.S. 269 (1988).
---------------------------------------------------------------------------
Benefit Relationship.--Although, in all the modern cases, the
Court has stated that a necessary factor to sustain state taxes having
an interstate impact is that the levy be fairly related to benefits
provided by the taxing State, it has declined to be drawn into any
consideration of the amount of the tax or the value of the benefits
bestowed. The test rather is whether, as a matter of the first factor,
the business has the requisite nexus with the State; if it does, the tax
meets the fourth factor simply because the business has enjoyed the
opportunities and protections which the State has afforded it.\966\
\966\Commonwealth Edison Co. v. Montana, 453 U.S. 609, 620-629
(1981). Two state taxes imposing flat rates on truckers, because they
did not vary directly with miles traveled or with some other proxy for
value obtained from the State, were found to violate this standard in
American Trucking Assns., Inc. v. Scheiner, 483 U.S. 266, 291 (1987),
but this oblique holding was tagged onto an elaborate opinion holding
the taxes invalid under two other Brady tests, and, thus, the
precedential value is questionable.
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Regulation.--Adoption of the modern standard of commerce-clause
review of state regulation of or having an impact on interstate commerce
was achieved in Southern Pacific Co. v. Arizona,\967\ although it was
presaged in a series of opinions, mostly dissents, by Chief Justice
Stone.\968\ The Southern Pacific case tested the validity of a state
train-length law, justified as a safety measure. Revising a hundred
years of doctrine, the Chief Justice wrote that whether a state or local
regulation was valid depended upon a ``reconciliation of the conflicting
claims of state and national power is to be attained only by some
appraisal and accommodation of the competing demands of the state and
national interests involved.''\969\ Save in those few cases in which
Congress has acted, ``this Court, and not the state legislature, is
under the commerce
[[Page 234]]
clause the final arbiter of the competing demands of state and national
interests.''\970\
\967\325 U.S. 761 (1945).
\968\E.g., DiSanto v. Pennsylvania, 273 U.S. 34, 43 (1927)
(dissenting); California v. Thompson, 313 U.S. 109 (1941); Duckworth v.
Arkansas, 314 U.S. 390 (1941); Parker v. Brown, 317 U.S. 341, 362-368
(1943) (alternative holding).
\969\Southern Pacific Co. v. Arizona, 325 U.S. 761, 768-769
(1941).
\970\Id., 769.
---------------------------------------------------------------------------
That the test to be applied was a balancing one, the Chief
Justice made clear at length, stating that in order to determine whether
the challenged regulation was permissible, ``matters for ultimate
determination are the nature and extent of the burden which the state
regulation of interstate trains, adopted as a safety measure, imposes on
interstate commerce, and whether the relative weights of the state and
national interests involved are such as to make inapplicable the rule,
generally observed, that the free flow of interstate commerce and its
freedom from local restraints in matters requiring uniformity of
regulation are interests safeguarded by the commerce clause from state
interference.''\971\
\971\Id., 770-771.
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The test today continues to be the Stone articulation, although
the more frequently quoted encapsulation of it is from Pike v. Bruce
Church, Inc.\972\ ``Where the statute regulates even-handedly to
effectuate a legitimate local public interest, and its effects on
interstate commerce are only incidental, it will be upheld unless the
burden imposed on such commerce is clearly excessive in relation to the
putative local benefits. . . . If a legitimate local purpose is found,
then the question becomes one of degree. And the extent of the burden
that will be tolerated will of course depend on the nature of the local
interest involved, and on whether it could be promoted as well with a
lesser impact on interstate activities.''
\972\397 U.S. 137, 142 (1970).
---------------------------------------------------------------------------
Obviously, the test requires ``even-handedness.'' Discrimination
in regulation is another matter altogether. When on its face or in its
effect a regulation betrays ``economic protectionism,'' an intent to
benefit in-state economic interests at the expense of out-of-state
interests, no balancing is required. ``When a state statute clearly
discriminates against interstate commerce, it will be struck down . . .
unless the discrimination is demonstrably justified by a valid factor
unrelated to economic protectionism, . . . . Indeed, when the state
statute amounts to simple economic protectionism, a `virtually per se
rule of invalidity' has applied.''\973\ Thus, an Oklahoma law that
required coal-fired electric utilities in the State, producing
[[Page 235]]
power for sale in the State, to burn a mixture of coal containing at
least 10% Oklahoma-mined coal was invalidated at the behest of a State
that had previously provided virtually 100% of the coal used by the
Oklahoma utilities.\974\ Similarly, the Court invalidated a state law
that permitted interdiction of export of hydroelectric power from the
State to neighboring States, when in the opinion of regulatory
authorities the energy was required for use in the State; a State may
not prefer its own citizens over out-of-state residents in access to
resources within the State.\975\
\973\Wyoming v. Oklahoma, 112 S.Ct. 789, 800 (1992) (quoting
City of Philadelphia v. New Jersey, 437 U.S. 617, 624 (1978)). See also
Brown-Forman Distillers Corp. v. New York State Liquor Auth., 476 U.S.
573, 579 (1986). In Maine v. Taylor, 477 U.S. 131 (1986), the Court did
uphold a protectionist law, finding a valid justification aside from
economic protectionism. The State barred the importation of out-of-state
baitfish, and the Court credited lower-court findings that legitimate
ecological concerns existed about the possible presence of parasites and
nonnative species in baitfish shipments.
\974\Wyoming v. Oklahoma, 112 S.Ct. 789 (1992). See also
Maryland v. Louisiana, 451 U.S. 725 (1981) (a tax case, invalidating a
state first-use tax, which, because of exceptions and credits, imposed a
tax only on natural gas moving out-of-state, because of impermissible
discrimination).
\975\New England Power Co. v. New Hampshire, 455 U.S. 331
(1982). See also Hughes v. Oklahoma, 441 U.S. 322 (1979) (voiding a ban
on transporting minnows caught in the State for sale outside the State);
Sporhase v. Nebraska, 458 U.S. 941 (1982) (invalidating a ban on the
withdrawal of ground water from any well in the State intended for use
in another State). These cases largely eviscerated a line of older cases
recognizing a strong state interest in protection of animals and
resources. See Geer v. Connecticut, 161 U.S. 519 (1896). New England
Power had rather old antecedents. E.g., West v. Kansas Gas Co., 221 U.S.
229 (1911); Pennsylvania v. West Virginia, 262 U.S. 553 (1923).
---------------------------------------------------------------------------
States may certainly promote local economic interests and favor
local consumers, but they may not do so by adversely regulating out-of-
state producers or consumers. In Hunt v. Washington State Apple
Advertising Comm.,\976\ the Court confronted a state requirement that
closed containers of apples offered for sale or shipped into North
Carolina carry no grade other than the applicable U. S. grade.
Washington State mandated that all apples produced in and shipped in
interstate commerce pass a much more rigorous inspection than that
mandated by the United States. The inability to display the recognized
state grade in North Carolina impeded marketing of Washington apples.
The Court obviously suspected the impact was intended, but, rather than
strike the state requirement down as purposeful, it held that the
regulation had the practical effect of discriminating, and, inasmuch as
no defense based on possible consumer protection could be presented, the
state law was invalidated.\977\ State actions to promote local products
and
[[Page 236]]
producers, of everything from milk\978\ to alcohol,\979\ may not be
achieved through protectionism.
\976\432 U.S. 333 (1977). Other cases in which the State was
attempting to promote and enhance local products and businesses include
Pike v. Bruce Church, Inc., 397 U.S. 137 (1970) (State required producer
of high-quality cantaloupes to pack them in the State, rather than in an
adjacent State at considerably less expense, in order that the produce
be identified with the producing State); Foster-Fountain Packing Co. v.
Haydel, 278 U.S. 1 (1928) (State banned export of shrimp from State
until hulls and heads were removed and processed, in order to favor
canning and manufacture within the State).
\977\That discriminatory effects will result in invalidation, as
well as purposeful discrimination, is also drawn from Dean Milk Co. v.
City of Madison, 340 U.S. 349 (1951)
\978\E.g., H. P. Hood & Sons v. Du Mond, 336 U.S. 525 (1949).
See also Great Atlantic & Pacific Tea Co. v. Cottrell, 424 U.S. 366
(1976) (state effort to combat discrimination by other States against
its milk through reciprocity provisions).
\979\Healy v. Beer Institute, Inc., 491 U.S. 324 (1989); Brown-
Forman Distillers Corp. v. New York State Liquor Auth., 476 U.S. 573
(1986). And see Bacchus Imports, Ltd. v. Dias, 468 U.S. 263 (1984) (a
tax case).
---------------------------------------------------------------------------
Even garbage transportation and disposition is covered by the
negative commerce clause. A state law that banned the importation of
most solid or liquid wastes that originated outside the State was struck
down, because the State could not justify it as a health or safety
measure, in the form of a quarantine, inasmuch as it did not limit in-
state disposal at its landfills; the State was simply attempting to
conserve landfill space and lower costs to its residents by keeping out
trash from other States.\980\ States may not interdict the movement of
persons into the State, whatever the motive to protect themselves from
economic or similar difficulties.\981\
\980\City of Philadelphia v. New Jersey, 437 U.S. 617 (1978),
reaffirmed and applied in Chemical Waste Management, Inc. v. Hunt, 112
S.Ct. 2009 (1992), and Fort Gratiot Sanitary Landfill v. Michigan
Natural Resources Dept., 112 S.Ct. 2019 (1992).
\981\Edwards v. California, 314 U.S. 160 (1941) (California
effort to bar ``Okies,'' persons fleeing the Great Plains dust bowl in
the Depression). Cf. the notable case of Crandall v. Nevada, 6 Wall. (73
U.S.) 35 (1867) (without tying it to any particular provision of
Constitution, Court finds a protected right of interstate movement). The
right of travel is now an aspect of equal protection jurisprudence.
---------------------------------------------------------------------------
Drawing the line between discriminatory regulations that are
almost per se invalid and regulations that necessitate balancing is not
an easy task. Not every claim of protectionism is sustained. Thus, in
Minnesota v. Clover Leaf Creamery Co.,\982\ there was attacked a state
law banning the retail sale of milk products in plastic, nonreturnable
containers but permitting sales in other nonreturnable, nonrefillable
containers, such as paperboard cartons. The Court found no
discrimination against interstate commerce, because both in-state and
out-of-state interests could not use plastic containers, and it refused
to credit a lower, state-court finding that the measure was intended to
benefit the local pulpwood industry. In Exxon Corp. v. Governor of
Maryland,\983\ the Court upheld a statute that prohibited producers or
refiners of petroleum products from operating retail service stations in
Maryland. No discrimination was found, first, because there were no
local producers or refiners within Maryland and therefore since the
State's entire gasoline supply flowed in interstate commerce there was
no favoritism, and, second, although the bar on operating fell entirely
on
[[Page 237]]
out-of-state concerns, there were out-of-state concerns that did not
produce or refine gasoline and they were able to continue operating in
the State, so that there was some distinction between all in-state
operators and some out-of-state operators as against some other out-of-
state operators.
\982\449 U.S. 456, 470-474 (1981).
\983\437 U.S. 117 (1978).
---------------------------------------------------------------------------
Still a model example of balancing is Chief Justice Stone's
opinion in Southern Pacific Co. v. Arizona.\984\ At issue was the
validity of Arizona's law barring the operation within the State of
trains of more than 14 passenger cars, no other State had a figure this
low, or 70 freight cars, only one other State had a cap this low. First,
the Court observed that the law substantially burdened interstate
commerce. Enforcement of the law in Arizona, while train lengths went
unregulated or were regulated by varying standards in other States,
meant that interstate trains of a length lawful in other States had to
be broken up before entering the State; inasmuch as it was not
practicable to break up trains at the border, that act had to be
accomplished at yards quite removed, with the result that the Arizona
limitation controlled train lengths as far east as El Paso, Texas, and
as far west as Los Angeles. Nearly 95% of the rail traffic in Arizona
was interstate. The other alternative was to operate in other States
with the lowest cap, Arizona's, with the result that that State's law
controlled the railroads' operations over a wide area.\985\ If other
States began regulating at different lengths, as they would be permitted
to do, the burden on the railroads would burgeon. Moreover, the
additional number of trains needed to comply with the cap just within
Arizona was costly, and delays were occasioned by the need to break up
and remake lengthy trains.\986\
\984\325 U.S. 761 (1945). Interestingly, Justice Stone had
written the opinion for the Court in South Carolina State Highway Dept.
v. Barnwell Bros., 303 U.S. 177 (1938), in which, in a similar case
involving regulation of interstate transportation and proffered safety
reasons, he had eschewed balancing and deferred overwhelmingly to the
state legislature. Barnwell Bros. involved a state law that prohibited
use on state highways of trucks that were over 90 inches wide or that
had a gross weight over 20,000 pounds, with from 85% to 90% of the
Nation's trucks exceeding these limits. This deference and refusal to
evaluate evidence resurfaced in a case involving an attack on railroad
``full-crew'' laws. Brotherhood of Locomotive Firemen & Enginemen v.
Chicago, R.I. & P. Railroad Co., 393 U.S. 129 (1968).
\985\The concern about the impact of one State's regulation upon
the laws of other States is in part a reflection of the Cooley national
uniformity interest and partly a hesitation about the autonomy of other
States, E.g., CTS Corp. v. Dynamics Corp. of America, 481 U.S. 69, 88-89
(1987); Brown-Forman Distillers Corp. v. New York State Liquor Auth.,
476 U.S. 573, 583-584 (1986).
\986\Southern Pacific Co. v. Arizona, 325 U.S. 761, 771-775
(1945).
---------------------------------------------------------------------------
Conversely, the Court found that as a safety measure the state
cap had ``at most slight and dubious advantage, if any, over unregulated
train lengths.'' That is, while there were safety problems
[[Page 238]]
with longer trains, the shorter trains mandated by state law required
increases in the numbers of trains and train operations and a consequent
increase in accidents generally more severe than those attributable to
longer trains. In short, the evidence did not show that the cap lessened
rather than increased the danger of accidents.\987\
\987\Id., 775-779, 781-784.
---------------------------------------------------------------------------
Conflicting state regulations appeared in Bibb v. Navajo Freight
Lines, Inc.\988\ There, Illinois required the use of contour mudguards
on trucks and trailers operating on the State's highways, while adjacent
Arkansas required the use of straight mudguards and banned contoured
ones. At least 45 States authorized straight mudguards. The Court sifted
the evidence and found it conflicting on the comparative safety
advantages of contoured and straight mudguards. But, admitting that if
that were all that was involved the Court would have to sustain the
costs and burdens of outfitting with the required mudguards, the Court
invalidated the Illinois law, because of the massive burden on
interstate commerce occasioned by the necessity of truckers to shift
cargoes to differently designed vehicles at the State's borders.
\988\359 U.S. 520 (1959).
---------------------------------------------------------------------------
Arguably, the Court in more recent years has continued to
stiffen the scrutiny with which it reviews state regulation of
interstate carriers purportedly for safety reasons.\989\ Difficulty
attends any evaluation of the possible developing approach, inasmuch as
the Court has spoken with several voices. A close reading, however,
indicates that while the Court is most reluctant to invalidate
regulations that touch upon safety and that if safety justifications are
not illusory it will not second-guess legislative judgment, nonetheless,
the Court will not accept, without more, state assertions of safety
motivations. ``Regulations designed for that salutary purpose
nevertheless may further the purpose so marginally, and interfere with
commerce so substantially, as to be invalid under the Commerce Clause.''
Rather, the asserted safety purpose must be weighed against the degree
of interference with interstate commerce. ``This `weighing' . . .
requires . . . `a sensitive consideration of the weight and nature of
the state regulatory concern in light of the extent of the burden
imposed on the course of interstate commerce.''\990\
\989\Raymond Motor Transp. v. Rice, 434 U.S. 429 (1978); Kassel
v. Consolidated Freightways Corp., 450 U.S. 662 (1981).
\990\Kassel v. Consolidated Freightways Corp., 450 U.S. 662, 67-
671 (1981) (quoting Raymond Motor Transp. v. Rice, 434 U.S. 429, 441,
443 (1978)). Both cases invalidated state prohibitions of the use of 65-
foot single-trailer trucks on state highways.
---------------------------------------------------------------------------
[[Page 239]]
Balancing has been used in other than transportation-industry
cases. Indeed, the modern restatement of the standard was in such a
case.\991\ There, the State required cantaloupes grown in the State to
be packed there, rather than in an adjacent State, so that in-state
packers' names would be associated with a superior product. Promotion of
a local industry was legitimate, the Court, said, but it did not justify
the substantial expense the company would have to incur to comply. State
efforts to protect local markets, concerns, or consumers against outside
companies have largely been unsuccessful. Thus, a state law that
prohibited ownership of local investment-advisory businesses by out-of-
state banks, bank-holding companies, and trust companies was
invalidated.\992\ The Court plainly thought the statute was
protectionist, but instead of voiding it for that reason it held that
the legitimate interests the State might have did not justify the
burdens placed on out-of-state companies and that the State could pursue
the accomplishment of legitimate ends through some intermediate form of
regulation. In Edgar v. Mite Corp.,\993\ an Illinois regulation of take-
over attempts of companies that had specified business contacts with the
State, as applied to an attempted take-over of a Delaware corporation
with its principal place of business in Connecticut, was found to
constitute an undue burden, with special emphasis upon the
extraterritorial effect of the law and the dangers of disuniformity.
These problems were found lacking in the next case, in which the state
statute regulated the manner in which purchasers of corporations
chartered within the State and with a specified percentage of in-state
shareholders could proceed with their take-over efforts. The Court
emphasized that the State was regulating only its own corporations,
which it was empowered to do, and no matter how many other States
adopted such laws there would be no conflict. The burdens on interstate
commerce, and the Court was not that clear that the effects of the law
were burdensome in the appropriate context, were justified by the
State's interests in regulating its corporations and resident
shareholders.\994\
\991\Pike v. Bruce Church, Inc., 397 U.S. 137 (1970).
\992\Lewis v. BT Investment Managers, Inc., 447 U.S. 27 (1980).
\993\457 U.S. 624 (1982) (plurality opinion).
\994\CTS Corp. v. Dynamics Corp. of America, 481 U.S. 69 (1987).
---------------------------------------------------------------------------
In other areas, while the Court repeats balancing language, it
has not applied it with any appreciable bite,\995\ but in most re
[[Page 240]]
spects the state regulations involved are at most problematic in the
context of the concerns of the commerce clause.
\995\E.g., Northwest Central Pipeline Corp. v. State Corp. Comm.
of Kansas, 489 U.S. 493, 525-526 (1989); Minnesota v. Clover Leaf
Creamery Co., 449 U.S. 456, 472-474 (1981); Exxon Corp. v. Governor of
Maryland, 437 U.S. 117, 127-128 (1978). But see Bendix Autolite Corp. v.
Midwesco Enterprises, Inc., 486 U.S. 888 (1988).
---------------------------------------------------------------------------
Foreign Commerce and State Powers
State taxation and regulation of commerce from abroad are also
subject to negative commerce clause constraints. In the seminal case of
Brown v. Maryland,\996\ in the course of striking down a state statute
requiring ``all importers of foreign articles or commodities,''
preparatory to selling the goods, to take out a license, Chief Justice
Marshall developed a lengthy exegesis explaining why the law was void
under both the import-export clause\997\ and the commerce clause.
According to the Chief Justice, an inseparable part of the right to
import was the right to sell, and a tax on the sale of an article is a
tax on the article itself. Thus, the taxing power of the States did not
extend in any form to imports from abroad so long as they remain ``the
property of the importer, in his warehouse, in the original form or
package'' in which they were imported, hence, the famous ``original
package'' doctrine. Only when the importer parts with his importations,
mixes them into his general property by breaking up the packages, may
the State treat them as taxable property.
\996\12 Wheat. (25 U.S.) 419 (1827).
\997\Article I, Sec. 10, cl. 2. This aspect of the doctrine of
the case was considerably expanded in Low v. Austin, 13 Wall. (80 U.S.)
29 (1872), and subsequent cases, to bar States from levying
nondiscriminatory, ad valorem property taxes upon goods that are no
longer in import transit. This line of cases was overruled in Michelin
Tire Corp. v. Wages, 423 U.S. 276 (1976).
---------------------------------------------------------------------------
Obviously, to the extent that the import-export clause was
construed to impose a complete ban on taxation of imports so long as
they were in their original packages, there was little occasion to
develop a commerce-clause analysis that would have reached only
discriminatory taxes or taxes upon goods in transit.\998\ In other
respects, however, the Court has applied the foreign commerce aspect of
the clause more stringently against state taxation.
\998\See, e.g., Halliburton Oil Well Cementing Co. v. Reily, 373
U.S. 64 (1963); Minnesota v. Blasius, 290 U.S. 1 (1933). After the
holding in Michelin Tire, the two clauses are now congruent. The Court
has observed that the two clauses are animated by the same policies.
Japan Line, Ltd. v. County of Los Angeles, 441 U.S. 434, 449-450 n. 14
(1979).
---------------------------------------------------------------------------
Thus, in Japan Line, Ltd. v. County of Los Angeles,\999\ the
Court held that, in addition to satisfying the four requirements that
govern the permissibility of state taxation of interstate
commerce,\1000\ ``When a State seeks to tax the instrumentalities of for
[[Page 241]]
eign commerce, two additional considerations . . . come into play. The
first is the enhanced risk of multiple taxation. . . . Second, a state
tax on the instrumentalities of foreign commerce may impair federal
uniformity in an area where federal uniformity is essential.''\1001\
Multiple taxation is to be avoided with respect to interstate commerce
by apportionment so that no jurisdiction may tax all the property of a
multistate business, and the rule of apportionment is enforced by the
Supreme Court with jurisdiction over all the States. However, the Court
is unable to enforce such a rule against another country, and the
country of the domicile of the business may impose a tax on full value.
Uniformity could be frustrated by disputes over multiple taxation, and
trade disputes could result.
\999\441 U.S. 434 (1979).
\1000\Complete Auto Transit, Inc. v. Brady, 430 U.S. 274, 279
(1977). A state tax failed to pass the nondiscrimination standard in
Kraft General Foods, Inc. v. Iowa Dept. of Revenue & Finance, 112 S.Ct.
2365 (1992). Iowa imposed an income tax on a unitary business operating
throughout the United States and in several foreign countries. It
included in the tax base of corporations the dividends the companies
received from subsidiaries operating in foreign countries, but it
allowed exclusions from the base of dividends received from domestic
subsidiaries. A domestic subsidiary doing business in Iowa was taxed but
not ones that did no business. Thus, there was a facial distinction
between foreign and domestic commerce.
\1001\Id., 446, 448.
---------------------------------------------------------------------------
Applying both these concerns, the Court invalidated a state tax,
a nondiscriminatory, ad valorem property tax, on foreign-owned
instrumentalities, i.e., cargo containers, of international commerce.
The containers were used exclusively in international commerce and were
based in Japan, which did in fact tax them on full value. Thus, there
was the actuality, not only the risk, of multiple taxation. National
uniformity was endangered, because, while California taxed the Japanese
containers, Japan did not tax American containers, and disputes
resulted.\1002\
\1002\Id., 451-457. For income taxes, the test is more lenient,
accepting not only the risk but the actuality of some double taxation as
something simply inherent in accounting devices. Container Corp. of
America v. Franchise Tax Bd., 463 U.S. 159, 187-192 (1983).
---------------------------------------------------------------------------
On the other hand, the Court has upheld a state tax on all
aviation fuel sold within the State as applied to a foreign airline
operating charters to and from the United States. The Court found the
Complete Auto standards met, and it similarly decided that the two
standards specifically raised in foreign commerce cases were not
violated. First, there was no danger of double taxation because the tax
was imposed upon a discrete transaction, the sale of fuel, that occurred
within one jurisdiction only. Second, the one-voice standard was
satisfied, inasmuch as the United States had never entered into any
compact with a foreign nation precluding such state taxation, having
only signed agreements with others, having no force of law, aspiring to
eliminate taxation that constituted im
[[Page 242]]
pediments to air travel.\1003\ Also, a state unitary-tax scheme that
used a worldwide-combined reporting formula was upheld as applied to the
taxing of the income of a domestic-based corporate group with extensive
foreign operations.\1004\
\1003\Wardair Canada v. Florida Dept. of Revenue, 477 U.S. 1
(1986).
\1004\Container Corp. of America v. Franchise Tax Bd., 463 U.S.
159 (1983). The validity of the formula as applied to domestic
corporations with foreign parents or to foreign corporations with
foreign parents or foreign subsidiaries, so that some of the income
earned abroad would be taxed within the taxing State, is a question of
some considerable dispute.
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The power to regulate foreign commerce was always broader than
the States' power to tax it, an exercise of the ``police power''
recognized by Chief Justice Marshall in Brown v. Maryland.\1005\ That
this power was constrained by notions of the national interest and
preemption principles was evidenced in the cases striking down state
efforts to curb and regulate the actions of shippers bringing persons
into their ports.\1006\ On the other hand, quarantine legislation to
protect the States' residents from disease and other hazards was
commonly upheld though it regulated international commerce.\1007\ A
state game-season law applied to criminalize the possession of a dead
grouse imported from Russia was upheld because of the practical
necessities of enforcement of domestic law.\1008\
\1005\12 Wheat. (25 U.S.) 419, 443-444 (1827).
\1006\New York City v. Miln, 11 Pet. (36 U.S.) 102 (1837)
(upholding reporting requirements imposed on ships' masters), overruled
in Henderson v. New York, 92 U.S. 259 (1876); Passenger Cases (Smith v.
Turner), 7 How. (48 U.S.) 282 (1849); Chy Lung v. Freeman, 92 U.S. 275
(1876).
\1007\Campagnie Francaise De Navigation a Vapeur v. Louisiana
State Bd. of Health, 186 U.S. 380 (1902); Louisiana v. Texas, 176 U.S. 1
(1900); Morgan v. Louisiana, 118 U.S. 455 (1886).
\1008\New York ex rel. Silz v. Hesterberg, 211 U.S. 31 (1908).
---------------------------------------------------------------------------
Nowadays, state regulation of foreign commerce is likely to be
judged by the extra factors set out in Japan Line.\1009\ Thus, the
application of a state civil rights law to a corporation transporting
passengers outside the State to an island in a foreign province was
sustained in an opinion emphasizing that, because of the particularistic
geographic situation the foreign commerce involved was more conceptual
than actual, there was only a remote hazard of conflict between state
law and the law of the other country and little if any prospect of
burdening foreign commerce.\1010\
\1009\Japan Line, Inc. v. County of Los Angeles, 441 U.S. 434,
456 n. 20 (1979) (construing Bob-Lo Excursion Co. v. Michigan, 333 U.S.
28 (1948)).
\1010\Ibid.
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[[Page 243]]
CONCURRENT FEDERAL AND STATE JURISDICTION
The General Issue: Preemption
In Gibbons v. Ogden,\1011\ the Court, speaking by Chief Justice
Marshall, held that New York legislation that excluded from the
navigable waters of that State steam vessels enrolled and licensed under
an act of Congress to engage in the coasting trade was in conflict with
the federal law and hence void.\1012\ The result, said the Chief
Justice, was required by the supremacy clause, which proclaimed not only
that the Constitution itself but statutes enacted pursuant to it and
treaties superseded state laws that ``interfere with, or are contrary to
the laws of Congress . . . . In every such case, the act of Congress, or
the treaty, is supreme; and the law of the State, though enacted in the
exercise of powers not controverted, must yield to it.''\1013\
\1011\9 Wheat. (22 U.S.) 1 (1824).
\1012\A modern application of Gibbons v. Ogden is Douglas v.
Seacoast Products, 431 U.S. 265 (1977), in which the Court, in reliance
on the present version of the licensing statute utilized by Chief
Justice Marshall, struck down state laws curtailing the operations of
federally licensed vessels. In the course of the Douglas opinion, the
Court observed that ``[a]lthough it is true that the Court's view in
Gibbons of the intent of the Second Congress in passing the Enrollment
and Licensing Act is considered incorrect by commentators, its
provisions have been repeatedly re-enacted in substantially the same
form. We can safely assume that Congress was aware of the holding, as
well as the criticism, of a case so renowned as Gibbons. We have no
doubt that Congress has ratified the statutory interpretation of Gibbons
and its progeny.'' Id., 278-279.
\1013\Gibbons v. Ogden, 9 Wheat. (22 U.S.) 1, 211 (1824). See
also McCulloch v. Maryland, 4 Wheat. (17 U.S.) 316, 436 (1819). Although
preemption is basically constitutional in nature, deriving its
forcefulness from the supremacy clause, it is much more like statutory
decisionmaking, inasmuch as it depends upon an interpretation of an act
of Congress in determining whether a state law is ousted. E.g., Douglas
v. Seacoast Products, Inc., 431 U.S. 265, 271-272 (1977). See also Swift
& Co. v. Wickham, 382 U.S. 111 (1965). ``Any such pre-emption or
conflict claim is of course grounded in the Supremacy Clause of the
Constitution: if a state measure conflicts with a federal requirement,
the state provision must give way. The basic question involved in these
cases, however, is never one of interpretation of the Federal
Constitution but inevitably one of comparing two statutes.'' Id., 120.
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Since the turn of the century, federal legislation, primarily
but not exclusively under the commerce clause, has penetrated deeper and
deeper into areas once occupied by the regulatory power of the States.
One result is that state laws on subjects about which Congress has
legislated have been more and more frequently attacked as being
incompatible with the acts of Congress and invalid under the supremacy
clause.\1014\
\1014\Cases considered under this heading are overwhelmingly
about federal legislation based on the commerce clause, but the
principles enunciated are identical whatever source of power Congress
utilizes. Therefore, cases arising under legislation based on other
powers are cited and treated interchangeably.
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[[Page 244]]
``The constitutional principles of preemption, in whatever
particular field of law they operate, are designed with a common end in
view: to avoid conflicting regulation of conduct by various official
bodies which might have some authority over the subject matter.''\1015\
As Justice Black once explained in a much quoted exposition of the
matter: ``There is not--and from the very nature of the problem there
cannot be--any rigid formula or rule which can be used as a universal
pattern to determine the meaning and purpose of every act of Congress.
This Court, in considering the validity of state laws in the light of
treaties or federal laws touching the same subject, has made use of the
following expressions: conflicting; contrary to; occupying the field;
repugnance; difference; irreconcilability; inconsistency; violation;
curtailment; and interference. But none of these expressions provides an
infallible constitutional test or an exclusive constitutional yardstick.
In the final analysis, there can be no one crystal clear distinctly
marked formula. Our primary function is to determine whether, under the
circumstances of this particular case, Pennsylvania's law stands as an
obstacle to the accomplishment and execution of the full purposes and
objectives of Congress.''\1016\
\1015\Amalgamated Assn. of Street, Electric Ry. & Motor Coach
Employees v. Lockridge, 403 U.S. 274, 285-286 (1971).
\1016\Hines v. Davidowitz, 312 U.S. 52, 67 (1941). This case
arose under the immigration power of cl. 4.
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Before setting out in their various forms the standards and
canons to which the Court formally adheres, one must still recognize the
highly subjective nature of their application. As an astute observer
long ago observed, ``the use or non-use of particular tests, as well as
their content, is influenced more by judicial reaction to the
desirability of the state legislation brought into question than by
metaphorical sign-language of `occupation of the field.' And it would
seem that this is largely unavoidable. The Court, in order to determine
an unexpressed congressional intent, has undertaken the task of making
the independent judgment of social values that Congress has failed to
make. In making this determination, the Court's evaluation of the
desirability of overlapping regulatory schemes or overlapping criminal
sanctions cannot but be a substantial factor.''\1017\
\1017\Cramton, Pennsylvania v. Nelson: A Case Study in Federal
Preemption, 26 U. Chi. L. Rev. 85, 87-88 (1956). ``The [Court] appears
to use essentially the same reasoning process in a case nominally
hinging on preemption as it has in past cases in which the question was
whether the state law regulated or burdened interstate commerce. [The]
Court has adopted the same weighing of interests approach in preemption
cases that it uses to determine whether a state law unjustifiably
burdens interstate commerce. In a number of situations the Court has
invalidated statutes on the preemption ground when it appeared that the
state laws sought to favor local economic interests at the expense of
the interstate market. On the other hand, when the Court has been
satisfied that valid local interests, such as those in safety or in the
reputable operation of local business, outweigh the restrictive effect
on interstate commerce, the Court has rejected the preemption argument
and allowed state regulation to stand.'' Note, Preemption as a
Preferential Ground: A New Canon of Construction, 12 Stan. L. Rev. 208,
217 (1959) (quoted approvingly as a ``thoughtful student comment'' in G.
Gunther, Constitutional Law (12th ed. 1991), 297).
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[[Page 245]]
Preemption Standards.--Until roughly the New Deal, as recited
above, the Supreme Court applied a doctrine of ``dual federalism,''
under which the Federal Government and the States were separate
sovereigns, each preeminent in its own fields but not overlapping. This
conception affected preemption cases, with the Court taking the view,
largely, that any congressional regulation of a subject effectively
preempted the field and ousted the States.\1018\ Thus, when Congress
entered the field of railroad regulation, the result was invalidation of
many previously enacted state measures. Even here, however, safety
measures tended to survive, and health and safety legislation in other
areas were protected from the effects of federal regulatory actions.
\1018\E.g., Charleston & W. Car. Ry. v. Varnville Furniture Co.,
237 U.S. 597, 604 (1915). But see Corn Products Refining Co. v. Eddy,
249 U.S. 427, 438 (1919).
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In the 1940s, the Court began to develop modern standards for
determining when preemption occurred, which are still recited and relied
on.\1019\ All modern cases recite some variation of the basic standards.
``[T]he question whether a certain state action is pre-empted by federal
law is one of congressional intent. The purpose of Congress is the
ultimate touchstone. To discern Congress' intent we examine the explicit
statutory language and the structure and purpose of the statute.''\1020\
Congress' intent to supplant state authority in a particular field may
be express in the terms of the statute.\1021\ Since preemption cases,
when the statute contains no express provision, theoretically turn on
statutory construction, generalizations about them can carry one only so
far. Each case must construe a different federal statute with a distinct
legislative history. If the statute and the legislative history are
silent or unclear, the Supreme Court has developed over time general
criteria which
[[Page 246]]
it purports to utilize in determining the preemptive effect of federal
legislation.
\1019\E.g., Hines v. Davidowitz, 312 U.S. 52 (1941); Cloverleaf
Butter v. Patterson, 315 U.S. 148 (1942); Rice v. Santa Fe Elevator Co.,
331 U.S. 218 (1947); California v. Zook, 336 U.S. 725 (1949).
\1020\Gade v. National Solid Wastes Mgmt. Assn., 112 S.Ct. 2374,
2381-2382 (1992) (internal quotation marks and case citations omitted).
Recourse to legislative history as one means of ascertaining
congressional intent, although contested, is permissible. Wisconsin
Public Intervenor v. Mortier, 501 U.S. 597, 606-612 & n. 4 (1991).
\1021\Jones v. Rath Packing Co., 430 U.S. 519, 525 (1977); FMC
Corp. v. Holliday, 498 U.S. 52, 56-57 (1991); Wisconsin Public
Intervenor v. Mortier, 501 U.S. 597, 604-605 (1991).
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``Absent explicit pre-emptive language, we have recognized at
least two types of implied pre-emption: field pre-emption, where the
scheme of federal regulation is so pervasive as to make reasonable the
inference that Congress left no room for the States to supplement it,
. . . and conflict pre-emption, where compliance with both federal and
state regulations is a physical impossibility, . . . or where state law
stands as an obstacle to the accomplishment and execution of the full
purposes and objectives of Congress.''\1022\ ``Preemption of state law
by federal statute or regulation is not favored `in the absence of
persuasive reasons--either that the nature of the regulated subject
matters permits no other conclusion, or that the Congress has
unmistakably so ordained.''\1023\ However, ``[t]he relative importance
to the State of its own law is not material when there is a conflict
with a valid federal law, for the Framers of our Constitution provided
that the federal law must prevail.''\1024\
\1022\Gade v. National Solid Wastes Mgmt. Assn., 112 S.Ct. 2374,
2383 (1992) (internal quotation marks and case citations omitted). The
same or similar language is used throughout the preemption cases. E.g.,
Cipollone v. Liggett Group, Inc, 112 S.Ct. 2608, 2617 (1992); id., 2625-
2626 (Justice Blackmun concurring and dissenting); id., 2632-2634
(Justice Scalia concurring and dissenting); Wisconsin Public Intervenor
v. Mortier, 501 U.S. 597, 604-605 (1991); English v. General Electric
Co., 496 U.S. 72, 78-80 (1990); Silkwood v. Kerr-McGee Corp., 464 U.S.
238, 248 (1984); Pacific Gas & Elec. Co. v. State Energy Resources
Conservation & Dev. Comm., 461 U.S. 190, 203-204 (1983); Fidelity
Federal Savings & Loan Assn. v. de la Cuesta, 458 U.S. 141, 153 (1982);
Florida Lime & Avocado Growers v. Paul, 373 U.S. 132, 142 (1963); Hines
v. Davidowitz, 312 U.S. 52, 67 (1941).
\1023\Florida Lime & Avocado Growers v. Paul, 373 U.S. 132, 142
(1963); Chicago & Northwestern Transp. Co. v. Kalo Brick & Tile Co., 450
U.S. 311, 317 (1981). Where Congress legislates in a field traditionally
occupied by the States, courts should ``start with the assumption that
the historic police powers of the States were not to be superseded by
the Federal Act unless that was the clear and manifest purpose of
Congress.'' Pacific Gas & Electric Co. v. State Energy Resources
Conservation & Dev. Comm., 461 U.S. 190, 206 (1983) ((quoting Rice v.
Santa Fe Elevator Corp., 331 U.S. 218, 230 (1947)).
\1024\Free v. Brand, 369 U.S. 633, 666 (1962).
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In the final conclusion, ``the generalities'' that may be drawn
from the cases do not decide them. Rather, ``the fate of state
legislation in these cases has not been determined by these generalities
but by the weight of the circumstances and the practical and experienced
judgment in applying these generalities to the particular
instances.''\1025\
\1025\Union Brokerage Co. v. Jensen, 322 U.S. 202, 211 (1944)
(per Justice Frankfurter).
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The Standards Applied.-- As might be expected from the caveat
just quoted, any overview of the Court's preemption decisions
[[Page 247]]
can only make the field seem muddled and to some extent it is. But some
guidelines may be extracted.
Express Preemption. Of course, it is possible for Congress to
write preemptive language that clearly and cleanly prescribes or does
not prescribe displacement of state laws in an area.\1026\ Provisions
governing preemption can be relatively interpretation free.\1027\ For
example, a prohibition of state taxes on carriage of air passengers ``or
on the gross receipts derived therefrom'' was held to preempt a state
tax on airlines, described by the State as a personal property tax, but
based on a percentage of the airline's gross income; ``the manner in
which the state legislature has described and categorized [the tax]
cannot mask the fact that the purpose and effect of the provision are to
impose a levy upon the gross receipts of airlines.''\1028\ But, more
often than not, express preemptive language may be ambiguous or at least
not free from conflicting interpretation. Thus, the Court was divided
with respect to whether a provision of the Airline Deregulation Act
proscribing the States from having and enforcing laws ``relating to
rates, routes, or services of any air carrier'' applied to displace
state consumer-protection laws regulating airline fare
advertising.\1029\
\1026\Not only congressional enactments can preempt. Agency
regulations, when Congress has expressly or implied empowered these
bodies to preempt, are ``the supreme law of the land'' under the
supremacy clause and can displace state law. E.g., City of New York v.
FCC, 486 U.S. 57, 63-64 (1988); Louisiana Public Service Comm. v. FCC,
476 U.S. 355 (1986); Capital Cities Cable, Inc. v. Crisp, 467 U.S. 691
(1984); Fidelity Federal Savings & Loan Assn. v. de la Cuesta, 458 U.S.
141 (1982). Federal common law, i.e., law promulgated by the courts
respecting uniquely federal interests and absent explicit statutory
directive by Congress, can also displace state law. See Boyle v. United
Technologies Corp., 487 U.S. 500 (1988) (Supreme Court promulgated
common-law rule creating government-contractor defense in tort liability
suits, despite Congress having considered and failed to enact bills
doing precisely this); Westfall v. Erwin, 484 U.S. 292 (1988) (civil
liability of federal officials for actions taken in the course of their
duty). Finally, ordinances of local governments are subject to
preemption under the same standards as state law. Hillsborough County v.
Automated Medical Laboratories, 471 U.S. 707 (1985).
\1027\Thus, Sec. 408 of the Federal Meat Inspection Act, as
amended by the Wholesome Meat Act, 21 U.S. C. Sec. 678, provides that
``[m]arking, labeling, packaging, or ingredient requirements in addition
to, or different than, those made under this chapter may not be imposed
by any state . . . .'' See Jones v. Rath Packing Co., 430 U.S. 519, 528-
532 (1977). Similarly, much state action is saved by the Securities
Exchange Act of 1934, 15 U.S.C. Sec. 78bb(a), which states that
``[n]othing in this chapter shall affect the jurisdiction of the
securities commissioner (or any agency or officer performing like
functions) of any State over any security or any person insofar as it
does not conflict with the provisions of this chapter or the rules and
regulations thereunder.'' For examples of other express preemptive
provisions, see Norfolk & Western Railway Co. v. American Train
Dispatchers' Assn., 499 U.S. 117 (1991); Exxon Corp. v. Hunt, 475 U.S.
355 (1986).
\1028\Aloha Airlines v. Director of Taxation, 464 U.S. 7, 13-14
(1983).
\1029\Morales v. TWA, 112 S.Ct. 2031 (1992). The section, 49
U.S.C. Sec. 1305(a)(1), was held to preempt state rules on advertising.
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[[Page 248]]
Perhaps the broadest preemption section ever enacted, Sec. 514
of the Employment Retirement Income Security Act of 1974 (ERISA), is so
constructed that the Court has been moved to comment that the provisions
``are not a model of legislative drafting.''\1030\ The section declares
that the statute shall ``supersede any and all State laws insofar as
they now or hereafter relate to any employee benefit plan,'' but saves
to the States the power to enforce ``law[s] . . . which regulates
insurance, banking, or securities,'' except that an employee benefit
plan governed by ERISA shall not be ``deemed'' an insurance company, an
insurer, or engaged in the business of insurance for purposes of state
laws ``purporting to regulate'' insurance companies or insurance
contracts.\1031\ Interpretation of the provisions has resulted in
contentious and divided Court opinions.\1032\
\1030\Metropolitan Life Ins. Co. v. Massachusetts, 471 U.S. 724,
739 (1985), repeated in FMC Corp. v. Holliday, 498 U.S. 52, 58 (1991).
\1031\29 U.S.C. Sec. Sec. 1144(a), 1144(b)(2)(A), 1144(b)(2)(B).
The Court has described this section as a ``virtually unique pre-emption
provision.'' Franchise Tax Board v. Construction Laborers Vacation
Trust, 463 U.S. 1, 24 n. 26 (1983). See Ingersoll-Rand Co. v. McClendon,
498 U.S. 133, 138-139 (1990); and see id., 142-145 (describing and
applying another preemption provision of ERISA).
\1032\Ingersoll-Rand Co. v. McClendon, 498 U.S. 133 (1990)
(ERISA preempts state common-law claim of wrongful discharge to prevent
employee attaining benefits under plan covered by ERISA); FMC Corp. v.
Holliday, 498 U.S. 52 (1990) (provision of state motor-vehicle
financial-responsibility law barring subrogation and reimbursement from
claimant's tort recovery for benefits received from a self-insured
health-care plan preempted by ERISA); Fort Halifax Packing Co. v. Coyne,
482 U.S. 1 (1987) (state law requiring employers to provide a one-time
severance payment to employees in the event of a plant closing held not
preempted by 5-4 vote); Metropolitan Life Ins. Co. v. Massachusetts, 471
U.S. 724 (1985) (state law mandating that certain minimum mental-health-
care benefits be provided to those insured under general health-
insurance policy or employee health-care plan is a law ``which regulates
insurance'' and is not preempted); Shaw v. Delta Air Lines, Inc., 463
U.S. 85 (1983) (state law forbidding discrimination in employee benefit
plans on the basis of pregnancy not preempted, because of another saving
provision in ERISA, and provision requiring employers to pay sick-leave
benefits to employees unable to work because of pregnancy not preempted
under construction of coverage sections, but both laws ``relate to''
employee benefit plans); Alessi v. Raybestos-Manhattan, Inc., 451 U.S.
504 (1981) (state law prohibiting plans from reducing benefits by amount
of workers' compensation awards ``relates to'' employee benefit plan and
is preempted);
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Illustrative of the judicial difficulty with ambiguous
preemption language is the fractured opinions in the Cipollone case, in
which the Court had to decide whether sections of the Federal Cigarette
Labeling and Advertising Act, enacted in 1965 and 1969, preempted state
common-law actions against a cigarette company for the alleged harm
visited on a smoker.\1033\ The 1965 provision
[[Page 249]]
barred the requirement of any ``statement'' relating to smoking health,
other than what the federal law imposed, and the 1969 provision barred
the imposition of any ``requirement or prohibition based on smoking and
health'' by any ``State law.'' It was, thus, a fair question whether
common-law claims, based on design defect, failure to warn, breach of
express warranty, fraudulent misrepresentation, and conspiracy to
defraud, were preempted or whether only positive state enactments came
within the scope of the clauses. Two groups of Justices concluded that
the 1965 section reached only positive state law and did not preempt
common-law actions;\1034\ different alignments of Justices concluded
that the 1969 provisions did reach common-law claims, as well as
positive enactments, and did preempt some of the claims insofar as they
in fact constituted a requirement or prohibition based on smoking
health.\1035\
\1033\Cipollone v. Liggett Group, Inc., 112 S.Ct. 2608 (1992).
The decision as a canon of construction promulgated two controversial
rules. First, the courts should interpret narrowly provisions that
purport to preempt state police-power regulations, and, second, that
when a law has express preemption language courts should look only to
that language and presume that when the preemptive reach of a law is
defined Congress did not intend to go beyond that reach, so that field
and conflict preemption will not be found. Id., 2618; and id., 2625-2626
(Justice Blackmun concurring and dissenting). Both parts of this canon
are departures from established law. Narrow construction when state
police powers are involved has hitherto related to implied preemption,
not express, and courts generally have applied ordinary-meaning
construction to such statutory language; further, courts have not
precluded the finding of conflict preemption, though perhaps field
preemption, because of the existence of some express preemptive
language. See id., 2632-2634 (Justice Scalia concurring and dissenting).
\1034\Id., 2618-2619 (opinion of the court), 2626 (Justice
Blackmun concurring).
\1035\Id., 2619-2625 (plurality opinion), 2626-2631 (Justice
Blackmun concurring and dissenting), 2634-2637 (Justice Scalia
concurring and dissenting).
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Field Preemption. Where the scheme of federal regulation is ``so
pervasive as to make reasonable the inference that Congress left no room
for the States to supplement it,''\1036\ States are ousted from the
field. Still a paradigmatic example of field preemption is Hines v.
Davidowitz,\1037\ in which the Court held that a new federal law
requiring the registration of all aliens in the country precluded
enforcement of a pre-existing state law mandating registration of aliens
within the State. Adverting to the supremacy of national power in
foreign relations and the sensitivity of the relationship between the
regulation of aliens and the conduct of foreign affairs, the Court had
little difficulty declaring the entire field to have been occupied by
federal law.\1038\ Similarly, in Pennsylvania
[[Page 250]]
v. Nelson,\1039\ the Court invalidated as preempted a state law
punishing sedition against the National Government. The Court enunciated
a three-part test: 1) the pervasiveness of federal regulation; 2)
federal occupation of the field as necessitated by the need for national
uniformity; and 3) the danger of conflict between state and federal
administration.\1040\
\1036\Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 230 (1947).
The case also is the source of the often quoted maxim that when Congress
legislates in a field traditionally occupied by the States, courts
should ``start with the assumption that the historic police powers of
the States were not to be superseded by the Federal Act unless that was
the clear and manifest purpose of Congress.'' Ibid.
\1037\312 U.S. 52 (1941).
\1038\The Court also said that courts must look to see whether
under the circumstances of a particular case, the state law ``stands as
an obstacle to the accomplishment and execution of the full purposes and
objectives of Congress.'' Id., 67. That standard is obviously drawn from
conflict preemption, for the two standards are frequently intermixed.
Nonetheless, not all state regulation is precluded. De Canas v. Bica,
424 U.S. 351 (1976) (upholding a state law penalizing the employment of
an illegal alien, the case arising before enactment of the federal law
doing the same thing).
\1039\350 U.S. 497 (1956).
\1040\Id., 502-505. Obviously, there is a noticeable blending
into conflict preemption.
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The Rice case itself held that a federal system of regulating
the operations of warehouses and the rates they charged completely
occupied the field and ousted state regulation.\1041\ However, it is
often a close decision whether a federal law has regulated part of a
field, however defined, or the whole area, so that state law cannot even
supplement the federal.\1042\ Illustrative of this point is the Court's
holding that the Atomic Energy Act's preemption of the safety aspects of
nuclear power did not invalidate a state law conditioning construction
of nuclear power plants on a finding by a state agency that adequate
storage and disposal facilities were available to treat nuclear wastes,
since ``economic'' regulation of power generation has traditionally been
left to the States - an arrangement maintained by the Act - and since
the state law could be justified as an economic rather than a safety
regulation.\1043\
\1041\Rice v. Santa Fe Elevator Corp., 331 U.S. 218 (1947).
\1042\Compare Campbell v. Hussey, 368 U.S. 297 (1961) (state law
requiring tobacco of a certain type to be marked by white tags, ousted
by federal regulation that occupied the field and left no room for
supplementation), with Florida Lime & Avocado Growers, Inc., 373 U.S.
132 (1963) (state law setting minimum oil content for avocados certified
as mature by federal regulation is complementary to federal law, since
federal standard was a minimum one, the field having not been occupied).
One should be wary of assuming that a state law that has dual purposes
and impacts will not, just for the duality, be held to be preempted. See
Gade v. National Solid Wastes Mgmt., 112 S.Ct. 2374 (1992); Perez v.
Campbell, 402 U.S. 637 (1971) (under bankruptcy clause).
\1043\Pacific Gas & Electric Co. v. Energy Resources
Conservation & Dev. Comm., 461 U.S. 190 (1983). Neither does the same
reservation of exclusive authority to regulate nuclear safety preempt
imposition of punitive damages under state tort law, even if based upon
the jury's conclusion that a nuclear licensee failed to follow adequate
safety precautions. Silkwood v. Kerr-McGee Corp., 464 U.S. 238 (1984).
See also English v. General Electric Co., 496 U.S. 72 (1990) (employee's
state-law claim for intentional infliction of emotional distress for her
nuclear-plant employer's actions retaliating for her whistleblowing is
not preempted as relating to nuclear safety).
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A city's effort to enforce stiff penalties for ship pollution
that resulted from boilers approved by the Federal Government was
[[Page 251]]
held not preempted, the field of boiler safety, but not boiler
pollution, having been occupied by federal regulation.\1044\ A state
liability scheme imposing cleanup costs and strict, no-fault liability
on shore facilities and ships for any oil-spill damage was held to
complement a federal law concerned solely with recovery of actual
cleanup costs incurred by the Federal Government and which textually
presupposed federal-state cooperation.\1045\ On the other hand, a
comprehensive regulation of the design, size, and movement of oil
tankers in Puget Sound was found, save in one respect, to be either
expressly or implicitly preempted by federal law and regulations.
Critical to the determination was the Court's conclusion that Congress,
without actually saying so, had intended to mandate exclusive standards
and a single federal decisionmaker for safety purposes in vessel
regulation.\1046\ Also, a closely divided Court voided a city ordinance
placing an 11 p.m. to 7 a.m. curfew on jet flights from the city airport
where, despite the absence of preemptive language in federal law,
federal regulation of aircraft noise was of such a pervasive nature as
to leave no room for state or local regulation.\1047\
\1044\Huron Portland Cement Co. v. City of Detroit, 362 U.S. 440
(1960).
\1045\Askew v. American Waterways Operators, 411 U.S. 325
(1973).
\1046\Ray v. Atlantic Richfield Co., 435 U.S. 151 (1978). See
also Exxon Corp. v. Eagerton, 462 U.S. 176 (1983) (preempting a state
ban on pass-through of a severance tax on oil and gas, because Congress
has occupied the field of wholesale sales of natural gas in interstate
commerce); Schneidewind v. ANR Pipeline Co., 485 U.S. 293 (1988)
(Natural Gas Act preempts state regulation of securities issuance by
covered gas companies); Bonito Boats v. Thunder Craft Boats, 489 U.S.
141 (1989) (under patent clause, state law extending patent-like
protection to unpatented designs invades an area of pervasive federal
regulation).
\1047\City of Burbank v. Lockheed Air Terminal, 411 U.S. 624
(1973).
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Congress may preempt state regulation without itself prescribing
a federal standard; it may deregulate a field and thus occupy it by
opting for market regulation and precluding state or local
regulation.\1048\
\1048\Transcontinental Gas Pipe Line Corp. v. Mississippi Oil &
Gas Board, 474 U.S. 409 (1986); Puerto Rico Dept. of Consumer Affairs v.
Isla Petroleum Corp., 485 U.S. 495 (1988).
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Conflict Preemption. Several possible situations will lead to a
holding that a state law is preempted as in conflict with federal law.
First, it may be that the two laws, federal and state, will actually
conflict. Thus, in Rose v. Arkansas State Police,\1049\ federal law
provided for death benefits for state law enforcement officers ``in
addition to'' any other compensation, while the state law required a
reduction in state benefits by the amount received from other
[[Page 252]]
sources. The Court, in a brief, per curiam opinion, had no difficulty
finding the state provision preempted.\1050\
\1049\479 U.S. 1 (1986).
\1050\See also Lawrence County v. Lead-Deadwood School Dist.,
469 U.S. 256 (1985) (state law requiring local governments to distribute
federal payments in lieu of taxes in same manner as general state-tax
revenues conflicts with federal law authorizing local governments to use
the payments for any governmental purpose); Southland Corp. v. Keating,
465 U.S. 1 (1984) (state franchise law requiring judicial resolution of
claims preempted by federal arbitration law precluding adjudication in
state or federal courts of claims parties had contracted to submit to
arbitration); Perry v. Thomas, 482 U.S. 483 (1987) (federal arbitration
law preempts state law providing that court actions for collection of
wages may be maintained without regard to agreements to arbitrate). See
also Free v. Bland, 369 U.S. 663 (1962).
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Second, conflict preemption may occur when it is practically
impossible to comply with the terms of both laws. Thus, where a federal
agency had authorized federal savings and loan associations to include
``due-on-sale'' clauses in their loan instruments and where the State
had largely prevented inclusion of such clauses, while it was literally
possible for lenders to comply with both rules, the federal rule being
permissive, the state regulation prevented the exercise of the
flexibility the federal agency had conferred and was preempted.\1051\ On
the other hand, it was possible for an employer to comply both with a
state law mandating leave and reinstatement to pregnant employees and
with a federal law prohibiting employment discrimination on the basis of
pregnancy.\1052\ Similarly, when faced with both federal and state
standards on the ripeness of avocados, the Court discerned that the
federal standard was a ``minimum'' one rather than a ``uniform'' one and
decided that growers could comply with both.\1053\
\1051\Fidelity Federal Savings & Loan Assn. v. de la Cuesta, 458
U.S. 141 (1982).
\1052\California Federal Savings & Loan Assn. v. Guerra, 479
U.S. 272 (1987). Compare Cloverleaf Butter v. Patterson, 315 U.S. 148
(1942) (federal law preempts more exacting state standards, even though
both could be complied with and state standards were harmonious with
purposes of federal law).
\1053\Florida Lime & Avocado Growers, Inc. v. Paul, 373 U.S. 132
(1963).
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Third, a fruitful source of preemption is found when it is
determined that the state law stands as an obstacle to the
accomplishment of the full purposes and objectives of Congress.\1054\
Thus, the Court voided a state requirement that the average net weight
of a package of flour in a lot could not be less than the net weight
stated on the package. While applicable federal law permitted variations
from stated weight caused by distribution losses, such as through
partial dehydration, the State allowed no such deviation. Although it
was possible for a producer to satisfy the federal standard while
satisfying the tougher state standard, the Court discerned that to do so
defeated one purpose of the federal requirement--the facilitating of
value comparisons by shoppers. Because
[[Page 253]]
different producers in different situations in order to comply with the
state standard may have to overpack flour to make up for dehydration
loss, consumers would not be comparing packages containing identical
amounts of flour solids.\1055\ In Felder v. Casey,\1056\ a state notice-
of-claim statute was found to frustrate the remedial objectives of civil
rights laws as applied to actions brought in state court under 42 U. S.
C. Sec. 1983. A state law recognizing the validity of an unrecorded oral
sale of an aircraft was held preempted by the Federal Aviation Act's
provision that unrecorded ``instruments'' of transfer are invalid, since
the congressional purpose evidenced in the legislative history was to
make information about an aircraft's title readily available by
requiring that all transfers be documented and recorded.\1057\
\1054\The standard is, of course, drawn from Hines v.
Davidowitz, 312 U.S. 52, 67 (1941).
\1055\Jones v. Rath Packing Co., 430 U.S. 519, 532-543 (1977).
\1056\487 U.S. 131 (1988).
\1057\Philco Aviation v. Shacket, 462 U.S. 406 (1983).
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Also, a state law making agricultural producers' associations
the exclusive bargaining agents and requiring payment of service fees by
nonmember producers was held to counter a strong federal policy
protecting the right of farmers to join or not join such
associations.\1058\ And a state assertion of the right to set minimum
stream-flow requirements different from those established by FERC in its
licensing capacity was denied as being preempted under the Federal Power
Act, despite language requiring deference to state laws ``relating to
the control, appropriation, use, or distribution of water.''\1059\
\1058\Michigan Canners & Freezers Assn. v. Agricultural
Marketing & Bargaining Bd., 467 U.S. 461 (1984). See also Nantahala
Power & Light Co. v. Thornburg, 476 U.S. 953 (1986) (state allocation of
costs for purposes of setting retail electricity rates, by disallowing
costs permitted by FERC in setting wholesale rates, frustrated federal
regulation by possibly preventing the utility from recovering in its
sales the costs of paying the FERC-approved wholesale rate); Capital
Cities Cable v. Crisp, 467 U.S. 691 (1984) (state ban on cable TV
advertising frustrates federal policy in the copyright law by which
cable operators pay a royalty fee for the right to retransmit distant
broadcast signals upon agreement not to delete commercials);
International Paper Co. v. Ouellette, 479 U.S. 481 (1987) (damage action
based on common law of downstream State frustrates Clean Water Act's
policies favoring permitting State in interstate disputes and favoring
predictability in permit process).
\1059\California v. FERC, 495 U.S. 490 (1990). The savings
clause was found inapplicable on the basis of an earlier interpretation
of the language in First Iowa Hydro-Electric Cooperative v. FPC, 328
U.S. 152 (1946).
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Contrarily, a comprehensive federal regulation of insecticides
and other such chemicals was held not to preempt a town ordinance that
required a permit for the spraying of pesticides, there being no
conflict between requirements.\1060\ The application of state antitrust
laws to authorize indirect purchasers to recover for all overcharges
passed on to them by direct purchasers was held
[[Page 254]]
to implicate no preemption concerns, inasmuch as the federal antitrust
laws had been interpreted as not permitting indirect purchasers to
recover under federal law; state law may be inconsistent with federal
law but in no way did it frustrate federal objectives and
policies.\1061\ The effect of federal policy was not strong enough to
warrant a holding of preemption when a State authorized condemnation of
abandoned railroad property after conclusion of an ICC proceeding
permitting abandonment, although the railroad's opportunity costs in the
property had been considered in the decision on abandonment.\1062\
\1060\Wisconsin Public Intervenor v. Mortier, 501 U.S. 597, 614-
616 (1991).
\1061\California v. ARC America Corp., 490 U.S. 93 (1989).
\1062\Hayfield Northern R. Co. v. Chicago & N. W. Transp. Co.,
467 U.S. 622 (1984). See also CTS Corp. v. Dynamics Corp. of America,
481 U.S. 69 (1987) (federal law's broad purpose of protecting
shareholders as a group is furthered by state anti-takeover law); Rose
v. Rose, 481 U.S. 619 (1987) (provision governing veterans' disability
benefits protects veterans' families as well as veterans, hence state
child-support order resulting in payment out of benefits is not
preempted).
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Federal Versus State Labor Laws.--One group of cases, which has
caused the Court much difficulty over the years, concerns the effect of
federal labor laws on state power to govern labor-management relations.
Although the Court some time ago reached a settled rule, changes in
membership on the Court re-opened the issue and modified the rules.
With the enactment of the National Labor Relations Act and
subsequent amendments, Congress declared a national policy in labor-
management relations and established the NLRB to carry out that
policy.\1063\ It became the Supreme Court's responsibility to determine
what role state law on labor-management relations was to play. At first,
the Court applied a test of determination whether the state regulation
was in direct conflict with the national regulatory scheme. Thus, in one
early case, the Court held that an order by a state board which
commanded a union to desist from mass picketing of a factory and from
assorted personal threats was not in conflict with the national law that
had not been invoked and
[[Page 255]]
that did not touch on some of the union conduct in question.\1064\ A
``cease and desist'' order of a state board implementing a state
provision making it an unfair labor practice for employees to conduct a
slowdown or to otherwise interfere with production while on the job was
found not to conflict with federal law,\1065\ while another order of the
board was also sustained in its prohibition of the discharge of an
employee under a maintenance-of-membership clause inserted in a contract
under pressure from the War Labor Board and which violated state
law.\1066\
\1063\Throughout the ups-and-downs of federal labor-law
preemption, it remains the rule that the Board remains preeminent and
almost exclusive. See, e.g., Wisconsin Dept. of Industry v. Gould, Inc.,
475 U.S. 282 (1986) (States may not supplement Board enforcement by
debarring from state contracts persons or firms that have violated the
NLRA); Golden Gate Transit Corp. v. City of Los Angeles, 475 U.S. 608
(1986) (City may not condition taxicab franchise on settlement of strike
by set date, since this intrudes into collective-bargaining process
protected by NLRA). On the other hand, the NLRA's protection of
associational rights is not so strong as to outweigh the Social Security
Act's policy permitting States to determine whether to award
unemployment benefits to persons voluntarily unemployed as the result of
a labor dispute. New York Telephone Co. v. New York Labor Dept., 440
U.S. 519 (1979); Ohio Bureau of Employment Services v. Hodory, 431 U.S.
471 (1977); Baker v. General Motors Corp., 478 U.S. 621 (1986).
\1064\Allen-Bradley Local No. 1111 v. WERB, 315 U.S. 740 (1942).
\1065\United Automobile Workers v. WERB, 336 U.S. 245 (1949)
(overruled in Machinists & Aerospace Workers v. WERC, 427 U.S. 132
(1976)).
\1066\Algoma Plywood Co. v. WERB, 336 U.S. 301 (1949).
---------------------------------------------------------------------------
On the other hand, a state statute requiring business agents of
unions operating in the State to file annual reports and to pay an
annual fee of one dollar was voided as in conflict with federal
law.\1067\ And state statutes providing for mediation and outlawing
public utility strikes were similarly voided as being in specific
conflict with federal law.\1068\ A somewhat different approach was noted
in several cases in which the Court held that the federal act had so
occupied the field in certain areas as to preclude state
regulation.\1069\ The latter approach was predominant through the 1950s
as the Court voided state court action in enjoining\1070\ or awarding
[[Page 256]]
damages\1071\ for peaceful picketing, in awarding of relief by damages
or otherwise for conduct which constituted an unfair labor practice
under federal law,\1072\ or in enforcing state antitrust laws so as to
affect collective bargaining agreements\1073\ or to bar a strike as a
restraint of trade,\1074\ even with regard to disputes over which the
NLRB declined to assert jurisdiction because of the degree of effect on
interstate commerce.\1075\
\1067\Hill v. Florida ex rel. Watson, 325 U.S. 538 (1945). More
recently, the Court has held that Hill's premise that the NLRA grants an
unqualified right to select union officials has been removed by
amendments prohibiting some convicted criminals from holding union
office. Partly because the federal disqualification standard was itself
dependent upon application of state law, the Court ruled that more
stringent state disqualification provisions, also aimed at individuals
who had been involved in racketeering and other criminal conduct, were
not inconsistent with federal law. Brown v. Hotel Employees, 468 U.S.
491 (1984).
\1068\United Automobile Workers v. O'Brien, 339 U.S. 454 (1950);
Bus Employees v. WERB, 340 U.S. 383 (1951). See also Bus Employees v.
Missouri, 374 U.S. 74 (1963).
\1069\Weber v. Anheuser-Busch, Inc., 348 U.S. 468 (1955); Garner
v. Teamsters Local 776, 346 U.S. 485 (1953); Bethlehem Steel Co. v. New
York Employment Relations Board, 330 U.S. 767 (1947). Of course, where
Congress clearly specifies, the Court has had no difficulty. Thus, in
the NLRA, Congress provided, 29 U.S.C. Sec. 164(b), that state laws on
the subject could override the federal law on union security
arrangements and the Court sustained those laws. Lincoln Federal Labor
Union v. Northwestern Iron & Metal Co., 335 U.S. 525 (1949); AFL v.
American Sash & Door Co., 335 U.S. 538 (1949). When Congress in the
Railway Labor Act, 45 U.S.C. Sec. 152, Eleventh, provided that the
federal law on union security was to override contrary state laws, the
Court sustained that determination. Railway Employees' Department v.
Hanson, 351 U.S. 225 (1956). The Court has held that state courts may
adjudicate questions relating to the permissibility of particular types
of union security arrangements under state law even though the issue
involves as well an interpretation of federal law., Retail Clerks
International Association v. Schermerhorn, 375 U.S. 96 (1963).
\1070\Garner v. Teamsters Local 776, 346 U.S. 485 (1953); United
Mine Workers v. Arkansas Flooring Co., 351 U.S. 62 (1956); Meat Cutters
v. Fairlawn Meats, 353 U.S. 20 (1957); Construction Laborers v. Curry,
371 U.S. 542 (1963).
\1071\San Diego Building Trades Council v. Garmon, 353 U.S. 26
(1957).
\1072\Guss v. Utah Labor Board, 353 U.S. 1 (1957).
\1073\Teamsters Union v. Oliver, 358 U.S. 283 (1959).
\1074\Weber v. Anheuser-Busch, Inc., 348 U.S. 468 (1955).
\1075\Guss v. Utah Labor Board, 353 U.S. 1 (1957). The ``no-
man's land'' thus created by the difference between the reach of
Congress' commerce power and the NLRB's finite resources was closed by
73 Stat. 541, 29 U.S.C. Sec. 164(c), which authorized the States to
assume jurisdiction over disputes which the Board had indicated through
promulgation of jurisdictional standards that it would not treat.
---------------------------------------------------------------------------
In San Diego Building Trades Council v. Garmon,\1076\ the Court
enunciated the rule, based on its previous decade of adjudication.
``When an activity is arguably subject to Sec. 7 or Sec. 8 of the Act,
the States . . . must defer to the exclusive competence of the National
Labor Relations Board if the danger of state interference with national
policy is to be averted.''\1077\
\1076\359 U.S. 236 (1959).
\1077\Id., 245. The rule is followed in, e.g., Radio &
Television Technicians v. Broadcast Service of Mobile, 380 U.S. 255
(1965); Hattiesburg Building & Trades Council v. Broome, 377 U.S. 126
(1964); Longshoremen Local 1416 v. Ariadne Shipping Co., 397 U.S. 195
(1970); Amalgamated Assn. of Street, Electric Railway & Motor Coach
Employees v. Lockridge, 403 U.S. 274 (1971). Cf. Nash v. Florida
Industrial Comm., 389 U.S. 235 (1967).
---------------------------------------------------------------------------
For much of the period since Garmon, the dispute in the Court
concerned the scope of the few exceptions permitted in the Garmon
principle. First, when picketing is not wholly peaceful but is attended
by intimidation, violence, and obstruction of the roads affording access
to the struck establishment, state police powers have been held not
disabled to deal with the conduct and narrowly-drawn injunctions
directed against violence and mass picketing have been permitted\1078\
as well as damages to compensate for harm growing out of such
activities.\1079\
\1078\United Automobile Workers v. WERB, 351 U.S. 266 (1956);
Youngdahl v. Rainfair, 355 U.S. 131 (1957).
\1079\United Automobile Workers v. Russell, 356 U.S. 634 (1958);
United Construction Workers v. Laburnum Construction Corp., 347 U.S. 656
(1954).
---------------------------------------------------------------------------
A 1958 case permitted a successful state court suit for
reinstatement and damages for lost pay because of a wrongful expulsion,
leading to discharge from employment, based on a theory that the union
constitution and by-laws constitute a contract between the union and the
members the terms of which can be enforced by state courts without the
danger of a conflict between state and fed
[[Page 257]]
eral law.\1080\ The Court subsequently narrowed the interpretation of
this ruling by holding in two cases that members who alleged union
interference with their existing or prospective employment relations
could not sue for damages but must file unfair labor practice charges
with the NLRB.\1081\ Gonzales was said to be limited to ``purely
internal union matters.''\1082\ Finally, Gonzales, was abandoned in a
five-to-four decision in which the Court held that a person who alleged
that his union had misinterpreted its constitution and its collective
bargaining agreement with the individual's employer in expelling him
from the union and causing him to be discharged from his employment
because he was late paying his dues, had to pursue his federal
remedies.\1083\ While it was not likely that in Gonzales, a state court
resolution of the scope of duty owed the member by the union would
implicate principles of federal law, Justice Harlan wrote for the Court,
state court resolution in this case involved an interpretation of the
contract's union security clause, a matter on which federal regulation
is extensive.\1084\
\1080\International Assn. of Machinists v. Gonzales, 356 U.S.
617 (1958).
\1081\Journeymen Local 100 v. Borden, 373 U.S. 690 (1963); Iron
Workers Local 207 v. Perko, 373 U.S. 701 (1963). Applying Perko, the
Court held that a state court action by a supervisor alleging union
interference with his contractual relationship with his employer is
preempted by the NLRA. Local 926, Intl. Union of Operating Engineers v.
Jones, 460 U.S. 669 (1983).
\1082\373 U.S., 697; 373 U.S., 705.
\1083\Amalgamated Assn. of Street, Electric Railway & Motor
Coach Employees v. Lockridge, 403 U.S. 274 (1971).
\1084\Id., 296.
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One other exception has been based, like the violence cases, on
the assumption that it concerns areas traditionally left to local law
into which Congress would not want to intrude. In Linn v. Plant Guard
Workers,\1085\ the Court permitted a state court adjudication of a
defamation action arising out of a labor dispute. And in Letter Carriers
v. Austin,\1086\ the Court held that federal law preempts state
defamation laws in the context of labor disputes to the extent that the
State seeks to make actionable defamatory statements in labor disputes
published without knowledge of their falsity or in reckless disregard of
truth or falsity.
\1085\383 U.S. 53 (1966).
\1086\418 U.S. 264 (1974).
---------------------------------------------------------------------------
However, a state tort action for the intentional infliction of
emotional distress occasioned through an alleged campaign of personal
abuse and harassment of a member of the union by the union and its
officials was held not preempted by federal labor law. Federal law was
not directed to the ``outrageous conduct'' alleged, and NLRB resolution
of the dispute would neither touch upon the claim of emotional distress
and physical injury nor award the plaintiff
[[Page 258]]
any compensation. But state court jurisdiction, in order that there not
be interference with the federal scheme, must be premised on tortious
conduct either unrelated to employment discrimination or a function of
the particularly abusive manner in which the discrimination is
accomplished or threatened rather than a function of the actual or
threatened discrimination itself.\1087\
\1087\Farmer v. Carpenters, 430 U.S. 290 (1977). Following this
case, the Court held that a state court action for misrepresentation and
breach of contract, brought by replacement workers promised permanent
employment when hired during a strike, was not preempted. The action for
breach of contract by replacement workers having no remedies under the
NLRA was found to be deeply rooted in local law and of only peripheral
concern under the Act. Belknap, Inc. v. Hale, 463 U.S. 491 (1983). See
also Intl. Longshoremen's Assn. v. Davis, 476 U.S. 380 (1986).
---------------------------------------------------------------------------
A significant retrenchment of Garmon occurred in Sears, Roebuck
& Co. v. Carpenters,\1088\ in the context of state court assertion of
jurisdiction over trespassory picketing. Objecting to the company's use
of nonunion work in one of its departments, the union picketed the
store, using the company's property, the lot area surrounding the store,
instead of the public sidewalks, to walk on. After the union refused to
move its pickets to the sidewalk, the company sought and obtained a
state court order enjoining the picketing on company property. Depending
upon the union motivation for the picketing, it was either arguably
prohibited or arguably protected by federal law, the trespassory nature
of the picketing being one factor the NLRB would have looked to in
determining at least the protected nature of the conduct. The Court
held, however, that under the circumstances, neither the arguably
prohibited nor the arguably protected rationale of Garmon was sufficient
to deprive the state court of jurisdiction.
\1088\436 U.S. 180 (1978).
---------------------------------------------------------------------------
First, as to conduct arguably prohibited by NLRA, the Court
seemingly expanded the Garmon exception recognizing state court
jurisdiction for conduct that touches interests ``deeply rooted in local
feeling''\1089\ in holding that where there exists ``a significant state
interest in protecting the citizens from the challenged conduct'' and
there exists ``little risk of interference with the regulatory
jurisdiction'' of the NLRB, state law is not preempted. Here, there was
obviously a significant state interest in protecting the company from
trespass; the second, ``critical inquiry'' was whether the controversy
presented to the state court was identical to or different from that
which could have been presented to the Board. The Court concluded that
the controversy was different. The Board would have been presented with
determining the motivation of the picketing and the location of the
picketing would have been irrele
[[Page 259]]
vant; the motivation was irrelevant to the state court and the situs of
the picketing was the sole inquiry. Thus, there was deemed to be no
realistic risk of state interference with Board jurisdiction.\1090\
\1089\San Diego Bldg Trades Council v. Garmon, 359 U.S. 236, 244
(1959).
\1090\Sears, Roebuck & Co. v. Carpenters, 436 U.S. 180, 190-198
(1978).
---------------------------------------------------------------------------
Second, in determining whether the picketing was protected, the
Board would have been concerned with the situs of the picketing, since
under federal labor laws the employer has no absolute right to prohibit
union activity on his property. Preemption of state court jurisdiction
was denied, nonetheless, in this case on two joined bases. One,
preemption is not required in those cases in which the party who could
have presented the protection issue to the Board has not done so and the
other party to the dispute has no acceptable means of doing so. In this
case, the union could have filed with the Board when the company
demanded removal of the pickets, but did not, and the company could not
file with the Board at all. Two, even if the matter is not presented to
the Board, preemption is called for if there is a risk of erroneous
state court adjudication of the protection issue that is unacceptable,
so that one must look to the strength of the argument that the activity
is protected. While the state court had to make an initial determination
that the trespass was not protected under federal law, the same
determination the Board would have made, in the instance of trespassory
conduct, the risk of erroneous determination is small, because
experience shows that a trespass is far more likely to be unprotected
than protected.\1091\
\1091\Id., 199-207.
---------------------------------------------------------------------------
Introduction of these two balancing tests into the Garmon
rationale substantially complicates determining when state courts do not
have jurisdiction and will no doubt occasion much more litigation in
state courts than has previously existed.
Another series of cases involves not a Court-created exception
to the Garmon rule but the applicability and interpretation of Sec. 301
of the Taft-Hartley Act,\1092\ which authorizes suits in federal, and
state,\1093\ courts to enforce collective bargaining agreements. The
Court has held that in enacting Sec. 301, Congress authorized actions
based on conduct arguably subject to the NLRA, so that the Garmon
preemption doctrine does not preclude judicial enforcement of duties and
obligations which would otherwise be within the exclusive jurisdiction
of the NLRB so long as those duties and obli
[[Page 260]]
gations are embodied in a collective-bargaining agreement, perhaps as
interpreted in an arbitration proceeding.\1094\
\1092\61 Stat. 156 (1947), 29 U.S.C. Sec. 185(a).
\1093\Charles Dowd Box Co. v. Courtney, 368 U.S. 502 (1962). The
state courts must, however, apply federal law. Local 174, Teamsters v.
Lucas Flour Co., 369 U.S. 95 (1962).
\1094\Smith v. Evening News Assn., 371 U.S. 195 (1962); Humphrey
v. Moore, 375 U.S. 335 (1964); Vaca v. Sipes, 386 U.S. 171 (1967).
---------------------------------------------------------------------------
Here, too, the permissible role of state tort actions has been
in great dispute. Generally, a state tort action as an alternative to a
Sec. 301 arbitration or enforcement action is preempted if it is
substantially dependent upon analysis of the terms of a collective-
bargaining agreement.\1095\ Thus, a state damage action for the bad-
faith handling of an insurance claim under a disability plan that was
part of a collective-bargaining agreement was preempted because it
involved interpretation of that agreement and because state enforcement
would frustrate the policies of Sec. 301 favoring uniform federal-law
interpretation of collective-bargaining agreements and favoring
arbitration as a predicate to adjudication.\1096\
\1095\See the analysis in Lingle v. Norge Div. of Magic Chef,
Inc., 486 U.S. 399 (1988) (state tort action for retaliatory discharge
for exercising rights under a state workers' compensation law is not
preempted by Sec. 301, there being no required interpretation of a
collective-bargaining agreement).
\1096\Allis-Chalmers Corp. v. Lueck, 471 U.S. 202 (1985). See
also Intl. Brotherhood of Electric Workers v. Hechler, 481 U.S. 851
(1987) (state-law claim that union breached duty to furnish employee a
reasonably safe workplace preempted); United Steelworkers of America v.
Rawson, 495 U.S. 362 (1990) (state-law claim that union was negligent in
inspecting a mine, the duty to inspect being created by the collective-
bargaining agreement preempted).
---------------------------------------------------------------------------
Finally, the Court has indicated that with regard to some
situations, Congress has intended to leave the parties to a labor
dispute free to engage in ``self-help,'' so that conduct not subject to
federal law is nonetheless withdrawn from state control.\1097\ However,
the NLRA is concerned primarily ``with establishing an equitable process
for determining terms and conditions of employment, and not with
particular substantive terms of the bargain that is struck when the
parties are negotiating from relatively equal positions,'' so States are
free to impose minimum labor standards.\1098\
\1097\Brotherhood of Railroad Trainmen v. Jacksonville Terminal
Co., 394 U.S. 369 (1969); Machinists & Aerospace Workers v. WERC, 427
U.S. 132 (1976); Golden Gate Transit Corp. v. City of Los Angeles, 475
U.S. 608 (1986). And, cf New York Telephone Co. v. New York State Dept.
of Labor, 440 U.S. 519 (1979).
\1098\Metropolitan Life Ins. Co. v. Massachusetts, 471 U.S. 724
(1985) (upholding a state requirement that health-care plans, including
those resulting from collective bargaining, provide minimum benefits for
mental-health care).
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COMMERCE WITH INDIAN TRIBES
Congress' power to regulate commerce ``with the Indian tribes,''
once almost rendered superfluous by Court decision,\1099\ has now
[[Page 261]]
been resurrected and made largely the basis for informing judicial
judgment with respect to controversies concerning the rights and
obligations of Native Americans. Although Congress in 1871 forbade the
further making of treaties with Indian tribes,\1100\ cases disputing the
application of the old treaties and especially their effects upon
attempted state taxation and regulation of on-reservation activities
continue to be a staple of the Court's docket.\1101\ But this clause is
one of the two bases now found sufficient to empower Federal Government
authority over Native Americans. ``The source of federal authority over
Indian matters has been the subject of some confusion, but it is now
generally recognized that the power derives from federal responsibility
for regulating commerce with Indian tribes and for treaty
making.''\1102\ Forsaking reliance upon other theories and rationales,
the Court has established the preemption doctrine as the analytical
framework within which to judge the permissibility of assertions of
state jurisdiction over the Indians. However, the ``semi-autonomous
status'' of Indian tribes erects an ``independent but related'' barrier
to the exercise of state authority over commercial activity on an Indian
reservation.\1103\ Thus, the question of preemption is not governed by
the standards of preemption developed in other areas. ``Instead, the
traditional notions of tribal sovereignty, and the recognition and
encouragement of this sovereignty in congressional Acts, inform the pre-
emption analysis that governs this inquiry. . . . As a result,
ambiguities in federal law should be construed generously, and federal
pre-emption is not limited to those situations where Congress has
explicitly announced an intention to pre-empt state activity.''\1104\ A
[[Page 262]]
corollary is that the preemption doctrine will not be applied strictly
to prevent States from aiding Native Americans.\1105\ However, the
protective rule is inapplicable to state regulation of liquor
transactions, since there has been no tradition of tribal sovereignty
with respect to that subject.\1106\
\1099\United States v. Kagama, 118 U.S. 375 (1886). Rejecting
the commerce clause as a basis for congressional enactment of a system
of criminal laws for Indians living on reservations, the Court
nevertheless sustained the act on the ground that the Federal Government
had the obligation and thus the power to protect a weak and dependent
people. Cf. United States v. Holiday, 3 Wall. (70 U.S.) 407 (1866);
United States v. Sandoval, 231 U.S. 28 (1913). This special fiduciary
responsibility can also be created by statute. E.g., United States v.
Mitchell, 463 U.S. 206 (1983).
\1100\16 Stat. 544, 566, 25 U.S.C. Sec. 71.
\1101\E.g., Puyallup Tribe v. Washington Game Dept., 433 U.S.
165 (1977); Washington v. Washington State Commercial Passenger Fishing
Vessel Assn., 443 U.S. 658 (1979); Montana v. United States, 450 U.S.
544 (1981).
\1102\McClanahan v. Arizona Tax Comm., 411 U.S. 164, 172 n. 7
(1973). See also Morton v. Mancari, 417 U.S. 535, 551-553 (1974); United
States v. Mazurie, 419 U.S. 544, 553-556 (1974); Bryan v. Itasca County,
426 U.S. 373, 376 n. 2 (1976); White Mountain Apache Tribe v. Bracker,
448 U.S. 136, 142 (1980); Ramah Navajo School Board v. Bureau of Revenue
of New Mexico, 458 U.S. 832, 837 (1982).
\1103\White Mountain Apache Tribe v. Bracker, 448 U.S. 136, 142-
143 (1980); Ramah Navajo School Board v. Bureau of Revenue of New
Mexico, 458 U.S. 832, 837-838 (1982). ``The two barriers are independent
because either, standing alone, can be a sufficient basis for holding
state law inapplicable to activity undertaken on the reservation or by
tribal members.'' Id., 837 (quoting White Mountain, supra, 143).
\1104\Ramah Navajo School Board v. Bureau of Revenue of New
Mexico, 458 U.S. 832, 838 (1982). See also New Mexico v. Mescalero
Apache Tribe, 462 U.S. 324 (1983).
\1105\Three Affiliated Tribes v. Wold Engineering, 467 U.S. 138
(1984) (upholding state-court jurisdiction to hear claims of Native
Americans against non-Indians involving transactions that occurred in
Indian country). However, attempts by States to retrocede jurisdiction
favorable to Native Americans may be held to be preempted. Three
Affiliated Tribes v. Wold Engineering, 476 U.S. 877 (1986).
\1106\Rice v. Rehner, 463 U.S. 713 (1983).
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The scope of state taxing powers--the conflict of ``the plenary
power of the States over residents within their borders with the semi-
autonomous status of Indians living on tribal reservations''\1107\--has
been often litigated. Absent cession of jurisdiction or other
congressional consent, States possess no power to tax Indian reservation
lands or Indian income from activities carried on within the boundaries
of the reservation.\1108\ Off-reservation Indian activities require an
express federal exemption to deny state taxing power.\1109\ Subjection
to taxation of non-Indians doing business with Indians on the
reservation involves a close analysis of the federal statutory
framework, although the operating premise was for many years to deny
state power because of its burdens upon the development of tribal self-
sufficiency as promoted through federal law and its interference with
the tribes' ability to exercise their sovereign functions.\1110\
\1107\McClanahan v. Arizona Tax Comm., 411 U.S. 164, 165 (1973).
\1108\Mescalero Apache Tribe v. Jones, 411 U.S. 145, 148 (1973);
McClanahan v. Arizona Tax Comm., 411 U.S. 164 (1973); Moe v.
Confederated Salish & Kootenai Tribes, 425 U.S. 463 (1976); Bryan v.
Itasca County, 426 U.S. 373 (1976); Washington v. Confederated Colville
Tribes, 447 U.S. 134 (1980); Montana v. Blackfeet Tribe, 471 U.S. 759
(1985). See also Oklahoma Tax Comm. v. Citizen Band Potawatomi Indian
Tribe, 498 U.S. 505 (1991). A discernable easing of the reluctance to
find congressional cession is reflected in more recent cases. See County
of Yakima v. Confederated Tribes & Bands of the Yakima Indian Nation,
112 S.Ct. 683 (1992).
\1109\Mescalero Apache Tribe v. Jones, 411 U.S. 145, 148-149
(1973).
\1110\White Mountain Apache Tribe v. Bracker, 448 U.S. 136
(1980); Central Machinery Co. v. Arizona Tax Comm., 448 U.S. 160 (1980);
Ramah Navajo School Board v. Bureau of Revenue of New Mexico, 458 U.S.
832 (1982).
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That operating premise, however, seems to have been eroded. For
example, in Cotton Petroleum Corp. v. New Mexico,\1111\ the Court held
that, in spite of the existence of multiple taxation occasioned by a
state oil and gas severance tax applied to on-reservation operations by
non-Indians, which was already taxed by the tribe,\1112\ the impairment
of tribal sovereignty was ``too indirect and too insubstantial'' to
warrant a finding of preemption. The fact that the State provided
significant services to the oil and gas les
[[Page 263]]
sees justified state taxation and also distinguished earlier cases in
which the State had ``asserted no legitimate regulatory interest that
might justify the tax.''\1113\ Still further erosion, or relaxation, of
the principle of construction may be found in a later case, in which the
Court, confronted with arguments that the imposition of particular state
taxes on Indian property on the reservation was inconsistent with self-
determination and self-governance, denominated these as ``policy''
arguments properly presented to Congress rather than the Court.\1114\
\1111\490 U.S. 163 (1989).
\1112\Held permissible in Merrion v. Jicarilla Apache Tribe, 455
U.S. 130 (1982).
\1113\Id., 490 U.S., 185 (distinguishing Bracker and Ramah
Navaho School Bd).
\1114\County of Yakima v. Confederated Tribes & Bands of the
Yakima Indian Nation, 112 S.Ct. 683, 692 (1992). To be sure, this
response was in the context of the reading of statutory texts and giving
effect to them, but the unqualified designation is suggestive.
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The impact on tribal sovereignty is also a prime determinant of
relative state and tribal regulatory authority.\1115\
\1115\E.g., New Mexico v. Mescalero Tribe, 462 U.S. 324 (1983).
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Since Worcester v. Georgia,\1116\ it has been recognized that
Indian tribes are unique aggregations possessing attributes of
sovereignty over both their members and their territory.\1117\ They are,
of course, no longer possessed of the full attributes of
sovereignty,\1118\ having relinquished some part of it by their
incorporation within the territory of the United States and their
acceptance of its protection. By specific treaty provision, they yielded
up other sovereign powers, and Congress has removed still others. ``The
sovereignty that the Indian tribes retain is of a unique and
[[Page 264]]
limited character. It exists only at the sufferance of Congress and is
subject to complete defeasance.''\1119\
\1116\6 Pet. (31 U.S.) 515 (1832). See also Cherokee Nation v.
Georgia, 5 Pet. (30 U.S.) 1 (1831). Under this doctrine, tribes possess
sovereign immunity from suit in the same way as the United States and
the States do. Santa Clara Pueblo v. Martinez, 436 U.S. 49, 58 (1978);
United States v. United States Fidelity & Guaranty Co., 309 U.S. 506,
512-513 (1940). The Court has repeatedly rejected arguments to abolish
tribal sovereign immunity or at least to curtail it. Oklahoma Tax Comm.
v. Citizen Band Potawatomi Indian Tribe, 498 U.S. 505, 510 (1991).
\1117\United States v. Wheeler, 435 U.S. 313 (1978) (inherent
sovereign power to punish tribal offenders). But tribes possess no
criminal authority over non-Indians. Oliphant v. Suquamish Indian Tribe,
435 U.S. 191 (1978). And see Duro v. Reina, 495 U.S. 676 (1990) (tribe
has no criminal jurisdiction over non-tribal Indians who commit crimes
on the reservation; jurisdiction over members rests on consent of the
self-governed, and absence of consent defeats jurisdiction). Compare
California v. Cabazon Band of Mission Indians, 480 U.S. 202 (1987)
(state regulation of on-reservation bingo is preempted as basically
civil/regulatory rather than criminal/prohibitory), with Brendale v.
Confederated Tribes & Bands of the Yakima Indian Nation, 492 U.S. 408
(1989) (extensive ownership of land within ``open areas'' of reservation
by non-members of tribe precludes application of tribal zoning within
such areas). Among the fundamental attributes of sovereignty which a
tribe possesses unless divested of it by federal law is the power to tax
non-Indians entering the reservation to engage in economic activities.
Washington v. Confederated Colville Tribes, 447 U.S. 134 (1980); Merrion
v. Jicarilla Apache Tribe, 455 U.S. 130 (1982).
\1118\United States v. Kagama, 118 U.S. 375, 381 (1886); United
States v. Wheeler, 435 U.S. 313, 323 (1978).
\1119\United States v. Wheeler, 435 U.S. 313, 323 (1978).
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In a case of major import for the settlement of Indian land
claims, the Court ruled in County of Oneida v. Oneida Indian
Nation,\1120\that an Indian tribe may obtain damages for wrongful
possession of land conveyed in 1795 without the federal approval
required by the Nonintercourse Act.\1121\The Act reflected the accepted
principle that extinguishment of the title to land by Native Americans
required the consent of the United States and left intact a tribe's
common-law remedies to protect possessory rights. The Court reiterated
the accepted rule that enactments are construed liberally in favor of
Native Americans and that Congress may abrogate Indian treaty rights or
extinguish aboriginal land title only if it does so clearly and
unambiguously. Consequently, federal approval of land-conveyance
treaties containing references to earlier conveyances that had violated
the Nonintercourse Act did not constitute ratification of the invalid
conveyances.\1122\Similarly, the Court refused to apply the general rule
for borrowing a state statute of limitations for the federal common-law
action, and it rejected the dissent's view that, given ``the
extraordinary passage of time,'' the doctrine of laches should have been
applied to bar the claim.\1123\
\1120\470 U.S. 226 (1985).
\1121\1 Stat. 379 (1793).
\1122\Id., 470 U.S., 246-248.
\1123\Id., 255, 257 (Justice Stevens).
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While the power of Congress over Indian affairs is broad, it is
not limitless.\1124\ The Court has promulgated a standard of review that
defers to the legislative judgment ``[a]s long as the special treatment
can be tied rationally to the fulfillment of Congress' unique obligation
toward the Indians . . . ``\1125\ A more searching review is warranted
when it is alleged that the Federal Government's behavior toward the
Indians has been in contravention of its obligation and that it has in
fact taken property from a tribe which it had heretofore guaranteed to
the tribe, without either com
[[Page 265]]
pensating the tribe or otherwise giving the Indians the full value of
the land.\1126\
\1124\``The power of Congress over Indian affairs may be of a
plenary nature; but it is not absolute.'' United States v. Alcea Bank of
Tillamooks, 329 U.S. 40, 54 (1946) (plurality opinion) (quoted with
approval in Delaware Tribal Business Comm. v. Weeks, 430 U.S. 73, 84
(1977)).
\1125\Morton v. Mancari, 417 U.S. 535, 555 (1974). The Court
applied the standard to uphold a statutory classification that favored
Indians over non-Indians. But in Delaware Tribal Business Comm. v.
Weeks, 430 U.S. 73 (1977), the same standard was used to sustain a
classification that disfavored, although inadvertently, one group of
Indians as against other groups. While Indian tribes are unconstrained
by federal or state constitutional provisions, Congress has legislated a
``bill of rights'' statute covering them. See Santa Clara Pueblo v.
Martinez, 436 U.S. 49 (1978).
\1126\United States v. Sioux Nation, 448 U.S. 371 (1980). See
also Solem v. Bartlett, 465 U.S. 463, 472 (1984) (there must be
``substantial and compelling evidence of congressional intention to
diminish Indian lands'' before the Court will hold that a statute
removed land from a reservation).
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Clause 4. The Congress shall have Power * * * To establish an uniform
Rule of Naturalization, and uniform Laws on the subject of Bankruptcies
throughout the United States.
NATURALIZATION AND CITIZENSHIP
Nature and Scope of Congress' Power
Naturalization has been defined by the Supreme Court as ``the
act of adopting a foreigner, and clothing him with the privileges of a
native citizen.''\1127\ In the Dred Scott case,\1128\ the Court asserted
that the power of Congress under this clause applies only to ``persons
born in a foreign country, under a foreign government.''\1129\ These
dicta are much too narrow to describe the power that Congress has
actually exercised on the subject. The competence of Congress in this
field merges, in fact, with its indefinite, inherent powers in the field
of foreign relations. ``As a government, the United States is invested
with all the attributes of sovereignty. As it has the character of
nationality it has the powers of nationality, especially those which
concern its relations and intercourse with other countries.''\1130\
\1127\Boyd v. Nebraska ex rel. Thayer, 143 U.S. 135, 162 (1892).
\1128\Scott v. Sandford, 19 How. (60 U.S.) 393 (1857).
\1129\Id., 417, 419.
\1130\Mackenzie v. Hare, 239 U.S. 299, 311 (1915).
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Congress' power over naturalization is an exclusive power; no
State has the power to constitute a foreign subject a citizen of the
United States.\1131\ But power to naturalize aliens may be, and was
early, devolved by Congress upon state courts of record.\1132\ And
States may confer the right of suffrage upon resident aliens who have
declared their intention to become citizens and many did so until
recently.\1133\
\1131\Chirac v. Chirac, 2 Wheat. (15 U.S.) 259, 269 (1817);
United States v. Wong Kim Ark, 169 U.S. 649, 701 (1898).
\1132\The first naturalization act, 1 Stat. 103 (1790), so
provided. See 8 U.S.C. Sec. 1421. In Holmgren v. United States, 217 U.S.
509 (1910), it was held that Congress may provide for the punishment of
false swearing in the proceedings in state courts.
\1133\Spragins v. Houghton, 3 Ill. 377 (1840); Stewart v.
Foster, 2 Binn. (Pa.) 110 (1809). See K. Porter, A History of Suffrage
in the United States (New York: 1918), ch. 5.
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[[Page 266]]
Citizenship by naturalization is a privilege to be given,
qualified, or withheld as Congress may determine, an individual may
claim it as a right only upon compliance with the terms Congress
imposes.\1134\ This interpretation makes of the naturalization power the
only power granted in Sec. 8 of Article I that is unrestrained by
constitutional limitations on its exercise. Thus, the first
naturalization act enacted by the first Congress restricted
naturalization to ``free white persons[s],''\1135\ which was expanded in
1870 so that persons of ``African nativity and . . . descent'' were
entitled to be naturalized.\1136\ Orientals were specifically excluded
from eligibility in 1882,\1137\ and the courts enforced these provisions
without any indication that constitutional issues were thereby
raised.\1138\ These exclusions are no longer law. Present naturalization
statutes continue and expand on provisions designed to bar subversives,
dissidents, and radicals generally from citizenship.\1139\
\1134\United States v. Macintosh, 283 U.S. 605, 615 (1931); Fong
Yue Ting v. United States, 149 U.S. 698, 707-708 (1893). A caveat to
this statement is that with regard to persons naturalized in the United
States the qualification may only be a condition precedent and not a
condition subsequent, Schneider v. Rusk, 377 U.S. 163 (1964), whereas
persons born abroad who are made citizens at birth by statute if one or
both of their parents are citizens are subject to conditions subsequent.
Rogers v. Bellei, 401 U.S. 815 (1971).
\1135\1 Stat. 103 (1790).
\1136\Act of July 14, 1870, Sec. 7, 16 Stat. 254, 256.
\1137\Act of May 6, 1882, Sec. 1, 22 Stat. 58.
\1138\Cf. Ozawa v. United States, 260 U.S. 178 (1922); United
States v. Bhagat Singh Thind, 261 U.S. 204 (1923); Toyota v. United
States, 268 U.S. 402 (1925); Morrison v. California, 291 U.S. 82 (1934).
The Court refused to review the only case in which the constitutional
issue was raised and rejected. Kharaiti Ram Samras v. United States, 125
F. 2d 879 (9th Cir., 1942), cert. den., 317 U.S. 634 (1942).
\1139\The Alien and Sedition Act of 1798, 1 Stat. 570, empowered
the President to deport any alien he found dangerous to the peace and
safety of the Nation. In 1903, Congress provided for denial of
naturalization and for deportation for mere belief in certain doctrines,
i.e., anarchy. Act of March 3, 1903, 32 Stat. 1214. See United States ex
rel. Turner v. Williams, 194 U.S. 279 (1904). The range of forbidden
views was broadened in 1918. Act of October 15, 1918, Sec. 1, 40 Stat.
1012. The present law is found in 8 U.S.C. Sec. 1424 and is discussed
infra, pp.268-270.
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Although the usual form of naturalization is through individual
application and official response on the basis of general congressional
rules, naturalization is not so limited. Citizenship can be conferred by
special act of Congress,\1140\ it can be conferred collectively either
through congressional action, such as the naturalization of all
residents of an annexed territory or of a territory made a State,\1141\
or through treaty provision.\1142\
\1140\E.g., 77 Stat. 5 (1963) (making Sir Winston Churchill an
``honorary citizen of the United States.'').
\1141\Boyd v. Nebraska ex rel. Thayer, 143 U.S. 135 (1892);
Contzen v. United States, 179 U.S. 191 (1900).
\1142\Boyd v. Nebraska ex rel. Thayer, 143 U.S. 135, 164, 168-
169 (1892).
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[[Page 267]]
Categories of Citizens: Birth and Naturalization
The first sentence of Sec. 1 of the Fourteenth Amendment
contemplates two sources of citizenship and two only: birth and
naturalization.\1143\ This contemplation is given statutory expression
in Sec. 301 of the Immigration and Nationality Act of 1952,\1144\ which
itemizes those categories of persons who are citizens of the United
States at birth; all other persons in order to become citizens must pass
through the naturalization process. The first category merely tracks the
language of the first sentence of Sec. 1 of the Fourteenth Amendment in
declaring that all persons born in the United States and subject to the
jurisdiction thereof are citizens by birth.\1145\ But there are six
other categories of citizens by birth. They are: (2) a person born in
the United States to a member of an Indian, Eskimo, Aleutian, or other
aboriginal tribe, (3) a person born outside the United States of citizen
parents one of whom has been resident in the United States, (4) a person
born outside the United States of one citizen parent who has been
continuously resident in the United States for one year prior to the
birth and of a parent who is a national but not a citizen, (5) a person
born in an outlying possession of the United States of one citizen
parent who has been continuously resident in the United States or an
outlying possession for one year prior to the birth, (6) a person of
unknown parentage found in the United States while under the age of five
unless prior to his twenty-first birthday he is shown not to have been
born in the United States, and (7) a person born outside the United
States of an alien parent and a citizen parent who has been resident in
the United States for a period of ten years, provided the person is to
lose his citizenship unless he resides continuously in the United States
for a period of five years between his fourteenth and twenty-eighth
birthdays.
\1143\United States v. Wong Kim Ark, 169 U.S. 649, 702 (1898).
\1144\66 Stat. 235, 8 U.S.C. Sec. 1401.
\1145\Sec. 301(a)(1), 8 U.S.C. Sec. 1401(a)(1).
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Subsection (7) citizens must satisfy the condition subsequent of
five years continuous residence within the United States between the
ages of fourteen and twenty-eight, a requirement held to be
constitutional,\1146\ which means in effect that for constitutional
purposes, according to the prevailing interpretation, there is a
difference between persons born or naturalized in, that is, within, the
United States and persons born outside the confines of the United States
who are statutorily made citizens.\1147\ The principal dif
[[Page 268]]
ference is that the former persons may not be involuntarily expatriated
whereas the latter may be, subject only to due process
protections.\1148\
\1146\Rogers v. Bellei, 401 U.S. 815 (1971).
\1147\Compare Schneider v. Rusk, 377 U.S. 163 (1964); Afroyim v.
Rusk, 387 U.S. 253 (1967). It will be noted that in practically all
cases persons statutorily made citizens at birth will be dual nationals,
having the citizenship of the country where they were born. Congress has
never required a citizen having dual nationality to elect at some point
one and forsake the other but it has enacted several restrictive
statutes limiting the actions of dual nationals which have occasioned
much litigation. E.g., Savorgnan v. United States, 338 U.S. 491 (1950);
Kawakita v. United States, 343 U.S. 717 (1952); Kennedy v. Mendoza-
Martinez, 372 U.S. 144 (1963); Schneider v. Rusk, 377 U.S. 163 (1964);
Rogers v. Bellei, 401 U.S. 815 (1971).
\1148\Cf. Rogers v. Bellei, 401 U.S. 815, 836 (1971); Kennedy v.
Mendoza-Martinez, 372 U.S. 144 (1963); Perez v. Brownell, 356 U.S. 44,
58-62 (1958).
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The Naturalization of Aliens
Although, as has been noted, throughout most of our history
there were significant racial and ethnic limitations upon eligibility
for naturalization, the present law prohibits any such discrimination.
``The right of a person to become a naturalized citizen of the
United States shall not be denied or abridged because of race or sex or
because such person is married.''\1149\ However, any person ``who
advocates or teaches, or who is a member of or affiliated with any
organization that advocates or teaches . . . opposition to all organized
government, or ``who advocates or teaches or who is a member of or
affiliated with any organization that advocates or teaches the overthrow
by force or violence or other unconstitutional means of the Government
of the United States'' or who is a member of or affiliated with the
Communist Party, or other communist organizations, or other totalitarian
organizations is ineligible.\1150\ These provisions moreover are
``applicable to any applicant for naturalization who at any time within
a period of ten years immediately preceding the filing of the petition
for naturalization or after such filing and before taking the final oath
of citizenship is, or has been found to be, within any of the classes
enumerated within this section, notwithstanding that at the time the
petition is filed he may not be included within such classes.''\1151\
\1149\Sec. 311, 66 Stat. 239 (1952), 8 U.S.C. Sec. 1422.
\1150\Sec. 313(a), 66 Stat. 240 (1952), 8 U.S.C. Sec. 1424(a).
Whether ``mere'' membership is sufficient to constitute grounds for
ineligibility is unclear. Compare Galvan v. Press, 347 U.S. 522 (1954),
with Berenyi v. Immigration Director, 385 U.S. 630 (1967).
\1151\Sec. 313(c), 66 Stat. 241 (1952), 8 U.S.C. Sec. 1424(c).
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Other limitations on eligibility are also imposed. Eligibility
may turn upon the decision of the responsible officials whether the
petitioner is of ``good moral character.''\1152\ The immigration and
nationality laws themselves include a number of specific congressional
determinations that certain persons do not possess ``good
[[Page 269]]
moral character,'' including persons who are ``habitual
drunkards,''\1153\ adulterers,\1154\ polygamists or advocates of
polygamy,\1155\ gamblers,\1156\ convicted felons,\1157\ and
homosexuals.\1158\ In order to petition for naturalization, an alien
must have been resident for at least five years and to have possessed
``good moral character'' for all of that period.
\1152\Sec. 316(a)(3), 66 Stat. 242, 8 U.S.C. Sec. 1427(a)(3).
\1153\Sec. 101(f)(1), 66 Stat. 172, 8 U.S.C. Sec. 1101(f)(1).
\1154\Sec. 101(f)(2), 66 Stat. 172, 8 U.S.C. Sec. 1101(f)(2).
\1155\Sec. 212(a)(11), 66 Stat. 182, 8 U.S.C. Sec. 1182(a)(11).
\1156\Sec. 101(f) (4) and (5), 66 Stat. 172, 8 U.S.C.
Sec. 1101(f) (4) and (5).
\1157\Sec. 101(f) (7) and (8), 66 Stat. 172, 8 U.S.C.
Sec. 1101(f) (7) and (8).
\1158\Sec. 212(a)(4), 66 Stat. 182, 8 U.S.C. Sec. 1182(a)(4),
barring aliens afflicted with ``psychopathic personality,'' a
congressional euphemism including homosexuality. Boutilier v.
Immigration and Naturalization Service, 387 U.S. 118 (1967).
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The process of naturalization culminates in the taking in open
court of an oath ``(1) to support the Constitution of the United States;
(2) to renounce and abjure absolutely and entirely all allegiance and
fidelity to any foreign prince, potentate, state, or sovereignty of whom
or which the petitioner was before a subject or citizen; (3) to support
and defend the Constitution and the laws of the United States against
all enemies, foreign and domestic; (4) to bear true faith and allegiance
to the same; and (5)(A) to bear arms on behalf of the United States when
required by the law, or (B) to perform noncombatant service in the Armed
Forces of the United States when required by the law, or (C) to perform
work of national importance under civilian direction when required by
law.''\1159\
\1159\Sec. 337(a), 66 Stat. 258 (1952), 8 U.S.C. Sec. 1448(a).
In United States v. Schwimmer, 279 U.S. 644 (1929), and United States v.
Macintosh, 283 U.S. 605 (1931), a divided Court held that clauses (3)
and (4) of the oath, as then prescribed, required the candidate for
naturalization to be willing to bear arms for the United States, thus
disqualifying conscientious objectors. These cases were overturned,
purely as a matter of statutory interpretation by Girouard v. United
States, 328 U.S. 61 (1946), and Congress codified the result, 64 Stat.
1017 (1950), as it now appears in the cited statute.
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Any naturalized person who takes this oath with mental
reservations or conceals or misrepresents beliefs, affiliations, and
conduct, which under the law disqualify one for naturalization, is
subject, upon these facts being shown in a proceeding brought for the
purpose, to have his certificate of naturalization cancelled.\1160\
Moreover, if within a year of his naturalization a person joins an
organization or becomes in any way affiliated with one which was
[[Page 270]]
a disqualification for naturalization if he had been a member at the
time, the fact is made prima facie evidence of his bad faith in taking
the oath and grounds for instituting proceedings to revoke his admission
to citizenship.\1161\
\1160\Sec. 340(a), 66 Stat. 260 (1952), 8 U.S.C. Sec. 1451(a).
See Kungys v. United States, 485 U.S. 759 (1988) (badly fractured Court
opinion dealing with the statutory requirements in a denaturalization
proceeding under this section). And see Johannessen v. United States,
225 U.S. 227 (1912). Congress has imposed no time bar applicable to
proceedings to revoke citizenship, so that many years after
naturalization has taken place a naturalized citizen remains subject to
divestment upon proof of fraud. Costello v. United States, 365 U.S. 265
(1961); Polites v. United States, 364 U.S. 426 (1960); Knauer v. United
States, 328 U.S. 654 (1946); Fedorenko v. United States, 449 U. S. 490
(1981).
\1161\340(c), 66 Stat. 261 (1952), 8 U.S.C. Sec. 1451(c). The
time period had previously been five years.
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Rights of Naturalized Persons
Chief Justice Marshall early stated in dictum that ``[a]
naturalized citizen . . . becomes a member of the society, possessing
all the rights of a native citizen, and standing, in the view of the
Constitution, on the footing of a native. The Constitution does not
authorize Congress to enlarge or abridge those rights. The simple power
of the national legislature is, to prescribe a uniform rule of
naturalization, and the exercise of this power exhausts it, so far as
respects the individual.''\1162\ A similar idea was expressed in Knauer
v. United States.\1163\ ``Citizenship obtained through naturalization is
not a second-class citizenship. . . . [It] carries with it the privilege
of full participation in the affairs of our society, including the right
to speak freely, to criticize officials and administrators, and to
promote changes in our laws including the very Charter of our
Government.''
\1162\Osborn v. Bank of the United States, 9 Wheat. (22 U.S.)
737, 827 (1824). One must be aware, however, that this language does not
appear in any case having to do with citizenship or naturalization or
the rights of naturalized citizens and its force may be therefore
questioned. Compare Afroyim v. Rusk, 387 U.S. 253, 261 (1967) (Justice
Black for the Court: ``a mature and well-considered dictum . . .''),
with id., 275-276 (Justice Harlan dissenting: the dictum, ``cannot have
been intended to reach the question of citizenship.''). The issue in
Osborn was the right of the Bank to sue in federal court. Osborn had
argued that the fact that the bank was chartered under the laws of the
United States did not make any legal issue involving the bank one
arising under the laws of the United States for jurisdictional purposes;
to argue the contrary, Osborn contended, was like suggesting that the
fact that persons were naturalized under the laws of Congress meant such
persons had an automatic right to sue in federal courts, unlike natural-
born citizens. The quoted language of Marshall's rejects this attempted
analogy.
\1163\328 U.S. 654, 658 (1946).
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Despite these dicta, it is clear that particularly in the past
but currently as well a naturalized citizen has been and is subject to
requirements not imposed on native-born citizens. Thus, as we have noted
above, a naturalized citizen is subject at any time to have his good
faith in taking the oath of allegiance to the United States inquired
into and to lose his citizenship if lack of such faith is shown in
proper proceedings.\1164\ And the naturalized citizen within a year of
his naturalization will join a questionable organi
[[Page 271]]
zation at his peril.\1165\ In Luria v. United States,\1166\ the Court
sustained a statute making prima facie evidence of bad faith a
naturalized citizen's assumption of residence in a foreign country
within five years after the issuance of a certificate of
naturalization.But in Schneider v. Rusk,\1167\ the Court voided a
statute that provided that a naturalized citizen should lose his United
States citizenship if following naturalization he resided continuously
for three years in his former homeland. ``We start,'' Justice Douglas
wrote for the Court, ``from the premise that the rights of citizenship
of the native-born and of the naturalized person are of the same dignity
and are coextensive. The only difference drawn by the Constitution is
that only the `natural born' citizen is eligible to be
President.''\1168\ The failure of the statute, the Court held, was that
it impermissibly distinguished between native-born and naturalized
citizens, denying the latter the equal protection of the laws.\1169\
``This statute proceeds on the impermissible assumption that naturalized
citizens as a class are less reliable and bear less allegiance to this
country than do the native-born. This is an assumption that is
impossible for us to make. . . . A native-born citizen is free to reside
abroad indefinitely without suffering loss of citizenship. The
discrimination aimed at naturalized citizens drastically limits their
rights to live and work abroad in a way that other citizens may. It
creates indeed a second-class citizenship. Living abroad, whether the
citizen be naturalized or native-born, is no badge of lack of allegiance
and in no way evidences a voluntary renunciation of nationality and
allegiance.''\1170\
\1164\Johannessen v. United States, 225 U.S. 227 (1912); Knauer
v. United States, 328 U.S. 654 (1946); Costello v. United States, 365
U.S. 265 (1961).
\1165\See 8 U.S.C. Sec. 1451(c).
\1166\231 U.S. 9 (1913). The provision has been modified to
reduce the period to one year. 8 U.S.C. Sec. 1451(d).
\1167\377 U.S. 163 (1964).
\1168\Id., 165.
\1169\While there is no equal protection clause specifically
applicable to the Federal Government, it is established that the due
process clause of the fifth Amendment forbids discrimination in much the
same manner as the equal protection clause of the Fourteenth Amendment.
\1170\Schneider v. Rusk, 377 U.S. 163, 168-169 (1964).
---------------------------------------------------------------------------
The Schneider equal protection rationale was abandoned in the
next case in which the Court held that the Fourteenth Amendment forbade
involuntary expatriation of naturalized persons.\1171\ But in Rogers v.
Bellei,\1172\ the Court refused to extend this holding to persons
statutorily naturalized at birth abroad because one of their parents was
a citizen and similarly refused to apply Schneider. Thus, one who failed
to honor a condition subsequent had his citizenship revoked. ``Neither
are we persuaded that a condition subse
[[Page 272]]
quent in this area impresses one with `second-class citizenship.' That
cliche is too handy and too easy, and, like most cliches, can be
misleading. That the condition subsequent may be beneficial is apparent
in the light of the conceded fact that citizenship was fully deniable.
The proper emphasis is on what the statute permits him to gain from the
possible starting point of noncitizenship, not on what he claims to lose
from the possible starting point of full citizenship to which he has no
constitutional right in the first place. His citizenship, while it
lasts, although conditional, is not `second-class.'''\1173\
\1171\Afroyim v. Rusk, 387 U.S. 253 (1967).
\1172\401 U.S. 815 (1971).
\1173\Id., 835-836.
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It is not clear where the progression of cases has left us in
this area. Clearly, naturalized citizens are fully entitled to all the
rights and privileges of those who are citizens because of their birth
here. But it seems equally clear that with regard to retention of
citizenship, naturalized citizens are not in the secure position of
citizens born here.\1174\
\1174\At least, there is a difference so long as Afroyim
prevents Congress from making expatriation the consequence of certain
acts when done by natural born citizens as well.
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On another point, the Court has held that, absent a treaty or
statute to the contrary, a child born in the United States who is taken
during minority to the country of his parents' origin, where his parents
resume their former allegiance, does not thereby lose his American
citizenship and that it is not necessary for him to make an election and
return to the United States.\1175\ On still another point, it has been
held that naturalization is so far retroactive as to validate an
acquisition of land prior to naturalization as to which the alien was
under a disability.\1176\
\1175\Perkins v. Elg, 307 U.S. 325 (1939). The qualifying phrase
``absent a treaty or statute . . .'' is error now, so long as Afroyim
remains in effect. But note Rogers v. Bellei, 401 U.S. 815, 832-833
(1971).
\1176\Governeur v. Robertson, 11 Wheat. (24 U.S.) 332 (1826);
Osterman v. Baldwin, 6 Wall. (73 U.S.) 116 (1867); Manuel v. Wulff, 152
U.S. 505 (1894).
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Expatriation: Loss of Citizenship
The history of the right of expatriation, voluntarily on the
part of the citizen or involuntarily under duress of statute, is shadowy
in United States constitutional law. Justice Story, in the course of an
opinion,\1177\ and Chancellor Kent, in his writings,\1178\ accepted the
ancient English doctrine of perpetual and unchangeable allegiance to the
government of one's birth, a citizen being precluded from renouncing his
allegiance without permission of that government. The pre-Civil War
record on the issue is so vague because
[[Page 273]]
there was wide disagreement on the basis of national citizenship in the
first place, with some contending that national citizenship was
derivative from state citizenship, which would place the power of
providing for expatriation in the state legislatures, and with others
contending for the primacy of national citizenship, which would place
the power in Congress.\1179\ The citizenship basis was settled by the
first sentence of Sec. 1 of the Fourteenth Amendment, but expatriation
continued to be a muddled topic. An 1868 statute specifically recognized
``the right of expatriation'' by individuals, but it was directed to
affirming the right of foreign nationals to expatriate themselves and to
become naturalized United States citizens.\1180\ An 1865 law provided
for the forfeiture of the ``rights of citizenship'' of draft-dodgers and
deserters, but whether the statute meant to deprive such persons of
citizenship or of their civil rights is unclear.\1181\
\1177\Shanks v. DuPont, 3 Pet. (28 U.S.) 242, 246 (1830).
\1178\2 J. Kent, Commentaries (New York: 1827), 49-50.
\1179\J. Tenbroek, Anti-Slavery Origins of the Fourteenth
Amendment (New York: 1951), 71-94; see generally J. Roche, The Early
Development of United States Citizenship (New York: 1949).
\1180\Act of July 27, 1868, 15 Stat. 223. While the Act's
preamble rhetorically proclaims the ``natural and inherent right of all
people'' to expatriate themselves, its title is ``An Act concerning the
Rights of American Citizens in foreign States'' and its operative parts
are concerned with that subject. It has long been taken, however, as a
general proclamation of United States recognition of the right of United
States citizens to expatriate themselves. Mackenzie v. Hare, 239 U.S.
299, 309 (1915); Mandoli v. Acheson, 344 U.S. 133, 135-136 (1952). Cf.
Savorgnan v. United States, 338 U.S. 491, 498 n. 11 (1950).
\1181\The Enrollment Act of March 3, 1865, Sec. 21, 13 Stat.
487, 490. The language of the section appears more consistent with a
deprivation of civil rights than of citizenship. Note also that Sec. 14
of the Wade-Davis Bill, pocket-vetoed by President Lincoln, specifically
provided that any person holding office in the Confederate Government
``is hereby declared not to be a citizen of the United States.'' 6 J.
Richardson, Messages and Papers of the Presidents (Washington: 1899),
223.
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Beginning in 1940, however, Congress did enact laws designed to
strip of their citizenship persons who committed treason,\1182\ deserted
the armed forces in wartime,\1183\ left the country to evade the
draft,\1184\ or attempted to overthrow the Government by force or
violence.\1185\ In 1907, Congress provided that female citizens who
married foreign citizens were to have their citizenship held ``in
abeyance'' while they remained wedded but to be entitled to reclaim it
when the marriage was dissolved.\1186\
\1182\Nationality Act of 1940, 54 Stat. 1169.
\1183\Ibid.
\1184\58 Stat. 746 (1944).
\1185\68 Stat. 1146 (1954).
\1186\34 Stat. 1228 (1907), repealed by 42 Stat. 1021 (1922).
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About the simplest form of expatriation, the renunciation of
citizenship by a person, there is no constitutional difficulty.
``Expatriation is the voluntary renunciation or abandonment of national
[[Page 274]]
ity and allegiance.''\1187\ But while the Court has hitherto insisted on
the voluntary character of the renunciation, it has sustained the power
of Congress to prescribe conditions and circumstances the voluntary
entering into of which constitutes renunciation; the person need not
intend to renounce so long as he intended to do what he did in fact
do.\1188\
\1187\Perkins v. Elg, 307 U.S. 325, 334 (1939).
\1188\Mackenzie v. Hare, 239 U.S. 299, 309, 311-312 (1915);
Savorgnan v. United States, 338 U.S. 491, 506 (1950).
---------------------------------------------------------------------------
The Court first encountered the constitutional issue of forced
expatriation in the rather anomalous form of the statute,\1189\ which
placed in limbo the citizenship of any American female who married a
foreigner. Sustaining the statute, the Court relied on the congressional
foreign relations power exercised in order to prevent the development of
situations that might entangle the United States in embarrassing or
hostile relationships with a foreign country. Noting too the fictional
merging of identity of husband and wife, the Court thought it well
within congressional power to attach certain consequences to these
actions, despite the woman's contrary intent and understanding at the
time she entered the relationship.\1190\
\1189\34 Stat. 1228 (1907).
\1190\Mackenzie v. Hare, 239 U.S. 299 (1915).
---------------------------------------------------------------------------
Beginning in 1958, the Court had a running encounter with the
provisions of the 1952 Immigration and Nationality Act, which prescribed
expatriation for a lengthy series of actions.\1191\ In 1958, a five-to-
four decision sustained the power to divest a dual national of his
United States citizenship because he had voted in an election in the
other country of which he was a citizen.\1192\ But at the same
[[Page 275]]
time, another five-to-four decision, in which a majority rationale was
lacking, struck down punitive expatriation visited on persons convicted
by court-martial of desertion from the armed forces in wartime.\1193\ In
the next case, the Court struck down another punitive expatriation
visited on persons who, in time of war or emergency, leave or remain
outside the country in order to evade military service.\1194\ And in the
following year, the Court held unconstitutional a section of the law
that expatriated a naturalized citizen who returned to his native land
and resided there continuously for a period of three years.\1195\
\1191\See generally 8 U.S.C. Sec. Sec. 1481-1489. Among the acts
for which loss of citizenship is prescribed are (1) obtaining
naturalization in a foreign state, (2) taking an oath of allegiance to a
foreign state, (3) serving in the armed forces of a foreign state
without authorization and with consequent acquisition of foreign
nationality, (4) assuming public office under the government of a
foreign state for which only nationals of that state are eligible, (5)
voting in an election in a foreign state, (6) formally renouncing
citizenship before a United states foreign service officer abroad, (7)
formally renewing citizenship within the United States in time of war,
subject to approval of the Attorney General, (8) being convicted and
discharged from the armed services for desertion in wartime, (9) being
convicted of treason or of an attempt to overthrow forcibly the
Government of the United States, (10) fleeing or remaining outside the
United States in wartime or a proclaimed emergency in order to evade
military service, and (11) residing abroad if a naturalized citizen,
subject to certain exceptions, for three years in the country of his
birth or in which he was formerly a national or for five years in any
other foreign state. Several of these sections have been declared
unconstitutional, as explained in the text.
\1192\Perez v. Brownell, 356 U.S. 44 (1958). For the Court,
Justice Frankfurter sustained expatriation as a necessary exercise of
the congressional power to regulate the foreign relations of the United
States to prevent the embarrassment and potential for trouble inherent
in our nationals voting in foreign elections. Justice Whittaker
dissented because he saw no problem of embarrassment or potential
trouble if the foreign state permitted aliens or dual nationals to vote.
Chief Justice Warren and Justices Black and Douglas denied that
expatriation is within Congress' power to prescribe for an act, like
voting, which is not necessarily a sign of intention to relinquish
citizenship.
\1193\Trop v. Dulles, 356 U.S. 86 (1958). Chief Justice Warren
for himself and three Justices held that expatriation for desertion was
a cruel and unusual punishment proscribed by the Eighth Amendment.
Justice Brennan concurred on the ground of a lack of the requisite
relationship between the statute and Congress' war powers. For the four
dissenters, Justice Frankfurter argued that Congress had power to impose
loss of citizenship for certain activity and that there was a rational
nexus between refusal to perform a duty of citizenship and deprivation
of citizenship. Justice Frankfurter denied that the penalty was cruel
and unusual punishment and denied that it was punishment at all ``in any
valid constitutional sense.'' Id., 124.
\1194\Kennedy v. Mendoza-Martinez, 372 U.S. 144 (1963). For the
Court Justice Goldberg held that penal expatriation effectuated solely
by administrative determination violated due process because of the
absence of procedural safeguards. Justices Black and Douglas continued
to insist Congress could not deprive a citizen of his nationality at
all. Justice Harlan for the dissenters thought the statute a valid
exercise of Congress' war powers but the four dissenters divided two-to-
two on the validity of a presumption spelled out in the statute.
\1195\Schneider v. Rusk, 377 U.S. 163 (1964).
---------------------------------------------------------------------------
The cases up to this point had lacked a common rationale and
would have seemed to permit even punitive expatriation under the proper
circumstances. But, in Afroyim v. Rusk,\1196\ a five-to-four majority
overruled the 1958 decision permitting expatriation for voting in a
foreign election and announced a constitutional rule against all but
purely voluntary renunciation of United States citizenship. The majority
ruled that the first sentence of Sec. 1 of the Fourteenth Amendment
constitutionally vested citizenship in every person ``born or
naturalized in the United States'' and that Congress was powerless to
take that citizenship away.\1197\ The continuing vitality of this
decision was called into question by another five-to-four decision in
1971, which technically distinguished Afroyim in upholding a
congressionally-prescribed loss of citizenship visited
[[Page 276]]
upon a person who was statutorily naturalized ``outside'' the United
States, and held not within the protection of the first sentence of
Sec. 1 of the Fourteenth Amendment.\1198\ Thus, while Afroyim was
distinguished, the tenor of the majority opinion was hostile to its
holding, and it may be that in a future case it will be overruled.
\1196\387 U.S. 253 (1967).
\1197\Justice Harlan, for himself and Justices Clark, Stewart,
and White, argued in dissent that there was no evidence that the
drafters of the Fourteenth Amendment had at all the intention ascribed
to them by the majority. He would have found in Afroyim's voluntary act
of voting in a foreign election a voluntary renunciation of United
States citizenship.
\1198\Rogers v. Bellei, 401 U.S. 815 (1971). The three remaining
Afroyim dissenters plus Chief Justice Burger and Justice Blackmun made
up the majority, the three remaining Justices of the Afroyim majority
plus Justice Marshall made up the dissenters. The continuing vitality of
Afroyim was assumed in Vance v. Terrazas, 444 U. S. 252 (1980), in which
a divided Court upheld a congressionally-imposed standard of proof,
preponderance of evidence, by which to determine whether one had by his
actions renounced his citizenship.
---------------------------------------------------------------------------
The issue, then, of the constitutionality of congressionally-
prescribed expatriation must be taken as unsettled.
ALIENS
The Power of Congress to Exclude Aliens
The power of Congress ``to exclude aliens from the United States
and to prescribe the terms and conditions on which they come in'' is
absolute, being an attribute of the United States as a sovereign nation.
``That the government of the United States, through the action of the
legislative department, can exclude aliens from its territory is a
proposition which we do not think open to controversy. Jurisdiction over
its own territory to that extent is an incident of every independent
nation. It is a part of its independence. If it could not exclude
aliens, it would be to that extent subject to the control of another
power. . . . The United States, in their relation to foreign countries
and their subjects or citizens, are one nation, invested with powers
which belong to independent nations, the exercise of which can be
invoked for the maintenance of its absolute independence and security
throughout its entire territory.''\1199\
\1199\Chinese Exclusion Case (Chae Chan Ping v. United States),
130 U.S. 581, 603, 604 (1889); see also Fong Yue Ting v. United States,
149 U.S. 698, 705 (1893); The Japanese Immigrant Case (Yamataya v.
Fisher), 189 U.S. 86 (1903); United States ex rel. Turner v. Williams,
194 U.S. 279 (1904); Bugajewitz v. Adams, 228 U.S. 585 (1913); Hines v.
Davidowitz, 312 U.S. 52 (1941); Kleindeist v. Mandel, 408 U. S. 753
(1972). In Galvan v. Press, 347 U.S. 522, 530-531 (1954), Justice
Frankfurter for the Court wrote: ``[M]uch could be said for the view,
were we writing on a clean slate, that the Due Process Clause qualifies
the scope of political discretion heretofore recognized as belonging to
Congress in regulating the entry and deportation of aliens. . . . But
the slate is not clean. As to the extent of the power of Congress under
review, there is not merely `a page of history,' . . . but a whole
volume. . . . [T]hat the formulation of these policies is entrusted
exclusively to Congress has become about as firmly imbedded in the
legislative and judicial tissues of our body politic as any aspect of
our government.'' Although the issue of racial discrimination was before
the Court in Jean v. Nelson, 472 U.S. 846 (1985), in the context of
parole for undocumented aliens, the Court avoided it, holding that
statutes and regulations precluded INS considerations of race or
national origin. Justices Marshall and Brennan, in dissent, argued for
reconsideration of the long line of precedents and for constitutional
restrictions on the Government. Id., 858. That there exists some
limitation upon exclusion of aliens is one permissible interpretation of
Reagan v. Abourezk, 484 U.S. 1 (1987), affg. by an equally divided
Court, 785 F.2d 1043 (D.C.Cir. 1986), holding that mere membership in
the Communist Party could not be used to exclude an alien on the ground
that his activities might be prejudicial to the interests of the United
States.
The power of Congress to prescribe the rules for exclusion or
expulsion of aliens is a ``fundamental sovereign attribute'' which is
``of a political character and therefore subject only to narrow judicial
review.'' Hampton v. Mow Sun Wong, 426 U.S. 88, 101 n. 21 (1976);
Mathews v. Diaz, 426 U.S. 67, 81-82 (1976); Fiallo v. Bell, 430 U.S.
787, 792 (1977). Although aliens are ``an identifiable class of
persons,'' who aside from the classification at issue ``are already
subject to disadvantages not shared by the remainder of the community,''
Hampton v. Mow Sun Wong, supra, 102, Congress may treat them in ways
that would violate the equal protection clause if a State should do it.
Diaz, supra (residency requirement for welfare benefits); Fiallo, supra
(sex and illegitimacy classifications). Nonetheless in Mow Sun Wong,
supra, 103, the Court observed that when the Federal Government asserts
an overriding national interest as justification for a discriminatory
rule that would violate the equal protection clause if adopted by a
State, due process requires that it be shown that the rule was actually
intended to serve that interest. The case struck down a classification
that the Court thought justified by the interest asserted but that had
not been imposed by a body charged with effectuating that interest. See
Vergara v. Hampton, 581 F.2d 1281 (C.A. 7, 1978).
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[[Page 277]]
Except for the Alien Act of 1798,\1200\ Congress went almost a
century without enacting laws regulating immigration into the United
States. The first such statute, in 1875, barred convicts and
prostitutes\1201\ and was followed by a series of exclusions based on
health, criminal, moral, economic, and subversion considerations.\1202\
Another important phase was begun with passage of the Chinese Exclusion
Act in 1882,\1203\ which was not repealed until 1943.\1204\ In 1924,
Congress enacted into law a national origins quota formula which based
the proportion of admittable aliens on the nationality breakdown of the
1920 census, which, of course, was heavily weighed in favor of English
and northern European ancestry.\1205\ This national origins quota system
was in effect until it was repealed in 1965.\1206\ The basic law remains
the Immigra
[[Page 278]]
tion and Nationality Act of 1952,\1207\ which, with certain revisions in
1965 and later piecemeal alterations, regulates who may be admitted and
under what conditions; the Act, it should be noted, contains a list of
31 excludable classes of aliens.\1208\
\1200\Act of June 25, 1798, 1 Stat. 570. The Act was part of the
Alien and Sedition Laws and authorized the expulsion of any alien the
President deemed dangerous.
\1201\Act of March 3, 1875, 18 Stat. 477.
\1202\22 Stat. 214 (1882) (excluding idiots, lunatics, convicts,
and persons likely to become public charges); 23 Stat. 332 (1885), and
24 Stat. 414 (1887) (regulating importing cheap foreign labor); 26 Stat.
1084 (1891) (persons suffering from certain diseases, those convicted of
crimes involving moral turpitude, paupers, and polygamists); 32 Stat.
1213 (1903) (epileptics, insane persons, professional beggars, and
anarchists); 34 Stat. 898 (1907) (feeble-minded, children unaccompanied
by parents, persons suffering with tuberculosis, and women coming to the
United States for prostitution or other immoral purposes).
\1203\Act of May 6, 1882, 22 Stat. 58.
\1204\Act of December 17, 1943, 57 Stat. 600.
\1205\Act of May 26, 1924, 43 Stat. 153.
\1206\Act of October 3, 1965, P.L. 89-236, 79 Stat. 911.
\1207\Act of June 27, 1952, P.L. 82-414, 66 Stat. 163, 8 U.S.C.
Sec. Sec. 1101 et seq. as amended.
\1208\The list of excludable aliens may be found at 8 U.S.C.
Sec. 1182. The list has been modified and classified by category in
recent amendments.
---------------------------------------------------------------------------
Numerous cases underscore the sweeping nature of the powers of
the Federal Government to exclude aliens and to deport by administrative
process persons in excluded classes. For example, in United States ex
rel. Knauff v. Shaughnessy,\1209\ an order of the Attorney General
excluding, on the basis of confidential information he would not
disclose, a wartime bride, who was prima facie entitled to enter the
United States,\1210\ was held to be unreviewable by the courts. Nor were
regulations on which the order was based invalid as an undue delegation
of legislative power. ``Normally Congress supplies the conditions of the
privilege of entry into the United States. But because the power of
exclusion of aliens is also inherent in the executive department of the
sovereign, Congress may in broad terms authorize the executive to
exercise the power, e.g., as was done here, for the best interest of the
country during a time of national emergency. Executive officers may be
entrusted with the duty of specifying the procedures for carrying out
the congressional intent.''\1211\ However, when Congress has spelled out
the basis for exclusion or deportation, the Court remains free to
interpret the statute and review the administration of it and to apply
it, often in a manner to mitigate the effects of the law on
aliens.\1212\
\1209\338 U.S. 537 (1950). See also Shaughnessy v. United States
ex rel. Mezei, 345 U.S. 206 (1953), in which the Court majority upheld
the Government's power to exclude on the basis of information it would
not disclose a permanent resident who had gone abroad for about nineteen
months and was seeking to return on a new visa. But the Court will
frequently read the applicable statutes and regulations strictly against
the Government for the benefit of persons sought to be excluded. Cf.
Delgadillo v. Carmichael, 332 U.S. 388 (1947); Kwong Hai Chew v.
Colding, 344 U.S. 590 (1953); Rosenburg v. Fleuti, 374 U.S. 449 (1963).
\1210\Under the War Brides Act of 1945, 59 Stat. 659.
\1211\Id., 338 U.S., 543.
\1212\E.g., Immigration and Naturalization Service v. Errico,
385 U.S. 214 (1966).
---------------------------------------------------------------------------
Congress' power to admit aliens under whatever conditions it
lays down is exclusive of state regulation. The States ``can neither add
to nor take from the conditions lawfully imposed by Congress upon
admission, naturalization and residence of aliens in the United States
or the several states. State laws which impose discriminatory burdens
upon the entrance or residence of aliens lawfully within the United
States conflict with this constitutionally derived
[[Page 279]]
federal power to regulate immigration, and have accordingly been held
invalid.''\1213\ This principle, however, has not precluded all state
regulations dealing with aliens.\1214\ The power of Congress to
legislate with respect to the conduct of alien residents is a
concomitant of its power to prescribe the terms and conditions on which
they may enter the United States, to establish regulations for sending
out of the country such aliens as have entered in violation of law, and
to commit the enforcement of such conditions and regulations to
executive officers. It is not a power to lay down a special code of
conduct for alien residents or to govern their private relations.\1215\
\1213\Takahashi v. Fish & Game Commission, 334 U.S. 410, 419
(1948); De Canas v. Bica, 424 U.S. 351, 358 n. 6 (1976); Toll v. Moreno,
458 U.S. 1, 12-13 (1982). See also Hines v. Davidowitz, 312 U.S. 52, 66
(1941); Graham v. Richardson, 403 U.S. 365, 376-380 (1971).
\1214\E.g., Heim v. McCall, 239 U.S. 175 (1915); Ohio ex rel.
Clarke v. Deckebach, 274 U.S. 392 (1927); Sugarman v. Dougall, 413 U.S.
634, 646-649 (1973); De Canas v. Bica, 424 U.S. 351 (1976); Cabell v.
Chavez-Salido, 454 U.S. 432 (1982).
\1215\Purporting to enforce this distinction, the Court voided a
statute, which, in prohibiting the importation of ``any alien woman or
girl for the purpose of prostitution,'' provided that whoever should
keep for the purpose of prostitution ``any alien woman or girl within
three years after she shall have entered the United States'' should be
deemed guilty of a felony. Keller v. United States, 213 U.S. 138 (1909).
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Yet Congress is empowered to assert a considerable degree of
control over aliens after their admission to the country. By the Alien
Registration Act of 1940, Congress provided that all aliens in the
United States, fourteen years of age and over, should submit to
registration and finger printing and willful failure to comply was made
a criminal offense against the United States.\1216\ This Act, taken in
conjunction with other laws regulating immigration and naturalization,
has constituted a comprehensive and uniform system for the regulation of
all aliens.\1217\
\1216\54 Stat. 670, 8 U.S.C. Sec. Sec. 1301-1306.
\1217\See Hines v. Davidowitz, 312 U.S. 52, 69-70 (1941).
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An important benefit of this comprehensive regulation accruing
to the alien is that it precludes state regulation that may well be more
severe and burdensome. For example, in Hines v. Davidowitz,\1218\ the
Court voided a Pennsylvania law requiring the annual registration and
fingerprinting of aliens but going beyond the subsequently-enacted
federal law to require acquisition of an alien identification card that
had to be carried at all times and to be exhibited to any police officer
upon demand and to other licensing officers upon applications for such
things as drivers' licenses. The Court did not squarely hold the State
incapable of having such a law in the absence of federal law but
appeared to lean in that
[[Page 280]]
direction.\1219\ Another decision voided a Pennsylvania law limiting
those eligible to welfare assistance to citizens and an Arizona law
prescribing a fifteen-year durational residency period before an alien
could be eligible for welfare assistance.\1220\ Congress had provided,
Justice Blackmun wrote for a unanimous Court, that persons who were
likely to become public charges could not be admitted to the United
States and that any alien who became a public charge within five years
of his admission was to be deported unless he could show that the causes
of his economic situation arose after his entry.\1221\ Thus, in effect
Congress had declared that lawfully admitted resident aliens who became
public charges for causes arising after their entry were entitled to the
full and equal benefit of all laws for the security of persons and
property, and the States were disabled from denying aliens these
benefits.\1222\
\1218\312 U.S. 52 (1941).
\1219\Id., 68. But see De Canas v. Bica, 424 U.S. 351 (1976), in
which the Court upheld a state law prohibiting an employer from hiring
aliens not entitled to lawful residence in the United States. The Court
wrote that States may enact legislation touching upon aliens coexistent
with federal laws, under regular preemption standards, unless the nature
of the regulated subject matter precludes the conclusion or unless
Congress has unmistakably ordained the impermissibility of state law.
\1220\Graham v. Richardson, 403 U.S. 365 (1971). See also
Sugarman v. Dougall, 413 U.S. 634 (1973); In re Griffiths, 413 U.S. 717
(1973); Cabell v. Chavez-Salido, 454 U.S. 432 (1982).
\1221\8 U.S.C. Sec. Sec. 1182(a)(8), 1182(a)(15), 1251(a)(8).
\1222\See 42 U.S.C. Sec. 1981, applied in Takahashi v. Fish and
Game Commission, 334 U.S. 410, 419 n. 7 (1948).
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Deportation
Unlike the exclusion proceedings,\1223\ deportation proceedings
afford the alien a number of constitutional rights: a right against
self-incrimination,\1224\ protection against unreasonable searches and
seizures,\1225\ guarantees against ex post facto laws, bills of
attainder, and cruel and unusual punishment,\1226\ a right to
bail,\1227\ a right to procedural due process,\1228\ a right to
counsel,\1229\ a right to notice of charges and hearing,\1230\ as well
as a right to cross-examine.\1231\
\1223\See United States ex rel. Knauff v. Shaughnessy, 338 U.S.
537, 544 (1950), where the Court noted that ``[w]hatever the procedure
authorized by Congress is, it is due process as far as an alien denied
entry is concerned.''
\1224\Kimm v. Rosenberg, 363 U.S. 405 (1960).
\1225\Abel v. United States, 362 U.S. 217, 229 (1960).
\1226\Marcello v. Bonds, 349 U.S. 302 (1955).
\1227\Carlson v. Landon, 342 U.S. 524, 540 (1952).
\1228\Wong Yang Sung v. McGrath, 339 U.S. 33, 49 (1950).
\1229\8 U.S.C. Sec. 1252(b)(2).
\1230\8 U.S.C. Sec. 1252(b)(1).
\1231\8 U.S.C. Sec. 1252(b)(3).
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Notwithstanding these guarantees, the Supreme Court has upheld a
number of statutory deportation measures as not uncon
[[Page 281]]
stitutional. The Internal Security Act of 1950, in authorizing the
Attorney General to hold in custody, without bail, aliens who are
members of the Communist Party of the United States, pending
determination as to their deportability, is not unconstitutional.\1232\
Nor was it unconstitutional to deport under the Alien Registration Act
of 1940\1233\ a legally resident alien because of membership in the
Communist Party, although such membership ended before the enactment of
the Act. Such application of the Act did not make it ex post facto,
being but an exercise of the power of the United States to treminate its
hospitality ad libitum.\1234\ And a statutory provision\1235\ making it
a felony for an alien against whom a specified order of deportation is
outstanding ``to willfully fail or refuse to make timely application for
travel or other documents necessary to his departure'' was not on its
face void for ``vagueness.''\1236\
\1232\Carlson v. Landon, 342 U.S. 524 (1952).
\1233\54 Stat. 670. For existing statutory provisions as to
deportation, see 8 U.S.C. Sec. 1251 et seq.
\1234\Carlson v. Landon, 342 U.S. 524 (1952).
\1235\8 U.S.C. Sec. 1252(e).
\1236\United States v. Spector, 343 U.S. 169 (1952).
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BANKRUPTCY
Persons Who May Be Released From Debt
In an early case on circuit, Justice Livingston suggested that
inasmuch as the English statutes on the subject of bankruptcy from the
time of Henry VIII down had applied only to traders it might ``well be
doubted, whether an act of Congress subjecting to such a law every
description of persons within the United States, would comport with the
spirit of the powers vested in them in relation to this subject.''\1237\
Neither Congress nor the Supreme Court has ever accepted this limited
view. The first bankruptcy law, passed in 1800, departed from the
English practice to the extent of including bankers, brokers, factors
and underwriters as well as traders.\1238\ Asserting that the narrow
scope of the English statutes was a mere matter of policy, which by no
means entered into the nature of such laws, Justice Story defined
bankruptcy legislation in the sense of the Constitution as a law making
provisions for cases of persons failing to pay their debts.\1239\
\1237\Adams v. Storey, 1 Fed. Cas. 141, 142 (No. 66) (C.C.D.N.Y.
1817).
\1238\2 Stat. 19 (1800).
\1239\2 J. Story, Commentaries on the Constitution of the United
States (Boston: 1833), 1113.
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This interpretation has been ratified by the Supreme Court. In
Hanover National Bank v. Moyses,\1240\ it held valid the Bankruptcy Act
of 1898, which provided that persons other than traders might
[[Page 282]]
become bankrupts and that this might be done on voluntary petition. The
Court has given tacit approval to the extension of the bankruptcy laws
to cover practically all classes of persons and corporations,\1241\
including even municipal corporations\1242\ and wage-earning
individuals. The Bankruptcy Act has, in fact been amended to provide a
wage-earners' extension plan to deal with the unique problems of debtors
who derive their livelihood primarily from salaries or commissions. In
furthering the implementation of this plan, the Supreme Court has held
that a wage earner may make use of it, notwithstanding the fact he has
been previously discharged in bankruptcy within the last six
years.\1243\
\1240\186 U.S. 181 (1902).
\1241\Continental Bank v. Rock Island Ry., 294 U.S. 648, 670
(1935).
\1242\United States v. Bekins, 304 U.S. 27 (1938),
distinguishing Ashton v. Cameron County Dist., 298 U.S. 513 (1936).
\1243\Perry v. Commerce Loan Co., 383 U.S. 392 (1966).
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Liberalization of Relief Granted and Expansion of the Rights of
the Trustee
As the coverage of the bankruptcy laws has been expanded, the
scope of the relief afforded to debtors has been correspondingly
enlarged. The act of 1800, like its English antecedents, was designed
primarily for the benefit of creditors. Beginning with the act of 1841,
which opened the door to voluntary petitions, rehabilitation of the
debtor has become an object of increasing concern to Congress. An
adjudication in bankruptcy is no longer requisite to the exercise of
bankruptcy jurisdiction. In 1867, the debtor for the first time was
permitted, either before or after adjudication of bankruptcy, to propose
terms of composition that would become binding upon acceptance by a
designated majority of his creditors and confirmation by a bankruptcy
court. This measure was held constitutional,\1244\ as were later acts,
which provided for the reorganization of corporations that are insolvent
or unable to meet their debts as they mature,\1245\ and for the
composition and extension of debts in proceedings for the relief of
individual farmer debtors.\1246\
\1244\In re Reiman, 20 Fed. Cas. 490 (No. 11,673) (D.C.S.D.N.Y.
1874), cited with approval in Continental Bank v. Rock Island Ry., 294
U.S. 648, 672 (1935).
\1245\Continental Bank v. Rock Island Ry., 294 U.S. 648 (1935).
\1246\Wright v. Vinton Branch, 300 U.S. 440 (1937); Adair v.
Bank of America Assn., 303 U.S. 350 (1938).
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Nor is the power of Congress limited to adjustment of the rights
of creditors. The Supreme Court has also ruled that the rights of a
purchaser at a judicial sale of the debtor's property are within reach
of the bankruptcy power, and may be modified by a reasonable extension
of the period for redemption from such sale.\1247\ Moreover, the Court
expanded the bankruptcy court's
[[Page 283]]
power over the property of the estate by affording the trustee
affirmative relief on counterclaim against a creditor filing a claim
against the estate.\1248\
\1247\Wright v. Union Central Ins. Co., 304 U.S. 502 (1938).
\1248\Katchen v. Landy, 382 U.S. 323 (1966).
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Underlying most Court decisions and statutes in this area is the
desire to achieve equity and fairness in the distribution of the
bankrupt's funds.\1249\ United States v. Speers,\1250\ codified by an
amendment to the Bankruptcy Act,\1251\ furthered this objective by
strengthening the position of the trustee as regards the priority of a
federal tax lien unrecorded at the time of bankruptcy.\1252\ The Supreme
Court has held, in other cases dealing with the priority of various
creditors' claims, that claims arising from the tort of the receiver is
an ``actual and necessary'' cost of administration,\1253\ that benefits
under a nonparticipating annuity plan are not wages and are therefore
not given priority,\1254\ and that when taxes are allowed against a
bankrupt's estate, penalties due because of the trustee's failure to pay
the taxes incurred while operating a bankrupt business are also
allowable.\1255\ The Court's attitude with regard to these and other
developments is perhaps best summarized in the opinion in Continental
Bank v. Rock Island Ry.,\1256\ where Justice Sutherland wrote, on behalf
of a unanimous court: ``[T]hese acts, far-reaching though they may be,
have not gone beyond the limit of Congressional power; but rather have
constituted extensions into a field whose boundaries may not yet be
fully revealed.''\1257\
\1249\Bank of Marin v. England, 385 U.S. 99, 103 (1966).
\1250\382 U.S. 266 (1965). Cf. United States v. Vermont, 337
U.S. 351 (1964).
\1251\Act of July 5, 1966, 80 Stat. 269, 11 U.S.C. Sec. 501,
repealed.
\1252\382 U.S., 271-272.
\1253\Reading Co. v. Brown, 391 U.S. 471 (1968).
\1254\Joint Industrial Board of the Election Industries v.
United States, 391 U.S. 224 (1968).
\1255\Nicholas v. United States, 384 U.S. 678 (1966).
\1256\294 U.S. 648 (1935).
\1257\Id., 671.
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Constitutional Limitations on the Bankruptcy Power
In the exercise of its bankruptcy powers, Congress must not
transgress the Fifth and Tenth Amendments. The Bankruptcy Act provides
that oral testimony cannot be used in violation of the bankrupt's right
against self-incrimination.\1258\ Congress may not take from a creditor
specific property previously acquired from a debtor, nor circumscribe
the creditor's right to such an unreasonable extent as to deny him due
process of law;\1259\ this principle, however, is subject to the Supreme
Court's finding that a bank
[[Page 284]]
ruptcy court has summary jurisdiction for ordering the surrender of
voidable preferences when the trustee successfully counterclaims to a
claim filed by the creditor receiving such preferences.\1260\
\1258\11 U.S.C. Sec. 344.
\1259\Louisville Bank v. Radford, 295 U.S. 555, 589, 602 (1935).
\1260\Katchen v. Landy, 382 U.S. 323, 327-340 (1966).
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Since Congress may not supersede the power of a State to
determine how a corporation shall be formed, supervised, and dissolved,
a corporation, which has been dissolved by a decree of a state court,
may not file a petition for reorganization under the Bankruptcy
Act.\1261\ But Congress may impair the obligation of a contract and may
extend the provisions of the bankruptcy laws to contracts already
entered into at the time of their passage.\1262\ Although it may not
subject the fiscal affairs of a political subdivision of a State to the
control of a federal bankruptcy court,\1263\ Congress may empower such
courts to entertain petitions by taxing agencies or instrumentalities
for a composition of their indebtedness where the State has consented to
the proceeding and the federal court is not authorized to interfere with
the fiscal or governmental affairs of such petitioners.\1264\ Congress
may recognize the laws of the State relating to dower, exemption, the
validity of mortgages, priorities of payment and similar matters, even
though such recognition leads to different results from State to
State;\1265\ for although bankruptcy legislation must be uniform, the
uniformity required is geographic, not personal.
\1261\Chicago Title and Trust Co. v. Wilcox Bldg. Corp., 302
U.S. 120 (1937).
\1262\In re Klein, 1 How. (42 U.S.) 277 (1843); Hanover National
Bank v. Moyses, 186 U.S. 181 (1902).
\1263\Ashton v. Cameron County Dist., 298 U.S. 513 (1936). See
also United States v. Bekii 304 U.S. 27 (1938).
\1264\United Slates v. Bekins, 304 U.S. 27 (1938).
\1265\Stellwagon v. Clum, 245 U.S. 605 (1918); Hanover National
Bank v. Moyses, 186 U.S. 181, 190 (1902).
---------------------------------------------------------------------------
The power of Congress to vest the adjudication of bankruptcy
claims in entities not having the constitutional status of Article III
federal courts is unsettled. At least, it may not give to non-Article
III courts the authority to hear state law claims made subject to
federal jurisdiction only because of their relevance to a bankruptcy
proceeding.\1266\
\1266\Northern Pipeline Constr. Co. v. Marathon Pipe Line Co.,
458 U.S. 50 (1982). And see Granfinanciera, S.A. v. Nordberg, 492 U.S.
33 (1989) (Seventh Amendment right to jury trial in bankruptcy cases).
---------------------------------------------------------------------------
Constitutional Status of State Insolvency Laws: Preemption
Prior to 1898, Congress exercised the power to establish
``uniform laws on the subject of bankruptcy'' only intermittently. The
first national bankruptcy law was not enacted until 1800 and was
repealed in 1803; the second was passed in 1841 and was repealed
[[Page 285]]
two years later; a third was enacted in 1867 and repealed in 1878.\1267\
Thus, during the first eighty-nine years under the Constitution, a
national bankruptcy law was in existence only sixteen years altogether.
Consequently, the most important issue of interpretation that arose
during that period concerned the effect of the clause on state law.
\1267\Hanover National Bank v. Moyses, 186 U.S. 181, 184 (1902).
---------------------------------------------------------------------------
The Supreme Court ruled at an early date that in the absence of
congressional action the States may enact insolvency laws, since it is
not the mere existence of the power but rather its exercise that is
incompatible with the exercise of the same power by the States.\1268\
Later cases settled further that the enactment of a national bankruptcy
law does not invalidate state laws in conflict therewith but serves only
to relegate them to a state of suspended animation with the result that
upon repeal of the national statute they again come into operation
without re-enactment.\1269\
\1268\Sturges v. Crowninshield, 4 Wheat. (17 U.S.) 122, 199
(1819); Ogden v. Saunders, 12 Wheat. (25 U.S.) 213, 368 (1827).
\1269\Tua v. Carriere, 117 U.S. 201 (1886); Butler v. Goreley,
146 U.S. 303, 314 (1892).
---------------------------------------------------------------------------
A State is, of course, without power to enforce any law
governing bankruptcies, which impairs the obligation of contracts,\1270\
extends to persons or property outside its jurisdiction,\1271\ or
conflicts with the national bankruptcy laws.\1272\ Giving effect to the
policy of the federal statute, the Court has held that a state statute
regulating this distribution of property of an insolvent was suspended
by that law,\1273\ and that a state court was without power to proceed
with pending foreclosure proceedings after a farmer-debtor had filed a
petition in federal bankruptcy court for a composition or extension of
time to pay his debts.\1274\ A state court injunction ordering a
defendant to clean up a waste-disposal site was held to be a ``liability
on a claim'' subject to discharge under the bankruptcy law, after the
State had appointed a receiver to take charge of the defendant's
property and comply with the injunction.\1275\ A
[[Page 286]]
state law governing fraudulent transfers was found to be compatible with
the federal law.\1276\
\1270\Sturges v. Crowninshield, 4 Wheat. (17 U.S.) 122 (1819).
\1271\Ogden v. Saunders, 12 Wheat. (25 U.S.) 213, 368 (1827);
Denny v. Bennett, 128 U.S. 489, 498 (1888); Brown v. Smart, 145 U.S. 454
(1892).
\1272\In re Watts and Sachs, 190 U.S. 1, 27 (1903);
International Shoe Co. v. Pinkus, 278 U.S. 261, 264 (1929).
\1273\International Shoe Co. v. Pinkus, 278 U.S. 261, 265
(1929).
\1274\Kalb v. Feurerstein, 308 U.S. 433 (1940).
\1275\Ohio v. Kovacs, 469 U.S. 274 (1985). Compare Kelly v.
Robinson, 479 U.S. 36 (1986) (restitution obligations imposed as
conditions of probation in state criminal actions are nondischargeable
in proceedings under chapter 7), with Pennsylvania Dept. of Public
Welfare v. Davenport, 495 U.S. 552 (1990) (restitution obligations
imposed as condition of probation in state criminal actions are
dischargeable in proceedings under chapter 13).
\1276\Stellwagen v. Clum, 245 U.S. 605, 615 (1918).
---------------------------------------------------------------------------
Substantial disagreement has marked the actions of the Justices
in one area, however, resulting in three five-to-four decisions first
upholding and then voiding state laws providing that a discharge in
bankruptcy was not to relieve a judgment arising out of an automobile
accident upon pain of suffering suspension of his driver's
license.\1277\ The state statutes were all similar enactments of the
Uniform Motor Vehicle Safety Responsibility Act, which authorizes the
suspension of the license of any driver who fails to satisfy a judgment
against himself growing out of a traffic accident; a section of the law
specifically provides that a discharge in bankruptcy will not relieve
the debtor of the obligation to pay and the consequence of license
suspension for failure to pay. In the first two decisions, the Court
majorities decided that the object of the state law was not to see that
such judgments were paid but was rather a device to protect the public
against irresponsible driving.\1278\ The last case rejected this view
and held that the Act's sole emphasis was one of providing leverage for
the collection of damages from drivers and as such was in fact intended
to and did frustrate the purpose of the federal bankruptcy law, the
giving of a fresh start unhampered by debt.\1279\
\1277\Reitz v. Mealey, 314 U.S. 33 (1941); Kesler v. Department
of Public Safety, 369 U.S. 153 (1962); Perez v. Campbell, 402 U.S. 637
(1971).
\1278\Reitz v. Mealey, 314 U.S. 33, 37 (1941); Kesler v.
Department of Public Safety, 369 U.S. 153, 169-174 (1962).
\1279\Perez v. Campbell, 402 U.S. 637, 644-648, 651-654 (1971).
The dissenters, Justice Blackmun for himself and Chief Justice Burger
and Justices Harlan and Stewart, argued, in line with the Reitz and
Kesler majorities, that the provision at issue was merely an attempt to
assure driving competence and care on the part of its citizens and had
only tangential effect upon bankruptcy.
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If a State desires to participate in the assets of a bankruptcy,
it must submit to the appropriate requirements of the bankruptcy court
with respect to the filing of claims by a designated date. It cannot
assert a claim for taxes by filing a demand at a later date.\1280\
\1280\New York v. Irving Trust Co., 288 U.S. 329 (1933).
---------------------------------------------------------------------------
Cls. 5 and 6--Fiscal and Monetary Powers
Clauses 5 and 6. The Congress shall have Power * * * To coin Money,
regulate the Value thereof, and of foreign Coin, and fix the Standard of
Weights and Measures.
* * * To provide for the Punishment of counterfeiting the Securities
and current Coin of the United States.
[[Page 287]]
FISCAL AND MONETARY POWERS OF CONGRESS
Coinage, Weights, and Measures
The power ``to coin money'' and ``regulate the value thereof''
has been broadly construed to authorize regulation of every phase of the
subject of currency. Congress may charter banks and endow them with the
right to issue circulating notes,\1281\ and it may restrain the
circulation of notes not issued under its own authority.\1282\ To this
end it may impose a prohibitive tax upon the circulation of the notes of
state banks\1283\ or of municipal corporations.\1284\ It may require the
surrender of gold coin and of gold certificates in exchange for other
currency not redeemable in gold. A plaintiff who sought payment for the
gold coin and certificates thus surrendered in an amount measured by the
higher market value of gold was denied recovery on the ground that he
had not proved that he would suffer any actual loss by being compelled
to accept an equivalent amount of other currency.\1285\ Inasmuch as
``every contract for the payment of money, simply, is necessarily
subject to the constitutional power of the government over the currency,
whatever that power may be, and the obligation of the parties is,
therefore, assumed with reference to that power,''\1286\ the Supreme
Court sustained the power of Congress to make Treasury notes legal
tender in satisfaction of antecedent debts,\1287\ and, many years later,
to abrogate the clauses in private contracts calling for payment in gold
coin, even though such contracts were executed before the legislation
was passed.\1288\ The power to coin money also imports authority to
maintain such coinage as a medium of exchange at home, and to forbid its
diversion to other uses by defacement, melting or exportation.\1289\
\1281\McCulloch v. Maryland, 4 Wheat. (17 U.S.) 316 (1819).
\1282\Veazie Bank v. Fenno, 8 Wall. (75 U.S.) 533 (1869).
\1283\Id., 548.
\1284\National Bank v. United States, 101 U.S. 1 (1880).
\1285\Nortz v. United States, 249 U.S. 317 (1935).
\1286\Legal Tender Cases (Knox v. Lee), 12 Wall. (79 U.S.) 457,
549 (1871); Legal Tender Cases (Juilliard v. Greenman), 110 U.S. 421,
449 (1884).
\1287\Legal Tender Cases (Knox v. Lee), 12 Wall. (79 U.S.) 457
(1871).
\1288\Norman v. Baltimore & O.R. Co., 294 U.S. 240 (1935).
\1289\Ling Su Fan v. United States, 218 U.S. 302 (1910).
---------------------------------------------------------------------------
Punishment of Counterfeiting
In its affirmative aspect, this clause has been given a narrow
interpretation; it has been held not to cover the circulation of
counterfeit coin or the possession of equipment susceptible of use for
making counterfeit coin.\1290\ At the same time, the Supreme Court has
rebuffed attempts to read into this provision a limitation upon
[[Page 288]]
either the power of the States or upon the powers of Congress under the
preceding clause. It has ruled that a State may punish the issuance of
forged coins.\1291\ On the ground that the power of Congress to coin
money imports ``the correspondent and necessary power and obligation to
protect and to preserve in its purity this constitutional currency for
the benefit of the nation,''\1292\ it has sustained federal statutes
penalizing the importation or circulation of counterfeit coin,\1293\ or
the willing and conscious possession of dies in the likeness of those
used for making coins of the United States.\1294\ In short, the above
clause is entirely superfluous. Congress would have had the power it
purports to confer under the necessary and proper clause; and the same
is the case with the other enumerated crimes it is authorized to punish.
The enumeration was unnecessary and is not exclusive.\1295\
\1290\United States v. Marigold, 9 How. (50 U.S.), 560, 568
(1850).
\1291\Fox v. Ohio, 5 How. (46 U.S.) 410 (1847).
\1292\United States v. Marigold, 9 How. (50 U.S.) 560, 568
(1850).
\1293\Ibid.
\1294\Baender v. Barnett, 255 U.S. 224 (1921).
\1295\Legal Tender Cases (Knox v. Lee), 122 Wall. (79 U.S.) 457,
536 (1871).
---------------------------------------------------------------------------
Borrowing Power Versus Fiscal Power
Usually the aggregate of the fiscal and monetary powers of the
National Government--to lay and collect taxes, to borrow money and to
coin money and regulate the value thereof--have reinforced each other,
and, cemented by the necessary and proper clause, have provided a secure
foundation for acts of Congress chartering banks and other financial
institutions,\1296\ or making its treasury notes legal tender in the
payment of antecedent debts.\1297\ But in 1935, the opposite situation
arose--one in which the power to regulate the value of money collided
with the obligation incurred in the exercise of the power to borrow
money. By a vote of eight-to-one the Supreme Court held that the
obligation assumed by the exercise of the latter was paramount, and
could not be repudiated to effectuate the monetary policies of
Congress.\1298\ In a concurring opinion, Justice Stone declined to join
with the majority in suggesting that ``the exercise of the sovereign
power to borrow money on credit, which does not override the sovereign
immunity from suit, may nevertheless preclude or impede the exercise of
another sovereign power, to regulate the value of money; or to suggest
that although there is and can be no present cause of action upon the re
[[Page 289]]
pudiated gold clause, its obligation is nevertheless, in some manner and
to some extent, not stated, superior to the power to regulate the
currency which we now hold to be superior to the obligation of the
bonds.''\1299\ However, with a view to inducing purchase of savings
bonds, the sale of which is essential to successful management of the
national debt, Congress is competent to authorize issuance of
regulations creating a right of survivorship in such bonds registered in
co-ownership form, and such regulations preempt provisions of state law
prohibiting married couples from utilizing the survivorship privilege
whenever bonds are paid out of community property.\1300\
\1296\McCulloch v. Maryland, 4 Wheat. (17 U.S.) 316, 407 (1819);
Osborn v. United States Bank, 9 Wheat. (22 U.S.) 737, 861 (1824);
Farmers' & Mechanics' Nat. Bank v. Dearing, 91 U.S. 29, 33 (1875); Smith
v. Kansas City Title Co., 255 U.S. 180, 208 (1921).
\1297\Legal Tender Cases (Knox v. Lee), 12 Wall. (79 U.S.) 457,
540-547 (1871).
\1298\Perry v. United States, 294 U.S. 330, 353 (1935).
\1299\Id., 361.
\1300\Free v. Bland, 369 U.S. 663 (1962).
---------------------------------------------------------------------------
Clause 7. The Congress shall have Power * * * To establish Post
Offices and post roads.
POSTAL POWER
``Establish''
The great question raised in the early days with reference to
the postal clause concerned the meaning to be given to the word
``establish''--did it confer upon Congress the power to construct post
offices and post roads, or only the power to designate from existing
places and routes those that should serve as post offices and post
roads? As late as 1855, Justice McLean stated that this power ``has
generally been considered as exhausted in the designation of roads on
which the mails are to be transported,'' and concluded that neither
under the commerce power nor the power to establish post roads could
Congress construct a bridge over a navigable water.\1301\ A decade
earlier, however, the Court, without passing upon the validity of the
original construction of the Cumberland Road, held that being ``charged
. . . with the transportation of the mails,'' Congress could enter a
valid compact with the State of Pennsylvania regarding the use and
upkeep of the portion of the road lying in the State.\1302\ The debate
on the question was terminated in 1876 by the decision in Kohl v. United
States,\1303\ sustaining a proceeding by the United States to
appropriate a parcel of land in Cincinnati as a site for a post office
and courthouse.
\1301\United States v. Railroad Bridge Co., 27 Fed. Cas. 686
(No. 16,114) (C.C.N.D. Ill. 1855).
\1302\Searight v. Stokes, 3 How. (44 U.S.) 151, 166 (1845).
\1303\91 U.S. 367 (1876).
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[[Page 290]]
Power To Protect the Mails
The postal powers of Congress embrace all measures necessary to
insure the safe and speedy transit and prompt delivery of the
mails.\1304\ And not only are the mails under the protection of the
National Government, they are in contemplation of law its property. This
principle was recognized by the Supreme Court in 1845 in holding that
wagons carrying United States mail were not subject to a state toll tax
imposed for use of the Cumberland Road pursuant to a compact with the
United States.\1305\ Half a century later it was availed of as one of
the grounds on which the national executive was conceded the right to
enter the national courts and demand an injunction against the authors
of any wide-spread disorder interfering with interstate commerce and the
transmission of the mails.\1306\
\1304\Ex parte Jackson, 96 U.S. 727, 732 (1878). See United
States Postal Service v. Council of Greenburgh Civic Assns., 453 U.S.
114 (1981), in which the Court sustained the constitutionality of a law
making it unlawful for persons to use, without payment of a fee
(postage), a letterbox which has been designated an ``authorized
depository'' of the mail by the Postal Service.
\1305\Searight v. Stokes, 3 How. (44 U.S.) 151, 169 (1845).
\1306\In re Debs, 158 U.S. 564, 599 (1895).
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Prompted by the efforts of Northern anti-slavery elements to
disseminate their propaganda in the Southern States through the mails,
President Jackson, in his annual message to Congress in 1835, suggested
``the propriety of passing such a law as will prohibit, under severe
penalties, the circulation in the Southern States, through the mail, of
incendiary publications intended to instigate the slaves to
insurrection.'' In the Senate, John C. Calhoun resisted this
recommendation, taking the position that it belonged to the States and
not to Congress to determine what is and what is not calculated to
disturb their security. He expressed the fear that if Congress might
determine what papers were incendiary, and as such prohibit their
circulation through the mail, it might also determine what were not
incendiary and enforce their circulation.\1307\ On this point his
reasoning would appear to be vindicated by such decisions as those
denying the right of the States to prevent the importation of alcoholic
beverages from other States.\1308\
\1307\Cong. Globe, 24th Cong., 1st Sess., 3, 10, 298 (1835).
\1308\Bowman v. Chicago & Nw. Railway Co., 125 U.S. 465 (1888);
Leisy v. Hardin, 135 U.S. 100 (1890).
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Power To Prevent Harmful Use of the Postal Facilities
In 1872, Congress passed the first of a series of acts to
exclude from the mails publications designed to defraud the public or
corrupt its morals. In the pioneer case of Ex parte Jackson,\1309\ the
[[Page 291]]
Court sustained the exclusion of circulars relating to lotteries on the
general ground that ``the right to designate what shall be carried
necessarily involves the right to determine what shall be
excluded.''\1310\ The leading fraud order case, decided in 1904, held to
the same effect.\1311\ Pointing out that it is ``an indispensable
adjunct to a civil government,'' to supply postal facilities, the Court
restated its premise that the ``legislative body in thus establishing a
postal service may annex such conditions . . . as it chooses.''\1312\
\1309\96 U.S. 727 (1878).
\1310\Id., 732.
\1311\Public Clearing House v. Coyne, 194 U.S. 497 (1904),
followed in Donaldson v. Read Magazine, 333 U.S. 178 (1948).
\1312\194 U.S., 506.
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Later cases first qualified these sweeping assertions and then
overturned them, holding Government operation of the mails to be subject
to constitutional limitations. In upholding requirements that publishers
of newspapers and periodicals seeking second-class mailing privileges
file complete information regarding ownership, indebtedness, and
circulation and that all paid advertisements in the publications be
marked as such, the Court emphasized that these provisions were
reasonably designed to safeguard the second-class privilege from
exploitation by mere advertising publications.\1313\ Chief Justice White
warned that the Court by no means intended to imply that it endorsed the
Government's ``broad contentions concerning . . . the classification of
the mails, or by the way of condition . . .''\1314\ Again, when the
Court sustained an order of the Postmaster General excluding from the
second-class privilege a newspaper he had found to have published
material in contravention of the Espionage Act of 1917, the claim of
absolute power in Congress to withhold the privilege was sedulously
avoided.\1315\
\1313\Lewis Publishing Co. v. Morgan, 229 U.S. 288 (1913).
\1314\Id., 316.
\1315\United States ex rel. Milwaukee Publishing Co. v.
Burleson, 255 U.S. 407 (1921). See also Hannegan v. Esquire, 327 U.S.
146 (1946), denying the Post Office the right to exclude Esquire
Magazine from the mails on grounds of the poor taste and vulgarity of
its contents.
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A unanimous Court transformed these reservations into a holding
in Lamont v. Postmaster General,\1316\ in which it struck down a statute
authorizing the Post Office to detain mail it determined to be
``communist political propaganda'' and to forward it to the addressee
only if he notified the Post Office he wanted to see it. Noting that
Congress was not bound to operate a postal service, the Court observed
that while it did, it was bound to observe constitutional
guarantees.\1317\ The statute violated the First Amendment
[[Page 292]]
because it inhibited the right of persons to receive any information
which they wished to receive.\1318\
\1316\381 U.S. 301 (1965).
\1317\Id., 305, quoting Justice Holmes in United States ex rel.
Milwaukee Publishing Co. v. Burleson, 255 U.S. 407, 437 (1921)
(dissenting opinion): ``The United States may give up the Post Office
when it sees fit, but while it carries it on the use of the mails is
almost as much a part of free speech as the right to use our tongues.
. . .'' And see Blount v. Rizzi, 400 U.S. 410, 416 (1971) (quoting same
language). But for a different perspective on the meaning and
application of the Holmes language, see United States Postal Service v.
Council of Greenburgh Civic Assns., 453 U.S. 114, 127 n. 5 (1981),
although there too the Court observed that the postal power may not be
used in a manner that abridges freedom of speech or press. Id., 126.
Notice, too, that first-class mail is protected against opening and
inspection, except in accordance with the Fourth Amendment. Ex parte
Jackson, 96 U.S. 727, 733 (1878); United States v. van Leeuwen, 397 U.S.
249 (1970). But see United States v. Ramsey, 431 U.S. 606 (1977) (border
search).
\1318\Lamont v. Postmaster General, 381 U.S. 301, 306-307
(1965). And see id., 308 (concurring opinion). Note that this was the
first congressional statute ever voided as in conflict with the First
Amendment.
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On the other hand, a statute authorizing persons to place their
names on a list in order to reject receipt of obscene or sexually
suggestive materials is constitutional, because no sender has a right to
foist his material on any unwilling receiver.\1319\ But, as in other
areas, postal censorship systems must contain procedural guarantees
sufficient to ensure prompt resolution of disputes about the character
of allegedly objectionable material consistently with the First
Amendment.\1320\
\1319\Rowan v. Post Office Department, 397 U.S. 728 (1970).
\1320\Blount v. Rizzi, 400 U.S. 410 (1971).
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Exclusive Power as an Adjunct to Other Powers
In the cases just reviewed, it was attempted to close the mails
to communication which were deemed to be harmful. A much broader power
of exclusion was asserted in the Public Utility Holding Company Act of
1935.\1321\ To induce compliance with the regulatory requirements of
that act, Congress denied the privilege of using the mails for any
purpose to holding companies that failed to obey that law, irrespective
of the character of the material to be carried. Viewing the matter
realistically, the Supreme Court treated this provision as a penalty.
While it held this statute constitutional because the regulations whose
infractions were thus penalized were themselves valid,\1322\ it declared
that ``Congress may not exercise its control over the mails to enforce a
requirement which lies outside its constitutional province.
. . .''\1323\
\1321\49 Stat. 803, 812, 813, 15 U.S.C. Sec. Sec. 79d, 79e.
\1322\Electric Bond Co. v. SEC, 303 U.S. 419 (1938).
\1323\Id., 442.
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State Regulations Affecting the Mails
In determining the extent to which state laws may impinge upon
persons or corporations whose services are utilized by Congress in
executing its postal powers, the task of the Supreme Court
[[Page 293]]
has been to determine whether particular measures are consistent with
the general policies indicated by Congress. Broadly speaking, the Court
has approved regulations having a trivial or remote relation to the
operation of the postal service, while disallowing those constituting a
serious impediment to it. Thus, a state statute, which granted to one
company an exclusive right to operate a telegraph business in the State,
was found to be incompatible with a federal law, which, in granting to
any telegraph company the right to construct its lines upon post roads,
was interpreted as a prohibition of state monopolies in a field Congress
was entitled to regulate in the exercise of its combined power over
commerce and post roads.\1324\
\1324\Pensacola Tel. Co. v. Western Union Telegraph Co., 96 U.S.
1 (1878).
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An Illinois statute, which, as construed by the state courts,
required an interstate mail train to make a detour of seven miles in
order to stop at a designated station, also was held to be an
unconstitutional interference with the power of Congress under this
clause.\1325\ But a Minnesota statute requiring intrastate trains to
stop at county seats was found to be unobjectionable.\1326\
\1325\Illinois Central Railroad v. Illinois, 163 U.S. 142
(1896).
\1326\Gladson v. Minnesota, 166 U.S. 427 (1897).
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Local laws classifying postal workers with railroad employees
for the purpose of determining a railroad's liability for personal
injuries,\1327\ or subjecting a union of railway mail clerks to a
general law forbidding any ``labor organization'' to deny any person
membership because of his race, color or creed,\1328\ have been held not
to conflict with national legislation or policy in this field. Despite
the interference pro tanto with the performance of a federal function, a
State may arrest a postal employee charged with murder while he is
engaged in carrying out his official duties,\1329\ but it cannot punish
a person for operating a mail truck over its highways without procuring
a driver's license from state authorities.\1330\
\1327\Price v. Pennsylvania R. Co., 113 U.S. 218 (1895); Martin
v. Pittsburgh & Lake Erie R.R., 203 U.S. 284 (1906).
\1328\Railway Mail Assn. v. Corsi, 326 U.S. 88 (1945).
\1329\United States v. Kirby, 7 Wall. (74 U.S.) 482 (1869).
\1330\Johnson v. Maryland, 254 U.S. 51 (1920).
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Clause 8. The Congress shall have Power * * * To promote the Progress
of Science and useful Arts, by securing for limited Times to Authors and
Inventors the exclusive Right to their respective Writings and
Discoveries.
[[Page 294]]
COPYRIGHTS AND PATENTS
Scope of the Power
This clause is the foundation upon which the national patent and
copyright laws rest, although it uses neither of those terms. So far as
patents are concerned, modern legislation harks back to the Statute of
Monopolies of 1624, whereby Parliament endowed inventors with the sole
right to their inventions for fourteen years.\1331\ Copyright law, in
turn, traces back to the English Statute of 1710, which secured to
authors of books the sole right of publishing them for designated
periods.\1332\ Congress was not vested by this clause, however, with
anything akin to the royal prerogative in the creation and bestowal of
monopolistic privileges.\1333\ Its power is limited with regard both to
subject matter and to the purpose and duration of the rights granted.
Only the writings and discoveries of authors and inventors may be
protected, and then only to the end of promoting science and the useful
arts.\1334\ The concept of originality is central to copyright, and it
is a constitutional requirement Congress may not exceed.\1335\ While
Congress may grant exclusive rights only for a limited period, it may
extend the term upon the expiration of the period originally specified,
and in so doing may protect the rights of purchasers and
assignees.\1336\ The copyright and patent laws do not have, of their own
force, any extraterritorial operation.\1337\
\1331\Pennock v. Dialogue, 2 Pet. (27 U.S.) 1, 17, 18 (1829).
\1332\Wheaton v. Peters, 8 Pet. (33 U.S.) 591, 656, 658 (1834).
\1333\Cf. Graham v. John Deere Co., 383 U.S. 1, 5, 9 (1966).
\1334\Kendall v. Winsor, 21 How. (62 U.S.) 322, 328 (1859); A. &
P. Co. v. Supermarket Equipment Corp., 340 U.S. 147 (1950).
\1335\Feist Publications, Inc. v. Rural Telephone Service Co.,
Inc., 499 U.S. 340 (1991) (publisher of telephone directory, consisting
of white pages and yellow pages, not entitled to copyright in white
pages, which are only compilations). ``To qualify for copyright
protection, a work must be original to the author. . . . Originality, as
the term is used in copyright, means only that the work was
independently created by the author (as opposed to copied from other
works), and that it possesses some minimal degree of creativity. . . .
To be sure, the requisite level of creativity is extremely low; even a
slight amount will suffice.'' Id., 345. First clearly articulated in The
Trade Mark Cases, 100 U.S. 82, 94 (1879), and Burrow-Giles Lithographic
Co. v. Saroney, 111 U.S. 53, 58-60 (1884), the requirement is expressed
in nearly every copyright opinion, but its forceful iteration in Feist
was noteworthy, because originality is a statutory requirement as well,
17 U.S.C. Sec. 102(a), and it was unnecessary to discuss the concept in
constitutional terms.
\1336\Evans v. Jordan, 9 Cr. (13 U.S.) 199 (1815); Bloomer v.
McQuewan, 14 How. (55 U.S.) 539, 548 (1852); Bloomer v. Millinger, 1
Wall. (68 U.S.) 340, 350 (1864); Eunson v. Dodge, 18 Wall. (85 U.S.)
414, 416 (1873).
\1337\Brown v. Duchesne, 19 How. (60 U.S.) 183, 195 (1857). It
is, however, the ultimate objective of many nations, including the
United States, to develop a system of patent issuance and enforcement
which transcends national boundaries; it has been recommended,
therefore, that United States policy should be to harmonize its patent
system with that of foreign countries so long as such measures do not
diminish the quality of the United States patent standards. President's
Commission on the Patent System, To Promote the Progress of Useful Arts,
Report to the Senate Judiciary Committee, S. Doc. No. 5, 90th Cong., 1st
sess. (1967), recommendation XXXV. Effectuation of this goal was begun
with the United States agreement to the Berne Convention (the Convention
for the Protection of Literary and Artistic Works, Sept. 9, 1886), and
Congress' conditional implementation of the Convention through
legislation. The Berne Convention Implementation Act of 1988, P. L. 100-
568, 102 Stat. 2853, 17 U.S.C. Sec. 101 and notes.
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[[Page 295]]
Patentable Discoveries
The protection traditionally afforded by acts of Congress under
this clause has been limited to new and useful inventions,\1338\ and
while a patentable invention is a mental achievement,\1339\ for an idea
to be patentable it must have first taken physical form.\1340\ Despite
the fact that the Constitution uses the term ``discovery'' rather than
``invention,'' a patent may not be issued for the discovery of a
hitherto unknown phenomenon of nature. ``If there is to be invention
from such a discovery, it must come from the application of the law of
nature to a new and useful end.''\1341\ As for the mental processes
which have been traditionally required, the Court has held in the past
that an invention must display ``more ingenuity . . . than the work of a
mechanic skilled in the art;''\1342\ and while combination patents have
been at times sustained,\1343\ the accumulation of old devices is
patentable ``only when the whole in some way exceeds the sum of its
parts.''\1344\ Though ``inventive genius''
[[Page 296]]
and slightly varying language have been appearing in judicial decisions
for almost a century,\1345\ ``novelty'' and ``utility'' has been the
primary statutory test since the Patent Act of 1793.\1346\ With
Congress' enactment of the Patent Act of 1952, however, Sec. 103 of the
Act required that an innovation be of a ``nonobvious'' nature, that is,
it must not be an improvement that would be obvious to a person having
ordinary skill in the pertinent art.\1347\ This alteration of the
standard of patentability was perceived by some as overruling previous
Supreme Court cases requiring perhaps a higher standard for obtaining a
patent,\1348\ but the Court itself interpreted the provision as
codifying its earlier holding in Hotchkiss v. Greenwood,\1349\ in Graham
v. John Deere Co.\1350\ The Court in this case said: ``Innovation,
advancement, and things which add to the sum of useful knowledge are
inherent requisites in a patent system which by constitutional command
must `promote the Progress of . . . useful Arts.' This is the standard
expressed in the Constitution and it may not be ignored.''\1351\
Congressional requirements on patentability, then, are conditions and
tests that must fall within the constitutional standard. Underlying the
constitutional tests and
[[Page 297]]
congressional conditions for patentability is the balancing of two
interests--the interest of the public in being protected against
monopolies and in having ready access to and use of new items versus the
interest of the country, as a whole, in encouraging invention by
rewarding creative persons for their innovations. By declaring a
constitutional standard of patentability, however, the Court, rather
than Congress, will be doing the ultimate weighing. As for the clarity
of the patentability standard, the three-fold test of utility, novelty
and advancement seems to have been made less clear by the Supreme
Court's recent rejuvenation of ``invention'' as a standard of
patentability.\1352\
\1338\Seymour v. Osborne, 11 Wall. (78 U.S.) 516, 549 (1871).
Cf. Collar Company v. Van Dusen, 23 Wall. (90 U.S.) 530, 563 (1875);
Reckendorfer v. Faber, 92 U.S. 347, 356 (1876).
\1339\Smith v. Nichols, 21 Wall. (89 U.S.) 112, 118 (1875).
\1340\Rubber-Tip Pencil Company v. Howard, 20 Wall. (87 U.S.)
498, 507 (1874); Clark Thread Co. v. Willimantic Linen Co., 140 U.S.
481, 489 (1891).
\1341\Funk Bros. Seed Co. v. Kalo Co., 333 U.S. 127, 130 (1948).
Cf. Dow Co. v. Halliburton Co., 324 U.S. 320 (1945); Cuno Corp. v.
Automatic Devices Corp., 314 U.S. 84, 89 (1941).
\1342\Sinclair Co. v. Interchemical Corp., 325 U.S. 327, 330
(1945); Marconi Wireless Co. v. United States, 320 U.S. 1 (1943).
\1343\Keystone Manufacturing Co. v. Adams, 151 U.S. 139 (1894);
Diamond Rubber Co. v. Consol. Tire Co., 220 U.S. 428 (1911).
\1344\A. & P. Tea Co. v. Supermarket Equipment Corp., 340 U.S.
147 (1950). An interesting concurring opinion was filed by Justice
Douglas for himself and Justice Black: ``It is not enough,'' says
Justice Douglas, ``that an article is new and useful. The Constitution
never sanctioned the patenting of gadgets. Patents serve a higher end--
the advancement of science. An invention need not be as startling as an
atomic bomb to be patentable. But it has to be of such quality and
distinction that masters of the scientific field in which it falls will
recognize it as an advance.'' Id., 154-155. He then quotes the following
from an opinion of Justice Bradley's given 70 years ago:
``It was never the object of those laws to grant a monopoly for
every trifling device, every shadow of a shade of an idea, which would
naturally and spontaneously occur to any skilled mechanic or operator in
the ordinary progress of manufacturers. Such an indiscriminate creation
of exclusive privileges tends rather to obstruct than to stimulate
invention. It creates a class of speculative schemers who make it their
business to watch the advancing wave of improvement, and gather its foam
in the form of patented monopolies, which enable them to lay a heavy tax
upon the industry of the country, without contributing anything to the
real advancement of the arts. It embarrasses the honest pursuit of
business with fears and apprehensions of concealed liens and unknown
liabilities to lawsuits and vexatious accountings for profits made in
good faith. ( Atlantic Works v. Brady, 107 U.S. 192, 200 (1882)).'' Id.,
155.
The opinion concludes: ``The attempts through the years to get a
broader, looser conception of patents than the Constitution contemplates
have been persistent. The Patent Office, like most administrative
agencies, has looked with favor on the opportunity which the exercise of
discretion affords to expand its own jurisdiction. And so it has placed
a host of gadgets under the armour of patents--gadgets that obviously
have had no place in the constitutional scheme of advancing scientific
knowledge. A few that have reached this Court show the pressure to
extend monopoly to the simplest of devices: [listing instances].'' Id.,
156-158.
\1345\``Inventive genius''--Justice Hunt in Reckendorfer v.
Faber, 92 U.S. 347, 357 (1875); ``Genius or invention''--Chief Justice
Fuller in Smith v. Whitman Saddle Co., 148 U.S. 674, 681 (1893);
``Intuitive genius''--Justice Brown in Potts v. Creager, 155 U.S. 597,
607 (1895); ``Inventive genius''--Justice Stone in Concrete Appliances
Co. v. Gomery, 269 U.S. 177, 185 (1925); ``Inventive genius''--Justice
Roberts in Mantle Lamp Co. v. Aluminum Co., 301 U.S. 544, 546 (1937);
``the flash of creative genius, not merely the skill of the calling''--
Justice Douglas in Cuno Corp. v. Automatic Devices Corp., 314 U.S. 84,
91 (1941).
\1346\Act of February 21, 1793, c. 11, 1 Stat. 318. See Graham
v. John Deere Co., 383 U.S. 1, 3-4, 10 (1966).
\1347\35 U.S.C. Sec. 103.
\1348\E.g., A. & P. Tea Co. v. Supermarket Equip. Corp., 340
U.S. 147 (1950); Jungerson v. Ostby & Barton Co., 335 U.S. 560 (1949);
and Cuno Corp. v. Automatic Devices Corp., 314 U.S. 84 (1941).
\1349\11 How. (52 U.S.) 248 (1850).
\1350\383 U.S. 1 (1966).
\1351\Id., 6(first emphasis added, second emphasis by Court).
For a thorough discussion, see Bonito Boats, Inc. v. Thunder Craft
Boats, Inc., 489 U.S. 141, 146-152 (1989).
\1352\Anderson's-Black Rock, Inc. v. Pavement Salvage Co., 396
U.S. 57 (1969). ``The question of invention must turn on whether the
combination supplied the key requirement.'' Id., 60. But the Court also
appeared to apply the test of nonobviousness in the same decision: ``We
conclude that the combination was reasonably obvious to one with
ordinary skill in the art.'' Ibid. See also McClain v. Ortmayer, 141
U.S. 419, 427 (1891), where, speaking of the use of ``invention'' as a
standard of patentability the Court said: ``The truth is the word cannot
be defined in such manner as to afford any substantial aid in
determining whether a particular device involves an exercise of the
inventive faculty or not.''
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Procedure in Issuing Patents
The standard of patentability is a constitutional standard, and
the question of the validity of a patent is a question of law.\1353\
Congress may authorize the issuance of a patent for an invention by a
special, as well as by general, law, provided the question as to whether
the patentees device is in truth an invention is left open to
investigation under the general law.\1354\ The function of the
Commissioner of Patents in issuing letters patent is deemed to be quasi-
judicial in character. Hence an act granting a right of appeal from the
Commission to the Court of Appeals for the District of Columbia is not
unconstitutional as conferring executive power upon a judicial
body.\1355\ The primary responsibility, however, for weeding out
unpatentable devices rests in the Patent Office.\1356\ The present
system of ``de novo'' hearings before the Court of Appeals allows the
applicant to present new evidence which the Patent Office has not
heard,\1357\ thus making somewhat amorphous the central responsibility.
\1353\A. & P. Tea Co. v. Supermarket Corp., 340 U.S. 147 (1950);
Mahn v. Harwood, 112 U.S. 354, 358 (1884).
\1354\Evans v. Eaton, 3 Wheat. (16 U.S.) 454, 512 (1818).
\1355\United States v. Duell, 172 U.S. 576, 586-589 (1899). See
also Butterworth v. United States ex rel. Hoe, 112 U.S. 50 (1884).
\1356\Graham v. John Deere Co., 383 U.S. 1, 18 (1966).
\1357\In Jennings v. Brenner, 255 F. Supp. 410, 412 (D.D.C.
1966), District Judge Holtzoff suggested that a system of remand be
adopted.
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[[Page 298]]
Nature and Scope of the Right Secured
The leading case bearing on the nature of the rights which
Congress is authorized to secure is that of Wheaton v. Peters. Wheaton
charged Peters with having infringed his copyright on the twelve volumes
of ``Wheaton's Reports,'' wherein are reported the decisions of the
United States Supreme Court for the years from 1816 to 1827 inclusive.
Peters' defense turned on the proposition that inasmuch as Wheaton had
not complied with all of the requirements of the act of Congress, his
alleged copyright was void. Wheaton, while denying this assertion of
fact, further contended that the statute was only intended to secure him
in his pre-existent rights at common law. These at least, he claimed,
the Court should protect. A divided Court held in favor of Peters on the
legal question. It denied, in the first place, that there was any
principle of the common law that protected an author in the sole right
to continue to publish a work once published. It denied, in the second
place, that there is any principle of law, common or otherwise, which
pervades the Union except such as are embodied in the Constitution and
the acts of Congress. Nor, in the third place, it held, did the word
``securing'' in the Constitution recognize the alleged common law
principle Wheaton invoked. The exclusive right Congress is authorized to
secure to authors and inventors owes its existence solely to the acts of
Congress securing it,\1358\ from which it follows that the rights
granted by a patent or copyright are subject to such qualifications and
limitations as Congress, in its unhampered consultation of the public
interest, sees fit to impose.\1359\
\1358\Wheaton v. Peters, 8 Pet. (33 U.S.) 591, 660 (1834);
Holmes v. Hurst, 174 U.S. 82 (1899). The doctrine of common-law
copyright was long statutorily preserved for unpublished works, but the
1976 revision of the federal copyright law abrogated the distinction
between published and unpublished works, substituting a single federal
system for that existing since the first copyright law in 1790. 17
U.S.C. Sec. 301.
\1359\Wheaton v. Peters, 8 Pet. (33 U.S.) 591, 662 (1834); Evans
v. Jordan, 9 Cr. (13 U.S.) 199 (1815). A major limitation of copyright
law is that ``fair use'' of a copyrighted work is not an infringement.
Fair use can involve such things as citation for the use of criticism
and reproduction for classroom purposes, but it may not supersede the
use of the original work. See Harper & Row, Publishers v. Nation
Enterprises, 471 U.S. 539 (1985) (an unauthorized 300 to 400 word
excerpt, published as a news ``scoop'' of the authorized prepublication
excerpt of former President Ford's memoirs and substantially affecting
the potential market for the authorized version, was not a fair use
within the meaning of Sec. 107 of the Copyright Act. 17 U.S.C. Sec. 107)
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The Court's ``reluctance to expand [copyright] protection
without explicit legislative guidance'' controlled its decision in Sony
Corp. v. Universal City Studios,\1360\ in which it held that the
manufacture and sale of video tape (or cassette) recorders for home use
do not constitute ``contributory'' infringement of the copyright in
[[Page 299]]
television programs. Copyright protection, the Court reiterated, is
``wholly statutory,'' and courts should be ``circumspect'' in extending
protections to new technology. The Court refused to hold that
contributory infringement could occur simply through the supplying of
the devices with which someone else could infringe, especially in view
of the fact that VCRs are capable of substantial noninfringing ``fair
use,'' e.g., time shifting of television viewing.
\1360\464 U.S. 417, 431 (1984).
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In giving to authors the exclusive right to dramatize any of
their works, Congress did not exceed its powers under this clause. Even
as applied to pantomine dramatization by means of silent motion
pictures, the act was sustained against the objection that it extended
the copyright to ideas rather than to the words in which they were
clothed.\1361\ But the copyright of the description of an art in a book
was held not to lay a foundation for an exclusive claim to the art
itself. The latter can be protected, if at all, only by letters
patent.\1362\ Since copyright is a species of property distinct from the
ownership of the equipment used in making copies of the matter
copyrighted, the sale of a copperplate under execution did not pass any
right to print and publish the map which the copperplate was designed to
produce.\1363\ A patent right may, however, be subjected, by bill in
equity, to payment of a judgment debt of the patentee.\1364\
\1361\Kalem Co. v. Harper Bros., 222 U.S. 55 (1911). For other
problems arising because of technological and electronic advancement
see, e.g., Fortnightly Corp. v. United Artists Television, Inc., 392
U.S. 390 (1968); Sony Corp. v. Universal City Studios, 464 U.S. 417
(1984).
\1362\Baker v. Selden, 101 U.S. 99, 105 (1880).
\1363\Stevens v. Gladding, 17 How. (58 U.S.) 447 (1855).
\1364\Ager v. Murray, 105 U.S. 126 (1882).
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Power of Congress Over Patent Rights
Letters patent for a new invention or discovery in the arts
confer upon the patentee an exclusive property in the patented invention
which cannot be appropriated or used by the Government without just
compensation.\1365\ Congress may, however, modify rights under an
existing patent, provided vested property rights are not thereby
impaired,\1366\ but it does not follow that it may authorize an inventor
to recall rights that he has granted to others or reinvest in him rights
of property that he had previously conveyed for a valuable and fair
consideration.\1367\ Furthermore, the rights
[[Page 300]]
the present statutes confer are subject to the antitrust laws, though it
can be hardly said that the cases in which the Court has endeavored to
draw the line between the rights claimable by patentees and the kind of
monopolistic privileges which are forbidden by those acts exhibit entire
consistency in their holdings.\1368\
\1365\James v. Campbell, 104 U.S. 356, 358 (1882). See also
United States v. Burns 12 Wall. (79 U.S.) 246, 252 (1871); Cammeyer v.
Newton, 94 U.S. 225, 234 (1877); Hollister v. Benedict Manufacturing
Co., 113 U.S. 59, 67 (1885); United States v. Palmer, 128 U.S. 262, 271
(1888); Belknap v. Schild, 161 U.S. 10, 16 (1896).
\1366\McClurg v. Kingsland, 1 How. (42 U.S.) 202, 206 (1843).
\1367\Bloomer v. McQuewan, 14 How. (55 U.S.) 539, 553 (1852).
\1368\See Motion Picture Co. v. Universal Film Co., 243 U.S. 502
(1917); Morton Salt Co. v. Suppiger Co., 314 U.S. 488 (1942); United
States v. Masonite Corp., 316 U.S. 265 (1942); United States v. New
Wrinkle, Inc., 342 U.S. 371 (1952), where the Justices divided 6 to 3 as
to the significance for the case of certain leading precedents; and
Walker Process Equip., Inc. v. Food Mach. & Chem. Corp., 382 U.S. 172
(1965).
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State Power Affecting Patents and Copyrights
Displacement of state police or taxing powers by federal patent
or copyright has been a source of considerable dispute. Ordinarily,
rights secured to inventors must be enjoyed in subordination to the
general authority of the States over all property within their limits. A
state statute requiring the condemnation of illuminating oils
inflammable at less than 130 degrees Fahrenheit was held not to
interfere with any right secured by the patent laws, although the oil
for which the patent was issued could not be made to comply with state
specifications.\1369\ In the absence of federal legislation, a State may
prescribe reasonable regulations for the transfer of patent rights, so
as to protect its citizens from fraud. Hence, a requirement of state law
that the words ``given for a patent right'' appear on the face of notes
given in payment for such right is not unconstitutional.\1370\ Royalties
received from patents or copyrights are subject to a nondiscriminatory
state income tax, a holding to the contrary being overruled.\1371\
\1369\Patterson v. Kentucky, 97 U.S. 501 (1879).
\1370\Allen v. Riley, 203 U.S. 347 (1906); John Woods & Sons v.
Carl, 203 U.S. 358 (1906); Ozan Lumber Co. v. Union County Bank, 207
U.S. 251 (1907).
\1371\Fox Film Corp. v. Doyal, 286 U.S. 123 (1932), overruling
Long v. Rockwood, 277 U.S. 142 (1928).
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State power to protect things not patented or copyrighted under
federal law has been buffeted under changing Court doctrinal views. In
two major cases, the Court held that a State could not utilize unfair
competition laws to prevent or punish the copying of products not
entitled to a patent. Emphasizing the necessity for a uniform national
policy and adverting to the monopolistic effects of the state
protection, the Court inferred that because Congress had not extended
the patent laws to the material at issue, federal policy was to promote
free access when the materials were thus in
[[Page 301]]
the public domain.\1372\ But, in Goldstein v. California,\1373\ the
Court distinguished the two prior cases and held that the determination
whether a state ``tape piracy'' statute conflicted with the federal
copyright statute depended upon the existence of a specific
congressional intent to forbid state protection of the ``writing'' there
involved. Its consideration of the statute and of its legislative
history convinced the Court that Congress in protecting certain
``writings'' and in not protecting others bespoke no intention that
federally unprotected materials should enjoy no state protection, only
that Congress ``has left the area unattended.''\1374\ Similar analysis
was used to sustain the application of a state trade secret law to
protect a chemical process, that was patentable but not patented, from
utilization by a commercial rival, which had obtained the process from
former employees of the company, all of whom had signed agreements not
to reveal the process. The Court determined that protection of the
process by state law was not incompatible with the federal patent policy
of encouraging invention and public use of patented inventions, inasmuch
as the trade secret law serves other interests not similarly served by
the patent law and where it protects matter clearly patentable it is not
likely to deter applications for patents.\1375\
\1372\Sears, Roebuck & Co. v. Stiffel Co., 376 U.S. 225 (1964);
Compco Corp. v. Day-Brite Lighting, Inc., 376 U.S. 234 (1964).
\1373\412 U.S. 546 (1973). Informing the decisions were
different judicial attitudes with respect to the preclusion of the
States from acting in fields covered by the patent and copyright
clauses, whether Congress had or had not acted. The latter case
recognized permissible state interests, id., 552-560, whereas the former
intimated that congressional power was exclusive. Sears, Roebuck & Co.
v. Stiffel Co., 376 U.S. 225, 228-231 (1964).
\1374\In the 1976 revision of the copyright law, Congress
broadly preempted, with narrow exceptions, all state laws bearing on
material subject to copyright. 17 U.S.C. Sec. 301. The legislative
history makes clear Congress' intention to overturn Goldstein and ``to
preempt and abolish any rights under the common law or statutes of a
state that are equivalent to copyright and that extend to works coming
within the scope of the federal copyright law.'' H. Rept. No. 94-1476,
94th Congress, 2d sess. (1976), 130. The statute preserves state tape
piracy and similar laws as to sound recordings fixed before February 15,
1972, until February 15, 2047.
\1375\Kewanee Oil Co. v. Bicron Corp., 416 U.S. 470 (1974). See
also Aronson v. Quick Point Pencil Co., 440 U.S. 257 (1979).
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Returning to the Sears and Compco emphasis, the Court
unanimously, in Bonito Boats v. ThunderCraft Boats,\1376\ reasserted
that ``efficient operation of the federal patent system depends upon
substantially free trade in publicly known, unpatented design and
utilitarian conceptions.''\1377\ At the same time, however, the Court
attempted to harmonize Goldstein, Kewanee, and other decisions: there is
room for state regulation of the use of
[[Page 302]]
unpatented designs if those regulations are ``necessary to promote goals
outside the contemplation of the federal patent scheme.''\1378\ What
States are forbidden to do is to ``offer patent-like protection to
intellectual creations which would otherwise remain unprotected as a
matter of federal law.''\1379\ A state law ``aimed directly at
preventing the exploitation of the [unpatented] design'' is invalid as
impinging on an area of pervasive federal regulation.\1380\
\1376\489 U.S. 141 (1989).
\1377\Id., 156.
\1378\Id., 166. As examples of state regulation that might be
permissible, the Court referred to unfair competition, trademark, trade
dress, and trade secrets laws. Perhaps by way of distinguishing Sears
and Compco, both of which invalidated use of unfair competition laws,
the Court suggested that prevention of ``consumer confusion'' is a
permissible state goal that can be served in some instances by
application of such laws. Id., 154.
\1379\Id., 156(emphasis supplied).
\1380\Id., 158.
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Trade-Marks and Advertisements
In the famous Trade-Mark Cases,\1381\ decided in 1879, the
Supreme Court held void acts of Congress, which, in apparent reliance
upon this clause, extended the protection of the law to trade-marks
registered in the Patent Office. ``The ordinary trade mark,'' said
Justice Miller for the Court, ``has no necessary relation to invention
or discovery;'' nor is it to be classified ``under the head of writings
of authors.'' It does not ``depend upon novelty, invention, discovery,
or any work of the brain.''\1382\ Not many years later, the Court, again
speaking through Justice Miller, ruled that a photograph may be
constitutionally copyrighted,\1383\ while still more recently a circus
poster was held to be entitled to the same protection. In answer to the
objection of the circuit court that a lithograph which ``has no other
use than that of a mere advertisement . . . (would not be within) the
meaning of the Constitution,'' Justice Holmes summoned forth the shades
of Velasquez, Whistler, Rembrandt, Ruskin, Degas, and others in support
of the proposition that it is not for the courts to attempt to judge the
worth of pictorial illustrations outside the narrowest and most obvious
limits.\1384\
\1381\100 U.S. 82 (1879).
\1382\Id., 94.
\1383\Burrow-Giles Lithographic Co. v. Sarony, 111 U.S. 53
(1884).
\1384\Bleisten v. Donaldson Lithographing Co., 188 U.S. 239, 251
(1903).
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Cls. 9 and 10--Piracies and Felonies
Clause 9. The Congress shall have Power * * * To constitute Tribunals
inferior to the supreme Court; (see Article III).
[[Page 303]]
Clause 10. The Congress shall have Power * * * To define and punish
Piracies and Felonies committed on the high Seas, and Offences against
the Law of Nations.
PIRACIES, FELONIES, AND OFFENSES AGAINST THE LAW OF NATIONS
Origin of the Clause
``When the United States ceased to be a part of the British
empire, and assumed the character of an independent nation, they became
subject to that system of rules which reason, morality, and custom had
established among civilized nations of Europe, as their public law.
. . . The faithful observance of this law is essential to national
character. . . .''\1385\ These words of the Chancellor Kent expressed
the view of the binding character of international law that was
generally accepted at the time the Constitution was adopted. During the
Revolutionary War, Congress took cognizance of all matters arising under
the law of nations and professed obedience to that law.\1386\ Under the
Articles of Confederation, it was given exclusive power to appoint
courts for the trial of piracies and felonies committed on the high
seas, but no provision was made for dealing with offenses against the
law of nations.\1387\ The draft of the Constitution submitted to the
Convention of 1787 by its Committee of Detail empowered Congress ``to
declare the law and punishment of piracies and felonies committed on the
high seas, and the punishment of counterfeiting the coin of the United
States, and of offences against the law of nations.''\1388\ In the
debate on the floor of the Convention, the discussion turned on the
question as to whether the terms, ``felonies'' and the ``law of
nations,'' were sufficiently precise to be generally understood. The
view that these terms were often so vague and indefinite as to require
definition eventually prevailed and Congress was authorized to define as
well as punish piracies, felonies, and offenses against the law of
nations.\1389\
\1385\1 J. Kent, Commentaries on American Law (New York: 1826),
1.
\1386\19 Journals of the Continental Congress, 315, 361 (1912);
20 id. 762; 21 id. 1136-1137, 1158.
\1387\Article IX.
\1388\2 M. Farrand, The Records of the Federal Convention of
1787 (New Haven: Rev. ed. 1937), 168, 182.
\1389\Id., 316.
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Definition of Offenses
The fact that the Constitutional Convention considered it
necessary to give Congress authority to define offenses against the law
[[Page 304]]
of nations does not mean that in every case Congress must undertake to
codify that law or mark its precise boundaries before prescribing
punishments for infractions thereof. An act punishing ``the crime of
piracy, as defined by the law of nations'' was held to be an appropriate
exercise of the constitutional authority to ``define and punish'' the
offense, since it adopted by reference the sufficiently precise
definition of International Law.\1390\ Similarly, in Ex parte
Quirin,\1391\ the Court found that by the reference in the Fifteenth
Article of War to ``offenders or offenses that . . . by the law of war
may be triable by such military commissions . . .,'' Congress had
``exercised its authority to define and punish offenses against the law
of nations by sanctioning, within constitutional limitations, the
jurisdiction of military commissions to try persons for offenses which,
according to the rules and precepts of the law of nations, and more
particularly the law of war, are cognizable by such tribunals.''\1392\
Where, conversely, Congress defines with particularity a crime which is
``an offense against the law of nations,'' the law is valid, even if it
contains no recital disclosing that it was enacted pursuant to this
clause. Thus, the duty which the law of nations casts upon every
government to prevent a wrong being done within its own dominion to
another nation with which it is at peace, or to the people thereof, was
found to furnish a sufficient justification for the punishment of the
counterfeiting within the United States, of notes, bonds, and other
securities of foreign governments.\1393\
\1390\United States v. Smith, 5 Wheat. (18 U.S.) 153, 160, 162
(1820). See also The Marianna Flora, 11 Wheat. (24 U.S.) 1, 40-41
(1826); United States v. Brig Malek Abhel, 2 How. (43 U.S.) 210, 232
(1844).
\1391\317 U.S. 1, 27 (1942).
\1392\Id., 28.
\1393\United States v. Arjona, 120 U.S. 479 487, 488 (1887).
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Extraterritorial Reach of the Power
Since this clause contains the only specific grant of power to
be found in the Constitution for the punishment of offenses outside the
territorial limits of the United States, a lower federal court held in
1932\1394\ that the general grant of admiralty and maritime jurisdiction
by Article III, Sec. 2, could not be construed as extending either the
legislative or judicial power of the United States to cover offenses
committed on vessels outside the United States but not on the high seas.
Reversing that decision, the Supreme Court held that this provision
``cannot be deemed to be a limitation on the powers, either legislative
or judicial, conferred on the National Government by Article III,
Sec. 2. The two clauses are the result of separate steps independently
taken in the Convention, by which
[[Page 305]]
the jurisdiction in admiralty, previously divided between the
Confederation and the States, was transferred to the National
Government. It would be a surprising result, and one plainly not
anticipated by the framers or justified by principles which ought to
govern the interpretation of a constitution devoted to the
redistribution of governmental powers, if part of them were lost in the
process of transfer. To construe the one clause as limiting rather than
supplementing the other would be to ignore their history, and without
effecting any discernible purpose of their enactment, to deny to both
the States and the National Government powers which were common
attributes of sovereignty before the adoption of the Constitution. The
result would be to deny to both the power to define and punish crimes of
less gravity than felonies committed on vessels of the United States
while on the high seas, and crimes of every grade committed on them
while in foreign territorial waters.''\1395\ Within the meaning of this
section, an offense is committed on the high seas even where the vessel
on which it occurs is lying at anchor on the road in the territorial
waters of another country.\1396\
\1394\United States v. Flores, 3 F. Supp. 134 (E.D. Pa. 1932).
\1395\United States v. Flores, 289 U.S. 137, 149-150 (1933).
\1396\United States v. Furlong, 5 Wheat. (18 U.S.) 184, 200
(1820).
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Cls. 11, 12, 13, and 14--The War Power
Clauses 11, 12, 13, and 14. The Congress shall have power * * * ;
To declare War, grant Letters of Marque and Reprisal, and make Rules
concerning Captures on Land and Water.
To raise and support Armies, but no Appropriation of Money to that Use
shall be for a longer Term than two Years.
To provide and maintain a Navy.
To make Rules for the Government and Regulation of the land and naval
Forces.
THE WAR POWER
Source and Scope
Three Theories.--Three different views regarding the source of
the war power found expression in the early years of the Constitution
and continued to vie for supremacy for nearly a century and a half.
Writing in The Federalist,\1397\ Hamilton elaborated
[[Page 306]]
the theory that the war power is an aggregate of the particular powers
granted by Article I, Sec. 8. Not many years later, in 1795, the
argument was advanced that the war power of the National Government is
an attribute of sovereignty and hence not dependent upon the affirmative
grants of the written Constitution.\1398\ Chief Justice Marshall appears
to have taken a still different view, namely that the power to wage war
is implied from the power to declare it. In McCulloch v. Maryland,\1399\
he listed the power ``to declare and conduct a war''\1400\ as one of the
``enumerated powers'' from which the authority to charter the Bank of
the United States was deduced. During the era of the Civil War, the two
latter theories were both given countenance by the Supreme Court.
Speaking for four Justices in Ex parte Milligan, Chief Justice Chase
described the power to declare war as ``necessarily'' extending ``to all
legislation essential to the prosecution of war with vigor and success,
except such as interferes with the command of the forces and conduct of
campaigns.''\1401\ In another case, adopting the terminology used by
Lincoln in his Message to Congress on July 4, 1861,\1402\ the Court
referred to ``the war power'' as a single unified power.\1403\
\1397\The Federalist, No. 23 (J. Cooke ed. ed.: 1937), 146-151.
\1398\Penhallow v. Doane, 3 Dall. (3 U.S.) 53 (1795).
\1399\4 Wheat. (17 U.S.) 316 (1819).
\1400\Id., 407. (Emphasis supplied.)
\1401\Ex parte Milligan, 4 Wall. (71 U.S.) 2, 139 (1866)
(dissenting opinion); see also Miller v. United States, 11 Wall. (78
U.S.) 268, 305 (1871); and United States v. MacIntosh, 283 U.S. 605, 622
(1931).
\1402\Cong. Globe, 37th Congress, 1st Sess., App. 1 (1861).
\1403\Hamilton v. Dillin, 21 Wall. (88 U.S.) 73, 86 (1875).
---------------------------------------------------------------------------
An Inherent Power.--Thereafter, we find the phrase, ``the war
power,'' being used by both Chief Justice White\1404\ and Chief Justice
Hughes,\1405\ the former declaring the power to be ``complete and
undivided.''\1406\ Not until 1936, however, did the Court explain the
logical basis for imputing such an inherent power to the Federal
Government. In United States v. Curtis-Wright Corp.,\1407\ the reasons
for this conclusion were stated by Justice Sutherland as follows: ``As a
result of the separation from Great Britain by the colonies acting as a
unit, the powers of external sovereignty passed from the Crown not to
the colonies severally, but to the colonies in their collective and
corporate capacity as the United States of America. Even before the
Declaration, the colonies were a unit in foreign affairs, acting through
a common agency--namely, the Con
[[Page 307]]
tinental Congress, composed of delegates from the thirteen colonies.
That agency exercised the powers of war and peace, raised an army,
created a navy, and finally adopted the Declaration of Independence.
. . . It results that the investment of the Federal Government with the
powers of external sovereignty did not depend upon the affirmative
grants of the Constitution. The power to declare and wage war, to
conclude peace, to make treaties, to maintain diplomatic relations with
other sovereignties, if they had never been mentioned in the
Constitution, would have vested in the Federal Government as necessary
concomitants of nationality.''\1408\
\1404\Northern Pac. Ry. Co. v. North Dakota, ex rel. Langer, 250
U.S. 135, 149 (1919).
\1405\Home Bldg. & L. Assn. v. Blaisdell, 290 U.S. 398 (1934).
\1406\Northern Pac. Ry. Co. v. North Dakota, ex rel. Langer, 250
U.S. 135, 149 (1919).
\1407\299 U.S. 304 (1936).
\1408\Id., 316, 318. On the controversy respecting Curtiss-
Wright, see infra, Article II.
---------------------------------------------------------------------------
A Complexus of Granted Powers.--In Lichter v. United
States,\1409\ on the other hand, the Court speaks of the ``war powers''
of Congress. Upholding the Renegotiation Act, it declared that: ``In
view of this power `To raise and support Armies, . . . and the power
granted in the same Article of the Constitution `to make all Laws which
shall be necessary and proper for carrying into Execution the foregoing
Powers,' . . . the only question remaining is whether the Renegotiation
Act was a law `necessary and proper for carrying into Execution' the war
powers of Congress and especially its power to support armies.''\1410\
In a footnote, it listed the Preamble, the necessary and proper clause,
the provisions authorizing Congress to lay taxes and provide for the
common defense, to declare war, and to provide and maintain a navy,
together with the clause designating the President as Commander-in-Chief
of the Army and Navy, as being ``among the many other provisions
implementing the Congress and the President with powers to meet the
varied demands of war. . . .''\1411\
\1409\334 U.S. 742 (1948).
\1410\Id., 757-758.
\1411\Id., 755 n. 3.
---------------------------------------------------------------------------
Declaration of War
In the early draft of the Constitution presented to the
Convention by its Committee of Detail, Congress was empowered ``to make
war.''\1412\ Although there were solitary suggestions that the power
should better be vested in the President alone,\1413\ in the Senate
[[Page 308]]
alone,\1414\ or in the President and the Senate,\1415\ the sentiment of
the Convention, as best we can determine from the limited notes of the
proceedings, was that the potentially momentous consequences of
initiating armed hostilities should be called up only by the concurrence
of the President and both Houses of Congress.\1416\ In contrast to the
English system, the Framers did not want the wealth and blood of the
Nation committed by the decision of a single individual;\1417\ in
contrast to the Articles of Confederation, they did not wish to forego
entirely the advantages of executive efficiency nor to entrust the
matter solely to a branch so close to popular passions.\1418\
\1412\2 M. Farrand, The Records of the Federal Convention of
1787 (New Haven: rev. ed. 1937), 313.
\1413\Mr. Butler favored ``vesting the power in the President,
who will have all the requisite qualities, and will not make war but
when the Nation will support it.'' Id., 318.
\1414\Mr. Pinkney thought the House was too numerous for such
deliberations but that the Senate would be more capable of a proper
resolution and more acquainted with foreign affairs. Additionally, with
the States equally represented in the Senate, the interests of all would
be safeguarded. Ibid.
\1415\Hamilton's plan provided that the President was ``to make
war or peace, with the advice of the senate . . .'' 1 id., 300.
\1416\2 id., 318-319. In The Federalist, No. 69 (J. Cooke ed.
1961), 465, Hamilton notes: ``[T]he President is to be commander-in-
chief of the army and navy of the United States. In this respect his
authority would be nominally the same with that of the king of Great
Britain, but in substance much inferior to it. It would amount to
nothing more than the supreme command and direction of the military and
naval forces, as first General and admiral of the confederacy; while
that of the British king extends to the declaring of war and to the
raising and regulating of fleets and armies,--all which, by the
Constitution under consideration, would appertain to the legislature.''
(Emphasis in original). And see id., No. 26, 164-171. Cf. C. Berdahl,
War Powers of the Executive in the United States (Urbana, Ill.: 1921),
ch. V.
\1417\The Federalist, No. 69 (J. Cooke ed. 1961), 464-465, 470.
During the Convention, Gerry remarked that he ``never expected to hear
in a republic a motion to empower the Executive alone to declare war.''
2 M. Farrand, The Records of the Federal Convention of 1787 (New Haven:
rev. ed. 1937), 318.
\1418\The Articles of Confederation vested powers with regard to
foreign relations in the Congress.
---------------------------------------------------------------------------
The result of these conflicting considerations was that the
Convention amended the clause so as to give Congress the power to
``declare war.''\1419\ Although this change could be read to give
Congress the mere formal function of recognizing a state of hostilities,
in the context of the Convention proceedings it appears more likely the
change was intended to insure that the President was empowered to repel
sudden attacks\1420\ without awaiting congressional action and to make
clear that the conduct of war was vested exclusively in the
President.\1421\
\1419\2 M. Farrand, The Records of the Federal Convention of
1787 (New Haven: rev. ed. 1937), 318-319.
\1420\Jointly introducing the amendment to substitute
``declare'' for ``make,'' Madison and Gerry noted the change would
``leav[e] to the Executive the power to repel sudden attacks.'' Id.,
318.
\1421\Connecticut originally voted against the amendment to
substitute ``declare'' for ``make'' but ``on the remark by Mr. King that
`make' war might be understood to `conduct' it which was an Executive
function, Mr. Ellsworth gave up his opposition, and the vote of
Connecticut was changed. . . .'' Id., 319. The contemporary and
subsequent judicial interpretation was to the understanding set out in
the text. Cf. Talbot v. Seeman, 1 Cr. (5 U.S.), 1, 28 (1801) (Chief
Justice Marshall: ``The whole powers of war being, by the Constitution
of the United States, vested in congress, the acts of that body alone
can be resorted to as our guides in this inquiry.''); Ex parte Milligan,
4 Wall. (71 U.S.) 2, 139 (1866).
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[[Page 309]]
An early controversy revolved about the issue of the President's
powers and the necessity of congressional action when hostilities are
initiated against us rather than the Nation instituting armed conflict.
The Bey of Tripoli, in the course of attempting to extort payment for
not molesting United States shipping, declared war upon the United
States, and a debate began whether Congress had to enact a formal
declaration of war to create a legal status of war. President Jefferson
sent a squadron of frigates to the Mediterranean to protect our ships
but limited its mission to defense in the narrowest sense of the term.
Attacked by a Tripolitan cruiser, one of the frigates subdued it,
disarmed it, and, pursuant to instructions, released it. Jefferson in a
message to Congress announced his actions as in compliance with
constitutional limitations on his authority in the absence of a
declaration of war.\1422\ Hamilton espoused a different interpretation,
contending that the Constitution vested in Congress the power to
initiate war but that when another nation made war upon the United
States we were already in a state of war and no declaration by Congress
was needed.\1423\ Congress thereafter enacted a statute authorizing the
President to instruct the commanders of armed vessels of the United
States to seize all vessels and goods of the Bey of Tripoli ``and also
to cause to be done all such other acts of precaution or hostility as
the state of war will justify . . .''\1424\ But no formal declaration of
war was passed, Congress apparently accepting Hamilton's view.\1425\
\1422\Messages and Papers of the Presidents, J. Richardson ed.
(Washington: 1896), 326, 327.
\1423\7 Works of Alexander Hamilton, J. Hamilton ed. (New York:
1851), 746-747.
\1424\2 Stat. 129, 130 (1802) (emphasis supplied).
\1425\Of course, Congress need not declare war in the all-out
sense; it may provide for a limited war which, it may be, the 1802
statute recognized. Cf. Bas v. Tingy, 4 Dall. (4 U.S.) 37 (1800).
---------------------------------------------------------------------------
Sixty years later, the Supreme Court sustained the blockade of
the Southern ports instituted by Lincoln in April 1861 at a time when
Congress was not in session.\1426\ Congress had subsequently ratified
Lincoln's action,\1427\ so that it was unnecessary for the Court to
consider the constitutional basis of the President's action in the
absence of congressional authorization, but the Court nonetheless
approved, five-to-four, the blockade order as an exercise of
[[Page 310]]
Presidential power alone, on the ground that a state of war was a fact.
``The President was bound to meet it in the shape it presented itself,
without waiting for Congress to baptize it with a name; and no name
given to it by him or them could change the fact.''\1428\ The minority
challenged this doctrine on the ground that while the President could
unquestionably adopt such measures as the laws permitted for the
enforcement of order against insurgency, Congress alone could stamp an
insurrection with the character of war and thereby authorize the legal
consequences ensuing from a state of war.\1429\
\1426\The Prize Cases, 2 Bl. (67 U.S.) 635 (1863).
\1427\12 Stat. 326 (1861).
\1428\The Prize Cases, 2 Bl. (67 U.S.) 635, 669 (1863).
\1429\Id., 682.
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The view of the majority was proclaimed by a unanimous Court a
few years later when it became necessary to ascertain the exact dates on
which the war began and ended. The Court, the Chief Justice said, must
``refer to some public act of the political departments of the
government to fix the dates; and, for obvious reasons, those of the
executive department, which may be, and, in fact, was, at the
commencement of hostilities, obliged to act during the recess of
Congress, must be taken. The proclamation of intended blockade by the
President may therefore be assumed as marking the first of these dates,
and the proclamation that the war had closed, as marking the
second.''\1430\
\1430\The Protector, 12 Wall. (79 U.S.) 700, 702 (1872).
---------------------------------------------------------------------------
These cases settled the issue whether a state of war could exist
without formal declaration by Congress. When hostile action is taken
against the Nation, or against its citizens or commerce, the appropriate
response by order of the President may be resort to force. But the issue
so much a source of controversy in the era of the Cold War and so
divisive politically in the context of United States involvement in the
Vietnamese War has been whether the President is empowered to commit
troops abroad to further national interests in the absence of a
declaration of war or specific congressional authorization short of such
a declaration.\1431\ The Supreme Court studiously refused to consider
the issue in any of the forms in which it was presented,\1432\ and the
lower courts gen
[[Page 311]]
erally refused, on ``political question'' grounds, to adjudicate the
matter.\1433\ In the absence of judicial elucidation, the Congress and
the President have been required to accommodate themselves in the
controversy to accept from each other less than each has been willing to
accept but more than either has been willing to grant.\1434\
\1431\The controversy, not susceptible of definitive resolution
in any event, was stilled for the moment, when in 1973 Congress set a
cut-off date for United States military activities in Indochina, P.L.
93-52, 108, 87 Stat. 134, and subsequently, over the President's veto,
Congress enacted the War Powers Resolution, providing a framework for
the assertion of congressional and presidential powers in the use of
military force. P.L. 93-148, 87 Stat. 555 (1973), 50 U.S.C.
Sec. Sec. 1541-1548.
\1432\In Atlee v. Richardson, 411 U.S. 911 (1973), aff'g. 347 F.
Supp. 689 (E.D.Pa., 1982), the Court summarily affirmed a three-judge
court's dismissal of a suit challenging the constitutionality of United
States activities in Vietnam on political question grounds. The action
constituted approval on the merits of the dismissal, but it did not
necessarily approve the lower court's grounds. See also Massachusetts v.
Laird, 400 U.S. 886 (1970); Holtzman v. Schlesinger, 414 U.S. 1304,
1316, 1321 (1973) (actions of individual justices on motions for stays).
The Court simply denied certiorari in all cases on its discretionary
docket.
\1433\E.g., Velvel v. Johnson, 287 F. Supp. 846 (D.Kan. 1968),
aff'd sub nom. Velvel v. Nixon, 415 F.2d 236 (10th Cir., 1969), cert.
den., 396 U.S. 1042 (1970); Luftig v. McNamara, 252 F. Supp. 819 (D.D.C.
1966), aff'd 373 F.2d 664 (C.A.D.C. 1967), cert. den., 389 U.S. 945
(1968); Mora v. McNamara, 387 F.2d 862 (D.C.Cir., 1967), cert. den., 389
U.S. 934 (1968); Orlando v. Laird, 317 F. Supp. 1013 (E.D.N.Y. 1970),
and Berk v. Laird, 317 F. Supp. 715 (E.D.N.Y. 1970), consolidated and
aff'd, 443 F.2d 1039 (2d Cir., 1971), cert. den., 404 U.S. 869 (1971);
Massachusetts v. Laird, 451 F.2d 26 (1st Cir., 1971); Holtzman v.
Schlesinger, 484 F.2d 1307 (2d Cir., 1973) cert. den., 416 U.S. 936
(1974); Mitchell v. Laird, 488 F.2d 611 (D.C.Cir., 1973).
During the 1980s, the courts were no more receptive to suits,
many by Members of Congress, seeking to obtain a declaration of the
President's powers. The political question doctrine as well as certain
discretionary authorities were relied on. See, e.g., Crockett v. Reagan,
558 F.Supp. 893 (D.D.C. 1982) (military aid to El Salvador), affd. 720
F.2d 1355 (D.C.Cir. 1983), cert. den., 467 U.S. 1251 (1984); Conyers v.
Reagan, 578 F.Supp. 324 (D.D.C. 1984) (invasion of Grenada), dismd. as
moot, 765 F.2d 1124 (D.C.Cir. 1985); Lowry v. Reagan, 676 F.Supp. 333
(D.D.C. 1987) (reflagging and military escort operation in Persian
Gulf), affd. No. 87-5426 (D.C.Cir. 1988); Dellums v. Bush, 752 F.Supp.
1141 (D.D.C. 1990) (U.S. Saudia Arabia/Persian Gulf deployment).
\1434\For further discussion, see under section on President's
commander-in-chief powers.
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THE POWER TO RAISE AND MAINTAIN ARMED FORCES
Purpose of Specific Grants
The clauses of the Constitution, which give Congress authority
to raise and support armies, and so forth, were not inserted to endow
the national government rather than the States with the power to do
these things but to designate the department of the Federal Government,
which would exercise the powers. As we have noted above, the English
king was endowed with the power not only to initiate war but the power
to raise and maintain armies and navies.\1435\ Aware historically that
these powers had been utilized to the detriment of the liberties and
well-being of Englishmen and aware that in the English Declaration of
Rights of 1688 it was insisted that standing armies could not be
maintained without the
[[Page 312]]
consent of Parliament, the Framers vested these basic powers in
Congress.\1436\
\1435\W. Blackstone, Commentaries, St. G. Tucker ed.
(Philadelphia: 1803), 263.
\1436\3 J. Story, Commentaries on the Constitution of the United
States (Boston: 1833), 1187.
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Time Limit on Appropriations for the Army
Prompted by the fear of standing armies to which Story alluded,
the framers inserted the limitation that ``no appropriation of money to
that use shall be for a longer term than two years.'' In 1904, the
question arose whether this provision would be violated if the
Government contracted to pay a royalty for use of a patent in
constructing guns and other equipment where the payments are likely to
continue for more than two years. Solicitor-General Hoyt ruled that such
a contract would be lawful; that the appropriations limited by the
Constitution ``are those only which are to raise and support armies in
the strict sense of the word `support,' and that the inhibition of that
clause does not extend to appropriations for the various means which an
army may use in military operations, or which are deemed necessary for
the common defense. . . .''\1437\ Relying on this earlier opinion,
Attorney General Clark ruled in 1948 that there was ``no legal objection
to a request to the Congress to appropriate funds to the Air Force for
the procurement of aircraft and aeronautical equipment to remain
available until expended.''\1438\
\1437\25 Ops. Atty. Gen. 105, 108 (1904).
\1438\40 Ops. Atty. Gen. 555 (1948).
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Conscription
The constitutions adopted during the Revolutionary War by at
least nine of the States sanctioned compulsory military service.\1439\
Towards the end of the War of 1812, conscription of men for the army was
proposed by James Monroe, then Secretary of War, but opposition
developed and peace came before the bill could be enacted.\1440\ In
1863, a compulsory draft law was adopted and put into operation without
being challenged in the federal courts.\1441\ Not so the Selective
Service Act of 1917.\1442\ This measure was attacked on the grounds that
it tended to deprive the States of the right to ``a well-regulated
militia,'' that the only power of Congress to exact compulsory service
was the power to provide for calling forth the militia for the three
purposes specified in the Constitu
[[Page 313]]
tion, which did not comprehend service abroad, and finally that the
compulsory draft imposed involuntary servitude in violation of the
Thirteenth Amendment. The Supreme Court rejected all of these
contentions. It held that the powers of the States with respect to the
militia were exercised in subordination to the paramount power of the
National Government to raise and support armies, and that the power of
Congress to mobilize an army was distinct from its authority to provide
for calling the militia and was not qualified or in any wise limited
thereby.\1443\
\1439\Selective Draft Law Cases, 245 U.S. 366, 380 (1918); Cox
v. Wood, 247 U.S. 3 (1918).
\1440\Id., 245 U.S., 385.
\1441\Id., 386-388. The measure was upheld by a state court.
Kneedler v. Lane, 45 Pa. St. 238 (1863).
\1442\Act of May 18, 1917, 40 Stat. 76.
\1443\Selective Draft Law Cases, 245 U.S. 366, 381, 382 (1918).
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Before the United States entered the first World War, the Court
had anticipated the objection that compulsory military service would
violate the Thirteenth Amendment and had answered it in the following
words: ``It introduced no novel doctrine with respect of services always
treated as exceptional, and certainly was not intended to interdict
enforcement of those duties which individuals owe to the State, such as
services in the army, militia, on the jury, etc. The great purpose in
view was liberty under the protection of effective government, not the
destruction of the latter by depriving it of essential powers.''\1444\
Accordingly, in the Selective Draft Law Cases,\1445\ it dismissed the
objection under that amendment as a contention that was ``refuted by its
mere statement.''\1446\
\1444\Butler v. Perry, 240 U.S. 328, 333 (1916).
\1445\245 U.S. 366 (1918).
\1446\Id., 390.
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Although the Supreme Court has so far formally declined to pass
on the question of the ``peacetime'' draft,\1447\ its opinions leave no
doubt of the constitutional validity of the act. In United States v.
O'Brien,\1448\ upholding a statute prohibiting the destruction of
selective service registrants' certificate of registration, the Court,
speaking through Chief Justice Warren, thought ``[t]he power of Congress
to classify and conscript manpower for military service is `beyond
question.'''\1449\ In noting Congress' ``broad constitutional power'' to
raise and regulate armies and navies,\1450\ the Court has specifically
observed that the conscription act was passed ``pursuant to'' the grant
of authority to Congress in clauses 12-14.\1451\
\1447\Universal Military Training and Service Act of 1948, 62
Stat. 604, as amended, 50 U.S.C. App. Sec. Sec. 451-473. Actual
conscription has been precluded as of July 1, 1973, P.L. 92-129, 85
Stat. 353, 50 U.S.C. App. Sec. 467(c), and registration was discontinued
in 1975. Pres. Proc. No. 4360, 3 C.F.R. 462, 50 U.S.C. App. Sec. 453
note. Registration, but not conscription, was reactivated in the wake of
the invasion of Afghanistan. P.L. 96-282, 94 Stat. 552 (1980).
\1448\391 U.S. 367 (1968).
\1449\Id., 377, quoting Lichter v. United States, 334 U.S. 742,
756 (1948).
\1450\Schlesinger v. Ballard, 419 U.S. 498, 510 (1975).
\1451\Rostker v. Goldberg, 453 U.S. 57, 59 (1981). See id., 64-
65. And see Selective Service System v. Minnesota Public Interest
Research Group, 468 U.S. 841 (1984) (upholding denial of federal
financial assistance under Title IV of the Higher Education Act to young
men who fail to register for the draft).
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[[Page 314]]
Care of the Armed Forces
Scope of the congressional and executive authority to prescribe
the rules for the governance of the military is broad and subject to
great deference by the judiciary. The Court recognizes ``that the
military is, by necessity, a specialized society separate from civilian
society,'' that ``[t]he military constitutes a specialized community
governed by a separate discipline from that of the civilian,'' and that
``Congress is permitted to legislate both with greater breadth and with
greater flexibility when prescribing the rules by which [military
society] shall be governed than it is when prescribing rules for
[civilian society].''\1452\ Denying that Congress or military
authorities are free to disregard the Constitution when acting in this
area,\1453\ the Court nonetheless operates with ``a healthy deference to
legislative and executive judgments'' with respect to military
affairs,\1454\ so that, while constitutional guarantees apply, ``the
different character of the military community and of the military
mission requires a different application of those protections.''\1455\
\1452\Parker v. Levy, 417 U.S. 733, 743-752 (1974). See also
Orloff v. Willoughby, 345 U.S. 83, 93-94 (1953); Schlesinger v.
Councilman, 420 U.S. 738, 746-748 (1975); Greer v. Spock, 424 U.S. 828,
837-838 (1976); Middendorf v. Henry, 425 U.S. 25, 45-46 (1976); Brown v.
Glines, 444 U.S. 348, 353-358 (1980); Rostker v. Goldberg, 453 U.S. 57,
64-68 (1981).
\1453\Rostker v. Goldberg, 453 U.S. 57, 67 (1981).
\1454\Id., 66. ``[P]erhaps in no other area has the Court
accorded Congress greater deference.'' Id., 64-65. See also Gilligan v.
Morgan, 413 U.S. 1, 10 (1973).
\1455\Parker v. Levy, 417 U.S. 733, 758 (1974). ``[T]he tests
and limitations [of the Constitution] to be applied may differ because
of the military context.'' Rostker v. Goldberg, 453 U.S. 57, 67 (1981).
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In reliance upon this deference to congressional judgment with
respect to the roles of the sexes in combat and the necessities of
military mobilization, coupled with express congressional consideration
of the precise questions, the Court sustained as constitutional the
legislative judgment to provide only for registration of males for
possible future conscription.\1456\ Emphasizing the unique, separate
status of the military, the necessity to indoctrinate men in obedience
and discipline, the tradition of military neutrality in political
affairs, and the need to protect troop morale, the Court upheld the
validity of military post regulations, backed by congressional
enactments, banning speeches and demonstrations of a partisan political
nature and the distribution of literature without prior approval of post
headquarters, with the commander authorized to keep out only those
materials that would clearly endanger
[[Page 315]]
the loyalty, discipline, or morale of troops on the base.\1457\ On the
same basis, the Court rejected challenges on constitutional and
statutory grounds to military regulations requiring servicemen to obtain
approval from their commanders before circulating petitions on base, in
the context of circulations of petitions for presentation to
Congress.\1458\ And the statements of a military officer urging
disobedience to certain orders could be punished under provisions that
would have been of questionable validity in a civilian context.\1459\
Reciting the considerations previously detailed, the Court has refused
to allow enlisted men and officers to sue to challenge or set aside
military decisions and actions.\1460\
\1456\Rostker v. Goldberg, 453 U.S. 57 (1981). Compare Frontiero
v. Richardson, 411 U.S. 677 (1973), with Schlesinger v. Ballard, 419
U.S. 498 (1975).
\1457\Greer v. Spock, 424 U.S. 828 (1976), limiting Flower v.
United States, 407 U.S. 197 (1972).
\1458\Brown v. Glines, 444 U.S. 348 (1980); Secretary of the
Navy v. Huff, 444 U.S. 453 (1980). The statutory challenge was based on
10 U.S.C. Sec. 1034, which protects a serviceman's right to communicate
with a Member of Congress, but which the Court interpreted narrowly.
\1459\Parker v. Levy, 417 U.S. 733 (1974).
\1460\Chappell v. Wallace, 462 U.S. 296 (1983) (enlisted men
charging racial discrimination by their superiors in duty assignments
and performance evaluations could not bring constitutional tort suits);
United States v. Stanley, 483 U.S. 669 (1987) (officer who had been an
unwitting, unconsenting subject of an Army experiment to test the
effects of LSD on human subjects could not bring a constitutional tort
for damages). These considerations are also the basis of the Court's
construction of the Federal Tort Claims Act so that it does not reach
injuries arising out of or in the course of military activity. Feres v.
United States, 340 U.S. 135 (1950). In United States v. Johnson, 481
U.S. 681 (1987), four Justices urged reconsideration of Feres, but that
has not occurred.
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Congress has a plenary and exclusive power to determine the age
at which a soldier or seaman shall be received, the compensation he
shall be allowed and the service to which he shall be assigned. This
power may be exerted to supersede parents' control of minor sons who are
needed for military service. Where the statute requiring the consent of
parents for enlistment of a minor son did not permit such consent to be
qualified, their attempt to impose a condition that the son carry war
risk insurance for the benefit of his mother was not binding on the
Government.\1461\ Since the possession of government insurance payable
to the person of his choice is calculated to enhance the morale of the
serviceman, Congress may permit him to designate any beneficiary he
desires, irrespective of state law, and may exempt the proceeds from the
claims of creditors.\1462\ Likewise, Congress may bar a State from
taxing the
[[Page 316]]
tangible, personal property of a soldier, assigned for duty therein, but
domiciled elsewhere.\1463\ To safeguard the health and welfare of the
armed forces, Congress may authorize the suppression of bordellos in the
vicinity of the places where forces are stationed.\1464\
\1461\United States v. Williams, 302 U.S. 46 (1937). See also In
re Grimley, 137 U.S. 147, 153 (1890); In re Morrissey, 137 U.S. 157
(1890).
\1462\Wissner v. Wissner, 338 U.S. 655 (1950); Ridgway v.
Ridgway, 454 U.S. 46 (1981). In the absence of express congressional
language, like that found in Wissner, the Court nonetheless held that a
state court division under its community property system of an officer's
military retirement benefits conflicted with the federal program and
could not stand. McCarty v. McCarty, 453 U.S. 210 (1981). See also
Porter v. Aetna Casualty Co., 370 U.S. 159 (1962) (exemption from
creditors' claims of disability benefits deposited by a veteran's
guardian in a savings and loan association).
\1463\Dameron v. Brodhead, 345 U.S. 322 (1953). See also
California v. Buzard, 382 U.S. 386 (1966); Sullivan v. United States,
395 U.S. 169 (1969).
\1464\McKinley v. United States, 249 U.S. 397 (1919).
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Trial and Punishment of Offenses: Servicemen, Civilian Employees,
and Dependents
Under its power to make rules for the government and regulation
of the armed forces, Congress has set up a system of criminal law
binding on all servicemen, with its own substantive laws, its own courts
and procedures, and its own appeals procedure.\1465\ The drafters of
these congressional enactments conceived of a military justice system
with application to all servicemen wherever they are, to reservists
while on inactive duty training, and to certain civilians in special
relationships to the military. In recent years, all these conceptions
have been restricted.
\1465\The Uniform Code of Military Justice of 1950, 64 Stat.
107, as amended by the Military Justice Act of 1968, 82 Stat. 1335, 10
U.S.C. Sec. 801 et seq. For prior acts, see 12 Stat. 736 (1863); 39
Stat. 650 (1916).
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Servicemen.--Although there is extensive disagreement about the
practice of court-martial trial of servicemen for nonmilitary offenses
in the past,\1466\ the matter never really was raised in substantial
degree until the Cold War period when the United States found it
essential to maintain both at home and abroad a large standing army in
which great numbers of servicemen were draftees. In O'Callahan v.
Parker,\1467\ the Court held that court-martial jurisdiction was lacking
to try servicemen charged with a crime that was not ``service
connected.'' The Court attempted to assay no definition of ``service
connection,'' but among the factors it noted were that the crime in
question was committed against a civilian in peacetime in the United
States off-base while the serviceman was lawfully off duty.\1468\
O'Callahan was overruled in Solorio v. United States,\1469\ the Court
holding that ``the requirements of the
[[Page 317]]
Constitution are not violated where . . . a court-martial is convened to
try a serviceman who was a member of the armed services at the time of
the offense charged.''\1470\ Chief Justice Rehnquist's opinion for the
Court insisted that O'Callahan had been based on erroneous readings of
English and American history, and that ``the service connection approach
. . . has proved confusing and difficult for military courts to
apply.''\1471\
\1466\Compare Solorio v. United States, 483 U.S. 435, 441-447
(1987) (majority opinion), with id., 456-461 (dissenting opinion), and
O'Callahan v. Parker, 395 U.S. 258, 268-272 (1969) (majority opinion),
with id., 276-280 (Justice Harlan dissenting). See Duke & Vogel, ``The
Constitution and the Standing Army: Another Problem of Court-Martial
Jurisdiction,'' 13 Vand. L. Rev. 435 (1960).
\1467\395 U.S. 258 (1969).
\1468\Id., 273-274. See also Relford v. Commandant, 401 U.S. 355
(1971); Gosa v. Mayden, 413 U.S. 665 (1973).
\1469\483 U.S. 435 (1987).
\1470\Id., 450-451.
\1471\Id., 448. Although the Court of Military Appeals had
affirmed Solorio's military-court conviction on the basis that the
service-connection test had been met, the Court elected to reconsider
and overrule O'Callahan altogether.
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With regard to trials before court-martials, it is not clear
what provisions of the Bill of Rights and other constitutional
guarantees do apply. The Fifth Amendment expressly excepts ``[c]ases
arising in the land and naval forces'' from its grand jury provision,
and there is an implication that these cases are also excepted from the
Sixth Amendment.\1472\ The double jeopardy provision of the Fifth
Amendment appears to be applicable.\1473\ The Court of Military Appeals
now holds that servicemen are entitled to all constitutional rights
except those expressly or by implication inapplicable to the
military.\1474\ The Uniform Code of Military Justice, supplemented by
the Manual for Courts-Martial, affirmatively grants due process rights
roughly comparable to civilian procedures, so that many such issues are
unlikely to arise absolutely necessitating constitutional
analysis.\1475\ However, the Code leaves intact much of the criticized
traditional structure of courts-martial, including the pervasive
possibilities of command influence,\1476\ and the Court of Military
Appeals is limited on the scope of its review,\1477\ thus creating areas
in which constitutional challenges are likely.
\1472\Ex parte Milligan, 4 Wall. (71 U.S.) 2, 123, 138-139
(1866); Ex parte Quirin, 317 U.S. 1, 40 (1942). The matter was raised
but left unresolved in Middendorf v. Henry, 425 U.S. 25 (1976).
\1473\See Wade v. Hunter, 336 U.S. 684 (1949). Cf. Grafton v.
United States, 206 U.S. 333 (1907).
\1474\United States v. Jacoby, 11 U.S.C.M.A. 428, 29 C.M.R. 244
(1960); United States v. Tempia, 16 U.S.C.M.A. 629, 37 C.M.R. 249
(1967). This conclusion by the Court of Military Appeals is at least
questioned and perhaps disapproved in Middendorf v. Henry, 425 U.S. 25,
43-48 (1976), in the course of overturning a CMA rule that counsel was
required in summary court-martial. For the CMA's response to the holding
see United States v. Booker, 5 M. J. 238 (C.M.A. 1977), rev'd in part on
reh., 5 M. J. 246 (C.M.A. 1978).
\1475\The UCMJ guarantees counsel, protection from self-
incrimination and double jeopardy, and warnings of rights prior to
interrogation, to name a few.
\1476\Cf. O'Callahan v. Parker, 395 U.S. 258, 263-264 (1969).
\1477\10 U.S.C. Sec. 867.
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Upholding Articles 133 and 134 of the Uniform Code of Military
Justice, the Court stressed the special status of military soci
[[Page 318]]
ety.\1478\ This difference has resulted in a military Code regulating
aspects of the conduct of members of the military that in the civilian
sphere would go unregulated, but on the other hand the penalties imposed
range from the severe to well below the threshold of that possible in
civilian life. Because of these factors, the Court, while agreeing that
constitutional limitations applied to military justice, was of the view
that the standards of constitutional guarantees were significantly
different in the military than in civilian life. Thus, the vagueness
challenge to the Articles was held to be governed by the standard
applied to criminal statutes regulating economic affairs, the most
lenient of vagueness standards.\1479\ Neither did application of the
Articles to conduct essentially composed of speech necessitate a voiding
of the conviction, inasmuch as the speech was unprotected, and, even
while it might reach protected speech, the officer here was unable to
raise that issue.\1480\
\1478\Parker v. Levy, 417 U.S. 733 (1974). Article 133 punishes
a commissioned officer for ``conduct unbecoming an officer and
gentleman,'' and Article 134 punishes any person subject to the Code for
``all disorders and neglects to the prejudice of good order and
discipline in the armed forces.''
\1479\Id., 756.
\1480\Id., 757-761.
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Military courts are not Article III courts but agencies
established pursuant to Article I.\1481\ It was established in the last
century that the civil courts have no power to interfere with courts-
martial and that court-martial decisions are not subject to civil court
review.\1482\ Until August 1, 1984, the Supreme Court had no
jurisdiction to review by writ of certiorari the proceedings of a
military commission, but Congress has now conferred appellate
jurisdiction of decisions of the Court of Military Appeals.\1483\ Prior
to this time, civil court review of court-martial decisions was possible
through habeas corpus jurisdiction,\1484\ an avenue that continues to
exist, but the Court severely limited the scope of such review,
restricting it to the issue whether the court-martial has jurisdiction
over the person tried and the offense charged.\1485\ In Burns v. Wil
[[Page 319]]
son,\1486\ however, at least seven Justices appeared to reject the
traditional view and adopt the position that civil courts on habeas
corpus could review claims of denials of due process rights to which the
military had not given full and fair consideration. Since Burns, the
Court has thrown little light on the range of issues cognizable by a
federal court in such litigation\1487\ and the lower federal courts have
divided several possible ways.\1488\
\1481\Kurtz v. Moffitt, 115 U.S. 487 (1885); Dynes v. Hoover, 20
How. (61 U.S.) 65 (1858). Judges of Article I courts do not have the
independence conferred by security of tenure and of compensation.
\1482\Dynes v. Hoover, 20 How. (61 U.S.) 65 (1858).
\1483\Military Justice Act of 1983, P.L. 98-209, 97 Stat. 1393,
28 U.S.C. Sec. 1259.
\1484\Cf. Ex parte Milligan, 4 Wall. (71 U.S.) 2 (1866); Ex
parte Yerger, 8 Wall. (75 U.S.) 85 (1869); Ex parte Reed, 100 U.S. 13
(1879). While federal courts have jurisdiction to intervene in military
court proceedings prior to judgment, as a matter of equity, following
the standards applicable to federal court intervention in state criminal
proceedings, they should act when the petitioner has not exhausted his
military remedies only in extraordinary circumstances. Schlesinger v.
Councilman, 420 U.S. 738 (1975).
\1485\Ex parte Reed, 100 U.S. 13 (1879); Swaim v. United States,
165 U.S. 553 (1897); Carter v. Roberts, 177 U.S. 496 (1900); Hiatt v.
Brown, 339 U.S. 103 (1950).
\1486\346 U.S. 137 (1953).
\1487\Cf. Fowler v. Wilkinson, 353 U.S. 583 (1957); United
States v. Augenblick, 393 U.S. 348, 350 n. 3, 351 (1969); Parker v.
Levy, 417 U.S. 733 (1974); Secretary of the Navy v. Avrech, 418 U.S. 676
(1974).
\1488\E.g., Calley v. Callaway, 519 F. 2d 184, 194-203 (5th
Cir., 1975) (en banc), cert. den., 425 U.S. 911 (1976).
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Civilians and Dependents.--In recent years, the Court rejected
the view of the drafters of the Code of Military Justice with regard to
the persons Congress may constitutionally reach under its clause 14
powers. Thus, it held that an honorably discharged former soldier,
charged with having committed murder during military service in Korea,
could not be tried by court-martial but must be charged in federal
court, if at all.\1489\ After first leaning the other way,\1490\ the
Court on rehearing found lacking court-martial jurisdiction, at least in
peacetime, to try civilian dependents of service personnel for capital
crimes committed outside the United States.\1491\ Subsequently, the
Court extended its ruling to civilian dependents overseas charged with
noncapital crimes\1492\ and to civilian employees of the military
charged with either capital or noncapital crimes.\1493\
\1489\United States ex rel. Toth v. Quarles, 350 U.S. 11 (1955).
See also Lee v. Madigan, 358 U.S. 228 (1959).
\1490\Kinsella v. Krueger, 351 U.S. 470 (1956); Reid v. Covert,
351 U.S. 487 (1956
\1491\Reid v. Covert, 354 U.S. 1 (1957) (voiding court-martial
convictions of two women for murdering their soldier husbands stationed
in Japan). Chief Justice Warren and Justices Black, Douglas, and Brennan
were of the opinion Congress' power under clause 14 could not reach
civilians. Justices Frankfurter and Harlan concurred, limited to capital
cases. Justices Clark and Burton dissented.
\1492\Kinsella v. United States ex rel. Singleton, 361 U.S. 234
(1960) (voiding court-martial conviction for noncapital crime of wife of
soldier husband overseas). The majority could see no reason for
distinguishing between capital and noncapital crimes. Justices Harlan
and Frankfurter dissented on the ground that in capital cases greater
constitutional protection, available in civil courts, was required.
\1493\Grisham v. Hagan, 361 U.S. 278 (1960); McElroy v. United
States ex rel. Guagliardo, 361 U.S. 281 (1960).
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WAR LEGISLATION
War Powers in Peacetime
To some indeterminate extent, the power to wage war embraces the
power to prepare for it and the power to deal with the problems of
adjustment following its cessation. Justice Story em
[[Page 320]]
phasized that ``[i]t is important also to consider, that the surest
means of avoiding war is to be prepared for it in peace. . . . How could
a readiness for war in time of peace be safely prohibited, unless we
could in like manner prohibit the preparations and establishments of
every hostile nation? . . . It will be in vain to oppose constitutional
barriers to the impulse of self-preservation.''\1494\ Authoritative
judicial recognition of the power is found in Ashwander v. Tennessee
Valley Authority,\1495\ in which the power of the Federal Government to
construct and operate a dam and power plant, pursuant to the National
Defense Act of June 3, 1916,\1496\ was sustained. The Court noted that
the assurance of an abundant supply of electrical energy and of
nitrates, which would be produced at the site, ``constitute national
defense assets'' and the project was justifiable under the war
powers.\1497\
\1494\3 J. Story, Commentaries on the Constitution of the United
States (Boston: 1833), 1180.
\1495\297 U.S. 288 (1936).
\1496\39 Stat. 166 (1916).
\1497\297 U.S., 327-328.
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Perhaps the most significant example of legislation adopted
pursuant to the war powers when no actual ``shooting war'' was in
progress, with the object of strengthening national defense, was the
Atomic Energy Act of 1946, establishing a body to oversee and further
the research into and development of atomic energy for both military and
civil purposes.\1498\ Congress has also authorized a vast amount of
highway construction, pursuant to its conception of their ``primary
importance to the national defense,''\1499\ and the first extensive
program of federal financial assistance in the field of education was
the National Defense Education Act.\1500\ The post-World War II years,
though nominally peacetime, constituted the era of the Cold War and the
occasions for several armed conflicts, notably in Korea and Indochina,
in which the Congress enacted much legislation designed to strengthen
national security, including an apparently permanent draft,\1501\
authorization of extensive space exploration,\1502\ authorization for
wage and price con
[[Page 321]]
trols,\1503\ and continued extension of the Renegotiation Act to
recapture excess profits on defense contracts.\1504\ Additionally, the
period saw extensive regulation of matter affecting individual rights,
such as loyalty-security programs,\1505\ passport controls,\1506\ and
limitations on members of the Communist Party and associated
organizations,\1507\ all of which are dealt with in other sections.
\1498\60 Stat. 755 (1946), 42 U.S.C. Sec. 1801 et seq.
\1499\108(a), 70 Stat. 374, 378 (1956), 23 U.S.C. Sec. 101(b),
naming the Interstate System the ``National System of Interstate and
Defense Highways.''
\1500\72 Stat. 1580 (1958), as amended, codified to various
sections of Titles 20 and 42.
\1501\Universal Military Training and Service Act of 1948, 62
Stat. 604, as amended, 50 U.S.C. App. Sec. Sec. 451-473. Actual
conscription has been precluded as of July 1, 1973, P. L. 92-129, 85
Stat. 353, 50 U. S. C. App. 467(c), although registration for possible
conscription is in effect. P. L. 96-282, 94 Stat. 552 (1980).
\1502\National Aeronautics and Space Act of 1958, 72 Stat. 426,
as amended, codified in various sections of Titles 5, 18, and 50.
\1503\Title II of the Defense Production Act Amendments of 1970,
84 Stat. 799, as amended, provided temporary authority for wage and
price controls, a power which the President subsequently exercised. E.O.
11615, 36 Fed Reg. 15727 (August 16, 1971). Subsequent legislation
expanded the President's authority. 85 Stat. 743, 12 U.S.C. Sec. 1904
note.
\1504\Renogtiation Act of 1951, 65 Stat. 7, as amended, 50
U.S.C. App. Sec. 1211 et seq.
\1505\E.g., Cafeteria & Restaurant Workers v. McElroy, 367 U.S.
886 (1961); Peters v. Hobby, 349 U.S. 331 (1955).
\1506\Zemel v. Rusk, 381 U.S. 1 (1965); United States v. Laub,
385 U.S. 475 (1967).
\1507\United States v. Robel, 389 U.S. 258 (1967); United States
v. Brown, 381 U.S. 437 (1965).
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A particular province of such legislation is that designed to
effect a transition from war to peace. The war power ``is not limited to
victories in the field. . . . It carries with it inherently the power to
guard against the immediate renewal of the conflict, and to remedy the
evils which have arisen from its rise and progress.''\1508\ This
principle was given a much broader application after the First World War
in Hamilton v. Kentucky Distilleries Co.,\1509\ where the War Time
Prohibition Act\1510\ adopted after the signing of the Armistice was
upheld as an appropriate measure for increasing war efficiency. The
Court was unable to conclude that the war emergency had passed with the
cessation of hostilities.\1511\ But in 1924, it held that a rent control
law for the District of Columbia, which had been previously
upheld,\1512\ had ceased to operate because the emergency which
justified it had come to an end.\1513\
\1508\Stewart v. Kahn, 11 Wall. (78 U.S.) 493, 507 (1871)
(sustaining a congressional deduction from a statute of limitations the
period during which the Civil War prevented the bringing of an action).
See also Mayfield v. Richards, 115 U.S. 137 (1885).
\1509\251 U.S. 146 (1919). See also Ruppert v. Caffey, 251 U.S.
264 (1920).
\1510\Act of November 21, 1918, 40 Stat. 1046.
\1511\251 U.S., 163.
\1512\Block v. Hirsh, 256 U.S. 135 (1921).
\1513\Chastleton Corp. v. Sinclair, 264 U.S. 543 (1924).
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A similar issue was presented after World War II in which the
Court held that the authority of Congress to regulate rents by virtue of
the war power did not end with the presidential proclamation terminating
hostilities on December 31, 1946.\1514\ However,
[[Page 322]]
the Court cautioned that ``[w]e recognize the force of the argument that
the effects of war under modern conditions may be felt in the economy
for years and years, and that if the war power can be used in days of
peace to treat all the wounds which war inflicts on our society, it may
not only swallow up all other powers of Congress but largely obliterate
the Ninth and Tenth Amendments as well. There are no such implications
in today's decision.''\1515\
\1514\Woods v. Cloyd W. Miller Co., 333 U.S. 138 (1948). See
also Fleming Mohawk Wrecking Co., 331 U.S. 111 (1947).
\1515\Id., 333 U.S., 143-144.
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In the same year, the Court sustained by only a five-to-four
vote the Government's contention that the power which Congress had
conferred upon the President to deport enemy aliens in times of a
declared war was not exhausted when the shooting stopped.\1516\ ``It is
not for us to question,'' said Justice Frankfurter for the Court, ``a
belief by the President that enemy aliens who were justifiably deemed
fit subjects for internment during active hostilites [sic] do not lose
their potency for mischief during the period of confusion and conflict
which is characteristic of a state of war even when the guns are silent
but the peace of Peace has not come.''\1517\
\1516\Ludecke v. Watkins, 335 U.S. 160 (1948).
\1517\Id., 170.
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Delegation of Legislative Power in Wartime
The Court has insisted that in times of war as in times of peace
``the respective branches of the Government keep within the power
assigned to each,''\1518\ thus raising the issue of permissible
delegation, inasmuch as during a war Congress has been prone to delegate
many more powers to the President than at other times.\1519\ But the
number of cases actually discussing the matter is few.\1520\ Two
theories have been advanced at times when the delegation doctrine
carried more of a force than it has in recent years. First, it is
suggested that inasmuch as the war power is inherent in the Federal
Government, and one shared by the legislative and executive branches,
Congress does not really delegate legislative power when it authorizes
the President to exercise the war power in a prescribed manner, a view
which entirely overlooks the fact that the Constitution expressly vests
the war power as a legislative power in Congress. Second, it is
suggested that Congress' power to delegate in wartime is limited as in
other situations but that the
[[Page 323]]
existence of a state of war is a factor weighing in favor of the
validity of the delegation.
\1518\Lichter v. United States, 334 U.S. 742, 779 (1948).
\1519\For an extensive consideration of this subject in the
context of the President's redelegation of it, see N. Grundstein,
Presidential Delegation of Authority in Wartime (Pittsburgh: 1961).
\1520\In the Selective Draft Law Cases, 245 U.S. 366, 389
(1918), the objection was dismissed without discussion. The issue was
decided by reference to peacetime precedents in Yakus v. United States,
321 U.S. 414, 424 (1944).
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The first theory was fully stated by Justice Bradley in Hamilton
v. Dillin,\1521\ upholding a levy imposed by the Secretary of the
Treasury pursuant to an act of Congress. To the argument that the levy
was a tax the fixing of which Congress could not delegate, Justice
Bradley noted that the power exercised ``does not belong to the same
category as the power to levy and collect taxes, duties, and excises. It
belongs to the war powers of the Government. . . .''\1522\
\1521\21 Wall. (88 U.S.) 73 (1875).
\1522\Id., 96-97. Cf. United States v. Chemical Foundation, 272
U.S. 1 (1926).
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Both theories found expression in different passages of Chief
Justice Stone's opinion in Hirabayashi v. United States,\1523\ upholding
executive imposition of a curfew on Japanese-Americans pursuant to
legislative delegation. On the one hand, he spoke to Congress and the
Executive, ``acting in cooperation,'' to impose the curfew,\1524\ while
on the other hand, he noted that a delegation in which Congress has
determined the policy and the rule of conduct, leaving to the Executive
the carry-out of the matter, is permissible delegation.\1525\
\1523\320 U.S. 81 (1943).
\1524\Id., 91-92, 104.
\1525\Id., 104.
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A similar ambiguity is found in Lichter v. United States,\1526\
upholding the Renegotiation Act, but taken as a whole the Court there
espoused the second theory. ``The power [of delegation] is especially
significant in connection with constitutional war powers under which the
exercise of broad discretion as to method to be employed may be
essential to an effective use of its war powers by Congress. The degree
to which Congress must specify its policies and standards in order that
the administrative authority granted may not be an unconstitutional
delegation of its own legislative power is not capable of precise
definition. . . . Thus, while the constitutional structure and controls
of our Government are our guides equally in war and in peace, they must
be read with the realistic purposes of the entire instrument fully in
mind.''\1527\ The Court then examined the exigencies of war and
concluded that the delegation was valid.\1528\
\1526\334 U.S. 742 (1948).
\1527\Id., 778-779, 782.
\1528\Id., 778-783.
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[[Page 324]]
CONSTITUTIONAL RIGHTS IN WARTIME
Constitution and the Advance of the Flag
Theater of Military Operations.--Military law to the exclusion
of constitutional limitations otherwise applicable is the rule in the
areas in which military operations are taking place. This view was
assumed by all members of the Court in Ex parte Milligan,\1529\ in which
the trial by a military commission of a civilian charged with disloyalty
in a part of the country remote from the theater of military operations
was held invalid. Although unanimous in the result, the Court divided
five-to-four on the ground of decision. The point of disagreement was
over which department of the Government had authority to say with
finality what regions lie within the theater of military operations. The
majority claimed this function for the courts and asserted that an area
in which the civil courts were open and functioning does not;\1530\ the
minority argued that the question was for Congress' determination.\1531\
The entire Court rejected the Government's contention that the
President's determination was conclusive in the absence of restraining
legislation.\1532\
\1529\4 Wall. (71 U.S.) 2 (1866).
\1530\Id., 127.
\1531\Id., 132, 138.
\1532\Id., 121, 139-142.
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Similarly, in Duncan v. Kahanamoku,\1533\ the Court declared
that the authority granted by Congress to the territorial governor of
Hawaii to declare marital law under certain circumstances, which he
exercised in the aftermath of the attack on Pearl Harbor, did not
warrant the supplanting of civil courts with military tribunals and the
trial of civilians for civilian crimes in these military tribunals at a
time when no obstacle stood in the way of the operation of the civil
courts, except, of course, the governor's order.
\1533\327 U.S. 304 (1946).
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Enemy Country.--It has seemed reasonably clear that the
Constitution does not follow the advancing troops into conquered
territory. Persons in such territory have been held entirely beyond the
reach of constitutional limitations and subject to the laws of war as
interpreted and applied by the Congress and the President.\1534\ ``What
is the law which governs an army invading an enemy's country?'' the
Court asked in Dow v. Johnson.\1535\ ``It is not the civil law of the
invaded country; it is not the civil law of the conquering country; it
is military law--the law of war--and its su
[[Page 325]]
premacy for the protection of the officers and soldiers of the army,
when in service in the field in the enemy's country, is as essential to
the efficiency of the army as the supremacy of the civil law at home,
and, in time of peace, is essential to the preservation of liberty.''
\1534\New Orleans v. The Steamship Co., 20 Wall. (87 U.S.) 387
(1874); Santiago v. Nogueras, 214 U.S. 260 (1909); Madsen v. Kinsella,
343 U.S. 341 (1952).
\1535\100 U.S. 158, 170 (1880).
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These conclusions follow not only from the usual necessities of
war but as well from the Court's doctrine that the Constitution is not
automatically applicable in all territories acquired by the United
States, the question turning upon whether Congress has made the area
``incorporated'' or ``unincorporated'' territory,\1536\ but in Reid v.
Covert,\1537\ Justice Black in a plurality opinion of the Court asserted
that wherever the United States acts it must do so only ``in accordance
with all the limitation imposed by the Constitution. . . .
[C]onstitutional protections for the individual were designed to
restrict the United States Government when it acts outside of this
country, as well as at home.''\1538\ The case, however, involved the
trial of a United States citizen abroad and the language quoted was not
subscribed to by a majority of the Court; thus, it must be regarded as a
questionable rejection of the previous line of cases.\1539\
\1536\De Lima v. Bidwell, 182 U.S. 1 (1901); Dooley v. United
States, 182 U.S. 222 (1901); Downes v. Bidwell, 182 U.S. 244 (1901);
Dorr v. United States, 195 U.S. 138 (1904).
\1537\354 U.S. 1 (1957).
\1538\Id., 6, 7.
\1539\For a comprehensive treatment, preceding Reid v. Covert,
of the matter in the context of the post-War war crimes trials, see
Fairman, Some New Problems of the Constitution Following the Flag, 1
Stan. L. Rev. 587 (1949).
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Enemy Property.--In Brown v. United States,\1540\ Chief Justice
Marshall dealt definitively with the legal position of enemy property
during wartime. He held that the mere declaration of war by Congress
does not effect a confiscation of enemy property situated within the
territorial jurisdiction of the United States, but the right of Congress
by further action to subject such property to confiscation was asserted
in the most positive terms. As an exercise of the war power, such
confiscation was held not subject to the restrictions of the Fifth and
Sixth Amendment. Since such confiscation is unrelated to the personal
guilt of the owner, it is immaterial whether the property belongs to an
alien, a neutral, or even to a citizen. The whole doctrine of
confiscation is built upon the foundation that it is an instrument of
coercion, which, by depriving an enemy of property within the reach of
his power, whether within his territory or outside it, impairs his
ability to resist the
[[Page 326]]
confiscating government while at the same time it furnishes to that
government means for carrying on the war.\1541\
\1540\8 Cr. (12 U.S.) 110 (1814). See also Conrad v. Waples, 96
U.S. 279 (1878).
\1541\Miller v. United States, 11 Wall. (78 U.S.) 268 (1871);
Steehr v. Wallace, 255 U.S. 239 (1921); Central Trust Co. v. Garvan, 254
U.S. 554 (1921); United States v. Chemical Foundation, 272 U.S. 1
(1926); Silesian-American Corp. v. Clark, 332 U.S. 469 (1947); Cities
Service Co. v. McGrath, 342 U.S. 330 (1952); Handelsbureau La Mola v.
Kennedy, 370 U.S. 940 (1962); cf. Honda v. Clark, 386 U.S. 484 (1967).
---------------------------------------------------------------------------
Prizes of War.--The power of Congress with respect to prizes is
plenary; no one can have any interest in prizes captured except by
permission of Congress.\1542\ Nevertheless, since international law is a
part of our law, the Court will administer it so long as it has not been
modified by treaty or by legislative or executive action. Thus, during
the Civil War, the Court found that the Confiscation Act of 1861, and
the Supplementary Act of 1863, which, in authorizing the condemnation of
vessels, made provision for the protection of interests of loyal
citizens, merely created a municipal forfeiture and did not override or
displace the law of prize. It decided, therefore, that when a vessel was
liable to condemnation under either law, the Government was at liberty
to proceed under the most stringent rules of international law, with the
result that the citizen would be deprived of the benefit of the
protective provisions of the statute.\1543\ Similarly, when Cuban ports
were blockaded during the Spanish-American War, the Court held, over the
vigorous dissent of three of its members, that the rule of international
law exempting unarmed fishing vessels from capture was applicable in the
absence of any treaty provision, or other public act of the Government
in relation to the subject.\1544\
\1542\The Siren, 13 Wall. (80 U.S.) 389 (1871).
\1543\The Hampton, 5 Wall. (72 U.S.) 372, 376 (1867).
\1544\The Paquete Habana, 175 U.S. 677, 700, 711 (1900).
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The Constitution at Home in Wartime
Personal Liberty.--``The Constitution of the United States is a
law for rulers and people, equally in war and in peace, and covers with
the shield of its protection all classes of men, at all times, and under
all circumstances. No doctrine, involving more pernicious consequences,
was ever invented by the wit of man than that any of its provisions can
be suspended during any of the great exigencies of government. Such a
doctrine leads directly to anarchy or despotism, but the theory of
necessity on which it is based is false; for the government, within the
Constitution, has all the powers granted to it, which are necessary to
preserve its existence; as has been happily proved by the result of the
great effort to throw off its just authority.''\1545\
\1545\Ex parte Milligan, 4 Wall. (71 U.S.) 2, 120-121 (1866).
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[[Page 327]]
Ex parte Milligan, from which these words are quoted, is justly
deemed one of the great cases undergirding civil liberty in this country
in times of war or other great crisis, holding that except in areas in
which armed hostilities have made enforcement of civil law impossible
constitutional rights may not be suspended and civilians subjected to
the vagaries of military justice. Yet, the words were uttered after the
cessation of hostilities, and the Justices themselves recognized that
with the end of the shooting there arose the greater likelihood that
constitutional rights could be and would be observed and that the Court
would require the observance.\1546\ This pattern recurs with each
critical period.
\1546\``During the late wicked Rebellion, the temper of the
times did not allow that calmness in deliberation and discussion so
necessary to a correct conclusion of a purely judicial question. Then,
considerations of safety were mingled with the exercise of power; and
feelings and interests prevailed which were happily terminated. Now that
the public safety is assured, this question, as well as all others, can
be discussed and decided without passion or the admixture of any element
not required to form a legal judgment.'' Id., 109 (emphasis by Court).
---------------------------------------------------------------------------
That the power of Congress to punish seditious utterances in
wartime is limited by the First Amendment was assumed by the Court in a
series of cases,\1547\ in which it nonetheless affirmed conviction for
violations of the Espionage Act of 1917.\1548\ The Court also upheld a
state law making it an offense for persons to advocate that citizens of
the State should refuse to assist in prosecuting war against enemies of
the United States.\1549\ Justice Holmes matter-of-factly stated the
essence of the pattern that we have mentioned. ``When a nation is at war
many things that might be said in time of peace are such a hindrance to
its effort that their utterance will not be endured so long as men fight
and that no Court could regard them as protected by any constitutional
right.''\1550\ By far, the most dramatic restraint of personal liberty
imposed during World War II was the detention and relocation of the
Japanese residents of the Western States, including those who were
native-born citizens of the United States. When various phases of this
program were challenged, the Court held that in order to prevent
espionage and sabotage, the authorities could restrict the movement of
these persons by a curfew order,\1551\ even by a regulation excluding
them from defined areas,\1552\ but that a citizen of Japanese ances
[[Page 328]]
try whose loyalty was conceded could not be detained in a relocation
camp.\1553\
\1547\Schneck v. United States, 249 U.S. 47 (1919); Debs v.
United States, 249 U.S. 211 (1919); Surgarman v. United States, 249 U.S.
182 (1919); Frohwerk v. United States, 249 U.S. 204 (1919); Abrams v.
United States, 250 U.S. 616 (1919).
\1548\40 Stat. 217 (1917), as amended by 40 Stat. 553 (1918).
\1549\Gilbert v. Minnesota, 254 U.S. 325 (1920).
\1550\Schenck v. United States, 249 U.S. 47, 52 (1919).
\1551\Hirabayashi v. United States, 320 U.S. 81 (1943).
\1552\Korematsu v. United States, 323 U.S. 214 (1944).
\1553\Ex parte Endo, 323 U.S. 283 (1944).
---------------------------------------------------------------------------
A mixed pattern emerges from an examination of the Cold War
period. Legislation designed to regulate and punish the organizational
activities of the Communist Party and its adherents was at first
upheld\1554\ and then in a series of cases was practically
vitiated.\1555\ Against a contention that Congress' war powers had been
utilized to achieve the result, the Court struck down for the second
time in history a congressional statute as an infringement of the First
Amendment.\1556\ It voided a law making it illegal for any member of a
``communist-action organization'' to work in a defense facility.\1557\
The majority reasoned that the law overbroadly required a person to
choose between his First Amendment-protected right of association and
his right to hold a job, without attempting to distinguish between those
persons who constituted a threat and those who did not.\1558\
\1554\E.g., Dennis v. United States, 341 U.S. 494 (1951);
Communist Party v. Subversive Activities Control Board, 367 U.S. 1
(1961); American Communications Association v. Douds, 339 U.S. 382
(1950).
\1555\E.g., Yates v. United States, 354 U.S. 298 (1957);
Albertson v. Subversive Activities Control Board, 382 U.S. 70 (1965);
United States v. Brown, 381 U.S. 437 (1965).
\1556\United States v. Robel, 389 U.S. 258 (1967); cf. Aptheker
v. Secretary of State, 378 U.S. 500 (1964). And see Schneider v. Smith,
390 U.S. 17 (1968).
\1557\Sec. 5(a)(1)(D) of the Subversive Control Act of 1950, 64
Stat 992, 50 U.S.C. Sec. 784(a)(1)(D).
\1558\Id., 389 U.S., 264-266. Justices Harlan and White
dissented, contending that the right of association should have been
balanced against the public interest and finding the weight of the
latter the greater. Id., 282.
---------------------------------------------------------------------------
On the other hand, in New York Times Co. v. United States,\1559\
a majority of the Court agreed that in appropriate circumstances the
First Amendment would not preclude a prior restraint of publication of
information that might result in a sufficient degree of harm to the
national interest, although a different majority concurred in denying
the Government's request for an injunction in that case.\1560\
\1559\403 U.S. 713 (1971).
\1560\The result in the case was reached by a six-to-three
majority. The three dissenters, Chief Justice Burger, id., 748, Justice
Harlan, id., 752, and Justice Blackmun, id., 759, would have granted an
injunction in the case; Justices Stewart and White, id., 727, 730, would
not in that case but could conceive of cases in which they would.
---------------------------------------------------------------------------
Enemy Aliens.--The Alien Enemy Act of 1798 authorized the
President to deport any alien or to license him to reside within the
United States at any place to be designated by the President.\1561\
Though critical of the measure, many persons conceded its con
[[Page 329]]
stitutionality on the theory that Congress' power to declare war carried
with it the power to treat the citizens of a foreign power against which
war has been declared as enemies entitled to summary justice.\1562\ A
similar statute was enacted during World War I\1563\ and was held valid
in Ludecke v. Watkins.\1564\
\1561\1 Stat. 577 (1798).
\1562\6 Writing of James Madison, G. Hunt ed. (New York: 1904),
360-361.
\1563\40 Stat. 531 (1918), 50 U.S.C. Sec. 21.
\1564\335 U.S. 160 (1948).
---------------------------------------------------------------------------
During World War II, the Court unanimously upheld the power of
the President to order to trial before a military tribunal German
saboteurs captured within this Country.\1565\ Enemy combatants, said
Chief Justice Stone, who without uniforms come secretly through the
lines during time of war, for the purpose of committing hostile acts,
are not entitled to the status of prisoners of war but are unlawful
combatants punishable by military tribunals.
\1565\Ex parte Quirin, 317 U.S. 1 (1942).
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Eminent Domain.--An often-cited dictum uttered shortly after the
Mexican War asserted the right of an owner to compensation for property
destroyed to prevent its falling into the hands of the enemy, or for
that taken for public use.\1566\ In United States v. Russell,\1567\
decided following the Civil War, a similar conclusion was based squarely
on the Fifth Amendment, although the case did not necessarily involve
the point. Finally, in United States v. Pacific Railroad,\1568\ also a
Civil War case, the Court held that the United States was not
responsible for the injury or destruction of private property by
military operations, but added that it did not have in mind claims for
property of loyal citizens taken for the use of the national forces.
``In such cases,'' the Court said, ``it has been the practice of the
government to make compensation for the property taken. . . . although
the seizure and appropriation of private property under such
circumstances by the military authorities may not be within the terms of
the constitutional clauses.''\1569\
\1566\Mitchell v. Harmony, 13 How. (54 U.S.) 115, 134 (1852).
\1567\13 Wall. (80 U.S.) 623, 627 (1871).
\1568\120 U.S. 227 (1887).
\1569\Id., 239.
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Meantime, however, in 1874, a committee of the House of
Representatives, in an elaborate report on war claims growing out of the
Civil War, had voiced the opinion that the Fifth Amendment embodies the
distinction between a taking of property in the course of military
operations or other urgent military necessity, and other takings for war
purposes, and required compensation of owners in the latter class of
cases.\1570\ In determining what constitutes just compensation for
property requisitioned for war purposes during
[[Page 330]]
World War II, the Court has assumed that the Fifth Amendment is
applicable to such takings.\1571\ But as to property seized and
destroyed to prevent its use by the enemy, it has relied on the
principle enunciated in United States v. Pacific Railroad as
justification for the conclusion that owners thereof are not entitled to
compensation.\1572\
\1570\H.R. Rept. No. 262, 43d Cong., 1st Sess. (1874), 39-40.
\1571\United States v. Commodities Trading Corp., 339 U.S. 121
(1950); United States v. Toronto Nav. Co., 338 U.S. 396 (1949); Kimball
Laundry Co. v. United States, 338 U.S. 1 (1949); United States v. Cors,
337 U.S. 325 (1949); United States v. Felin & Co., 334 U.S. 624 (1948);
United States v. Petty Motor Co., 327 U.S. 372 (1946); United States v.
General Motors Corp., 323 U.S. 373 (1945).
\1572\United States v. Caltex, Inc., 344 U.S. 149, 154 (1952).
Justices Douglas and Black dissented.
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Rent and Price Controls.--Even at a time when the Court was
utilizing substantive due process to void economic regulations, it
generally sustained such regulations in wartime. Thus, shortly following
the end of World War I, it sustained, by a narrow margin, a rent control
law for the District of Columbia, which not only limited permissible
rent increases but also permitted existing tenants to continue in
occupancy provided they paid rent and observed other stipulated
conditions.\1573\ Justice Holmes for the majority conceded in effect
that in the absence of a war emergency the legislation might transcend
constitutional limitations\1574\ but noted that ``a public exigency will
justify the legislature in restricting property rights in land to a
certain extent without compensation.''\1575\
\1573\Block v. Hirsh, 256 U.S. 135 (1921).
\1574\But quaere in the light of Nebbia v. New York, 291 U.S.
502 (1934), Olsen v. Nebraska ex rel. Western Reference and Bond
Association, 313 U.S. 236 (1941), and their progeny.
\1575\Block v. Hirsh, 256 U.S. 135, 156 (1921).
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During World War II and thereafter, economic controls were
uniformly sustained.\1576\ An apartment house owner who complained that
he was not allowed a ``fair return'' on the property was dismissed with
the observation that ``a nation which can demand the lives of its men
and women in the waging of . . . war is under no constitutional
necessity of providing a system of price control . . . which will assure
each landlord a `fair return' on his property.''\1577\ The Court also
held that rental ceilings could be established without a prior hearing
when the exigencies of national security precluded the delay which would
ensue.\1578\
\1576\Yakus v. United States, 321 U.S. 414 (1944); Bowles v.
Willingham, 321 U.S. 503 (1944); Lockerty v. Phillips, 319 U.S. 182
(1943); Fleming v. Mohawk Wrecking & Lumber Co., 331 U.S. 111 (1947);
Lichter v. United States, 334 U.S. 742 (1948).
\1577\Bowles v. Willingham, 321 U.S. 503, 519 (1944).
\1578\Id., 521. The Court stressed, however, that Congress had
provided for judicial review after the regulations and orders were made
effective.
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[[Page 331]]
But in another World War I case, the Court struck down a statute
which penalized the making of ``any unjust or unreasonable rate or
charge in handling . . . any necessaries''\1579\ as repugnant to the
Fifth and Sixth Amendments in that it was so vague and indefinite that
it denied due process and failed to give adequate notice of what acts
would violate it.\1580\
\1579\Act of October 22, 1919, 2, 41 Stat. 297.
\1580\United States v. L. Cohen Grocery Co., 255 U.S. 81 (1921).
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Cls. 15 and 16--Power over the Militia
Clause 15. The Congress shall have Power * * * To provide for calling
forth the Militia to execute the Laws of the Union, suppress
Insurrections and repel Invasions.
Clause 16. The Congress shall have Power * * * To provide for
organizing, arming, and disciplining, the Militia, and for governing
such Part of them as may be employed in the Service of the United
States, reserving to the States respectively, the Appointment of the
Officers, and the Authority of training the Militi according to the
discipline prescribed by Congress.
THE MILITIA CLAUSE
Calling Out the Militia
The States as well as Congress may prescribe penalties for
failure to obey the President's call of the militia. They also have a
concurrent power to aid the National Government by calls under their own
authority, and in emergencies may use the militia to put down armed
insurrection.\1581\ The Federal Government may call out the militia in
case of civil war; its authority to suppress rebellion is found in the
power to suppress insurrection and to carry on war.\1582\ The act of
February 28, 1795,\1583\ which delegated to the President the power to
call out the militia, was held constitutional.\1584\ A militiaman who
refused to obey such a call was not ``employed in the service of the
United States so as to be subject
[[Page 332]]
to the article of war,'' but was liable to be tried for disobedience of
the act of 1795.\1585\
\1581\Moore v. Houston, 3 S. & R. (Pa.) 169 (1817), affirmed,
Houston v. Moore, 5 Wheat. (18 U.S.) 1 (1820).
\1582\Texas v. White, 7 Wall. (74 U.S.) 700 (1869); Tyler v.
Defrees, 11 Wall. (78 U.S.) 331 (1871).
\1583\1 Stat. 424 (1795), 10 U.S.C. Sec. 332.
\1584\Martin v. Mott, 12 Wheat. (25 U.S.) 19, 32 (1827).
\1585\Houston v. Moore, 5 Wheat. (18 U.S.) 1 (1820); Martin v.
Mott, 12 Wheat. (25 U.S.) 19 (1827).
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Regulation of the Militia
The power of Congress over the militia ``being unlimited, except
in the two particulars of officering and training them . . . it may be
exercised to any extent that may be deemed necessary by Congress. . . .
The power of the state government to legislate on the same subjects,
having existed prior to the formation of the Constitution, and not
having been prohibited by that instrument, it remains with the States,
subordinate nevertheless to the paramount law of the General Government
. . .''\1586\ Under the National Defense Act of 1916,\1587\ the militia,
which hitherto had been an almost purely state institution, was brought
under the control of the National Government. The term ``militia of the
United States'' was defined to comprehend ``all able-bodied male
citizens of the United States and all other able-bodied males who have
. . . declared their intention to become citizens of the United
States,'' between the ages of eighteen and forty-five. The act
reorganized the National Guard, determined its size in proportion to the
population of the several States, required that all enlistments be for
``three years in service and three years in reserve,'' limited the
appointment of officers to those who ``shall have successfully passed
such tests as to . . . physical, moral and professional fitness as the
President shall prescribe,'' and authorized the President in certain
emergencies to ``draft into the military service of the United States to
serve therein for the period of the war unless sooner discharged, and
all members of the National Guard and National Guard Reserve,'' who
thereupon should ``stand discharged from the militia.''\1588\
\1586\Houston v. Moore, 5 Wheat. (18 U.S.) 1, 16 (1820).
Organizing and providing for the militia being constitutionally
committed to Congress and statutorily shared with the Executive, the
judiciary is precluded from exercising oversight over the process,
Gilligan v. Morgan, 413 U.S. 1 (1973), although wrongs committed by
troops are subject to judicial relief in damages. Scheuer v. Rhodes, 416
U.S. 233 (1974).
\1587\39 Stat. 166, 197, 198, 200, 202, 211 (1916), codified in
sections of Titles 10 & 32. See Wiener, The Militia Clause of the
Constitution, 54 Harv. L. Rev. 181 (1940).
\1588\Military and civilian personnel of the National Guard are
state, rather than federal, employees and the Federal Government is thus
not liable under the Tort Claims Act for their negligence. Maryland v.
United States, 381 U.S. 41 (1965).
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The militia clauses do not constrain Congress in raising and
supporting a national army. The Court has approved the system of ``dual
enlistment,'' under which persons enlisted in state militia (National
Guard) units simultaneously enlist in the National
[[Page 333]]
Guard of the United States, and, when called to active duty in the
federal service, are relieved of their status in the state militia.
Consequently, the restrictions in the first militia clause have no
application to the federalized National Guard; there is no
constitutional requirement that state governors hold a veto power over
federal duty training conducted outside the United States or that a
national emergency be declared before such training may take
place.\1589\
\1589\Perpich v. Department of Defense, 496 U.S. 434 (1990).
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Clause 17. Congress shall have power * * * To exercise exclusive
Legislation in all Cases whatsoever, over such District (not exceeding
ten Miles square) as may, by Cession of particular States, and the
Acceptance of Congress, become the Seat of Government of the United
States, and to exercise like Authority over all Places purchased by the
Consent of the Legislature of the State in which the same shall be, for
the Erection of Forts, Magazines, Arsenals, dock-Yards, and other
needful Buildings.
SEAT OF THE GOVERNMENT
The Convention was moved to provide for the creation of a site
in which to locate the Capital of the Nation, completely removed from
the control of any State, because of the humiliation suffered by the
Continental Congress on June 21, 1783. Some eighty soldiers, unpaid and
weary, marched on the Congress sitting in Philadelphia, physically
threatened and verbally abused the members, and caused the Congress to
flee the City when neither municipal nor state authorities would take
action to protect the members.\1590\ Thus, Madison noted that ``[t]he
indispensable necessity of complete authority at the seat of government,
carries its own evidence with it. . . . Without it, not only the public
authority might be insulted and its proceedings interrupted with
impunity, but a dependence of the members of the general government on
the State comprehending the seat of government, for protection in the
exercise of their duty, might bring on the national council an imputa
[[Page 334]]
tion of awe or influence, equally dishonorable to the government and
dissatisfactory to the other members of the confederacy.''\1591\
\1590\J. Fiske, The Critical Period of American History, 1783-
1789 (Boston: 1888), 112-113; W. Tindall, The Origin and Government of
the District of Columbia (Washington: 1903), 31-36.
\1591\The Federalist, No. 43 (J. Cooke ed. 1961), 288-289. See
also 3 J. Story, Commentaries on the Constitution of the United States
(Boston: 1833), 1213, 1214.
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The actual site was selected by compromise, Northerners
accepting the Southern-favored site on the Potomac in return for
Southern support for a Northern aspiration, assumption of Revolutionary
War debts by the National Government.\1592\ Maryland and Virginia both
authorized the cession of territory\1593\ and Congress accepted.\1594\
Congress divided the District into two counties, Washington and
Alexandria, and provided that the local laws of the two States should
continue in effect.\1595\ It also established a circuit court and
provided for the appointment of judicial and law enforcement
officials.\1596\
\1592\W. Tindall, The Origin and Government of the District of
Columbia (Washington: 1903), 5-30.
\1593\Maryland Laws 1798, ch. 2, p. 46; 13 Laws of Virginia 43
(Hening 1789).
\1594\Act of July 16, 1790, 1 Stat. 130. In 1846, Congress
authorized a referendum in Alexandria County on the question of
retroceding that portion to Virginia. The voters approved and the area
again became part of Virginia. Laws of Virginia 1845-46, ch. 64, p. 50;
Act of July 9, 1846, 9 Stat. 35; Proclamation of September 7, 1846; 9
Stat. 1000. Constitutional questions were raised about the retrocession
but suit did not reach the Supreme Court until some 40 years later and
the Court held that the passage of time precluded the raising of the
question. Phillips v. Payne, 92 U.S. 130 (1875).
\1595\Act of February 27, 1801, 2, 2 Stat. 103. The declaration
of the continuing effect of state law meant that law in the District was
frozen as of the date of cession, unless Congress should change it,
which it seldom did. For some of the problems, see Tayloe v. Thompson, 5
Pet. (30 U.S.) 358 (1831); Ex parte Watkins, 7 Pet. (32 U.S.) 568
(1833); Stelle v. Carroll, 12 Pet. (37 U.S.) 201 (1838); Van Ness v.
United States Bank, 13 Pet. (38 U.S.) 17 (1839); United States v.
Eliason, 16 Pet. (41 U.S.) 291 (1842).
\1596\Act of March 3, 1801, 1, 2 Stat. 115.
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There seems to have been no consideration, at least none
recorded, given at the Convention or in the ratifying conventions to the
question of the governance of the citizens of the District.\1597\
Madison in The Federalist did assume that the inhabitants ``will have
had their voice in the election of the government which is to exercise
authority over them, as a municipal legislature for all local purposes,
derived from their own suffrages, will of course be allowed them.
. . .''\1598\ Although there was some dispute about the constitutional
propriety of permitting local residents a measure of ``home rule,'' to
use the recent term,\1599\ almost from the first there
[[Page 335]]
were local elections provided for. In 1802, the District was divided
into five divisions, in some of which the governing officials were
elected; an elected mayor was provided in 1820. District residents
elected some of those who governed them until this form of government
was swept away in the aftermath of financial scandals in 1874\1600\ and
replaced with presidentially appointed Commission in 1878.\1601\ The
Commission lasted until 1967 when it was replaced by an appointed Mayor-
Commissioner and an appointed city council.\1602\ In recent years,
Congress provided for a limited form of self-government in the District,
with the major offices filled by election.\1603\ District residents vote
for President and Vice President\1604\ and elect a nonvoting delegate to
Congress.\1605\ An effort by constitutional amendment to confer voting
representation in the House and Senate failed of ratification.\1606\
\1597\The objections raised in the ratifying conventions and
elsewhere seemed to have consisted of prediction of the perils to the
Nation of setting up the National Government in such a place. 3 J.
Story, Commentaries on the Constitution of the United States (Boston:
1833), 1215, 1216.
\1598\The Federalist, No. 43 (J. Cooke ed. 1961), 289.
\1599\Such a contention was cited and rebutted in 3 J. Story,
Commentaries on the Constitution of the United States (Boston: 1833),
1218.
\1600\Act of May 3, 1802, 2 Stat. 195; Act of May 15, 1820, 3
Stat. 583; Act of February 21, 1871, 16 Stat. 419; Act of June 20, 1874,
18 Stat. 116. The engrossing story of the postwar changes in the
government is related in W. Whyte, The Uncivil War: Washington During
the Reconstruction (Washington: 1958).
\1601\Act of June 11, 1878, 20 Stat. 103.
\1602\Reorganization Plan No. 3 of 1967, 32 Fed. Reg. 11699,
reprinted as appendix to District of Columbia Code, Title I.
\1603\District of Columbia Self-Government and Governmental
Reorganization Act, P.L. 93-198, 87 Stat. 774.
\1604\Twenty-third Amendment.
\1605\P.L. 91-405, 84 Stat. 848, D.C. Code, Sec. 1-291.
\1606\H.J. Res. 554, 95th Congress, passed the House on March 2,
1978, and the Senate on August 22, 1978, but only 16 States had ratified
before the expiration after seven years of the proposal.
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Constitutionally, it appears that Congress is neither required
to provide for a locally elected government\1607\ nor precluded from
delegating its powers over the District to an elective local
government.\1608\ The Court has indicated that the ``exclusive''
jurisdiction granted was meant to exclude any question of state power
over the area and was not intended to require Congress to exercise all
powers itself.\1609\
\1607\Loughborough v. Blake, 5 Wheat. (18 U.S.) 317 (1820);
Heald v. District of Columbia, 259 U.S. 114 (1922).
\1608\District of Columbia v. John R. Thompson Co., 346 U.S. 100
(1953). The case upheld the validity of ordinances enacted by the
District governing bodies in 1872 and 1873 prohibiting racial
discrimination in places of public accommodations.
\1609\Id., 109-110. See also Thompson v. Lessee of Carroll, 22
How. (63 U.S.) 422 (1860); Stoutenburgh v. Hennick, 129 U.S. 141 (1889).
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Chief Justice Marshall for the Court held in Hepburn v.
Ellzey\1610\ that the District of Columbia was not a State within the
meaning of the diversity jurisdiction clause of Article III. This
[[Page 336]]
view, adhered to for nearly a century and a half,\1611\ was overturned
by the Court in 1949 upholding the constitutionality of a 1940 statute
authorizing federal courts to take jurisdiction of nonfederal
controversies between residents of the District of Columbia and the
citizens of a State.\1612\ The decision was by a five to four division,
but the five in the majority disagreed among themselves on the reasons.
Three thought the statute to be an appropriate exercise of the power of
Congress to legislate for the District of Columbia pursuant to this
clause without regard to Article III.\1613\ Two others thought that
Hepburn v. Ellzey had been erroneously decided and would have overruled
it.\1614\ But six Justices rejected the former rationale, and seven
Justices rejected the latter one; since five Justices agreed, however,
that the statute was constitutional, it was sustained.
\1610\2 Cr. (6 U.S.) 445 (1805); see also Sere v. Pitot, 6 Cf.
(10 U.S.) 332 (1810); New Orleans v. Winter, 1 Wheat. (14 U.S.) 91
(1816). The District was held to be a State within the terms of a
treaty. Geofroy v. Riggs, 133 U.S. 258 (1890).
\1611\Barney v. City of Baltimore, 6 Wall. (73 U.S.) 280 (1868);
Hooe v. Jamieson, 166 U.S. 395 (1897); Hooe v. Werner, 166 U.S. 399
(1897).
\1612\National Mutual Ins. Co. v. Tidewater Transfer Co., 337
U.S. 582 (1949).
\1613\Id., 588-600 (Justices Jackson, Black and Burton).
\1614\Id., 604 (Justices Rutledge and Murphy). The dissents were
by Chief Justice Vinson, id., 626, joined by Justice Douglas, and by
Justice Frankfurter, id., 646, joined by Justice Reed.
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It is not disputed that the District is a part of the United
States and that its residents are entitled to all the guarantees of the
United States Constitution including the privilege of trial by
jury\1615\ and of presentment by a grand jury.\1616\ Legislation
restrictive of liberty and property in the District must find
justification in facts adequate to support like legislation by a State
in the exercise of its police power.\1617\
\1615\Callan v. Wilson, 127 U.S. 540 (1888); Capital Traction
Co. v. Hof, 174 U.S. 1 (1899).
\1616\United States v. Moreland, 258 U.S. 433 (1922).
\1617\Wright v. Davidson, 181 U.S. 371, 384 (1901); cf. Adkins
v. Children's Hospital, 261 U.S. 525 (1923), overruled in West Coast
Hotel Co. v. Parrish, 300 U.S. 379 (1937).
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Congress possesses over the District of Columbia the blended
powers of a local and national legislature.\1618\ This fact means that
in some respects ordinary constitutional restrictions do not operate;
thus, for example, in creating local courts of local jurisdiction in the
District, Congress acts pursuant to its legislative powers under clause
17 and need not create courts that comply that Article III court
requirements.\1619\ And when legislating for the District Con
[[Page 337]]
gress remains the legislature of the Union, so that it may give its
enactments nationwide operation to the extent necessary to make them
locally effective.\1620\
\1618\Kendall v. United States ex rel. Stokes, 12 Pet. (37 U.S.)
524, 619 (1838): Shoemaker v. United States, 147 U.S. 282, 300 (1893);
Atlantic Cleaners & Dyers v. United States, 286 U.S. 427, 435 (1932);
O'Donoghue v. United States, 289 U.S. 516, 518 (1933).
\1619\In the District of Columbia Court Reform and Criminal
Procedure Act of 1970, P.L. 91-358, 111, 84 Stat. 475, D.C. Code,
Sec. 11-101, Congress specifically declared it was acting pursuant to
Article I in creating the Superior Court and the District of Columbia
Court of Appeals and pursuant to Article III in continuing the United
States District Court and the United States Court of Appeals for the
District of Columbia. The Article I courts were sustained in Palmore v.
United States, 411 U.S. 389 (1973). See also Swain v. Pressley, 430 U.S.
372 (1977). The latter, federal courts, while Article III courts,
traditionally have had some non-Article III functions imposed on them,
under the ``hybrid'' theory announced in O'Donoghue v. United States,
289 U.S. 516 (1933). E.g., Hobson v. Hansen, 265 F. Supp. 902 (D.C.D.C.
1967), app. dismd., 393 U.S. 801 (1968) (power then vested in District
Court to appoint school board members). See also Keller v. Potomac
Electric Co., 261 U.S. 428 (1923); Embry v. Palmer, 107 U.S. 3 (1883).
\1620\Cohens v. Virginia, 6 Wheat. (19 U.S.) 264, 428 (1821).
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AUTHORITY OVER PLACES PURCHASED
``Places''
This clause has been broadly construed to cover all structures
necessary for carrying on the business of the National Government.\1621\
It includes post offices,\1622\ a hospital and a hotel located in a
national park,\1623\ and locks and dams for the improvement of
navigation.\1624\ But it does not cover lands acquired for forests,
parks, ranges, wild life sanctuaries or flood control.\1625\
Nevertheless, the Supreme Court has held that a State may convey, and
the Congress may accept, either exclusive or qualified jurisdiction over
property acquired within the geographical limits of a State, for
purposes other than those enumerated in clause 17.\1626\
\1621\James v. Dravo Contracting Co., 302 U.S. 134, 143 (1937).
\1622\Battle v. United States, 209 U.S. 36 (1908).
\1623\Arlington Hotel v. Fant, 278 U.S. 439 (1929).
\1624\James v. Dravo Contracting Co., 302 U.S. 134, 143 (1937).
\1625\Collins v. Yosemite Park Co., 304 U.S. 518, 530 (1938).
\1626\Id., 528.
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After exclusive jurisdiction over lands within a State has been
ceded to the United States, Congress alone has the power to punish
crimes committed within the ceded territory.\1627\ Private property
located thereon is not subject to taxation by the State,\1628\ nor can
state statutes enacted subsequent to the transfer have any operation
therein.\1629\ But the local laws in force at the date of cession that
are protective of private rights continue in force until abro
[[Page 338]]
gated by Congress.\1630\ Moreover, as long as there is no interference
with the exclusive jurisdiction of the United States, an area subject
thereto may be annexed by a municipality.\1631\
\1627\Battle v. United States, 209 U.S. 36 (1908); Johnson v.
Yellow Cab Co., 321 U.S. 383 (1944); Bowen v. Johnston, 306 U.S. 19
(1939).
\1628\Surplus Trading Co. v. Cook, 281 U.S. 647 (1930).
\1629\Western Union Telegraph Co. v. Chiles, 214 U.S. 274
(1909); Arlington Hotel v. Fant, 278 U.S. 439 (1929); Pacific Coast
Dairy v. Department of Agriculture, 318 U.S. 285 (1943). The
Assimilative Crimes Act of 1948, 18 U.S.C. Sec. 13, making applicable to
a federal enclave a subsequently enacted criminal law of the State in
which the enclave is situated entails no invalid delegation of
legislative power to the State. United States v. Sharpnack, 355 U.S.
286, 294, 296-297 (1958).
\1630\Chicago, R. I. & P. Ry. Co. v. McGlinn, 114 U.S. 542, 545
(1885); Stewart & Co. v. Sadrakula, 309 U.S. 94 (1940).
\1631\Howard v. Commissioners, 344 U.S. 624 (1953). As Howard
recognized, such areas of federal property do not cease to be part of
the State in which they are located and the residents of the areas are
for most purposes residents of the State. Thus, a State may not
constitutionally exclude such residents from the privileges of suffrage
if they are otherwise qualified. Evans v. Cornman, 398 U.S. 419 (1970).
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Duration of Federal Jurisdiction
A State may qualify its cession of territory by a condition that
jurisdiction shall be retained by the United States only so long as the
place is used for specified purposes.\1632\ Such a provision operates
prospectively and does not except from the grant that portion of a
described tract which is then used as a railroad right of way.\1633\ In
1892, the Court upheld the jurisdiction of the United States to try a
person charged with murder on a military reservation, over the objection
that the State had ceded jurisdiction only over such portions of the
area as were used for military purposes and that the particular place on
which the murder was committed was used solely for farming. The Court
held that the character and purpose of the occupation having been
officially established by the political department of the government, it
was not open to the Court to inquire into the actual uses to which any
portion of the area was temporarily put.\1634\ A few years later,
however, it ruled that the lease to a city, for use as a market, of a
portion of an area which had been ceded to the United States for a
particular purpose, suspended the exclusive jurisdiction of the United
States.\1635\
\1632\Palmer v. Barrett, 162 U.S. 399 (1896).
\1633\United States v. Unzeuta, 281 U.S. 138 (1930).
\1634\Benson v. United States, 146 U.S. 325, 331 (1892).
\1635\Palmer v. Barrett, 162 U.S. 399 (1896).
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The question arose whether the United States retains
jurisdiction over a place, which was ceded to it unconditionally, after
it has abandoned the use of the property for governmental purposes and
entered into a contract for the sale thereof to private persons.
Minnesota asserted the right to tax the equitable interest of the
purchaser in such land, and the Supreme Court upheld its right to do so.
The majority assumed that ``the Government's unrestricted transfer of
property to nonfederal hands is a relinquishment of the exclusive
legislative power.''\1636\ In separate concurring opinions,
[[Page 339]]
Chief Justice Stone and Justice Frankfurter reserved judgment on the
question of territorial jurisdiction.\1637\
\1636\S.R.A., Inc. v. Minnesota, 327 U.S. 558, 564 (1946).
\1637\Id., 570, 571.
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Reservation of Jurisdiction by States
For more than a century the Supreme Court kept alive, by
repeated dicta,\1638\ the doubt expressed by Justice Story ``whether
Congress are by the terms of the Constitution, at liberty to purchase
lands for forts, dockyards, etc., with the consent of a State
legislature, where such consent is so qualified that it will not justify
the `exclusive legislation' of Congress there. It may well be doubted if
such consent be not utterly void.''\1639\ But when the issue was
squarely presented in 1937, the Court ruled that where the United States
purchases property within a State with the consent of the latter, it is
valid for the State to convey, and for the United States to accept,
``concurrent jurisdiction'' over such land, the State reserving to
itself the right to execute process ``and such other jurisdiction and
authority over the same as is not inconsistent with the jurisdiction
ceded to the United States.''\1640\ The holding logically renders the
second half of clause 17 superfluous. In a companion case, the Court
ruled further that even if a general state statute purports to cede
exclusive jurisdiction, such jurisdiction does not pass unless the
United States accepts it.\1641\
\1638\Fort Leavenworth R.R. Co. v. Lowe, 114 U.S. 525, 532
(1885); United States v. Unzeuta, 281 U.S. 138, 142 (1930); Surplus
Trading Co. v. Cook, 281 U.S. 647, 652 (1930).
\1639\United States v. Cornell, 25 Fed. Cas. 646, 649 (No.
14,867) (C.C.D.R.I. 1819).
\1640\James v. Dravo Contracting Co., 302 U.S. 134, 145 (1937).
\1641\Mason Co. v. Tax Comm. 302 U.S. 186 (1937). See also
Atkinson v. Tax Comm., 303 U.S. 20 (1938).
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Clause 18. The Congress shall have Power * * * To make all Laws which
shall be necessary and proper for carrying into Execution the foregoing
Powers, and all other Powers vested by the Constitution in the
Government of the United States, or in any Department or Officer
thereof.
COEFFICIENT OR ELASTIC CLAUSE
Scope of Incidental Powers
That this clause is an enlargement, not a constriction, of the
powers expressly granted to Congress, that it enables the lawmakers to
select any means reasonably adapted to effectuate those
[[Page 340]]
powers, was established by Marshall's classic opinion in McCulloch v.
Maryland.\1642\ ``Let the end be legitimate,'' he wrote, ``let it be
within the scope of the Constitution, and all means which are
appropriate, which are plainly adapted to that end, which are not
prohibited, but consistent with the letter and spirit of the
Constitution, are constitutional.''\1643\ Moreover, the provision gives
Congress a share in the responsibilities lodged in other departments, by
virtue of its right to enact legislation necessary to carry into
execution all powers vested in the National Government. Conversely,
where necessary for the efficient execution of its own powers, Congress
may delegate some measure of legislative power to other
departments.\1644\
\1642\4 Wheat. (17 U.S.) 316 (1819).
\1643\Id., 420. This decision had been clearly foreshadowed
fourteen years earlier by Marshall's opinion in United States v. Fisher,
2 Cr. (6 U.S.) 358, 396 (1805). Upholding an act which gave priority to
claims of the United States against the estate of a bankrupt he wrote:
``The government is to pay the debt of the Union, and must be authorized
to use the means which appear to itself most eligible to effect that
object. It has, consequently, a right to make remittance, by bills or
otherwise, and to take those precautions which will render the
transaction safe.''
\1644\Supra, pp. 73-89.
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Operation of Coefficient Clause
Practically every power of the National Government has been
expanded in some degree by the coefficient clause. Under its authority
Congress has adopted measures requisite to discharge the treaty
obligations of the nation;\1645\ it has organized the federal judicial
system and has enacted a large body of law defining and punishing
crimes. Effective control of the national economy has been made possible
by the authority to regulate the internal commerce of a State to the
extent necessary to protect and promote interstate commerce.\1646\ The
right of Congress to utilize all known and appropriate means for
collecting the revenue, including the distraint of property for federal
taxes,\1647\ and its power to acquire property needed for the operation
of the Government by the exercise of the power of eminent domain,\1648\
have greatly extended the range of national power. But the widest
application of the necessary and proper clause has occurred in the field
of monetary and fiscal controls. Inasmuch as the various specific powers
granted by Article I, Sec. 8, do not add up to a general legislative
power over such matters, the Court has relied heavily upon this clause
in sustaining
[[Page 341]]
the comprehensive control which Congress has asserted over this
subject.\1649\
\1645\Neely v. Henkel, 180 U.S. 109, 121 (1901). See also
Missouri v. Holland, 252 U.S. 416 (1920).
\1646\Supra, pp. 165-167, 203-209.
\1647\Murray's Lessee v. Hoboken Land & Improvement Co., 18 How.
(59 U.S. 272, 281 (1856).
\1648\Kohl v. United States, 91 U.S. 367, 373 (1876); United
States v. Fox, 94 U.S. 315, 320 (1877).
\1649\Supra., pp. 144-159.
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Definition of Punishment and Crimes
Although the only crimes which Congress is expressly authorized
to punish are piracies, felonies on the high seas, offenses against the
law of nations, treason and counterfeiting of the securities and current
coin of the United States, its power to create, define, and punish
crimes and offenses whenever necessary to effectuate the objects of the
Federal Government is universally conceded.\1650\ Illustrative of the
offenses which have been punished under this power are the alteration of
registered bonds,\1651\ the bringing of counterfeit bonds into the
country,\1652\ conspiracy to injure prisoners in custody of a United
States marshal,\1653\ impersonation of a federal officer with intent to
defraud,\1654\ conspiracy to injure a citizen in the free exercise or
enjoyment of any right or privilege secured by the Constitution or laws
of the United States,\1655\ the receipt by Government officials of
contributions from Government employees for political purposes,\1656\
advocating the overthrow of the Government by force.\1657\ Part I of
Title 18 of the United States Code comprises more than 500 sections
defining penal offenses against the United States.\1658\
\1650\United States v. Fox, 95 U.S. 670, 672 (1978); United
States v. Hall, 98 U.S. 343, 357 (1879); United States v. Worrall, 2
Dall. (2 U.S.) 384, 394 (1798); McCulloch v. Maryland, 4 Wheat. (17
U.S.) 316 (1819). That this power has been freely exercised is attested
by the pages of the United States Code devoted to Title 18, entitled
``Criminal Code and Criminal Procedure.'' In addition numerous
regulatory measures prescribe criminal penalties for infractions
thereof.
\1651\Ex parte Carll, 106 U.S. 521 (1883).
\1652\United States v. Marigold, 9 How. (50 U.S.) 560, 567
(1850).
\1653\Logan v. United States, 144 U.S. 263 (1892).
\1654\United States v. Barnow, 239 U.S. 74 (1915).
\1655\Ex parte Yarbrough, 110 U.S. 651 (1884); United States v.
Waddell, 112 U.S. 76 (1884); In re Quarles and Butler, 158 U.S. 532, 537
(1895); Motes v. United States, 178 U.S. 458, (1900); United States v.
Mosley, 238 U.S. 383 (1915). See also Rakes v. United States, 212 U.S.
55 (1909).
\1656\Ex parte Curtis, 106 U.S. 371 (1882).
\1657\18 U.S.C. Sec. 2385.
\1658\See National Commission on Reform of Federal Criminal
Laws, Final Report (Washington: 1970); National Commission on Reform of
Federal Criminal Laws, Working Papers (Washington: 1970), 2 vols.
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Chartering of Banks
As an appropriate means for executing ``the great powers, to lay
and collect taxes; to borrow money; to regulate commerce; to declare and
conduct a war; and to raise and support armies . . . ,'' Congress may
incorporate banks and kindred institutions.\1659\
[[Page 342]]
Moreover, it may confer upon them private powers, which, standing alone,
have no relation to the functions of the Federal Government, if those
privileges are essential to the effective operation of such
corporations.\1660\ Where necessary to meet the competition of state
banks, Congress may authorize national banks to perform fiduciary
functions, even though, apart from the competitive situation, federal
instrumentalities might not be permitted to engage in such
business.\1661\ The Court will not undertake to assess the relative
importance of the public and private functions of a financial
institution Congress has seen fit to create. It sustained the act
setting up the Federal Farm Loan Banks to provide funds for mortgage
loans on agricultural land against the contention that the right of the
Secretary of the Treasury, which he had not exercised, to use these
banks as depositories of public funds, was merely a pretext for
chartering those banks for private purposes.\1662\
\1659\McCulloch v. Maryland, 4 Wheat. (17 U.S.) 316, 407 (1819).
\1660\Osborn v. United States Bank, 9 Wheat. (22 U.S.) 738, 862
(1824). See also Pittman v. Home Owners' Corp., 308 U.S. 21 (1939).
\1661\First National Bank v. Follows ex rel. Union Trust Co.,
244 U.S. 416 (1917); Missouri ex rel. Burnes National Bank v. Duncan,
265 U.S. 17 (1924).
\1662\Smith v. Kansas City Title Co., 255 U.S. 180 (1921).
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Currency Regulations
Reinforced by the necessary and proper clause, the powers ```to
lay and collect taxes, to pay the debts and provide for the common
defence and general welfare of the United States,' and `to borrow money
on the credit of the United States and to coin money and regulate the
value thereon . . . ,'''\1663\ have been held to give Congress virtually
complete control over money and currency. A prohibitive tax on the notes
of state banks,\1664\ the issuance of treasury notes impressed with the
quality of legal tender in payment of private debts\1665\ and the
abrogation of clauses in private contracts, which called for payment in
gold coin,\1666\ were sustained as appropriate measures for carrying
into effect some or all of the foregoing powers.
\1663\Legal Tender Cases (Julliard v. Greenman), 110 U.S. 421,
449 (1884).
\1664\Veazie Bank v. Fenno, 8 Wall. (75 U.S.) 533 (1869).
\1665\Legal Tender Cases (Julliard v. Greenman), 110 U.S. 421
(1884). See also Legal Tender Cases (Knox v. Lee), 12 Wall. (79 U.S.)
457 (1871).
\1666\Norman v. B. & O. R. Co., 294 U.S. 240, 303 (1935).
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Power to Charter Corporations
In addition to the creation of banks, Congress has been held to
have authority to charter a railroad corporation,\1667\ or a corporation
to construct an interstate bridge,\1668\ as instrumentalities
[[Page 343]]
for promoting commerce among the States, and to create corporations to
manufacture aircraft\1669\ or merchant vessels\1670\ as incidental to
the war power.
\1667\Pacific Railroad Removal Cases, 115 U.S. 1 (1885);
California v. Pacific Railroad Company, 127 U.S. 1, 39 (1888).
\1668\Luxton v. North River Bridge Co., 153 U.S. 525 (1894).
\1669\Clallam County v. United States, 263 U.S. 341 (1923).
\1670\Sloan Shipyards v. United States Fleet Corp., 258 U.S. 549
(1922).
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Courts and Judicial Proceedings
Inasmuch as the Constitution ``delineated only the great
outlines of the judicial power . . . , leaving the details to Congress,
. . . [t]he distribution and appropriate exercise of the judicial power
must . . . be made by laws passed by Congress. . . .''\1671\ As a
necessary and proper provision for the exercise of the jurisdiction
conferred by Article III, Sec. 2, Congress may direct the removal from a
state to a federal court of a criminal prosecution against a federal
officer for acts done under color of federal law,\1672\ and may
authorize the removal before trial of civil cases arising under the laws
of the United States.\1673\ It may prescribe the effect to be given to
judicial proceedings of the federal courts\1674\ and may make all laws
necessary for carrying into execution the judgments of federal
courts.\1675\ When a territory is admitted as a State, Congress may
designate the court to which the records of the territorial courts shall
be transferred and may prescribe the mode for enforcement and review of
judgments rendered by those courts.\1676\ In the exercise of other
powers conferred by the Constitution, apart from Article III, Congress
may create legislative courts and ``clothe them with functions deemed
essential or helpful in carrying those powers into execution.''\1677\
\1671\Rhode Island v. Massachusetts, 12 Pet. (37 U.S.) 657, 721
(1838).
\1672\Tennessee v. Davis, 100 U.S. 257, 263 (1880).
\1673\Railway Company v. Whitton, 13 Wall. (80 U.S.) 270, 287
(1872).
\1674\Embry v. Palmer, 107 U.S. 3 (1883).
\1675\Bank of the United States v. Halstead, 10 Wheat. (23 U.S.)
51, 53 (1825).
\1676\Express Company v. Kountze Brothers, 8 Wall. (75 U.S.)
342, 350 (1869).
\1677\Ex parte Bakelite Corp., 279 U.S. 438, 449 (1929). But see
Northern Pipeline Const. Co. v. Marathon Pipe Line Co., 458 U.S. 50
(1982).
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Special Acts Concerning Claims
This clause enables Congress to pass special laws to require
other departments of the Government to prosecute or adjudicate
particular claims, whether asserted by the Government itself or by
private persons. In 1924,\1678\ Congress adopted a Joint Resolution
directing the President to cause suit to be instituted for the
cancellation of certain oil leases alleged to have been obtained from
the Government by fraud and to prosecute such other actions and
proceedings, civil and criminal, as were warranted by the facts.
[[Page 344]]
This resolution also authorized the appointment of special counsel to
have charge of such litigation. Private acts providing for a review of
an order for compensation under the Longshoreman's and Harbor Workers'
Compensation Act,\1679\ or conferring jurisdiction upon the Court of
Claims, after it had denied recovery, to hear and determine certain
claims of a contractor against the Government, have been held
constitutional.\1680\
\1678\43 Stat. 5 (1924). See Sinclair v. United States, 279 U.S.
263 (1929).
\1679\Paramino Co. v. Marshall, 309 U.S. 370 (1940).
\1680\Pope v. United States, 323 U.S. 1 (1944).
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Maritime Law
Congress may implement the admiralty and maritime jurisdiction
conferred upon the federal courts by revising and amending the maritime
law that existed at the time the Constitution was adopted, but in so
doing, it cannot go beyond the reach of that jurisdiction.\1681\ This
power cannot be delegated to the States; hence, acts of Congress that
purported to make state workmen's compensation laws applicable to
maritime cases were held unconstitutional.\1682\
\1681\Detroit Trust Co. v. The Thomas Barlum, 293 U.S. 21
(1934).
\1682\Knickerbocker Ice Co. v. Stewart, 253 U.S. 149 (1920);
Washington v. Dawson & Co., 264 U.S. 219 (1924).
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ARTICLE I
LEGISLATIVE DEPARTMENT
Section 9. Clause 1. The Migration or Importation of such Persons as
any of the States now existing shall think proper to admit, shall not be
prohibited by the Congress prior to the Year one thousand eight hundred
and eight, but a Tax or duty may be imposed on such Importation, not
exceeding ten dollars for each Person.
POWERS DENIED TO CONGRESS
General Purpose of Section 9
This section of the Constitution (containing eight clauses
restricting or prohibiting legislation affecting the importation of
slaves, the suspension of the writ of habeas corpus, the enactment of
bills of attainder or ex post facto laws, the levying of taxes on
exports, the granting of preference to ports of one State over another,
the granting of titles of nobility, et cetera) is devoted to restraints
upon the power of Congress and of the National Govern
[[Page 345]]
ment,\1683\ and in no respect affects the States in the regulation of
their domestic affairs.\1684\
\1683\Barron v. Baltimore, 7 Pet. (32 U.S.) 243 (1833); Morgan
v. Louisiana, 118 U.S. 455, 467 (1886).
\1684\Munn v. Illinois, 94 U.S. 113, 135 (1877); Johnson v.
Chicago & Pacific Elevator Co., 119 U.S. 388, 400 (1886).
---------------------------------------------------------------------------
The above clause, which sanctioned the importation of slaves by
the States for twenty years after the adoption of the Constitution, when
considered with the section requiring escaped slaves to be returned to
their masters, Art. IV, Sec. 1, cl. 3, was held by Chief Justice Taney
in Scott v. Sandford,\1685\ to show conclusively that such persons and
their descendants were not embraced within the term ``citizen'' as used
in the Constitution. Today, this ruling is interesting only as an
historical curiosity.
\1685\19 How. (60 U.S.) 393, 411 (1857).
---------------------------------------------------------------------------
Clause 2. The Privilege of the Writ of Habeas Corpus shall not be
suspended, unless when in Cases of Rebellion or Invasion the public
Safety may require it.
This clause is the only place in the Constitution in which the
Great Writ is mentioned, a strange fact in the context of the regard
with which the right was held at the time the Constitution was
written\1686\ and stranger in the context of the role the right has come
to play in the Supreme Court's efforts to constitutionalize federal and
state criminal procedure.\1687\
\1686\R. Walker, The American Reception of the Writ of Liberty
(Norman, Okla.: 1961).
\1687\Infra, discussion under Article III.
---------------------------------------------------------------------------
Only the Federal Government and not the States, it has been held
obliquely, is limited by the clause.\1688\ The issue that has always
excited critical attention is the authority in which the clause places
the power to determine whether the circumstances warrant suspension of
the privilege of the Writ.\1689\ The clause itself does
[[Page 346]]
not specify, and while most of the clauses of 9 are directed at Congress
not all of them are.\1690\ At the Convention, the first proposal of a
suspending authority expressly vested ``in the legislature'' the
suspending power,\1691\ but the author of this proposal did not retain
this language when the matter was taken up,\1692\ the present language
then being adopted.\1693\ Nevertheless, Congress' power to suspend was
assumed in early commentary\1694\ and stated in dictum by the
Court.\1695\ President Lincoln suspended the privilege on his own motion
in the early Civil War period,\1696\ but this met with such
opposition\1697\ that he sought and received congressional
authorization.\1698\ Three other suspensions were subsequently ordered
on the basis of more or less express authorizations from Congress.\1699\
\1688\Gasquet v. Lapeyre, 242 U.S. 367, 369 (1917).
\1689\In form, of course, clause 2 is a limitation of power, not
a grant of power, and is in addition placed in a section of limitations.
It might be argued, therefore, that the power to suspend lies elsewhere
and that this clause limits that authority. This argument is opposed by
the little authority there is on the subject. 3 M. Farrand, The Records
of the Federal Convention of 1787 (New Haven: 1937), 213 (Luther
Martin); Ex parte Merryman, 17 Fed. Cas. 144, 148 (No. 9487), (C.C.D.
Md. 1861); but cf. 3 J. Elliot, The Debates in the Several State
Conventions on the Adoption of the Federal Constitution (Washington: 2d
ed. 1836), 464 (Edmund Randolph). At the Convention, Gouverneur Morris
proposed the language of the present clause: the first section of the
clause, down to ``unless'' was adopted unanimously, but the second part,
qualifying the prohibition on suspension was adopted over the opposition
of three States. 2 M. Farrand, op. cit., 438. It would hardly have been
meaningful for those States opposing any power to suspend to vote
against this language if the power to suspend were conferred elsewhere.
\1690\Cf. Clauses 7, 8.
\1691\2 M. Farrand, The Records of the Federal Convention of
1787 (New Haven: rev. ed. 1937), 341.
\1692\Id., 438.
\1693\Ibid.
\1694\3 J. Story, Commentaries on the Constitution of the United
States (Boston: 1833), 1336.
\1695\Ex parte Bollman, 4 Cr. (8 U.S.) 75, 101 (1807).
\1696\Cf. J. Randall, Constitutional Problems Under Lincoln
(Urbana: rev. ed. 1951), 118-139.
\1697\Including a finding by Chief Justice Taney on circuit that
the President's action was invalid. Ex parte Merryman, 17 Fed. Cas. 144
(No. 9487) (C.C.D. Md. 1861).
\1698\Act of March 3, 1863, 1, 12 Stat. 755. See Sellery,
Lincoln's Suspension of Habeas Corpus as Viewed by Congress, 1 U. Wis.
History Bull. 213 (1907).
\1699\The privilege of the Writ was suspended in nine counties
in South Carolina in order to combat the Ku Klux Klan, pursuant to Act
of April 20, 1871, 4, 17 Stat. 14. It was suspended in the Philippines
in 1905, pursuant to the Act of July 1, 1902, 5, 32 Stat. 692. Cf.
Fisher v. Baker, 203 U.S. 174 (1906). Finally, it was suspended in
Hawaii during World War II, pursuant to a section of the Hawaiian
Organic Act, 67, 31 Stat. 153 (1900). Cf. Duncan v. Kahanamoku, 327 U.S.
304 (1946). For the problem of de facto suspension through manipulation
of the jurisdiction of the federal courts, see infra, discussion under
Article III.
---------------------------------------------------------------------------
When suspension operates, what is suspended? In Ex parte
Milligan,\1700\ the Court asserted that the Writ is not suspended but
only the privilege, so that the Writ would issue and the issuing court
on its return would determine whether the person applying can proceed,
thereby passing on the constitutionality of the suspension and whether
the petitioner is within the terms of the suspension.
\1700\4 Wall. (71 U.S.) 2, 130-131 (1866).
---------------------------------------------------------------------------
Clause 3. No Bill of Attainder or ex post facto Law shall be passed.
[[Page 347]]
Bills of Attainder
``Bills of attainder . . . are such special acts of the
legislature, as inflict capital punishments upon persons supposed to be
guilty of high offences, such as treason and felony, without any
conviction in the ordinary course of judicial proceedings. If an act
inflicts a milder degree of punishment than death, it is called a bill
of pains and penalties. . . . In such cases, the legislature assumes
judicial magistracy, pronouncing upon the guilt of the party without any
of the common forms and guards of trial, and satisfying itself with
proofs, when such proofs are within its reach, whether they are
conformable to the rules of evidence, or not. In short, in all such
cases, the legislature exercises the highest power of sovereignty, and
what may be properly deemed an irresponsible despotic discretion, being
governed solely by what it deems political necessity or expediency, and
too often under the influence of unreasonable fears, or unfounded
suspicions.''\1701\ The phrase ``bill of attainder,'' as used in this
clause and in clause 1 of Sec. 10, applies to bills of pains and
penalties as well as to the traditional bills of attainder.\1702\
\1701\3 J. Story, Commentaries on the Constitution of the United
States (Boston: 1833), 1338.
\1702\Cummings v. Missouri, 4 Wall. (71 U.S.) 277, 323 (1867);
cf. United States v. Brown, 381 U.S. 437, 441-442, (1965).
---------------------------------------------------------------------------
The prohibition embodied in this clause is not to be strictly
and narrowly construed in the context of traditional forms but is to be
interpreted in accordance with the designs of the framers so as to
preclude trial by legislature, a violation of the separation of powers
concept.\1703\ The clause thus prohibits all legislative acts, ``no
matter what their form, that apply either to named individuals or to
easily ascertainable members of a group in such a way as to inflict
punishment on them without a judicial trial. . . .''\1704\ That the
Court has applied the clause dynamically is revealed by a consideration
of the three cases in which acts of Congress have been struck down as
violating it.\1705\ In Ex parte Garland,\1706\ the Court struck down a
statute that required attorneys to take an oath that they had taken no
part in the Confederate rebellion against the United States before they
could practice in federal courts. The statute, and a state
constitutional amendment requiring a similar oath of per
[[Page 348]]
sons before they could practice certain professions,\1707\ were struck
down as legislative acts inflicting punishment on a specific group the
members of which had taken part in the rebellion and therefore could not
truthfully take the oath. The clause then lay unused until 1946 when the
Court utilized it to strike down a rider to an appropriations bill
forbidding the use of money appropriated therein to pay the salaries of
three named persons whom the House of Representatives wished discharged
because they were deemed to be ``subversive.''\1708\
\1703\United States v. Brown, 381 U.S. 437, 442-446 (1965). Four
dissenting Justices, however, denied that any separation of powers
concept underlay the clause. Id., 472-473.
\1704\United States v. Lovett, 328 U.S. 303, 315 (1946).
\1705\For a rejection of the Court's approach and a plea to
adhere to the traditional concept, see id., 318 (Justice Frankfurter
concurring).
\1706\4 Wall. (71 U.S.) 333 (1867).
\1707\Cummings v. Missouri, 4 Wall. (71 U.S.) 277 (1867).
\1708\United States v. Lovett, 328 U.S. 303 (1946).
---------------------------------------------------------------------------
Then, in United States v. Brown,\1709\ a sharply divided Court
held void as a bill of attainder a statute making it a crime for a
member of the Communist Party to serve as an officer or as an employee
of a labor union. Congress could, Chief Justice Warren wrote for the
majority, under its commerce power, protect the economy from harm by
enacting a prohibition generally applicable to any person who commits
certain acts or possesses certain characteristics making him likely in
Congress' view to initiate political strikes or other harmful deeds and
leaving it to the courts to determine whether a particular person
committed the specified acts or possessed the specified characteristics;
it was impermissible, however, for Congress to designate a class of
persons--members of the Communist Party--as being forbidden to hold
union office.\1710\ The dissenters viewed the statute as merely
expressing in shorthand the characteristics of those persons who were
likely to utilize union responsibilities to accomplish harmful acts;
Congress could validly conclude that all members of the Communist Party
possessed those characteristics.\1711\ The majority's decision in Brown
cast in doubt certain statutes and certain statutory formulations that
had been held not to constitute bills of attainder. For example, a
predecessor of the statute struck down in Brown, which had conditioned a
union's access to the NLRB upon the filing of affidavits by all of the
union's officers attesting that they were not members of or affiliated
with the Communist Party, had been upheld,\1712\ and although Chief
Justice Warren distinguished the previous case from
[[Page 349]]
Brown on the basis that the Court in the previous decision had found the
statute to be preventive rather than punitive,\1713\ he then proceeded
to reject the contention that the punishment necessary for a bill of
attainder had to be punitive or retributive rather than
preventive,\1714\ thus undermining the prior decision. Of much greater
significance was the effect of the Brown decision on ``conflict-of-
interest'' legislation typified by that upheld in Board of Governors v.
Agnew.\1715\ The statute there forbade any partner or employee of a firm
primarily engaged in underwriting securities from being a director of a
national bank.\1716\ Chief Justice Warren distinguished the prior
decision and the statute on three grounds from the statute then under
consideration. First, the union statute inflicted its deprivation upon
the members of a suspect political group in typical bill-of-attainder
fashion, unlike the statute in Agnew. Second, in the Agnew statute,
Congress did not express a judgment upon certain men or members of a
particular group; it rather concluded that any man placed in the two
positions would suffer a temptation any man might yield to. Third,
Congress established in the Agnew statute an objective standard of
conduct expressed in shorthand, which precluded persons from holding the
two positions.
\1709\381 U.S. 437 (1965).
\1710\The Court of Appeals had voided the statute as an
infringement of First Amendment expression and association rights, but
the Court majority did not choose to utilize this ground. 334 F. 2d 488
(9th Cir., 1964). However, in United States v. Robel, 389 U.S. 258
(1967), a very similar statute making it unlawful for any member of a
``Communist-action organization'' to be employed in a defense facility
was struck down on First Amendment grounds and the bill of attainder
argument was ignored.
\1711\United States v. Brown, 381 U.S. 437, 462 (1965) (Justices
White, Clark, Harlan, and Stewart dissenting).
\1712\American Communications Assn. v. Douds, 339 U.S. 382
(1950).
\1713\Id., 413, 414, cited in United States v. Brown, 381 U.S.
437, 457-458 (1965).
\1714\Id., 458-461.
\1715\329 U.S. 441 (1947).
\1716\12 U.S.C. Sec. 78.
---------------------------------------------------------------------------
Apparently withdrawing from the Brown analysis in upholding a
statute providing for governmental custody of documents and recordings
accumulated during the tenure of former President Nixon,\1717\ the Court
set out a rather different formula for deciding bill of attainder
cases.\1718\ The law specifically applied only to President Nixon and
directed an executive agency to assume control over the materials and
prepare regulations providing for ultimate public dissemination of at
least some of them; the act assumed that it did not deprive the former
President of property rights but authorized the award of just
compensation if it should be judicially determined that there was a
taking. First, the Court
[[Page 350]]
denied that the clause denies the power to Congress to burden some
persons or groups while not so treating all other plausible individuals
or groups; even the present law's specificity in referring to the former
President by name and applying only to him did not condemn the act
because he ``constituted a legitimate class of one'' on whom Congress
could ``fairly and rationally'' focus.\1719\ Second, even if the
statute's specificity did bring it within the prohibition of the clause,
the lodging of Mr. Nixon's materials with the GSA did not inflict
punishment within the meaning of the clause. This analysis was a three-
pronged one: 1) the law imposed no punishment traditionally judged to be
prohibited by the clause; 2) the law, viewed functionally in terms of
the type and severity of burdens imposed, could rationally be said to
further nonpunitive legislative purposes; and 3) the law had no
legislative record evincing a congressional intent to punish.\1720\ That
is, the Court, looking ``to its terms, to the intent expressed by
Members of Congress who voted its passage, and to the existence or
nonexistence of legitimate explanations for its apparent effect,''
concluded that the statute served to further legitimate policies of
preserving the availability of evidence for criminal trials and the
functioning of the adversary legal system and in promoting the
preservation of records of historical value, all in a way that did not
and was not intended to punish the former President.
\1717\The Presidential Recordings and Materials Preservation
Act, P.L. 93-526, 88 Stat. 1695 (1974), note following 44 U.S.C.
Sec. 2107. For an application of this statute, see Nixon v. Warner
Communications, 435 U.S. 589 (1978).
\1718\Nixon v. Administrator of General Services, 433 U.S. 425,
468-484 (1977). Justice Stevens' concurrence is more specifically
directed to the facts behind the statute than is the opinion of the
Court, id., 484, and Justice White, author of the dissent in Brown,
merely noted he found the act nonpunitive. Id., 487. Chief Justice
Burger and Justice Rehnquist dissented. Id., 504, 536-545, 545. Adding
to the impression of a departure from Brown is the quotation in the
opinion of the Court at several points of the Brown dissent, id., 470 n.
31, 471 n. 34, while the dissent quoted and relied on the opinion of the
Court in Brown. Id., 538, 542.
\1719\Id., 472. Justice Stevens carried the thought further,
although in the process he severely limited the precedential value of
the decision. Id., 484.
\1720\Id., 473-484.
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The clause protects individual persons and groups who are
vulnerable to nonjudicial determinations of guilt and does not apply to
a State; neither does a State have standing to invoke the clause for its
citizens against the Federal Government.\1721\
\1721\South Carolina v. Katzenbach, 383 U.S. 301, 324 (1966).
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Ex Post Facto Laws
Definition.--At the time the Constitution was adopted, many
persons understood the term ex post facto laws to ``embrace all
retrospective laws, or laws governing or controlling past transactions,
whether . . . of a civil or a criminal nature.''\1722\ But in the early
case of Calder v. Bull,\1723\ the Supreme Court decided that the
phrase, as used in the Constitution, applied only to penal and criminal
statutes. But although it is inapplicable to retroactive legislation of
any other kind,\1724\ the constitutional prohibition may
[[Page 351]]
not be evaded by giving a civil form to a measure that is essentially
criminal.\1725\ Every law, which makes criminal an act that was innocent
when done, or which inflicts a greater punishment than the law annexed
to the crime when committed, is an ex post facto law within the
prohibition of the Constitution.\1726\ A prosecution under a temporary
statute, which was extended before the date originally set for its
expiration, does not offend this provision even though it is instituted
subsequent to the extension of the statute's duration for a violation
committed prior thereto.\1727\ Since this provision has no application
to crimes committed outside the jurisdiction of the United States
against the laws of a foreign country, it is immaterial in extradition
proceedings whether the foreign law is ex post facto or not.\1728\
\1722\3 J. Story, Commentaries on the Constitution of the United
States (Boston: 1833), 1339.
\1723\3 Dall. (3 U.S.) 386, 393 (1798).
\1724\Bankers Trust Co. v. Blodgett, 260 U.S. 647, 652 (1923).
\1725\Burgess v. Salmon, 97 U.S. 381 (1878).
\1726\Calder v. Bull, 3 Dall. (3 U.S.) 386, 390 (1798); Ex parte
Garland, 4 Wall. (71 U.S.) 333, 377 (1867); Burgess v. Salmon, 97 U.S.
381, 384 (1878).
\1727\United States v. Powers, 307 U.S. 214 (1939).
\1728\Neely v. Henkel, 180 U.S. 109, 123 (1901). Cf. In re
Yamashita, 327 U.S. 1, 26 (1946) (dissenting opinion of Justice Murphy);
Hirota v. MacArthur, 338 U.S. 197, 199 (1948) (concurring opinion of
Justice Douglas).
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What Constitutes Punishment.--An act of Congress that prescribed
as a qualification for practice before the federal courts an oath that
the attorney had not participated in the Rebellion was found
unconstitutional since it operated as a punishment for past acts.\1729\
But a statute that denied to polygamists the right to vote in a
territorial election was upheld even as applied to one who had not
contracted a polygamous marriage and had not cohabited with more than
one woman since the act was passed, because the law did not operate as
an additional penalty for the offense of polygamy but merely defined it
as a disqualification of a voter.\1730\ A deportation law authorizing
the Secretary of Labor to expel aliens for criminal acts committed
before its passage is not ex post facto since deportation is not a
punishment.\1731\ For this reason, a statutory provision terminating
payment of old-age benefits to an alien deported for Communist
affiliation also is not ex post facto, for the denial of a non-
contractual benefit to a deported alien is not a penalty
[[Page 352]]
but a regulation designed to relieve the Social Security System of
administrative problems of supervision and enforcement likely to arise
from disbursements to beneficiaries residing abroad.\1732\ Likewise an
act permitting the cancellation of naturalization certificates obtained
by fraud prior to the passage of the law was held not to impose a
punishment, but it was simply to deprive the alien of his illgotten
privileges.\1733\
\1729\Ex parte Garland, 4 Wall. (71 U.S.) 333 (1867).
\1730\Murphy v. Ramsey, 114 U.S. 15 (1885).
\1731\Mahler v. Eby, 264 U.S. 32 (1924); Bugajewitz v. Adams,
228 U.S. 585 (1913); Marcello v. Bonds, 349 U.S. 302 (1955). Justices
Black and Douglas, reiterating in Lehman v. United States ex rel.
Carson, 353 U.S. 685, 690-691 (1957), their dissent from the premise
that the ex post facto clause is directed solely to penal legislation,
disapproved a holding that an immigration law, enacted in 1952, 8 U.S.C.
Sec. 1251, which authorized deportation of an alien who, in 1945, had
acquired a status of nondeportability under pre-existing law is valid.
In their opinion, to banish, in 1957, an alien who had lived in the
United States for almost 40 years, for an offense committed in 1936, and
for which he already had served a term in prison, was to subject him to
new punishment retrospectively imposed.
\1732\Flemming v. Nestor, 363 U.S. 603 (1960).
\1733\Johannessen v. United States, 225 U.S. 227 (1912).
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Change in Place or Mode of Trial.--A change of the place of
trial of an alleged offense after its commission is not an ex post facto
law. If no place of trial was provided when the offense was committed,
Congress may designate the place of trial thereafter.\1734\ A law which
alters the rule of evidence to permit a person to be convicted upon less
or different evidence than was required when the offense was committed
is invalid,\1735\ but a statute which simply enlarges the class of
persons who may be competent to testify in criminal cases is not ex post
facto as applied to a prosecution for a crime committed prior to its
passage.\1736\
\1734\Cook v. United States, 138 U.S. 157, 183 (1891).
\1735\Calder v. Bull, 3 Dall. (3 U.S.) 386, 390 (1798).
\1736\Hopt v. Utah, 110 U.S. 574, 589 (1884).
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Clause 4. No Capitation, or other direct, Tax shall be laid, unless in
Proportion to the Census or Enumeration herein before directed to be
taken.
Direct Taxes
The Hylton Case.--The crucial problem under this section is to
distinguish ``direct'' from other taxes. In its opinion in Pollock v.
Farmers' Loan & Trust Co., the Court declared: ``It is apparent . . .
that the distinction between direct and indirect taxation was well
understood by the framers of the Constitution and those who adopted
it.''\1737\ Against this confident dictum may be set the following brief
excerpt from Madison's Notes on the Convention: ``Mr. King asked what
was the precise meaning of direct taxation? No one answered.''\1738\ The
first case to come before the Court on this issue was Hylton v. United
States,\1739\ which was decided early in 1796. Congress has levied,
according to the rule of uniformity, a specific tax upon all carriages,
for the conveyance of persons, which were to be kept by, or for any
person, for his own use, or
[[Page 353]]
to be let out for hire, or for the conveying of passengers. In a
fictitious statement of facts, it was stipulated that the carriages
involved in the case were kept exclusively for the personal use of the
owner and not for hire. The principal argument for the constitutionality
of the measure was made by Hamilton, who treated it as an ``excise
tax,''\1740\ while Madison both on the floor of Congress and in
correspondence attacked it as ``direct'' and so void, inasmuch as it was
levied without apportionment.\1741\ The Court, taking the position that
the direct tax clause constituted in practical operation an exception to
the general taxing powers of Congress, held that no tax ought to be
classified as ``direct'' which could not be conveniently apportioned,
and on this basis sustained the tax on carriages as one on their ``use''
and therefore an ``excise.'' Moreover, each of the judges advanced the
opinion that the direct tax clause should be restricted to capitation
taxes and taxes on land, or that at most, it might cover a general tax
on the aggregate or mass of things that generally pervade all the
States, especially if an assessment should intervene, while Justice
Paterson, who had been a member of the Federal Convention, testified to
his recollection that the principal purpose of the provision had been to
allay the fear of the Southern States lest their Negroes and land should
be subjected to a specific tax.\1742\
\1737\157 U.S. 429, 573 (1895).
\1738\J. Madison, The Debates in the Federal Convention of 1787
(G. Hunt & J. Scott eds.) (Greenwood Press ed. 1970), 435.
\1739\3 Dall. (3 U.S.) 171 (1796).
\1740\The Works of Alexander Hamilton, J. Hamilton ed. (New
York: 1851), 845. ``If the meaning of the word excise is to be sought in
the British statutes, it will be found to include the duty on carriages,
which is there considered as an excise, and then must necessarily be
uniform and liable to apportionment; consequently, not a direct tax.''
\1741\4 Annals of Congress 730 (1794); 2 Letters and Other
Writings of James Madison (Philadelphia: 1865), 14.
\1742\3 Dall. (3 U.S.) 171, 177 (1796).
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From the Hylton to the Pollock Case.--The result of the Hylton
case was not challenged until after the Civil War. A number of the taxes
imposed to meet the demands of that war were assailed during the postwar
period as direct taxes but without result. The Court sustained
successively, as ``excises'' or ``duties,'' a tax on an insurance
company's receipts for premiums and assessments;\1743\ a tax on the
circulating notes of state banks,\1744\ an inheritance tax on real
estate,\1745\ and finally a general tax on incomes.\1746\ In the last
case, the Court took pains to state that it regarded the term ``direct
taxes'' as having acquired a definite and fixed meaning, to wit,
capitation taxes, and taxes on land.\1747\ Then, almost one hundred
years after the Hylton case, the famous
[[Page 354]]
case of Pollock v. Farmers' Loan & Trust Co.\1748\ arose under the
Income Tax Act of 1894.\1749\ Undertaking to correct ``a century of
error,'' the Court held, by a vote of five-to-four, that a tax on income
from property was a direct tax within the meaning of the Constitution
and hence void because not apportioned according to the census.
\1743\Pacific Insurance Company v. Soule, 7 Wall. (74 U.S.) 433
(1869).
\1744\Veazie Bank v. Fenno, 8 Wall. (75 U.S.) 533 (1869).
\1745\Scholey v. Rew, 23 Wall. (90 U.S.) 331 (1875).
\1746\Springer v. United States, 102 U.S. 586 (1881).
\1747\Id., 602.
\1748\157 U.S. 429 (1895); 158 U.S. 601 (1895).
\1749\28 Stat. 509, 553 (1894).
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Restriction of the Pollock Decision.--The Pollock decision
encouraged taxpayers to challenge the right of Congress to levy by the
rule of uniformity numerous taxes that had always been reckoned to be
excises. But the Court evinced a strong reluctance to extend the
doctrine to such exactions. Purporting to distinguish taxes levied
``because of ownership'' or ``upon property as such'' from those laid
upon ``privileges,''\1750\ it sustained as ``excises'' a tax on sales on
business exchanges,\1751\ a succession tax which was construed to fall
on the recipients of the property transmitted rather than on the estate
of the decedent,\1752\ and a tax on manufactured tobacco in the hands of
a dealer, after an excise tax had been paid by the manufacturer.\1753\
Again, in Thomas v. United States,\1754\ the validity of a stamp tax on
sales of stock certificates was sustained on the basis of a definition
of ``duties, imposts and excises.'' These terms, according to the Chief
Justice, ``were used comprehensively to cover customs and excise duties
imposed on importation, consumption, manufacture and sale of certain
commodities, privileges, particular business transactions, vocations,
occupations and the like.''\1755\ On the same day, it ruled, in
Spreckels Sugar Refining Co. v. McClain,\1756\ that an exaction,
denominated a special excise tax, imposed on the business of refining
sugar and measured by the gross receipts thereof, was in truth an excise
and hence properly levied by the rule of uniformity. The lesson of Flint
v. Stone Tracy Co.\1757\ was the same. In the Flint case, what was in
form an income tax was sustained as a tax on the privilege of doing
business as a corporation, the value of the privilege being measured by
the income, including income from investments. Similarly,, in Stanton v.
Baltic Mining Co.,\1758\ a tax on the annual production of mines was
held to be ``independently of the effect of the oper
[[Page 355]]
ation of the Sixteenth Amendment . . . not a tax upon property as such
because of its ownership, but a true excise levied on the results of the
business of carrying on mining operations.''\1759\
\1750\Stanton v. Baltic Mining Co., 240 U.S. 103 (1916);
Knowlton v. Moore, 178 U.S. 41, 80 (1900).
\1751\Nicol v. Ames, 173 U.S. 509 (1899).
\1752\Knowlton v. Moore, 178 U.S. 41 (1900).
\1753\Patton v. Brady, 184 U.S. 608 (1902).
\1754\192 U.S. 363 (1904).
\1755\Id., 370.
\1756\192 U.S. 397 (1904).
\1757\220 U.S. 107 (1911).
\1758\240 U.S. 103 (1916).
\1759\Id., 114.
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A convincing demonstration of the extent to which the Pollock
decision had been whittled down by the time the Sixteenth Amendment was
adopted is found in Billings v. United States.\1760\ In challenging an
annual tax assessed for the year 1909 on the use of foreign built
yachts--a levy not distinguishable in substance from the carriage tax
involved in the Hylton case as construed by the Supreme Court--counsel
did not even suggest that the tax should be classed as a direct tax.
Instead, he based his argument that the exaction constituted a taking of
property without due process of law upon the premise that it was an
excise, and the Supreme Court disposed of the case upon the same
assumption.
\1760\232 U.S. 261 (1914).
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In 1921, the Court cast aside the distinction drawn in Knowlton
v. Moore between the right to transmit property on the one hand and the
privilege of receiving it on the other, and sustained an estate tax as
an excise. ``Upon this point,'' wrote Justice Holmes for a unanimous
Court, ``a page of history is worth a volume of logic.''\1761\ This
proposition being established, the Court had no difficulty in deciding
that the inclusion in the computation of the estate tax of property held
as joint tenants,\1762\ or as tenants by the entirety,\1763\ or the
entire value of community property owned by husband and wife,\1764\ or
the proceeds of insurance upon the life of the decedent,\1765\ did not
amount to direct taxation of such property. Similarly, it upheld a
graduated tax on gifts as an excise, saying that it was ``a tax laid
only upon the exercise of a single one of those powers incident to
ownership, the power to give the property owned to another.''\1766\
Justice Sutherland, speaking for himself and two associates, urged that
``the right to give away one's property is as fundamental as the right
to sell it or, indeed, to possess it.''\1767\
\1761\New York Trust Co. v. Eisner, 256 U.S. 345, 349 (1921).
\1762\Phillips v. Dime Trust & S.D. Co., 284 U.S. 160 (1931).
\1763\Tyler v. United States, 281 U.S. 497 (1930).
\1764\Fernandez v. Wiener, 326 U.S. 340 (1945).
\1765\Chase Nat. Bank v. United States, 278 U.S. 327 (1929);
United States v. Manufacturers Nat. Bank, 363 U.S. 194, 198-201 (1960).
\1766\Bromley v. McCaughn, 280 U.S. 124, 136 (1929). See also
Helvering v. Bullard, 303 U.S. 297 (1938).
\1767\Bromley v. McCaughn, 280 U.S. 124, 140 (1929).
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Miscellaneous.--The power of Congress to levy direct taxes is
not confined to the States represented in that body. Such a tax may be
levied in proportion to population in the District of Colum
[[Page 356]]
bia.\1768\ A penalty imposed for nonpayment of a direct tax is not a
part of the tax itself and hence is not subject to the rule of
apportionment. Accordingly, the Supreme Court sustained the penalty of
fifty percent, which Congress exacted for default in the payment of the
direct tax on land in the aggregate amount of twenty million dollars
that was levied and apportioned among the States during the Civil
War.\1769\
\1768\Loughborough v. Blake, 5 Wheat. (18 U.S.) 317 (1820).
\1769\De Treville v. Smalls, 98 U.S. 517, 527 (1879).
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Clause 5. No Tax or Duty shall be laid on Articles exported from any
State.
Taxes on Exports
This prohibition applies only to the imposition of duties on
goods by reason of exportation.\1770\ The word ``export'' signifies
goods exported to a foreign country, not to an unincorporated territory
of the United States.\1771\ A general tax laid on all property alike,
including that intended for export, is not within the prohibition, if it
is not levied on goods in course of exportation nor because of their
intended exportation.\1772\ Where the sale to a commission merchant for
a foreign consignee was consummated by delivery of the goods to an
exporting carrier, the sale was held to be a step in the exportation and
hence exempt from a general tax on sales of such commodity.\1773\ The
giving of a bond for exportation of distilled liquor was not the
commencement of exportation so as to exempt from an excise tax spirits
that were not exported pursuant to such bond.\1774\ A tax on the income
of a corporation derived from its export trade was not a tax on
``articles exported'' within the meaning of the Constitution.\1775\
\1770\Turpin v. Burgess, 117 U.S. 504, 507 (1886). Cf. Almy v.
California, 24 How. (65 U.S.) 169, 174 (1861).
\1771\Dooley v. United States, 183 U.S. 151, 154 (1901).
\1772\Cornell v. Coyne, 192 U.S. 418, 428 (1904); Turpin v.
Burgess, 117 U.S. 504, 507 (1886).
\1773\Spalding & Bros. v. Edwards, 262 U.S. 66 (1923).
\1774\Thompson v. United States, 142 U.S. 471 (1892).
\1775\Peck & Co. v. Lowe, 247 U.S. 165 (1918); National Paper
Co. v. Bowers, 266 U.S. 373 (1924).
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Stamp Taxes.--A stamp tax imposed on foreign bills of
lading,\1776\ charter parties,\1777\ or marine insurance policies,\1778\
was in effect a tax or duty upon exports, and so void; but an act
requiring the stamping of all packages of tobacco intended for export in
[[Page 357]]
order to prevent fraud was held not to be forbidden as a tax on
exports.\1779\
\1776\Fairbank v. United States, 181 U.S. 283 (1901).
\1777\United States v. Hvoslef, 237 U.S. 1 (1915).
\1778\Thames & Mersey Inc. Co. v. United States, 237 U.S. 19
(1915).
\1779\Pace v. Burgess, 92 U.S. 372 (1876); Turpin v. Burgess,
117 U.S. 504, 505 (1886).
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Clause 6. No Preference shall be given by any Regulation of Commerce
or Revenue to the Ports of one State over those of another: nor shall
Vessels bound to, or from, one State, be obliged to enter, clear, or pay
duties in another.
The ``No Preference'' Clause
The limitations imposed by this section were designed to prevent
preferences as between ports because of their location in different
States. They do not forbid such discriminations as between individual
ports. Acting under the commerce clause, Congress may do many things
that benefit particular ports and which incidentally result to the
disadvantage of other ports in the same or neighboring States. It may
establish ports of entry, erect and operate lighthouses, improve rivers
and harbors, and provide structures for the convenient and economical
handling of traffic.\1780\ A rate order of the Interstate Commerce
Commission which allowed an additional charge to be made for ferrying
traffic across the Mississippi to cities on the east bank of the river
was sustained over the objection that it gave an unconstitutional
preference to ports in Texas.\1781\ Although there were a few early
intimations that this clause was applicable to the States as well as to
Congress,\1782\ the Supreme Court declared emphatically in 1886 that
state legislation was unaffected by it.\1783\ After more than a century,
the Court confirmed, over the objection that this clause was offended,
the power which the First Congress had exercised\1784\ in sanctioning
the continued supervision and regulation of pilots by the States.\1785\
\1780\Louisiana Pub. Serv. Comm. v. Texas & N.O.R. Co., 284 U.S.
125, 131 (1931); Pennsylvania v. Wheeling & Belmont Bridge Co., 18 How.
(59 U.S.) 421, 433 (1856); South Carolina v. Georgia, 93 U.S. 4 (1876).
In Williams v. United States, 255 U.S. 336 (1921) the argument that an
act of Congress which prohibited interstate transportation of liquor
into States whose laws prohibited manufacture or sale of liquor for
beverage purposes was repugnant to this clause was rejected.
\1781\Louisiana PSC v. Texas & N.O.R. Co., 284 U.S. 125, 132
(1931).
\1782\Passenger Cases (Smith v. Turner), 7 How. (48 U.S.) 282,
414 (1849) (opinion of Justice Wayne); cf. Cooley v. Port Wardens, 12
How. (53 U.S.) 299, 314 (1851).
\1783\Morgan v. Louisiana, 118 U.S. 455, 467 (1886). See also
Munn v. Illinois, 94 U.S. 113, 135 (1877); Johnson v. Chicago & Pacific
Elevator Co., 119 U.S. 388, 400 (1886).
\1784\1 Stat. 53, 54, Sec. 4 (1789).
\1785\Thompson v. Darden, 198 U.S. 310 (1905).
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[[Page 358]]
Clause 7. No Money shall be drawn from the Treasury but in Consequence
of Appropriations made by Law; and a regular Statement and Account of
the Receipts and Expenditures of all public Money shall be published
from time to time.
Appropriations
This clause is a limitation upon the power of the Executive
Department and does not restrict Congress in appropriating moneys in the
Treasury.\1786\ That body may recognize and pay a claim of an equitable,
moral, or honorary nature. When it directs a specific sum to be paid to
a certain person, neither the Secretary of the Treasury nor any court
has discretion to determine whether the person is entitled to receive
it.\1787\ In making appropriations to pay claims arising out of the
Civil War, Congress could, the Court held, lawfully provide that certain
persons, i.e., those who had aided the Rebellion, should not be paid out
of the funds made available by the general appropriation, but that such
persons should seek relief from Congress.\1788\ The Court has also
recognized that Congress has a wide discretion with regard to the extent
to which it shall prescribe details of expenditures for which it
appropriates funds and has approved the frequent practice of making
general appropriations of large amounts to be allotted and expended as
directed by designated government agencies. Citing as an example that
act of June 17, 1902,\1789\ where all moneys received from the sale and
disposal of public lands in a large number of States and territories
were set aside as a special fund to be expended under the direction of
the Secretary of the Interior upon such projects as he determined to be
practicable and advisable for the reclamation of arid and semi-arid
lands within those States and territories, the Court declared: ``The
constitutionality of this delegation of authority has never been
seriously questioned.''\1790\
\1786\Cincinnati Soap Co. v. United States, 301 U.S. 308, 321
(1937); Knote v. United States, 95 U.S. 149, 154 (1877).
\1787\United States v. Price, 116 U.S. 43 (1885); United States
v. Realty Company, 163 U.S. 427, 439 (1896); Allen v. Smith, 173 U.S.
389, 393 (1899).
\1788\Hart v. United States, 118 U.S. 62, 67 (1886).
\1789\32 Stat. 388 (1902).
\1790\Cincinnati Soap Co. v. United States, 301 U.S. 308, 322
(1937).
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Payment of Claims
No officer of the Federal Government is authorized to pay a debt
due from the United States, whether reduced to judgment or not, without
an appropriation for that purpose.\1791\ Nor may a gov
[[Page 359]]
ernment employee, by erroneous advice to a claimant, bind the United
States through equitable estoppel principles to pay a claim for which an
appropriation has not been made.\1792\
\1791\Reeside v. Walker, 11 How. (52 U.S.) 272 (1851).
\1792\OPM v. Richmond, 496 U.S. 414 (1990).
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After the Civil War, a number of controversies arose out of
attempts by Congress to restrict the payment of the claims of persons
who had aided the Rebellion but had thereafter received a pardon from
the President. The Supreme Court held that Congress could not prescribe
the evidentiary effect of a pardon in a proceeding in the Court of
Claims for property confiscated during the Civil War,\1793\ but that
where the confiscated property had been sold and the proceeds paid into
the Treasury, a pardon did not of its own force authorize the
restoration of such proceeds.\1794\ It was within the competence of
Congress to declare that the amount due to persons thus pardoned should
not be paid out of the Treasury and that no general appropriation should
extend to their claims.\1795\
\1793\United States v. Klein, 13 Wall. (80 U.S.) 128 (1872).
\1794\Knote v. United States, 95 U.S. 149, 154 (1877); Austin v.
United States, 155 U.S. 417, 427 (1894).
\1795\Hart v. United States, 118 U.S. 62, 67 (1886).
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Clause 8. No Title of Nobility shall be granted by the United States:
And no Person holding any Office of Profit or Trust under them, shall,
without the Consent of the Congress accept of any present, Emolument,
Office, or Title, of any kind whatever, from any King, Prince, or
foreign State.
In 1871 the Attorney General of the United States ruled that:
``A minister of the United States abroad is not prohibited by the
Constitution from rendering a friendly service to a foreign power, even
that of negotiating a treaty for it, provided he does not become an
officer of that power . . . but the acceptance of a formal commission,
as minister plenipotentiary, creates an official relation between the
individual thus commissioned and the government which in this way
accredits him as its representative,'' which is prohibited by this
clause of the Constitution.\1796\
\1796\13 Ops. Atty. Gen. 538 (1871).
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ARTICLE I
LEGISLATIVE DEPARTMENT
Section 10. No State shall enter into any Treaty, Alliance, or
Confederation; grant Letters of Marque and Reprisal; coin Money; emit
Bills of Credit; make any Thing but gold and sil
[[Page 360]]
ver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex
post facto Law, or Law impairing the Obligation of Contracts, or grant
any Title of Nobility.
POWERS DENIED TO THE STATES
Treaties, Alliances, or Confederations
At the time of the Civil War, this clause was one of the
provisions upon which the Court relied in holding that the Confederation
formed by the seceding States could not be recognized as having any
legal existence.\1797\ Today, its practical significance lies in the
limitations which it implies upon the power of the States to deal with
matters having a bearing upon international relations. In the early case
of Holmes v. Jennison,\1798\ Chief Justice Taney invoked it as a reason
for holding that a State had no power to deliver up a fugitive from
justice to a foreign State. Recently, the kindred idea that the
responsibility for the conduct of foreign relations rests exclusively
with the Federal Government prompted the Court to hold that, since the
oil under the three mile marginal belt along the California coast might
well become the subject of international dispute and since the ocean,
including this three mile belt, is of vital consequence to the nation in
its desire to engage in commerce and to live in peace with the world,
the Federal Government has paramount rights in and power over that belt,
including full dominion over the resources of the soil under the water
area.\1799\ In Skiriotes v. Florida,\1800\ the Court, on the other hand,
ruled that this clause did not disable Florida from regulating the
manner in which its own citizens may engage in sponge fishing outside
its territorial waters. Speaking for a unanimous Court, Chief Justice
Hughes declared; ``When its action does not conflict with federal
legislation, the sovereign authority of the State over the conduct of
its citizens upon the high seas is analogous to the sovereign authority
of the United States over its citizens in like circumstances.''\1801\
\1797\Williams v. Bruffy, 96 U.S. 176, 183 (1878).
\1798\14 Pet. (39 U.S.) 540 (1840).
\1799\United States v. California, 332 U.S. 19 (1947).
\1800\313 U.S. 69 (1941).
\1801\Id., 78-79.
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Bills of Credit
Within the sense of the Constitution, bills of credit signify a
paper medium of exchange, intended to circulate between individuals, and
between the Government and individuals, for the ordi
[[Page 361]]
nary purposes of society. It is immaterial whether the quality of legal
tender is imparted to such paper. Interest bearing certificates, in
denominations not exceeding ten dollars, which were issued by loan
offices established by the State of Missouri and made receivable in
payment of taxes or other moneys due to the State, and in payment of the
fees and salaries of state officers, were held to be bills of credit
whose issuance was banned by this section.\1802\ The States are not
forbidden, however, to issue coupons receivable for taxes,\1803\ nor to
execute instruments binding themselves to pay money at a future day for
services rendered or money borrowed.\1804\ Bills issued by state banks
are not bills of credit;\1805\ it is immaterial that the State is the
sole stockholder of the bank,\1806\ that the officers of the bank were
elected by the state legislature,\1807\ or that the capital of the bank
was raised by the sale of state bonds.\1808\
\1802\Craig v. Missouri, 4 Pet. (29 U.S.) 410, 425 (1830); Byrne
v. Missouri, 8 Pet. (33 U.S.) 40 (1834).
\1803\Virginia Coupon Cases (Poindexter v. Greenhow), 114 U.S.
269 (1885); Chaffin v. Taylor, 116 U.S. 567 (1886).
\1804\Houston & Texas Central Rd. v. Texas, 177 U.S. 66 (1900).
\1805\Briscoe v. Bank of Kentucky, 11 Pet. (36 U.S.) 257 (1837).
\1806\Darrington v. Bank of Alabama, 13 How. (54 U.S.) 12, 15
(1851); Curran v. Arkansas, 15 How. (56 U.S.) 304, 317 (1854).
\1807\Briscoe v. Bank of Kentucky, 11 Pet. (36 U.S.) 257 (1837).
\1808\Woodruff v. Trapnall, 10 How. (51 U.S.) 190, 205 (1851).
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Legal Tender
Relying on this clause, which applies only to the States and not
to the Federal Government,\1809\ the Supreme Court has held that where
the marshal of a state court received state bank notes in payment and
discharge of an execution, the creditor was entitled to demand payment
in gold or silver.\1810\ Since, however, there is nothing in the
Constitution prohibiting a bank depositor from consenting when he draws
a check that payment may be made by draft, a state law providing that
checks drawn on local banks should, at the option of the bank, be
payable in exchange drafts was held valid.\1811\
\1809\Legal Tender Cases (Juilliard v. Greenman), 110 U.S. 421,
446 (1884).
\1810\Gwin v. Breedlove, 2 How. (43 U.S.) 29, 38 (1844). See
also Griffin v. Thompson, 2 How. (43 U.S.) 244 (1844).
\1811\Farmers & Merchants Bank v. Fed. Reserve Bank, 262 U.S.
649, 659 (1923).
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Bills of Attainder
Statutes passed after the Civil War with the intent and result
of excluding persons who had aided the Confederacy from following
certain callings, by the device of requiring them to take an oath
[[Page 362]]
that they had never given such aid, were held invalid as being bills of
attainder, as well as ex post facto laws.\1812\
\1812\Cummings v. Missouri, 4 Wall. (71 U.S.) 277, 323 (1867);
Klinger v. Missouri, 13 Wall. (80 U.S.) 257 (1872); Pierce v. Carskadon,
16 Wall. (83 U.S.) 234, 239 (1873).
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Other attempts to raise bill-of-attainder claims have been
unsuccessful. A Court majority denied that a municipal ordinance, that
required all employees to execute oaths that they had never been
affiliated with Communist or similar organizations, violated the clause,
on the grounds that the ordinance merely provided standards of
qualifications and eligibility for employment.\1813\ A law that
prohibited any person convicted of a felony and not subsequently
pardoned from holding office in a waterfront union was not a bill of
attainder because the ``distinguishing feature of a bill of attainder is
the substitution of a legislative for a judicial determination of
guilt'' and the prohibition ``embodies no further implications of
appellant's guilt than are contained in his 1920 judicial
conviction.''\1814\
\1813\Garner v. Board of Public Works of Los Angeles, 341 U.S.
716, 722-723 (1951). Cf. Konigsberg v. State Bar of California, 366 U.S.
36, 47 n. 9 (1961).
\1814\De Veau v. Braisted, 363 U.S. 144, 160 (1960). Presumably,
United States v. Brown, 381 U.S. 437 (1965), does not qualify this
decision.
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Ex Post Facto Laws
Scope of the Provision.--This clause, like the cognate
restriction imposed on the Federal Government by Sec. 9, relates only to
penal and criminal legislation and not to civil laws that affect private
rights adversely.\1815\ There are three categories of ex post facto
laws: those ``which punish[] as a crime an act previously committed,
which was innocent when done; which make[] more burdensome the
punishment for a crime, after its commission; or which deprive[] one
charged with crime of any defense available according to law at the time
when the act was committed.''\1816\ The bar is directed only against
legislative action and does not touch erroneous or inconsistent
decisions by the courts.\1817\ Even though a law is
[[Page 363]]
ex post facto and invalid as to crimes committed prior to its enactment,
it is nonetheless valid as to subsequent offenses.\1818\ If it mitigates
the rigor of the law in force at the time the crime was committed,\1819\
or if it merely penalizes the continuance of conduct lawfully begun
before its passage, the statute is not ex post facto. Thus, measures
penalizing the failure of a railroad to cut drains through existing
embankments\1820\ or making illegal the continued possession of
intoxicating liquors which were lawfully acquired\1821\ have been held
valid.
\1815\Calder v. Bull, 3 Dall. (3 U.S.) 386, 390 (1798); Watson
v. Mercer, 8 Pet. (33 U.S.) 88, 110 (1834); Baltimore and Susquehanna
Railroad Co. v. Nesbit, 10 How. (51 U.S.) 395, 401 (1850); Carpenter v.
Pennsylvania, 17 How. (58 U.S.) 456, 463 (1855); Loche v. New Orleans, 4
Wall. (71 U.S.) 172 (1867); Orr v. Gilman, 183 U.S. 278, 285 (1902);
Kentucky Union Co. v. Kentucky, 219 U.S. 140 (1911).
\1816\Collins v. Youngblood, 497 U.S. 37, 42 (1990) (quoting
Beazell v. Ohio, 269 U.S. 167, 169-170 (1925)). Alternatively, the Court
described the reach of the clause as extending to laws that ``alter the
definition of crimes or increase the punishment for criminal acts.''
Id., 43.
\1817\Frank v. Mangum, 237 U.S. 309, 344 (1915); Ross v. Oregon,
227 U.S. 150, 161 (1913). However, an unforeseeable judicial enlargement
of a criminal statute so as to encompass conduct not covered on the face
of the statute operates like an ex post facto law if it is applied
retroactively and violates due process in that event. Bouie v. City of
Columbia, 378 U.S. 347 (1964). See Marks v. United States, 430 U.S. 188
(1977) (applying Bouie in context of Sec. 9, cl. 3). But see Splawn v.
California, 431 U.S. 595 (1977) (rejecting application of Bouie ). The
Court itself has not always adhered to this standard. See Ginzburg v.
United States, 383 U.S. 463 (1966).
\1818\Jachne v. New York, 128 U.S. 189, 190 (1888).
\1819\Rooney v. North Dakota, 196 U.S. 319, 325 (1905).
\1820\Chicago & Alton R.R. v. Tranbarger, 238 U.S. 67 (1915).
\1821\Samuels v. McCurdy, 267 U.S. 188 (1925).
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Denial of Future Privileges to Past Offenders.--The right to
practice a profession may be denied to one who was convicted of an
offense before the statute was enacted if the offense reasonably may be
regarded as a continuing disqualification for the profession. Without
offending the Constitution, statutes barring a person from practicing
medicine after conviction of a felony\1822\ or excluding convicted
felons from waterfront union offices, unless pardoned or in receipt of a
parole board's good conduct certificate,\1823\ may be enforced against a
person convicted before the measures were passed. But the test oath
prescribed after the Civil War, whereby office holders, teachers, or
preachers were required to swear that they had not participated in the
Rebellion, was held invalid on the ground that it had no reasonable
relation to fitness to perform official or professional duties, but
rather was a punishment for past offenses.\1824\ A similar oath required
of suitors in the courts also was held void.\1825\
\1822\Hawker v. New York, 170 U.S. 189, 190 (1898). See also
Reetz v. Michigan, 188 U.S. 505, 509 (1903); Lehmann v. State Board of
Public Accountancy, 263 U.S. 394 (1923).
\1823\De Veau v. Braisted, 363 U.S. 144, 160 (1960).
\1824\Cummings v. Missouri, 4 Wall. (71 U.S.) 277, 316 (1867).
\1825\Pierce v. Carskadon, 16 Wall. (83 U.S.) 234 (1873).
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Changes in Punishment.--Statutes that changed an indeterminate
sentence law to require a judge to impose the maximum sentence, whereas
formerly he could impose a sentence between the minimum and
maximum,\1826\ required criminals sentenced to death to be kept
thereafter in solitary confinement,\1827\ or allowed a warden to fix,
within limits of one week, and keep secret the time
[[Page 364]]
of execution,\1828\ were held to be ex post facto as applied to offenses
committed prior to their enactment. Because it made more onerous the
punishment for crimes committed before its enactment, a law, a law that
altered sentencing guidelines to make it more likely the sentencing
authority would impose on a defendant a more severe sentence than was
previously likely and making it impossible for the defendant to
challenge the sentence was ex post facto as to one who had committed the
offense prior to the change.\1829\ But laws providing heavier penalties
for new crimes thereafter committed by habitual criminals,\1830\
changing the punishment from hanging to electrocution, fixing the place
therefor in the penitentiary, and permitting the presence of a greater
number of invited witnesses,\1831\ or providing for close confinement of
six to nine months in the penitentiary, in lieu of three to six months
in jail prior to execution, and substituting the warden for the sheriff
as hangman, have been sustained.\1832\
\1826\Lindsey v. Washington, 301 U.S. 397 (1937). But note the
limitation of Lindsey in Dobbert v. Florida, 432 U.S. 282, 298-301
(1977).
\1827\Holden v. Minnesota, 137 U.S. 483, 491 (1890).
\1828\Medley, Petitioner, 134 U.S. 160, 171 (1890).
\1829\Miller v. Florida, 482 U.S. 423 (1987).
\1830\Gryger v. Burke, 334 U.S. 728 (1948); McDonald v.
Massachusetts, 180 U.S. 311 (1901); Graham v. West Virginia, 224 U.S.
616 (1912).
\1831\Malloy v. South Carolina, 237 U.S. 180 (1915).
\1832\Rooney v. North Dakota, 196 U.S. 319, 324 (1905).
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In Dobbert v. Florida,\1833\ the Court may have formulated a new
test for determining when a criminal statute vis-a-vis punishment is ex
post facto. Defendant murdered two of his children; at the time of the
commission of the offenses, Florida law provided the death penalty upon
conviction for certain takings of life. Subsequent to the commission of
the capital offenses, the Supreme Court held laws similar to Florida's
unconstitutional to the extent that death was a sentence under them,
although convictions obtained under the statutes were not to be
overturned,\1834\ and the Florida Supreme Court voided its death penalty
statutes on the authority of the High Court decision. The Florida
legislature then enacted a new capital punishment law, which was
sustained. Dobbert was convicted and sentenced to death under the new
law, which was enacted after the commission of his offenses. The Court
rejected the ex post facto challenge to the sentence on the basis that
whether the old statute was constitutional or not, ``it clearly
indicated Florida's view of the severity of murder and of the degree of
punishment which the legislature wished to impose upon murderers. The
statute was intended to provide maximum deterrence, and its existence on
the statute books provided fair warning as to the degree
[[Page 365]]
of culpability which the State ascribed to the act of murder.''\1835\
Whether the ``fair warning'' standard is to have any prominent place in
ex post facto jurisprudence may be an interesting question but it is
problematical in any event whether the fact situation will occur often
enough to make the principle applicable in very many cases.
\1833\432 U.S. 282, 297-298 (1977). Justices Stevens, Brennan,
and Marshall dissented. Id., 304.
\1834\Furman v. Georgia, 408 U.S. 238 (1972). The new law was
sustained in Proffitt v. Florida, 428 U.S. 242 (1976).
\1835\Id., 432 U.S., 297.
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Changes in Procedure.--An accused person does not have a right
to be tried in all respects in accordance with the law in force when the
crime charged was committed.\1836\ Laws shifting the place of trial from
one county to another,\1837\ increasing the number of appellate judges
and dividing the appellate court into divisions,\1838\ granting a right
of appeal to the State,\1839\ changing the method of selecting and
summoning jurors,\1840\ making separate trials for persons jointly
indicted a matter of discretion for the trial court rather than a matter
of right,\1841\ and allowing a comparison of handwriting experts\1842\
have been sustained over the objection that they were ex post facto. It
was said or suggested in a number of these cases, and two decisions were
rendered precisely on the basis, that the mode of procedure might be
changed only so long as the substantial rights of the accused were not
curtailed.\1843\ The Court has now disavowed this position.\1844\ All
that the language of most of these cases meant was that a legislature
might not evade the ex post facto clause by labeling changes as
alteration of ``procedure.'' If a change labeled ``procedural'' effects
a substantive change in the definition of a crime or increases
punishment or denies a defense, the clause is invoked; however, if a law
changes the procedures by which a criminal case is adjudicated, the
clause is
[[Page 366]]
not implicated, regardless of the increase in the burden on a
defendant.\1845\
\1836\Gibson v. Mississippi, 162 U.S. 565, 590 (1896).
\1837\Gut v. Minnesota, 9 Wall. (76 U.S.) 35, 37 (1870).
\1838\Duncan v. Missouri, 152 U.S. 377 (1894).
\1839\Mallett v. North Carolina, 181 U.S. 589, 593 (1901).
\1840\Gibson v. Mississippi, 162 U.S. 565, 588 (1896).
\1841\Beazell v. Ohio, 269 U.S. 167 (1925).
\1842\Thompson v. Missouri, 171 U.S. 380, 381 (1898).
\1843\E.g., Duncan v. Missouri, 152 U.S. 377, 382-383 (1894);
Malloy v. South Carolina, 237 U.S. 180, 183 (1915); Beazell v. Ohio, 269
U.S. 167, 171 (1925). The two cases decided on the basis of the
distinction were Thompson v. Utah, 170 U.S. 343 (1898) (application to
felony trial for offense committed before enactment of change from 12-
person jury to an eight-person jury void under clause), and Kring v.
Missouri, 107 U.S. 221 (1883) (as applied to a case arising before
change, a law abolishing a rule under which a guilty plea functioned as
a acquittal of a more serious offense, so that defendant could be tried
on the more serious charge, a violation of the clause).
\1844\Collins v. Youngblood, 497 U.S. 37, 44-52 (1990). In so
doing, the Court overruled Kring and Thompson v. Utah.
\1845\Id., 44, 52. Youngblood upheld a Texas statute, as applied
to a person committing an offense and tried before passage of the law,
that authorized criminal courts to reform an improper verdict assessing
a punishment not authorized by law, which had the effect of denying
defendant a new trial to which he would have been previously entitled.
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Obligation of Contracts
``Law'' Defined.--The term comprises statutes, constitutional
provisions,\1846\ municipal ordinances,\1847\ and administrative
regulations having the force and operation of statutes.\1848\ But are
judicial decisions within the clause? The abstract principle of the
separation of powers, at least until recently, forbade the idea that the
courts ``make'' law and the word ``pass'' in the above clause seemed to
confine it to the formal and acknowledged methods of exercise of the
law-making function. Accordingly, the Court has frequently said that the
clause does not cover judicial decisions, however erroneous, or whatever
their effect on existing contract rights.\1849\ Nevertheless, there are
important exceptions to this rule that are hereinafter set forth.
\1846\Dodge v. Woolsey, 18 How. (59 U.S.) 331 (1856); Ohio & M.
R. Co. v. McClure, 10 Wall. (77 U.S.) 511 (1871); New Orleans Gas Co. v.
Louisiana Light Co., 115 U.S. 650 (1885); Bier v. McGehee, 148 U.S. 137,
140 (1893).
\1847\New Orleans Water-Works Co. v. Rivers, 115 U.S. 674
(1885); City of Walla Walla v. Walla Walla Water Co., 172 U.S. 1 (1898);
City of Vicksburg v. Waterworks Co., 202 U.S. 453 (1906); Atlantic Coast
Line v. City of Goldsboro, 232 U.S. 548 (1914); Cuyahoga Power Co. v.
City of Akron, 240 U.S. 462 (1916).
\1848\Ibid.; see also Grand Trunk Ry. v. Indiana R.R. Comm., 221
U.S. 400 (1911); Appleby v. Delaney, 271 U.S. 403 (1926).
\1849\Central Land Company v. Laidley, 159 U.S. 103 (1895). See
also N.O. Water-Works Co. v. La. Sugar Co., 125 U.S. 18 (1888); Hanford
v. Davies, 163 U.S. 273 (1896); Ross v. Oregon, 227 U.S. 150 (1913);
Detroit United Ry. v. Michigan, 242 U.S. 238 (1916); Long Sault
Development Co. v. Call, 242, U.S. 272, (1916); McCoy v. Union Elevated
R. Co., 247 U.S. 354 (1918); Columbia G. & E. Ry. v. South Carolina, 261
U.S. 236 (1923); Tidal Oil Co. v. Flannagan, 263 U.S. 444 (1924).
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Status of Judicial Decision.--While the highest state court
usually has final authority in determining the construction as well as
the validity of contracts entered into under the laws of the State, and
the national courts will be bound by their decision of such matters,
nevertheless, for reasons that are fairly obvious, this rule does not
hold when the contract is one whose obligation is alleged to have been
impaired by state law.\1850\ Otherwise, the chal
[[Page 367]]
lenged state authority could be vindicated through the simple device of
a modification or outright nullification by the state court of the
contract rights in issue. Similarly, the highest state court usually has
final authority in construing state statutes and determining their
validity in relation to the state constitution. But this rule too has
had to bend to some extent to the Supreme Court's interpretation of the
obligation of contracts clause.\1851\
\1850\Jefferson Branch Bank v. Skelly, 1 Bl. (66 U.S.) 436, 443
(1862); Bridge Proprietors v. Hoboken Co., 1 Wall. (68 U.S.) 116, 145
(1863); Wright v. Nagle, 101 U.S. 791, 793 (1880); McGahey v. Virginia,
135 U.S. 662, 667 (1890); Scott v. McNeal, 154 U.S. 34, 35 (1894);
Stearns v. Minnesota, 179 U.S. 223, 232-233 (1900); Coombes v. Getz, 285
U.S. 434, 441 (1932); Atlantic Coast Line R. Co. v. Phillips, 332 U.S.
168, 170 (1947).
\1851\McCullough v. Virginia, 172 U.S. 102 (1898); Houston &
Texas Central R. Co. v. Texas, 177 U.S. 66, 76, 77 (1900); Hubert v. New
Orleans, 215 U.S. 170, 175 (1909); Carondelet Canal Co. v. Louisiana,
233 U.S. 362, 376 (1914); Louisiana Ry. & Nav. Co. v. New Orleans, 235
U.S. 164, 171 (1914).
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Suppose the following situation: (1) a municipality, acting
under authority conferred by a state statute, has issued bonds in aid of
a railway company; (2) the validity of this statute has been sustained
by the highest state court; (3) later the state legislature passes an
act to repeal certain taxes to meet the bonds; (4) it is sustained in
doing so by a decision of the highest state court holding that the
statute authorizing the bonds was unconstitutional ab initio. In such a
case the Supreme Court would take an appeal from the state court and
would reverse the latter's decision of unconstitutionality because of
its effect in rendering operative the act to repeal the tax.\1852\
\1852\State Bank of Ohio v. Knoop, 16 How. (57 U.S.) 369 (1854),
and Ohio Life Insurance and Trust Co. v. Debolt, 16 How. (57 U.S.) 416
(1854) are the leading cases. See also Jefferson Branch Bank v. Skelly,
1 Bl. (66 U.S.) 436 (1862); Louisiana v. Pilsbury, 105 U.S. 278 (1882);
McGahey v. Virginia, 135 U.S. 662 (1890); Mobile & Ohio Railroad v.
Tennessee, 153 U.S. 486 (1894); Bacon v. Texas, 163 U.S. 207 (1896);
McCullough v. Virginia, 172 U.S. 102 (1898).
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Suppose further, however, that the state court has reversed
itself on the question of the constitutionality of the bonds in a suit
by a creditor for payment without there having been an act of repeal. In
this situation, the Supreme Court would still afford relief if the case
is one between citizens of different States, which reaches it via a
lower federal court.\1853\ This is because in cases of this nature the
Court formerly felt free to determine questions of fundamental justice
for itself. Indeed, in such a case, the Court has apparently in the past
regarded itself as free to pass upon the constitutionality of the state
law authorizing the bonds even though there has been no prior decision
by the highest state court sustaining them, the idea being that
contracts entered into simply on the
[[Page 368]]
faith of the presumed constitutionality of a state statute are entitled
to this protection.\1854\
\1853\Gelpcke v. Dubuque, 1 Wall. (68 U.S.) 175, 206 (1865);
Havemayer v. Iowa County, 3 Wall. (70 U.S.) 294 (1866); Thomson v. Lee
County, 3 Wall. (70 U.S.) 327 (1866); The City v. Lamson, 9 Wall. (76
U.S.) 477 (1870); Olcott v. The Supervisors, 16 Wall. (83 U.S.) 678
(1873); Taylor v. Ypsilanti, 105 U.S. 60 (1882); Anderson v. Santa Anna,
116 U.S. 356 (1886); Wilkes County v. Coler, 180 U.S. 506 (1901).
\1854\Great Southern Hotel Co. v. Jones, 193 U.S. 532, 548
(1904).
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In other words, in cases of which it has jurisdiction because of
diversity of citizenship, the Court has held that the obligation of
contracts is capable of impairment by subsequent judicial decisions no
less than by subsequent statutes and that it is able to prevent such
impairment. In cases, on the other hand, of which it obtains
jurisdiction only on the constitutional ground and by appeal from a
state court, it has always adhered in terms to the doctrine that the
word ``laws'' as used in Article I, Sec. 10, does not comprehend
judicial decisions. Yet even in these cases, it will intervene to
protect contracts entered into on the faith of existing decisions from
an impairment that is the direct result of a reversal of such decisions,
but there must be in the offing, as it were, a statute of some kind--one
possibly many years older than the contract rights involved--on which to
pin its decision.\1855\
\1855\Sauer v. New York, 206 U.S. 536 (1907); Muhlker v. New
York & Harlem Railroad Co., 197 U.S. 544, 570 (1905).
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In 1922, Congress, through an amendment to the Judicial Code,
endeavored to extend the reviewing power of the Supreme Court to suits
involving ''. . . the validity of a contract wherein it is claimed that
a change in the rule of law or construction of statutes by the highest
court of a State applicable to such contract would be repugnant to the
Constitution of the United States. . . .'' This appeared to be an
invitation to the Court to say frankly that the obligation of a contract
can be impaired as well by a subsequent decision as by a subsequent
statute. The Court, however, declined the invitation in an opinion by
Chief Justice Taft that reviewed many of the cases covered in the
preceding paragraphs.
Dealing with Gelpcke and adherent decisions, Chief Justice Taft
said: ``These cases were not writs of error to the Supreme Court of a
State. They were appeals or writs of error to federal courts where
recovery was sought upon municipal or county bonds or some other form of
contracts, the validity of which had been sustained by decisions of the
Supreme Court of a State prior to their execution, and had been denied
by the same court after their issue or making. In such cases the federal
courts exercising jurisdiction between citizens of different States held
themselves free to decide what the state law was, and to enforce it as
laid down by the state Supreme Court before the contracts were made
rather than in later decisions. They did not base this conclusion on
Article I, Sec. 10, of the Federal Constitution, but on the state law as
they determined it,
[[Page 369]]
which, in diverse citizenship cases, under the third Article of the
Federal Constitution they were empowered to do. Burgess v. Seligman, 107
U.S. 20 (1883).''\1856\ While doubtless this was an available
explanation in 1924, the decision in 1938 in Erie Railroad Co. v.
Tompkins,\1857\ so cut down the power of the federal courts to decide
diversity of citizenship cases according to their own notions of
``general principles of common law'' as to raise the question whether
the Court will not be required eventually to put Gelpcke and its
companions and descendants squarely on the obligation of contracts
clause or else abandon them.
\1856\Tidal Oil Company v. Flanagan, 263 U.S. 444, 450, 451-452
(1924).
\1857\304 U.S. 64 (1938).
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``Obligation'' Defined.--A contract is analyzable into two
elements: the agreement, which comes from the parties, and the
obligation, which comes from the law and makes the agreement binding on
the parties. The concept of obligation is an importation from the Civil
Law and its appearance in the contracts clause is supposed to have been
due to James Wilson, a graduate of Scottish universities and a Civilian.
Actually, the term as used in the contracts clause has been rendered
more or less superfluous by the doctrine that the law in force when a
contract is made enters into and comprises a part of the contract
itself.\1858\ Hence, the Court sometimes recognizes the term in its
decisions applying the clause, sometimes ignores it. In Sturges v.
Crowninshield,\1859\ Marshall defined ``obligation of contract'' as
``the law which binds the parties to perform their agreement;'' but a
little later the same year he sets forth the points presented for
consideration in Dartmouth College v. Woodward,\1860\ to be: ``1. Is
this contract protected by the Constitution of the United States? 2. Is
it impaired by the acts under which the defendant holds?''\1861\ The
word ``obligation'' undoubtedly does carry the implication that the
Constitution was intended to protect only executory contracts--i.e.,
contracts still awaiting performance, but this implication was early
rejected for a certain class of contracts, with immensely important
result for the clause.
\1858\Walker v. Whitehead, 16 Wall. (83 U.S.) 314 (1873); Wood
v. Lovett, 313 U.S. 362, 370 (1941).
\1859\4 Wheat. (17 U.S.) 122, 197 (1819); see also Curran v.
Arkansas, 15 How. (56 U.S.) 304 (1854).
\1860\4 Wheat. (17 U.S.) 518 (1819).
\1861\Id., 627.
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``Impair'' Defined.--``The obligations of a contract,'' says
Chief Justice Hughes for the Court in Home Building & Loan Assn. v.
Blaisdell,\1862\ ``are impaired by a law which renders them in
[[Page 370]]
valid, or releases or extinguishes them . . ., and impairment . . . has
been predicated upon laws which without destroying contracts derogate
from substantial contractual rights.''\1863\ But he adds: ``Not only are
existing laws read into contracts in order to fix obligations as between
the parties, but the reservation of essential attributes of sovereign
power is also read into contracts as a postulate of the legal order. The
policy of protecting contracts against impairment presupposes the
maintenance of a government by virtue of which contractual relations are
worthwhile,--a government which retains adequate authority to secure the
peace and good order of society. This principle of harmonizing the
constitutional prohibition with the necessary residuum of state power
has had progressive recognition in the decisions of this Court.''\1864\
In short, the law from which the obligation stems must be understood to
include constitutional law and, moreover a ``progressive''
constitutional law.\1865\
\1862\290 U.S. 398 (1934).
\1863\Id., 431.
\1864\Id., 435. And see City of El Paso v. Simmons, 379 U.S. 497
(1965).
\1865\``The Blaisdell decision represented a realistic
appreciation of the fact that ours is an evolving society and that the
general words of the contract clause were not intended to reduce the
legislative branch of government to helpless impotency.'' Justice Black,
in Wood v. Lovett, 313 U.S. 362, 383 (1941).
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Vested Rights Not Included.--The term ``contracts'' is used in
the contracts clause in its popular sense of an agreement of minds. The
clause therefore does not protect vested rights that are not referable
to such an agreement between the State and an individual, such as the
right of recovery under a judgment. The individual in question may have
a case under the Fourteenth Amendment, but not one under Article I,
Sec. 10.\1866\
\1866\Crane v. Hahlo, 258 U.S. 142, 145-146 (1922); Louisiana ex
rel. Folsom v. Mayor of New Orleans, 109 U.S. 285, 288 (1883); Morley v.
Lake Shore Railway Co., 146 U.S. 162, 169 (1892). That the obligation of
contracts clause did not protect vested rights merely as such was stated
by the Court as early as Satterlee v. Matthewson, 2 Pet. (27 U.S.) 380,
413 (1829); and again in Charles River Bridge v. Warren Bridge, 11 Pet.
(36 U.S.) 420, 539-540 (1837).
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Public Grants That Are Not ``Contracts''.--Not all grants by a
State constitute ``contracts'' within the sense of Article I, Sec. 10.
In his Dartmouth College decision, Chief Justice Marshall conceded that
``if the act of incorporation be a grant of political power, if it
creates a civil institution, to be employed in the administration of the
government . . . the subject is one in which the legislature of the
State may act according to its own judgment,'' unrestrained by the
Constitution\1867\--thereby drawing a line between ``public'' and
[[Page 371]]
``private'' corporations that remained undisturbed for more than half a
century.\1868\
\1867\Dartmouth College v. Woodward, 4 Wheat. (17 U.S.) 518, 629
(1819).
\1868\In Munn v. Illinois, 94 U.S. 113 (1877) a category of
``business affected with a public interest'' and whose property is
``impressed with a public use'' was recognized. A corporation engaged in
such a business becomes a ``quasi-public'' corporation, the power of the
State to regulate which is larger than in the case of a purely private
corporation. Inasmuch as most corporations receiving public franchises
are of this character, the final result of Munn was to enlarge the
police power of the State in the case of the most important
beneficiaries of the Dartmouth College decision.
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It has been subsequently held many times that municipal
corporations are mere instrumentalities of the State for the more
convenient administration of local governments, whose powers may be
enlarged, abridged, or entirely withdrawn at the pleasure of the
legislature.\1869\ The same principle applies, moreover, to the property
rights which the municipality derives either directly or indirectly from
the State. This was first held as to the grant of a franchise to a
municipality to operate a ferry and has since then been recognized as
the universal rule.\1870\ It was stated in a case decided in 1923 that
the distinction between the municipality as an agent of the State for
governmental purposes and as an organization to care for local needs in
a private or proprietary capacity, while it limited the legal liability
of municipalities for the negligent acts or omissions of its officers or
agents, did not, on the other hand, furnish ground for the application
of constitutional restraints against the State in favor of its own
municipalities.\1871\ Thus, no contract rights were impaired by a
statute relocating a county seat, even though the former location was by
law to be ``permanent'' and the citizens of the community had donated
land and furnished bonds for the erection of public buildings.\1872\
Similarly, a statute changing the boundaries of a school district,
giving to the new district the property within its limits that had
belonged to the former district, and requiring the new district to
assume the debts of the old district, did not impair the obligation of
contracts.\1873\ Nor was the contracts clause violated by state
legislation authorizing state control over insolvent communities through
a Municipal Finance Commission.\1874\
\1869\Meriwether v. Garrett, 102 U.S. 472 (1880); Covington v.
Kentucky, 173 U.S. 231 (1899); Hunter v. Pittsburgh, 207 U.S. 161
(1907).
\1870\East Hartford v. Hartford Bridge Co., 10 How. (51 U.S.)
511 (1851); Hunter v. Pittsburgh, 207 U.S. 161 (1907).
\1871\City of Trenton v. New Jersey 262 U.S. 182, 191 (1923).
\1872\Newton v. Commissioners, 100 U.S. 548 (1880).
\1873\Michigan ex rel. Kies v. Lowrey, 199 U.S. 233 (1905).
\1874\Faitoute Co. v. City of Asbury Park, 316 U.S. 502 (1942).
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On the same ground of public agency, neither appointment nor
election to public office creates a contract in the sense of Article I,
[[Page 372]]
Sec. 10, whether as to tenure, or salary, or duties, all of which
remain, so far as the Constitution of the United States is concerned,
subject to legislative modification or outright repeal.\1875\ Indeed,
there can be no such thing in this country as property in office,
although the common law sustained a different view that sometimes found
reflection in early cases.\1876\ When, however, services have once been
rendered, there arises an implied contract that they shall be
compensated at the rate in force at the time they were rendered.\1877\
Also, an express contract between the State and an individual for the
performance of specific services falls within the protection of the
Constitution. Thus, a contract made by the governor pursuant to a
statute authorizing the appointment of a commissioner to conduct, over a
period of years, a geological, mineralogical, and agricultural survey of
the State, for which a definite sum had been authorized, was held to
have been impaired by repeal of the statute.\1878\ But a resolution of a
local board of education reducing teachers' salaries for the school year
1933-1934, pursuant to an act of the legislature authorizing such
action, was held not to impair the contract of a teacher who, having
served three years, was by earlier legislation exempt from having his
salary reduced except for inefficiency or misconduct.\1879\ Similarly,
it was held that an Illinois statute that reduced the annuity payable to
retired teachers under an earlier act did not violate the contracts
clause, since it had not been the intention of the earlier act to
propose a contract but only to put into effect a general policy.\1880\
On the other hand, the right of one, who had become a `permanent
teacher'' under the Indiana Teachers Tenure Act of 1927, to continued
employment was held to be contractual and to have been impaired by the
repeal in 1933 of the earlier act.\1881\
\1875\Butler v. Pennsylvania, 10 How. (51 U.S.) 402 (1850); Fisk
v. Jefferson Policy Jury, 116 U.S. 131 (1885); Dodge v. Board of
Education, 302 U.S. 74 (1937); Mississippi ex rel. Robertson v. Miller,
276 U.S. 174 (1928).
\1876\Butler v. Pennsylvania, 10 How. (51 U.S.) 420 (1850). Cf.
Marbury v. Madison, 1 Cr. (5 U.S.) 137 (1803); Hoke v. Henderson, 154
N.C. (4 Dev.) 1 (1833). See also United States v. Fisher, 109 U.S. 143
(1883); United States v. Mitchell, 109 U.S. 146 (1883); Crenshaw v.
United States, 134 U.S. 99 (1890).
\1877\Fisk v. Jefferson Police Jury, 116 U.S. 131 (1885);
Mississippi ex rel. Robertson v. Miller, 276 U.S. 174 (1928).
\1878\Hall v. Wisconsin, 103 U.S. 5 (1880). Cf. Higginbotham v.
City of Baton Rouge, 306 U.S. 535 (1930).
\1879\Phelps v. Board of Education, 300 U.S. 319 (1937).
\1880\Dodge v. Board of Education, 302 U.S. 74 (1937).
\1881\Indiana ex rel. Anderson v. Brand, 303 U.S. 95 (1938).
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Tax Exemptions: When Not ``Contracts''.--From a different point
of view, the Court has sought to distinguish between grants of
privileges, whether to individuals or to corporations, which are
contracts and those which are mere revocable licenses, although on
[[Page 373]]
account of the doctrine of presumed consideration mentioned earlier,
this has not always been easy to do. In pursuance of the precedent set
in New Jersey v. Wilson,\1882\ the legislature of a State ``may exempt
particular parcels of property or the property of particular persons or
corporations from taxation, either for a specified period or
perpetually, or may limit the amount or rate of taxation, to which such
property shall be subjected,'' and such an exemption is frequently a
contract within the sense of the Constitution. Indeed this is always so
when the immunity is conferred upon a corporation by the clear terms of
its charter.\1883\ When, on the other hand, an immunity of this sort
springs from general law, its precise nature is more open to doubt, as a
comparison of decisions will serve to illustrate.
\1882\7 Cr. (11 U.S.) 164 (1812).
\1883\The Delaware Railroad Tax, 18 Wall. (85 U.S.) 206, 225
(1874); Pacific Railroad Company v. Maguire, 20 Wall. (87 U.S.) 36, 43
(1874); Humphrey v. Pegues, 16 Wall. (83 U.S.) 244, 249 (1873); Home of
the Friendless v. Rouse, 8 Wall. (75 U.S.) 430, 438 (1869).
---------------------------------------------------------------------------
In State Bank of Ohio v. Knoop,\1884\ a closely divided Court
held that a general banking law of Ohio, which provided that companies
complying therewith and their stockholders should be exempt from all but
certain taxes, was, as to a bank organized under it and its
stockholders, a contract within the meaning of Article I, Sec. 10. The
provision was not, the Court said, ``a legislative command nor a rule of
taxation until changed, but a contract stipulating against any change,
from the nature of the language used and the circumstances under which
it was adopted.''\1885\ When, however, the State of Michigan pledged
itself, by a general legislative act, not to tax any corporation,
company, or individual undertaking to manufacture salt in the State from
water there obtained by boring on property used for this purpose and,
furthermore, to pay a bounty on the salt so manufactured, it was held
not to have engaged itself within the constitutional sense. ``General
encouragements,'' said the Court, ``held out to all persons
indiscriminately, to engage in a particular trade or manufacture,
whether such encouragement be in the shape of bounties or drawbacks, or
other advantage, are always under the legislative control, and may be
discontinued at any time.''\1886\ So far as exemption from taxation is
concerned the difference between these two cases is obviously slight,
but the later
[[Page 374]]
one is unquestionable authority for the proposition that legislative
bounties are repealable at will.
\1884\16 How. (57 U.S.) 369 (1854).
\1885\Id., 382-383.
\1886\Salt Company v. East Saginaw, 13 Wall. (80 U.S.) 373, 379
(1872). See also Welch v. Cook, 97 U.S. 541 (1879); Grand Lodge v. New
Orleans, 166 U.S. 143 (1897); Wisconsin & Michigan Ry. Co. v. Powers,
191 U.S. 379 (1903). Cf. Ettor v. Tacoma, 228 U.S. 148 (1913), in which
it was held that the repeal of a statute providing for consequential
damages caused by changes of grades of streets could not
constitutionally affect an already accrued right to compensation.
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Furthermore, exemptions from taxation have in certain cases been
treated as gratuities repealable at will, even when conferred by
specific legislative enactments. This would seem always to be the case
when the beneficiaries were already in existence when the exemption was
created and did nothing of a more positive nature to qualify for it than
to continue in existence.\1887\ Yet the cases are not always easy to
explain in relation to each other, except in light of the fact that the
Court's point of view has altered from time to time.\1888\
\1887\See Rector of Christ Church, Phila. v. County of
Philadelphia, 24 How. (65 U.S.) 300, 302 (1861); Seton Hall College v.
South Orange, 242 U.S. 100 (1916).
\1888\Compare the above cases with Home of the Friendless v.
Rouse, 8 Wall. (75 U.S.) 430, 437 (1869); Illinois Central Railroad v.
Decatur, 147 U.S. 190 (1893), with Wisconsin & Michigan Ry. Co. v.
Powers, 191 U.S. 379 (1903).
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``Contracts'' Include Public Contracts and Corporate Charters.--
The question, which was settled very early, was whether the clause was
intended to be applied solely in protection of private contracts or in
the protection also of public grants, or, more broadly, in protection of
public contracts, in short, those to which a State is a party.\1889\
Support for the affirmative answer accorded this question could be
derived from the following sources. For one thing, the clause departed
from the comparable provision in the Northwest Ordinance (1787) in two
respects: first, in the presence of the word ``obligation;'' secondly,
in the absence of the word ``private.'' There is good reason for
believing that Wilson may have been responsible for both alterations,
inasmuch as two years earlier he had denounced a current proposal to
repeal the Bank of North America's Pennsylvania charter in the following
words: ``If the act for incorporating the subscribers to the Bank of
North America shall be repealed in this manner, every precedent will be
established for repealing, in the same manner, every other legisla
[[Page 375]]
tive charter in Pennsylvania. A pretence, as specious as any that can be
alleged on this occasion, will never be wanting on any future occasion.
Those acts of the state, which have hitherto been considered as the sure
anchors of privilege and of property, will become the sport of every
varying gust of politicks, and will float wildly backwards and forwards
on the irregular and impetuous tides of party and faction.''\1890\
\1889\According to Benjamin F. Wright, throughout the first
century of government under the Constitution ``the contract clause had
been considered in almost forty per cent of all cases involving the
validity of State legislation,'' and of these the vast proportion
involved legislative grants of one type or other, the most important
category being charters of incorporation. However, the numerical
prominence of such grants in the cases does not overrate their relative
importance from the point of view of public interest. B. Wright, The
Contract Clause of the Constitution, (Boston: 1938), 95.
Madison explained the clause by allusion to what had occurred
``in the internal administration of the States'' in the years preceding
the Constitutional Convention, in regard to private debts. Violations of
contracts had become familiar in the form of depreciated paper made
legal tender, of property substituted for money, of installment laws,
and of the occlusions of the courts of justice. 3 M. Farrand, The
Records of the Federal Convention of 1787 (New Haven: rev. ed. 1937),
548; The Federalist, No. 44 (J. Cooke ed. 1961), 301-302.
\1890\2 The Works of James Wilson, R. McCloskey ed. (Cambridge:
1967), 834.
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Furthermore, in its first important constitutional case, that of
Chisholm v. Georgia,\1891\ the Court ruled that its original
jurisdiction extended to an action in assumpsit brought by a citizen of
South Carolina against the State of Georgia. This construction of the
federal judicial power was, to be sure, promptly repealed by the
Eleventh Amendment, but without affecting the implication that the
contracts protected by the Constitution included public contracts.
\1891\2 Dall. (2 U.S.) 419 (1793).
---------------------------------------------------------------------------
One important source of this diversity of opinion is to be found
in that ever welling spring of constitutional doctrine in early days,
the prevalence of natural law notions and the resulting vague
significance of the term ``law.'' In Sturges v. Crowninshield, Marshall
defined the obligation of contracts as ``the law which binds the parties
to perform their undertaking.'' Whence, however, comes this law? If it
comes from the State alone, which Marshall was later to deny even as to
private contracts,\1892\ then it is hardly possible to hold that the
States' own contracts are covered by the clause, which manifestly does
not create an obligation for contracts but only protects such obligation
as already exists. But, if, on the other hand, the law furnishing the
obligation of contracts comprises Natural Law and kindred principles, as
well as law which springs from state authority, then, inasmuch as the
State itself is presumably bound by such principles, the State's own
obligations, so far as harmonious with them, are covered by the clause.
\1892\Ogden v. Saunders, 12 Wheat. (25 U.S.) 213, 338 (1827).
---------------------------------------------------------------------------
Fletcher v. Peck,\1893\ has the double claim to fame in that it
was the first case in which the Supreme Court held a state enactment to
be in conflict with the Constitution, and also the first case to hold
that the contracts clause protected public grants. By an act passed on
January 7, 1795, the Georgia Legislature directed the sale to four land
companies of public lands comprising most of what are now the States of
Alabama and Mississippi. As soon became known, the passage of the
measure had been secured by open and wholesale bribery. So when a new
legislature took over in the
[[Page 376]]
winter of 1795-1796, almost its first act was to revoke the sale made
the previous year.
\1893\6 Cr. (10 U.S.) 87 (1810).
---------------------------------------------------------------------------
Meantime, however, the land companies had disposed of several
millions of acres of their holdings to speculators and prospective
settlers, and following the rescinding act some of these took counsel
with Alexander Hamilton as to their rights. In an opinion which was
undoubtedly known to the Court when it decided Fletcher v. Peck,
Hamilton characterized the repeal as contravening ``the first principles
of natural justice and social policy,'' especially so far as it was made
``to the prejudice . . . of third persons . . . innocent of the alleged
fraud or corruption; . . . moreover,'' he added, ``the Constitution of
the United States, article first, section tenth, declares that no State
shall pass a law impairing the obligations of contract. This must be
equivalent to saying no State shall pass a law revoking, invalidating,
or altering a contract. Every grant from one to another, whether the
grantor be a State or an individual, is virtually a contract that the
grantee shall hold and enjoy the thing granted against the grantor, and
his representatives. It, therefore, appears to me that taking the terms
of the Constitution in their large sense, and giving them effect
according to the general spirit and policy of the provisions, the
revocation of the grant by the act of the legislature of Georgia may
justly be considered as contrary to the Constitution of the United
States, and, therefore null. And that the courts of the United States,
in cases within their jurisdiction, will be likely to pronounce it
so.''\1894\ In the debate to which the ``Yazoo Land Frauds,'' as they
were contemporaneously known, gave rise in Congress, Hamilton's views
were quoted frequently.
\1894\B. Wright, The Contract Clause of the Constitution
(Boston: 1938), 22. Professor Wright dates Hamilton's pamphlet, 1796.
---------------------------------------------------------------------------
So far as it invoked the obligation of contracts clause,
Marshall's opinion in Fletcher v. Peck performed two creative acts. He
recognized that an obligatory contract was one still to be performed--in
other words, was an executory contract, also that a grant of land was an
executed contract--a conveyance. But, he asserted, every grant is
attended by ``an implied contract'' on the part of the grantor not to
claim again the thing granted. Thus, grants are brought within the
category of contracts having continuing obligation and so within Article
I, Sec. 10. But the question still remained of the nature of this
obligation. Marshall's answer to this can only be inferred from his
statement at the end of his opinion. The State of Georgia, he says,
``was restrained'' from the passing of the rescinding act ``either by
general principles which are common to our
[[Page 377]]
free institutions, or by particular provisions of the Constitution of
the United States.''\1895\
\1895\6 Cr. (10 U.S.) 87, 139 (1810). Justice Johnson, in his
concurring opinion, relied exclusively on general principles. ``I do not
hesitate to declare, that a State does not possess the power of revoking
its own grants. But I do it, on a general principle, on the reason and
nature of things; a principle which will impose laws even on the
Deity.'' Id., 143.
---------------------------------------------------------------------------
The protection thus thrown about land grants was presently
extended, in the case of New Jersey v. Wilson,\1896\ to a grant of
immunity from taxation that the State of New Jersey had accorded certain
Indian lands, and several years after that, in the Dartmouth College
case,\1897\ to the charter privileges of an eleemosynary corporation.
\1896\7 Cr. (11 U.S.) 164 (1812). The exemption from taxation
which was involved in this case was held in 1886 to have lapsed through
the acquiescence for sixty years by the owners of the lands in the
imposition of taxes upon these. Given v. Wright, 117 U.S. 648 (1886).
\1897\Dartmouth College v. Woodward, 4 Wheat. (17 U.S.) 518
(1819).
---------------------------------------------------------------------------
In City of El Paso v. Simmons,\1898\ the Court held, over a
vigorous dissent by Justice Black, that Texas had not violated this
clause when it amended its laws governing the sale of public lands so as
to restrict the previously unlimited right of a delinquent to reinstate
himself upon forfeited land by a single payment of all past interest
due.
\1898\379 U.S. 497 (1965). See also Thorpe v. Housing Authority
of City of Durham, 393 U.S. 268, 278-279 (1969).
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Corporate Charters: Different Ways of Regarding.--There are
three ways in which the charter of a corporation may be regarded. In the
first place, it may be thought of simply as a license terminable at will
by the State, like a liquor-seller's license or an auctioneer's license,
but affording the incorporators, so long as it remains in force, the
privileges and advantages of doing business in the form of a
corporation. Nowadays, indeed, when corporate charters are usually
issued to all legally qualified applicants by an administrative officer
who acts under a general statute, this would probably seem to be the
natural way of regarding them were it not for the Dartmouth College
decision. But, in 1819, charters were granted directly by the state
legislatures in the form of special acts and there were very few profit-
taking corporations in the country. The later extension of the benefits
of the Dartmouth College decision to corporations organized under
general law took place without discussion.
Secondly, a corporate charter may be regarded as a franchise
constituting a vested or property interest in the hands of the holders,
and therefore as forfeitable only for abuse or in accordance with its
own terms. This is the way in which some of the early
[[Page 378]]
state courts did regard them at the outset.\1899\ It is also the way in
which Blackstone regarded them in relation to the royal prerogative,
although not in relation to the sovereignty of Parliament, and the same
point of view found expression in Story's concurring opinion in
Dartmouth College v. Woodward, as it did also in Webster's argument in
that case.\1900\
\1899\In 1806 Chief Justice Parsons of the Supreme Judicial
Court of Massachusetts, without mentioning the contracts clause,
declared that rights legally vested in a corporation cannot be
``controlled of destroyed by a subsequent statute, unless a power [for
that purpose] be reserved to the legislature in the act of
incorporation,'' Wales v. Stetson, 2 Mass. 142 (1806). See also
Stoughton v. Baker, 4 Mass. 521 (1808) to like effect; cf. Locke v.
Dane, 9 Mass. 360 (1812) in which it is said that the purpose of the
contracts clause was to provide against paper money and insolvent laws.
Together these holdings add up to the conclusion that the reliance of
the Massachusetts court was on ``fundamental principles,'' rather than
the contracts clause.
\1900\4 Wheat. (17 U.S.), 577-595 (Webster's argument); id., 666
(Story's opinion). See also Story's opinion for the Court in Terrett v.
Taylor, 9 Cr. (13 U.S.) 43 (1815).
---------------------------------------------------------------------------
The third view is the one formulated by Chief Justice Marshall
in his controlling opinion in Dartmouth College v. Woodward.\1901\ This
is that the charter of Dartmouth College, a purely private institution,
was the outcome and partial record of a contract between the donors of
the college, on the one hand, and the British Crown, on the other, and
the contract still continued in force between the State of New
Hampshire, as the successor to the Crown and Government of Great
Britain, and the trustees, as successors to the donors. The charter, in
other words, was not simply a grant--rather it was the documentary
record of a still existent agreement between still existent
parties.\1902\ Taking this view, which he developed with great ingenuity
and persuasiveness, Marshall was able to appeal to the obligation of
contracts clause directly, and without further use of his fiction in
Fletcher v. Peck of an executory contract accompanying the grant.
\1901\4 Wheat. (17 U.S.) 518 (1819).
\1902\Id., 627.
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A difficulty still remained, however, in the requirement that a
contract, before it can have obligation, must import consideration, that
is to say, must be shown not to have been entirely gratuitous on either
side. Moreover, the consideration, which induced the Crown to grant a
charter to Dartmouth College, was not merely a speculative one. It
consisted of the donations of the donors to the important public
interest of education. Fortunately or unfortunately, in dealing with
this phase of the case, Marshall used more sweeping terms than were
needed. ``The objects for which a corporation is created,'' he wrote,
``are universally such as the government wishes to promote. They are
deemed beneficial to the country; and this benefit constitutes the
consideration, and in most cases,
[[Page 379]]
the sole consideration of the grant.'' In other words, the simple fact
of the charter having been granted imports consideration from the point
of view of the State.\1903\ With this doctrine before it, the Court in
Providence Bank v. Billings,\1904\ and again in Charles River Bridge v.
Warren Bridge,\1905\ admitted, without discussion of the point, the
applicability of the Dartmouth College decision to purely business
concerns.
\1903\Id., 637; see also Home of the Friendless v. Rouse, 8
Wall. (75 U.S.) 430, 437 (1869).
\1904\4 Pet. (29 U.S.) 514 (1830).
\1905\11 Pet. (36 U.S.) 420 (1837).
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Reservation of Right to Alter or Repeal Corporate Charters.--It
is next in order to consider four principles or doctrines whereby the
Court has itself broken down the force of the Dartmouth College decision
in great measure in favor of state legislative power. By the logic of
the Dartmouth College decision itself, the State may reserve in a
corporate charter the right to ``amend, alter, and repeal'' the same,
and such reservation becomes a part of the contract between the State
and the incorporators, the obligation of which is accordingly not
impaired by the exercise of the right.\1906\ Later decisions recognize
that the State may reserve the right to amend, alter, and repeal by
general law, with the result of incorporating the reservation in all
charters of subsequent date.\1907\ There is, however, a difference
between a reservation by a statute and one by constitutional provision.
While the former may be repealed as to a subsequent charter by the
specific terms thereof, the latter may not.\1908\
\1906\Dartmouth College v. Woodward, 4 Wheat. (17 U.S.) 518, 712
(1819) (Justice Story).
\1907\Home of the Friendless v. Rouse, 8 Wall. (75 U.S.) 430,
438 (1869); Pennsylvania College Cases, 13 Wall. (80 U.S.) 190, 213
(1872); Miller v. New York, 15 Wall. (82 U.S.) 478 (1873); Murray v.
Charleston, 96 U.S. 432 (1878); Greenwood v. Freight Co., 105 U.S. 13
(1882); Chesapeake & Ohio Railway Co. v. Miller, 114 U.S. 176 (1885);
Louisville Water Company v. Clark, 143 U.S. 1 (1892).
\1908\New Jersey v. Yard, 95 U.S. 104, 111 (1877).
---------------------------------------------------------------------------
Is the right reserved by a State to ``amend'' or ``alter'' a
charter without restriction? When it is accompanied, as it generally is,
by the right to ``repeal,'' one would suppose that the answer to this
question was self-evident. Nonetheless, there are a number of judicial
dicta to the effect that this power is not without limit, that it must
be exercised reasonably and in good faith, and that the alterations made
must be consistent with the scope and object of the grant.\1909\ Such
utterances amount, apparently, to little more than
[[Page 380]]
an anchor to windward, for while some of the state courts have applied
tests of this nature to the disallowance of legislation, it does not
appear that the Supreme Court of the United States has ever done
so.\1910\
\1909\See Holyoke Company v. Lyman, 15 Wall. (82 U.S.) 500, 520
(1873), See also Shields v. Ohio, 95 U.S. 319 (1877); Fair Haven R.R. v.
New Haven, 203 U.S. 379 (1906); Berea College v. Kentucky, 211 U.S. 45
(1908). Also Lothrop v. Stedman, 15 Fed. Cas. 922 (No. 8519) (C.C.D.
Conn. 1875) where the principles of natural justice are thought to set a
limit to the power.
\1910\See in this connection the cases cited by Justice
Sutherland in his opinion for the Court in Phillips Petroleum Co. v.
Jenkins, 297 U.S. 629 (1936).
---------------------------------------------------------------------------
Quite different is it with the distinction pointed out in the
cases between the franchises and privileges that a corporation derives
from its charter and the rights of property and contract that accrue to
it in the course of its existence. Even the outright repeal of the
former does not wipe out the latter or cause them to escheat to the
State. The primary heirs of the defunct organization are its creditors,
but whatever of value remains after their valid claims are met goes to
the former shareholders.\1911\ By the earlier weight of authority, on
the other hand, persons who contract with companies whose charters are
subject to legislative amendment or repeal do so at their own risk; any
``such contracts made between individuals and the corporation do not
vary or in any manner change or modify the relation between the State
and the corporation in respect to the right of the State to alter,
modify, or amend such a charter. . . .''\1912\ But later holdings
becloud this rule.\1913\
\1911\Curran v. Arkansas, 15 How. (56 U.S.) 304 (1853); Shields
v. Ohio, 95 U.S. 319 (1877); Greenwood v. Freight Co., 105 U.S. 13
(1882); Adirondack Railway Co. v. New York, 176 U.S. 335 (1900); Stearns
v. Minnesota, 179 U.S. 223 (1900); Chicago, M. & St. P. R. v. Wisconsin,
238 U.S. 491 (1915); Coombes v. Getz, 285 U.S. 434 (1932).
\1912\Pennsylvania College Cases, 13 Wall. (80 U.S.) 190, 218
(1872). See also Calder v. Michigan, 218 U.S. 591 (1910).
\1913\Lake Shore & Michigan Southern Railway Co. v. Smith, 173
U.S. 684, 690 (1899); Coombes v. Getz, 285 U.S. 434 (1932). Both these
decisions cite Greenwood v. Freight Co., 105 U.S. 13, 17 (1882), but
without apparent justification.
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Corporation Subject to the Law and Police Power.--But suppose
the State neglects to reserve the right to amend, alter, or repeal--is
it, then, without power to control its corporate creatures? By no means.
Private corporations, like other private persons, are always presumed to
be subject to the legislative power of the State, from which it follows
that immunities conferred by charter are to be treated as exceptions to
an otherwise controlling rule. This principle was recognized by Chief
Justice Marshall in the case of Providence Bank v. Billings,\1914\ in
which he held that in the absence of express stipulation or reasonable
implication to the contrary in its charter, the bank was subject to the
taxing power of the State, notwithstanding that the power to tax is the
power to destroy.
\1914\4 Pet. (29 U.S.) 514 (1830).
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And of course the same principle is equally applicable to the
exercise by the State of its police powers. Thus, in what was per
[[Page 381]]
haps the leading case before the Civil War, the Supreme Court of Vermont
held that the legislature of that State had the right, in furtherance of
the public safety, to require chartered companies operating railways to
fence in their tracks and provide cattle guards. In a matter of this
nature, said the court, corporations are on a level with individuals
engaged in the same business, unless, from their charter, they can prove
the contrary.\1915\ Since then the rule has been applied many times in
justification of state regulation of railroads,\1916\ and even of the
application of a state prohibition law to a company that had been
chartered expressly to manufacture beer.\1917\
\1915\Thorpe v. Rutland & Burlington R. Company, 27 Vt. 140
(1854).
\1916\Thus a railroad may be required, at its own expense and
irrespective of benefits to itself, to eliminate grade crossings in the
interest of the public safety, New York & N.E. Railroad v. Bristol, 151
U.S. 556 (1894), to make highway crossings reasonably safe and
convenient for public use, Great Northern Ry. Co. v. Minnesota ex rel.
Clara City, 246 U.S. 434 (1918), to repair viaducts, Northern Pacific
Railway v. Duluth, 208 U.S. 583 (1908), and to fence its right of way,
Minneapolis & St. L. Ry. v. Emmons, 149 U.S. 364 (1893). Though a
railroad company owns the right of way along a street, the city may
require it to lay tracks to conform to the established grade; to fill in
tracks at street intersections; and to remove tracks from a busy street
intersection, when the attendant disadvantage and expense are small and
the safety of the public appreciably enhanced Denver & R.G.R. Co. v.
Denver, 250 U.S. 241 (1919).
Likewise the State, in the public interest, may require a
railroad to reestablish an abandoned station, even though the railroad
commission had previously authorized its abandonment on condition that
another station be established elsewhere, a condition which had been
complied with. Railroad Co. v. Hammersley, 104 U.S. 1 (1881). It may
impose upon a railroad liability for fire communicated by its
locomotives, even though the State had previously authorized the company
to use said type of locomotive power, St. Louis & San Francisco Railway
v. Mathews, 165 U.S. 1, 5 (1897), and it may penalize the failure to cut
drains through embankments so as to prevent flooding of adjacent lands.
Chicago & Alton R.R. v. Tranbarger, 238 U.S. 67 (1915).
\1917\Beer Co. v. Massachusetts, 97 U.S. 25 (1878). See also
Fertilizing Co. v. Hyde Park, 97 U.S. 659 (1878); Hammond Packing Co. v.
Arkansas, 212 U.S. 322, 345 (1909).
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Strict Construction of Charters, Tax Exemptions.--Long, however,
before the cases last cited were decided, the principle that they
illustrate had come to be powerfully reinforced by two others, the first
of which is that all charter privileges and immunities are to be
strictly construed as against the claims of the State, or as it is
otherwise often phrased, ``nothing passes by implication in a public
grant.''
The leading case was that of the Charles River Bridge v. Warren
Bridge,\1918\ which was decided shortly after Chief Justice Marshall's
death by a substantially new Court. The question at issue was whether
the charter of the complaining company, which authorized it to operate a
toll bridge, stood in the way of the State's
[[Page 382]]
permitting another company of later date to operate a free bridge in the
immediate vicinity. Inasmuch as the first company could point to no
clause in its charter specifically vested it with an exclusive right,
the Court held the charter of the second company to be valid on the
principle just stated. Justice Story, presented a vigorous dissent, in
which he argued cogently, but unavailingly, that the monopoly claimed by
the Charles River Bridge Company was fully as reasonable an implication
from the terms of its charter and the circumstances surrounding its
concession as perpetuity had been from the terms of the Dartmouth
College charter and the ensuing transaction.
\1918\11 Pet. (36 U.S.) 420 (1837).
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The Court was in fact making new law, because it was looking at
things from a new point of view. This was the period when judicial
recognition of the Police Power began to take on a doctrinal character.
It was also the period when the railroad business was just beginning.
Chief Justice Taney's opinion evinces the influence of both these
developments. The power of the State to provide for its own internal
happiness and prosperity was not, he asserted, to be pared away by mere
legal intendments, nor was its ability to avail itself of the lights of
modern science to be frustrated by obsolete interests such as those of
the old turnpike companies, the charter privileges of which, he
apprehended, might easily become a bar to the development of
transportation along new lines.\1919\
\1919\Id., 548-553.
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The rule of strict construction has been reiterated by the Court
many times. In the Court's opinion in Blair v. City of Chicago,\1920\
decided nearly seventy years after the Charles River Bridge case, it
said: ``Legislative grants of this character should be in such
unequivocal form of expression that the legislative mind may be
distinctly impressed with their character and import, in order that the
privilege may be intelligently granted or purposely withheld. It is a
matter of common knowledge that grants of this character are usually
prepared by those interested in them, and submitted to the legislature
with a view to obtain from such bodies the most liberal grant of
privileges which they are willing to give. This is one among many
reasons why they are to be strictly construed. . . . The principle is
this, that all rights which are asserted against the State must be
clearly defined, and not raised by inference or presumption; and if the
charter is silent about a power, it does not exist. If, on a fair
reading of the instrument, reasonable doubts arise as to the proper
interpretation to be given to it, those doubts are to be solved in favor
of the State; and where it is susceptible
[[Page 383]]
of two meanings, the one restricting and the other extending the powers
of the corporation, that construction is to be adopted which works the
least harm to the State.'''\1921\
\1920\201 U.S. 400 (1906).
\1921\Id., 471-472, citing The Binghamton Bridge, 3 Wall. (70
U.S.) 51, 75 (1866).
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An excellent illustration of the operation of the rule in
relation to tax exemptions was furnished by the derivative doctrine that
an immunity of this character must be deemed as intended solely for the
benefit of the corporation receiving it and hence, in the absence of
express permission by the State, may not be passed on to a
successor.\1922\ Thus, where two companies, each exempt from taxation,
were permitted by the legislature to consolidate, the new corporation
was held to be subject to taxation.\1923\ Again, a statute which granted
a corporation all ``the rights and privileges'' of an earlier
corporation was held not to confer the latter's ``immunity'' from
taxation.\1924\ Yet again, a legislative authorization of the transfer
by one corporation to another of the former's ``estate, property, right,
privileges, and franchises'' was held not to clothe the later company
with the earlier one's exemption from taxation.\1925\
\1922\Memphis & L. R. Co. v. Commissioners, 112 U.S. 609, 617
(1884). See also Morgan v. Louisiana, 93 U.S. 217 (1876); Wilson v.
Gaines, 103 U.S. 417 (1881); Louisville & Nashville R.R. Co. v. Palmes,
109 U.S. 244, 251 (1883); Norfolk & Western Railroad v. Pendleton, 156
U.S. 667, 673 (1895); Pickard v. East Tennessee, V. & G.R. Co., 130 U.S.
637, 641 (1889).
\1923\Atlantic & Gulf R. Co. v. Georgia, 98 U.S. 359, 365
(1879).
\1924\Phoenix F. & M. Ins. Co. v. Tennessee, 161 U.S. 174
(1896).
\1925\Rochester Railway Co. v. Rochester, 205 U.S. 236 (1907);
followed in Wright v. Georgia R.R. & Banking Co., 216 U.S. 420 (1910);
Rapid Transit Corp. v. New York, 303 U.S. 573 (1938). Cf. Tennessee v.
Whitworth, 117 U.S. 139 (1886), the authority of which is respected in
the preceding case.
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Furthermore, an exemption from taxation is to be strictly
construed even in the hands of one clearly entitled to it. So the
exemption conferred by its charter on a railway company was held not to
extend to branch roads constructed by it under a later statute.\1926\
Also, a general exemption of the property of a corporation from taxation
was held to refer only to the property actually employed in its
business.\1927\ Also, the charter exemption of the capital stock of a
railroad from taxation ``for ten years after completion of the said
road'' was held not to become operative until the completion of the
road.\1928\ So also the exemption of the campus and endowment fund of a
college was held to leave other lands of the college, though a part of
its endowment, subject to taxation.\1929\ Provisions in a statute that
bonds of the State and its political subdivisions were not to be taxed
and should not be taxed were held
[[Page 384]]
not to exempt interest on them from taxation as income of the
owners.\1930\
\1926\Chicago, B. & K.C. R. v. Guffey, 120 U.S. 569 (1887).
\1927\Ford v. Delta and Pine Land Company, 164 U.S. 662 (1897).
\1928\Vicksburg, S. & P. R. Co. v. Dennis, 116 U.S. 665 (1886).
\1929\Millsaps College v. City of Jackson, 275 U.S. 129 (1927).
\1930\Hale v. State Board, 302 U.S. 95 (1937).
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Strict Construction and the Police Power.--The police power,
too, has frequently benefitted from the doctrine of strict construction,
although this recourse is today seldom, if ever, necessary in this
connection. Some of the more striking cases may be briefly summarized.
The provision in the charter of a railway company permitting it to set
reasonable charges still left the legislature free to determine what
charges were reasonable.\1931\ On the other hand, when a railway agreed
to accept certain rates for a specified period, it thereby foreclosed
the question of the reasonableness of such rates.\1932\ The grant to a
company of the right to supply a city with water for twenty-five years
was held not to prevent a similar concession to another company by the
same city.\1933\ The promise by a city in the charter of a water company
not to make a similar grant to any other person or corporation was held
not to prevent the city itself from engaging in the business.\1934\ A
municipal concession to a water company to run for thirty years and
accompanied by the provision that the ``said company shall charge the
following rates,'' was held not to prevent the city from reducing such
rates.\1935\ But more broadly, the grant to a municipality of the power
to regulate the charges of public service companies was held not to
bestow the right to contract away this power.\1936\ Indeed, any claim by
a private corporation that it received the rate-making power from a
municipality must survive a two-fold challenge: first, as to the right
of the municipality under its charter to make such a grant, secondly, as
to whether it has actually done so, and in both respects an affirmative
answer must be based on express words and not on implication.\1937\
\1931\Railroad Commission Cases (Stone v. Farmers' Loan & Trust
Co.), 116 U.S. 307, 330 (1886), extended in Southern Pacific Co. v.
Campbell, 230 U.S. 537 (1913) to cases in which the word ``reasonable''
does not appear to qualify the company's right to prescribe tolls. See
also American Bridge Co. v. Comm., 307 U.S. 486 (1939).
\1932\Georgia Ry. Co. v. Town of Decatur, 262 U.S. 432 (1923).
See also Southern Iowa Elec. Co. v. City of Chariton, 255 U.S. 539
(1921).
\1933\City of Walla Walla v. Walla Walla Water Co., 172 U.S. 1,
15 (1898).
\1934\Skaneateles Water Co. v. Village of Skaneateles, 184 U.S.
354 (1902); Water Co. v. City of Knoxville, 200 U.S. 22 (1906); Madera
Water Works v. City of Madera, 228 U.S. 454 (1913).
\1935\Rogers Park Water Company v. Fergus, 180 U.S. 624 (1901).
\1936\Home Tel. & Tel. Co. v. City of Los Angeles, 211 U.S. 265
(1908); Wyandotte Gas Co. v. Kansas, 231 U.S. 622 (1914).
\1937\See also Puget Sound Traction Co. v. Reynolds, 244 U.S.
574 (1917). ``Before we can find impairment of a contract we must find
an obligation of the contract which has been impaired. Since the
contract here relied upon is one between a political subdivision of a
state and private individuals, settled principles of construction
require that the obligation alleged to have been impaired be clearly and
unequivocally expressed.'' Justice Black for the Court in Keefe v.
Clark, 322 U.S. 393, 396-397 (1944).
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[[Page 385]]
Doctrine of Inalienability as Applied to Eminent Domain, Taxing,
and Police Powers.--The second of the doctrines mentioned above, whereby
the principle of the subordination of all persons, corporate and
individual alike, to the legislative power of the State has been
fortified, is the doctrine that certain of the State's powers are
inalienable, and that any attempt by a State to alienate them, upon any
consideration whatsoever, is ipso facto void and hence incapable to
producing a ``contract'' within the meaning of Article I, Sec. 10. One
of the earliest cases to assert this principle occurred in New York in
1826. The corporation of the City of New York, having conveyed certain
lands for the purposes of a church and cemetery together with a covenant
for quiet enjoyment, later passed a by-law forbidding their use as a
cemetery. In denying an action against the city for breach of covenant,
the state court said the defendants ``had no power as a party, [to the
covenant] to make a contract which should control or embarrass their
legislative powers and duties.''\1938\
\1938\Brick Presbyterian Church v. New York, 5 Cow. (N.Y.) 538,
540 (1826).
---------------------------------------------------------------------------
The Supreme Court first applied similar doctrine in 1848 in a
case involving a grant of exclusive right to construct a bridge at a
specified locality. Sustaining the right of the State of Vermont to make
a new grant to a competing company, the Court held that the obligation
of the earlier exclusive grant was sufficiently recognized in making
just compensation for it; and that corporate franchises, like all other
forms of property, are subject to the overruling power of eminent
domain.\1939\ This reasoning was reinforced by an appeal to the theory
of state sovereignty, which was held to involve the corollary of the
inalienability of all the principal powers of a State.
\1939\West River Bridge Company v. Dix, 6 How. (47 U.S.) 507
(1848). See also Backus v. Lebanon, 11 N.H. 19 (1840); White River
Turnpike Co. v. Vermont Cent. R. Co., 21 Vt. 590 (1849); and Bonaparte
v. Camden & A.R. Co., 3 Fed. Cas. 821 (No. 1617) (C.C.D.N.J. 1830).
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The subordination of all charter rights and privileges to the
power of eminent domain has been maintained by the Court ever since; not
even an explicit agreement by the State to forego the exercise of the
power will avail against it.\1940\ Conversely, the State may revoke an
improvident grant of public property without recourse to the power of
eminent domain, such a grant being inherently beyond the power of the
State to make. So when the legislature of Illinois in 1869 devised to
the Illinois Central Railroad Company, its successors and assigns, the
State's right and title to nearly a thousand acres of submerged land
under Lake Michigan
[[Page 386]]
along the harbor front of Chicago, and four years later sought to repeal
the grant, the Court, a four-to-three decision, sustained an action by
the State to recover the lands in question. Said Justice Field, speaking
for the majority: ``Such abdication is not consistent with the exercise
of that trust which requires the government of the State to preserve
such waters for the use of public. The trust devolving upon the State
for the public, and which can only be discharged by the management and
control of property in which the public has an interest, cannot be
relinquished by a transfer of the property. . . . Any grant of the kind
is necessarily revocable, and the exercise of the trust by which the
property was held by the State can be resumed at any time.''\1941\
\1940\Pennsylvania Hospital v. City of Philadelphia, 245 U.S. 20
(1917).
\1941\Illinois Central R. Co. v. Illinois, 146 U.S. 387, 453,
455 (1892).
---------------------------------------------------------------------------
On the other hand, repeated endeavors to subject tax exemptions
to the doctrine of inalienability, though at times supported by powerful
minorities on the Bench, have failed.\1942\ As recently as January,
1952, the Court ruled that the Georgia Railway Company was entitled to
seek an injunction in the federal courts against an attempt by Georgia's
Revenue Commission to compel it to pay ad valorem taxes contrary to the
terms of its special charter issued in 1833. In answer to the argument
that this was a suit contrary to the Eleventh Amendment, the Court
declared that the immunity from federal jurisdiction created by the
Amendment ``does not extend to individuals who act as officers without
constitutional authority.''\1943\
\1942\See especially Home of the Friendless v. Rouse, 8 Wall.
(75 U.S.) 430 (1869), and The Washington University v. Rouse, 8 Wall.
(75 U.S.) 439 (1869).
\1943\Georgia R. Co. v. Redwine, 342 U.S. 299, 305-306 (1952).
The Court distinguished In re Ayers, 123 U.S. 443 (1887) on the ground
that the action there was barred ``as one in substance directed at the
State merely to obtain specific performance of a contract with the
State.'' 342 U.S., 305.
---------------------------------------------------------------------------
The leading case involving the police power is Stone v.
Mississippi.\1944\ In 1867, the legislature of Mississippi chartered a
company to which it expressly granted the power to conduct a lottery.
Two years later, the State adopted a new Constitution which contained a
provision forbidding lotteries, and a year later the legislature passed
an act to put this provision into effect. In upholding this act and the
constitutional provision on which it was based, the Court said: ``The
power of governing is a trust committed by the people to the government,
no part of which can be granted away. The people, in their sovereign
capacity, have established their agencies for the preservation of the
public health and the public morals, and the protection of public and
private rights,'' and these agencies can neither give away nor sell
their discretion. All that
[[Page 387]]
one can get by a charter permitting the business of conducting a lottery
``is suspension of certain governmental rights in his favor, subject to
withdrawal at will.''\1945\
\1944\101 U.S. 814 (1880).
\1945\Id., 820-821.
---------------------------------------------------------------------------
The Court shortly afterward applied the same reasoning in a case
in which was challenged the right of Louisiana to invade the exclusive
privilege of a corporation engaged in the slaughter of cattle in New
Orleans by granting another company the right to engage in the same
business. Although the State did not offer to compensate the older
company for the lost monopoly, its action was sustained on the ground
that it had been taken in the interest of the public health.\1946\ When,
however, the City of New Orleans, in reliance on this precedent, sought
to repeal an exclusive franchise which it had granted a company for
fifty years to supply gas to its inhabitants, the Court interposed its
veto, explaining that in this instance neither the public health, the
public morals, nor the public safety was involved.\1947\
\1946\Butcher's Union Co. v. Crescent City Co., 111 U.S. 746
(1884).
\1947\New Orleans Gas Co. v. Louisiana Light Co., 115 U.S. 650
(1885).
---------------------------------------------------------------------------
Later decisions, nonetheless, apply the principle of
inalienability broadly. To quote from one: ``It is settled that neither
the `contract' clause nor the `due process' clause has the effect of
overriding the power to the State to establish all regulations that are
reasonably necessary to secure the health, safety, good order, comfort,
or general welfare of the community; that this power can neither be
abdicated nor bargained away, and is inalienable even by express grant;
and all contract and property rights are held subject to its fair
exercise.''\1948\
\1948\Atlantic Coast Line R. Co. v. City of Goldsboro, 232 U.S.
548, 558 (1914). See also Chicago & Alton Railroad v. Tranbarger, 238
U.S. 67 (1915); Pennsylvania Hospital v. Philadelphia, 245 U.S. 20
(1917); where the police power and eminent domain are treated on the
same basis in respect of inalienability; Wabash Railroad Company v.
Defiance, 167 U.S. 88, 97 (1897); Home Tel. & Tel. v. City of Los
Angeles, 211 U.S. 265 (1908).
---------------------------------------------------------------------------
It would scarcely suffice today for a company to rely upon its
charter privileges or upon special concessions from a State in resisting
the application to it of measures alleged to have been enacted under the
police power thereof; if this claim is sustained, the obligation of the
contract clause will not avail, and if it is not, the due process of law
clause of the Fourteenth Amendment will furnish a sufficient reliance.
That is to say, the discrepancy that once existed between the Court's
theory of an overriding police power in these two adjoining fields of
constitutional law is today apparently at an end. Indeed, there is
usually no sound reason why rights based on public grant should be
regarded as more sacrosanct than
[[Page 388]]
rights that involve the same subject matter but are of different
provenience.
Private Contracts.--The term ``private contract'' is, naturally,
not all-inclusive. A judgment, though granted in favor of a creditor, is
not a contract in the sense of the Constitution,\1949\ nor is
marriage.\1950\ And whether a particular agreement is a valid contract
is a question for the courts, and finally for the Supreme Court, when
the protection of the contract clause is invoked.\1951\
\1949\Morley v. Lake Shore Railway Co., 146 U.S. 162 (1892); New
Orleans v. N.O. Water Works Co., 142 U.S. 79 (1891); Missouri & Ark L. &
M. Co. v. Sebastion County, 249 U.S. 170 (1919). But cf. Livingston's
Lessee v. Moore, 7 Pet. (32 U.S.) 469, 549 (1833); and Garrison v. New
York, 21 Wall. (88 U.S.) 196, 203 (1875), suggesting that a different
view was earlier entertained in the case of judgments in actions of
debt.
\1950\Maynard v. Hill, 125 U.S. 190 (1888); Dartmouth College v.
Woodward, 4 Wheat. (17 U.S.) 518, 629 (1819). Cf. Andrews v. Andrews,
188 U.S. 14 (1903). The question whether a wife's rights in the
community property under the laws of California were of a contractual
nature was raised but not determined in Moffit v. Kelly, 218 U.S. 400
(1910).
\1951\New Orleans v. New Orleans Water Works Co., 142 U.S. 79
(1891); Zane v. Hamilton County, 189 U.S. 370, 381 (1903).
---------------------------------------------------------------------------
The question of the nature and source of the obligation of a
contract, which went by default in Fletcher v. Peck and the Dartmouth
College Case, with such vastly important consequences, had eventually to
be met and answered by the Court in connection with private contracts.
The first case involving such a contract to reach the Supreme Court was
Sturges v. Crowninshield,\1952\ in which a debtor sought escape behind a
state insolvency act of later date than his note. The act was held
inoperative, but whether this was because of its retroactivity in this
particular case or for the broader reason that it assumed to excuse
debtors from their promises was not at the time made clear. As noted
earlier, Chief Justice Marshall's definition on this occasion of the
obligation of a contract as the law that binds the parties to perform
their undertakings was not free from ambiguity, owing to the uncertain
connotation of the term law.
\1952\4 Wheat. (17 U.S.) 122 (1819).
---------------------------------------------------------------------------
These obscurities were finally cleared up for most cases in
Ogden v. Saunders,\1953\ in which the temporal relation of the statute
and the contract involved was exactly reversed--the former antedating
the latter. Marshall contended, but unsuccessfully, that the statute was
void, inasmuch as it purported to release the debtor from that original,
intrinsic obligation that always attaches under natural law to the acts
of free agents. ``When,'' he wrote, ``we advert to the course of reading
generally pursued by American statesmen in early life, we must suppose
that the framers of our
[[Page 389]]
Constitution were intimately acquainted with the writings of those wise
and learned men whose treatises on the laws of nature and nations have
guided public opinion on the subjects of obligation and contracts,'' and
that they took their views on these subjects from those sources. He also
posed the question of what would happen to the obligation of contracts
clause if States might pass acts declaring that all contracts made
subsequently thereto should be subject to legislative control.\1954\
\1953\12 Wheat. (25 U.S.) 213 (1827).
\1954\Id., 353-354.
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For the first and only time, a majority of the Court abandoned
the Chief Justice's leadership. Speaking by Justice Washington, it held
that the obligation of private contracts is derived from the municipal
law--state statutes and judicial decisions--and that the inhibition of
Article I, Sec. 10, is confined to legislative acts made after the
contracts affected by them, subject to the following exception. By a
curiously complicated line of reasoning, it was also held in the same
case that when the creditor is a nonresident, then a State by an
insolvency law may not alter the former's rights under a contract,
albeit one of later date.
With the proposition established that the obligation of a
private contract comes from the municipal law in existence when the
contract is made, a further question presents itself, namely, what part
of the municipal law is referred to? No doubt, the law which determines
the validity of the contract itself is a part of such law. Also part of
such law is the law which interprets the terms used in the contract, or
which supplies certain terms when others are used, as for instance,
constitutional provisions or statutes which determine what is ``legal
tender'' for the payment of debts, or judicial decisions which construe
the term ``for value received'' as used in a promissory note, and so on.
In short, any law which at the time of the making of a contract goes to
measure the rights and duties of the parties to it in relation to each
other enters into its obligation.
Remedy a Part of the Private Obligation.--Suppose, however, that
one of the parties to a contract fails to live up to his obligation as
thus determined. The contract itself may now be regarded as at an end,
but the injured party, nevertheless, has a new set of rights in its
stead, those which are furnished him by the remedial law, including the
law of procedure. In the case of a mortgage, he may foreclose; in the
case of a promissory note, he may sue; and in certain cases, he may
demand specific performance. Hence the further question arises, whether
this remedial law is to be considered a part of the law supplying the
obligation of contracts. Origi
[[Page 390]]
nally, the predominating opinion was negative, since as we have just
seen, this law does not really come into operation until the contract
has been broken. Yet it is obvious that the sanction which this law
lends to contracts is extremely important--indeed, indispensable. In due
course it became the accepted doctrine that that part of the law which
supplies one party to a contract with a remedy if the other party does
not live up to his agreement, as authoritatively interpreted, entered
into the ``obligation of contracts'' in the constitutional sense of this
term, and so might not be altered to the material weakening of existing
contracts. In the Court's own words: ``Nothing can be more material to
the obligation than the means of enforcement. Without the remedy the
contract may, indeed, in the sense of the law, be said not to exist, and
its obligation to fall within the class of those moral and social duties
which depend for their fulfillment wholly upon the will of the
individual. The ideas of validity and remedy are inseparable
. . .''\1955\
\1955\United States ex rel. Von Hoffman v. Quincy, 4 Wall. (71
U.S.) 535, 552 (1867).
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This rule was first definitely announced in 1843 in the case of
Bronson v. Kinzie.\1956\ Here, an Illinois mortgage giving the mortgagee
an unrestricted power of sale in case of the mortgagor's default was
involved, along with a later act of the legislature that required
mortgaged premises to be sold for not less than two-thirds of the
appraised value and allowed the mortgagor a year after the sale to
redeem them. It was held that the statute, in altering the preexisting
remedies to such an extent, violated the constitutional prohibition and
hence was void. The year following a like ruling was made in the case of
McCracken v. Hayward,\1957\ as to a statutory provision that personal
property should not be sold under execution for less than two-thirds of
its appraised value.
\1956\1 How. (42 U.S.) 311 (1843).
\1957\2 How. (43 U.S.) 608 (1844).
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But the rule illustrated by these cases does not signify that a
State may make no changes in its remedial or procedural law that affect
existing contracts. ``Provided,'' the Court has said, ``a substantial or
efficacious remedy remains or is given, by means of which a party can
enforce his rights under the contract, the Legislature may modify or
change existing remedies or prescribe new modes of procedure.''\1958\
Thus, States are constantly remodelling their judicial systems and modes
of practice unembarrassed by the obligation of contracts clause.\1959\
The right of a State to abolish
[[Page 391]]
imprisonment for debt was early asserted.\1960\ Again, the right of a
State to shorten the time for the bringing of actions has been affirmed
even as to existing causes of action, but with the proviso added that a
reasonable time must be left for the bringing of such actions.\1961\ On
the other hand, a statute which withdrew the judicial power to enforce
satisfaction of a certain class of judgments by mandamus was held
invalid.\1962\ In the words of the Court: ``Every case must be
determined upon its own circumstances;''\1963\ and it later added: ``In
all such cases the question becomes . . . one of reasonableness, and of
that the legislature is primarily the judge.''\1964\
\1958\Oshkosh Waterworks Co. v. Oshkosh, 187 U.S. 437, 439
(1903); City & Lake Railroad v. New Orleans, 157 U.S. 219 (1895).
\1959\Antoni v. Greenhow, 107 U.S. 769 (1883).
\1960\The right was upheld in Mason v. Haile, 12 Wheat. (25
U.S.) 370 (1827), and again in Penniman's Case, 103 U.S. 714 (1881).
\1961\McGahey v. Virginia, 135 U.S. 662 (1890).
\1962\Louisiana v. New Orleans, 102 U.S. 203 (1880).
\1963\United States ex rel. Von Hoffman v. Quincy, 4 Wall. (71
U.S.) 535, 554 (1867).
\1964\Antoni v. Greenhow, 107 U.S. 769, 775 (1883).
Illustrations of changes in remedies, which have been sustained, may be
seen in the following cases: Jackson v. Lamphire, 3 Pet. (28 U.S.) 280
(1830); Hawkins v. Barney's Lessee, 5 Pet. (30 U.S.) 457 (1831);
Crawford v. Branch Bank of Mobile 7 How. (48 U.S.) 279 (1849); Curtis v.
Whitney, 13 Wall. (80 U.S.) 68 (1872); Railroad Co. v. Hecht, 95 U.S.
168 (1877); Terry v. Anderson, 95 U.S. 628 (1877); Tennessee v. Sneed,
96 U.S. 69 (1877); South Carolina v. Gaillard, 101 U.S. 433 (1880);
Louisiana v. New Orleans, 102 U.S. 203 (1880); Connecticut Mut. Life
Ins. Co. v. Cushman, 108 U.S. 51 (1883); Vance v. Vance, 108 U.S. 514
(1883); Gilfillan v. Union Canal Co., 109 U.S. 401 (1883); Hill v.
Merchant's Ins. Co., 134 U.S. 515 (1890); City & Lake Railroad v. New
Orleans, 157 U.S. 219 (1895); Red River Valley Bank v. Craig, 181 U.S.
548 (1901); Wilson v. Standefer, 184 U.S. 399 (1902); Oshkosh Waterworks
Co. v. Oshkosh, 187 U.S. 437 (1903); Waggoner v. Flack, 188 U.S. 595
(1903); Bernheimer v. Converse, 206 U.S. 516 (1907); Henley v. Myers,
215 U.S. 373 (1910); Selig v. Hamilton, 234 U.S. 652 (1914); Security
Bank v. California, 263 U.S. 282 (1923); United States Mortgage Co. v.
Matthews, 293 U.S. 232 (1934); McGee v. International Life Ins. Co., 355
U.S. 220 (1957).
Compare the following cases, where changes in remedies were
deemed to be of such character as to interfere with substantial rights:
Wilmington & Weldon R.R. v. King, 91 U.S. 3 (1875); Memphis v. United
States, 97 U.S. 293 (1878); Virginia Coupon Cases (Poindexter v.
Greenhow), 114 U.S. 269, 270, 298, 299 (1885); Effinger v. Kenney, 115
U.S. 566 (1885); Fisk v. Jefferson Police Jury, 116 U.S. 131 (1885);
Bradley v. Lightcap, 195 U.S. 1 (1904); Bank of Minden v. Clement, 256
U.S. 126 (1921).
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There is one class of cases resulting from the doctrine that the
law of remedy constitutes a part of the obligation of a contract to
which a special word is due. This comprises cases in which the contracts
involved were municipal bonds. While a city is from one point of view
but an emanation from the government's sovereignty and an agent thereof,
when it borrows money it is held to be acting in a corporate or private
capacity and so to be suable on its contracts. Furthermore, as was held
in the leading case of United States ex rel. Von Hoffman v.
Quincy,\1965\ ``where a State has authorized a municipal corporation to
contract and to exercise the
[[Page 392]]
power of local taxation to the extent necessary to meet its engagements,
the power thus given cannot be withdrawn until the contract is
satisfied.'' In this case, the Court issued a mandamus compelling the
city officials to levy taxes for the satisfaction of a judgment on its
bonds in accordance with the law as it stood when the bonds were
issued.\1966\ Nor may a State by dividing an indebted municipality among
others enable it to escape its obligations. The debt follows the
territory, and the duty of assessing and collecting taxes to satisfy it
devolves upon the succeeding corporations and their officers.\1967\ But
where a municipal organization has ceased practically to exist through
the vacation of its offices, and the government's function is exercised
once more by the State directly, the Court has thus far found itself
powerless to frustrate a program of repudiation.\1968\ However, there is
no reason why the State should enact the role of particeps criminis in
an attempt to relieve its municipalities of the obligation to meet their
honest debts. Thus, in 1931, during the Great Depression, New Jersey
created a Municipal Finance Commission with power to assume control over
its insolvent municipalities. To the complaint of certain bondholders
that this legislation impaired the contract obligations of their
debtors, the Court, speaking by Justice Frankfurter, pointed out that
the practical value of an unsecured claim against a city is ``the
effectiveness of the city's taxing power,'' which the legislation under
review was designed to conserve.\1969\
\1965\4 Wall. (71 U.S.) 535, 554-555 (1867).
\1966\See also Nelson v. St. Martin's Parish, 111 U.S. 716
(1884).
\1967\Mobile v. Watson, 116 U.S. 289 (1886); Graham v. Folsom,
200 U.S. 248 (1906).
\1968\Heine v. Levee Commissioners, 19 Wall. (86 U.S.) 655
(1874). Cf., Virginia v. West Virginia, 246 U.S. 565 (1918).
\1969\Faitoute Co. v. City of Asbury Park, 316 U.S. 502, 510
(1942). Alluding to the ineffectiveness of purely judicial remedies
against defaulting municipalities, Justice Frankfurter says: ``For there
is no remedy when resort is had to `devices and contrivances' to nullify
the taxing power which can be carried out only through authorized
officials. See Rees v. City of Watertown, 19 Wall. (86 U.S.) 107, 124
(1874). And so we have had the spectacle of taxing officials resigning
from office in order to frustrate tax levies through mandamus, and
officials running on a platform of willingness to go to jail rather than
to enforce a tax levy ( see Raymond, State and Municipal Bonds, 342-
343), and evasion of service by tax collectors, thus making impotent a
court's mandate. Yost v. Dallas County, 236 U.S. 50, 57 (1915).'' Id.,
511.
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Private Contracts and the Police Power.--The increasing
subjection of public grants to the police power of the States has been
previously pointed out. That purely private contracts should be in any
stronger situation in this respect obviously would be anomalous in the
extreme. In point of fact, the ability of private parties to curtail
governmental authority by the easy device of contracting with one
another is, with an exception to be noted, even less than that of the
State to tie its own hands by contracting away
[[Page 393]]
its own powers. So, when it was contended in an early Pennsylvania case
that an act prohibiting the issuance of notes by unincorporated banking
associations was violative of the obligation of contracts clause because
of its effect upon certain existing contracts of members of such
association, the state Supreme Court answered: ``But it is said, that
the members had formed a contract between themselves, which would be
dissolved by the stoppage of their business. And what then? Is that such
a violation of contracts as is prohibited by the Constitution of the
United States? Consider to what such a construction would lead. Let us
suppose, that in one of the States there is no law against gaming, cock-
fighting, horse-racing or public masquerades, and that companies should
be formed for the purpose of carrying on these practices. . . .'' Would
the legislature then be powerless to prohibit them? The answer returned,
of course, was no.\1970\
\1970\Myers v. Irwin, 2 S. & R. (Pa.), 367, 372 (1816); see, to
the same effect, Lindenmuller v. The People, 33 Barb. (N.Y.) 548 (1861);
Brown v. Penobscot Bank, 8 Mass. 445 (1812).
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The prevailing doctrine was stated by the Supreme Court of the
United States in the following words: ``It is the settled law of this
court that the interdiction of statutes impairing the obligation of
contracts does not prevent the State from exercising such powers as are
vested in it for the promotion of the common weal, or are necessary for
the general good of the public, though contracts previously entered into
between individuals may thereby be affected. . . . In other words, that
parties by entering into contracts may not estop the legislature from
enacting laws intended for the public good.''\1971\
\1971\Manigault v. Springs, 199 U.S. 473, 480 (1905).
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So, in an early case, we find a state recording act upheld as
applying to deeds dated before the passage of the act.\1972\ Later cases
have brought the police power in its more customary phases into contact
with private as well as with public contracts. Lottery tickets, valid
when issued, were necessarily invalidated by legislation prohibiting the
lottery business;\1973\ contracts for the sale of beer, valid when
entered into, were similarly nullified by a state prohibition law;\1974\
and contracts of employment were modified by later laws regarding the
liability of employers and workmen's compensation.\1975\ Likewise, a
contract between plaintiff and defendant
[[Page 394]]
did not prevent the State from making the latter a concession which
rendered the contract worthless;\1976\ nor did a contract as to rates
between two railway companies prevent the State from imposing different
rates;\1977\ nor did a contract between a public utility company and a
customer protect the rates agreed upon from being superseded by those
fixed by the State.\1978\ Similarly, a contract for the conveyance of
water beyond the limits of a State did not prevent the State from
prohibiting such conveyance.\1979\
\1972\Jackson v. Lamphire, 3 Pet. (28 U.S.) 280 (1830). See also
Phalen v. Virginia, 8 How. (49 U.S.) 163 (1850).
\1973\Stone v. Mississippi, 101 U.S. 814 (1880).
\1974\Beer Co. v. Massachusetts, 97 U.S. 25 (1878).
\1975\New York Central R. Co. v. White, 243 U.S. 188 (1917). In
this and the preceding two cases the legislative act involved did not
except from its operation existing contracts.
\1976\Manigault v. Springs, 199 U.S. 473 (1905).
\1977\Portland Ry. Co. v. Oregon R. Comm., 229 U.S. 397 (1913).
\1978\Midland Co. v. Kansas City Power Co., 300 U.S. 109 (1937).
\1979\Hudson Water Co. v. McCarter, 209 U.S. 349 (1908).
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But the most striking exertions of the police power touching
private contracts, as well as other private interests within recent
years, have been evoked by war and economic depression. Thus, in World
War I, the State of New York enacted a statute, which, declaring that a
public emergency existed, forbade the enforcement of covenants for the
surrender of the possession of premises on the expiration of leases, and
wholly deprived for a period owners of dwellings, including apartment
and tenement houses, within the City of New York and contiguous
counties, of possessory remedies for the eviction from their premises of
tenants in possession when the law took effect, providing the latter
were able and willing to pay a reasonable rent. In answer to objections
leveled against this legislation on the basis of the obligation of
contracts clause, the Court said: ``But contracts are made subject to
this exercise of the power of the State when otherwise justified, as we
have held this to be.''\1980\ In a subsequent case, however, the Court
added that, while the declaration by the legislature of a justifying
emergency was entitled to great respect, it was not conclusive; a law
``depending upon the existence of an emergency or other certain state of
facts to uphold it may cease to operate if the emergency ceases or the
facts change,'' and whether they have changed was always open to
judicial inquiry.\1981\
\1980\Marcus Brown Co. v. Feldman, 256 U.S. 170, 198 (1921),
followed in Levy Leasing Co. v. Siegel, 258 U.S. 242 (1922).
\1981\Chastleton Corp. v. Sinclair, 264 U.S. 543, 547-548
(1924).
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Summing up the result of the cases above referred to, Chief
Justice Hughes, speaking for the Court in Home Building & Loan Assn. v.
Blaisdell,\1982\ remarked in 1934: ``It is manifest from this review of
our decisions that there has been a growing appreciation of public needs
and of the necessity of finding ground for a rational compromise between
individual rights and public welfare. The settlement and consequent
contraction of the public domain, the pres
[[Page 395]]
sure of a constantly increasing density of population, the interrelation
of the activities of our people and the complexity of our economic
interests, have inevitably led to an increased use of the organization
of society in order to protect the very bases of individual opportunity.
Where, in earlier days, it was thought that only the concerns of
individuals or of classes were involved, and that those of the State
itself were touched only remotely, it has later been found that the
fundamental interests of the State are directly affected; and that the
question is no longer merely that of one party to a contract as against
another, but of the use of reasonable means to safeguard the economic
structure upon which the good of all depends. . . . The principle of
this development is . . . that the reservation of the reasonable
exercise of the protective power of the States is read into all
contracts . . .''\1983\
\1982\290 U.S. 398 (1934).
\1983\Id., 442, 444. See also Veix v. Sixth Ward Assn. 310 U.S.
32 (1940), in which was sustained a New Jersey statute amending in view
of the Depression the law governing building and loan associations. The
authority of the State to safeguard the vital interests of the people,
said Justice Reed, ``extends to economic needs as well.'' Id., 39. In
Lincoln Federal Labor Union v. Northwestern Iron & Metal Co., 335 U.S.
525, 531-532 (1949), the Court dismissed out-of-hand a suggestion that a
state law outlawing union security agreements was an invalid impairment
of existing contracts, citing Blaisdell and Veix.
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Evaluation of the Clause Today.--It should not be inferred that
the obligation of contracts clause is today totally moribund. Even prior
to the most recent decisions, it still furnished the basis for some
degree of judicial review as to the substantiality of the factual
justification of a professed exercise by a state legislature of its
police power, and in the case of legislation affecting the remedial
rights of creditors, it still affords a solid and palpable barrier
against legislative erosion. Nor is this surprising in view of the fact
that, as we have seen, such rights were foremost in the minds of the
framers of the clause. The Court's attitude toward insolvency laws,
redemption laws, exemption laws, appraisement laws and the like, has
always been that they may not be given retroactive operation,\1984\ and
the general lesson of these earlier cases is confirmed by the Court's
decisions between 1934 and 1945 in certain cases involving state
moratorium statutes. In Home Building & Loan Assn. v. Blaisdell,\1985\
the leading case, a closely divided Court sustained the Minnesota
Moratorium Act of April 18, 1933, which, reciting the existence of a
severe financial and economic depression for several years and the
frequent occurrence of mortgage foreclosure sales for inadequate prices,
and asserting that these conditions had created an economic emergency
calling for the exercise of the
[[Page 396]]
State's police power, authorized its courts to extend the period for
redemption from foreclosure sales for such additional time as they might
deem just and equitable, although in no event beyond May 1, 1935.
\1984\See especially Edwards v. Kearzey, 96 U.S. 595 (1878);
Barnitz v. Beverly, 163 U.S. 118 (1896).
\1985\290 U.S. 398 (1934).
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The act also left the mortgagor in possession during the period
of extension, subject to the requirement that he pay a reasonable rental
for the property as fixed by the court. Contemporaneously, however, less
carefully drawn statutes from Missouri and Arkansas, acts which were not
as considerate of creditor's rights, were set aside as violative of the
contracts clause.\1986\ ``A State is free to regulate the procedure in
its courts even with reference to contracts already made,'' said Justice
Cardozo for the Court, ``and moderate extensions of the time for
pleading or for trial will ordinarily fall within the power so reserved.
A different situation is presented when extensions are so piled up as to
make the remedy a shadow. . . . What controls our judgment at such times
is the underlying reality rather than the form or label. The changes of
remedy now challenged as invalid are to be viewed in combination, with
the cumulative significance that each imparts to all. So viewed they are
seen to be an oppressive and unnecessary destruction of nearly all the
incidents that give attractiveness and value to collateral
security.''\1987\ On the other hand, in the most recent of this category
of cases, the Court gave its approval to an extension by the State of
New York of its moratorium legislation. While recognizing that business
conditions had improved, the Court was of the opinion that there was
reason to believe that ```the sudden termination of the legislation
which has dammed up normal liquidation of these mortgages for more than
eight years might well result in an emergency more acute than that which
the original legislation was intended to alleviate.'''\1988\
\1986\W. B. Worthen Co. v. Thomas, 292 U.S. 426 (1934); W. B.
Worthen Co. v. Kavanaugh, 295 U.S. 56 (1935).
\1987\Id., 62.
\1988\East New York Bank v. Hahn, 326 U.S. 230, 235 (1945),
quoting New York Legislative Document (1942), No. 45, p. 25.
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And meantime the Court had sustained legislation of the State of
New York under which a mortgagee of real property was denied a
deficiency judgment in a foreclosure suit where the state court found
that the value of the property purchased by the mortgagee at the
foreclosure sale was equal to the debt secured by the mortgage.\1989\
``Mortgagees,'' the Court said, ``are constitutionally entitled to no
more than payment in full. . . . To hold that mortgagees are entitled
under the contract clause to retain the advantages of
[[Page 397]]
a forced sale would be to dignify into a constitutionally protected
property right their chance to get more than the amount of their
contracts. . . . The contract clause does not protect such a
strategical, procedural advantage.''\1990\
\1989\Honeyman v. Jacobs, 306 U.S. 539 (1939). See also Gelfert
v. National City Bank, 313 U.S. 221 (1941).
\1990\Id., 233-234.
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More important, the Court has been at pains most recently to
reassert the vitality of the clause, although one may wonder whether
application of the clause will be more than episodic.
``[T]he Contract Clause remains a part of our written
Constitution.''\1991\ So saying, the Court struck down state legislation
in two instances, one law involving the government's own contractual
obligation and the other affecting private contracts.\1992\ A finding
that a contract has been ``impaired'' in some way is merely the
preliminary step in evaluating the validity of the state action.\1993\
But in both cases the Court applied a stricter-than-usual scrutiny to
the statutory action, in the public contracts case precisely because it
was its own obligation that the State was attempting to avoid and in the
private contract case, apparently, because the legislation was in aid of
a ``narrow class.''\1994\ The approach in any event is one of balancing.
``The severity of the impairment measures the height of the hurdle the
state legislation must clear. Minimal alteration of contractual
obligations may end the inquiry at its first stage. Severe impairment,
on the other hand, will push the inquiry to a careful examination of the
nature and purpose of the state legislation.''\1995\ Having determined
that a severe impairment had resulted in both cases,\1996\ the Court
moved on to assess the justifica
[[Page 398]]
tion for the state action. In United States Trust, the test utilized by
the Court was that an impairment would be upheld only if it were
``necessary'' and ``reasonable'' to serve an important public purpose.
But the two terms were given somewhat restrictive meanings. Necessity is
shown only when the State's objectives could not have been achieved
through less dramatic modifications of the contract; reasonableness is a
function of the extent to which alteration of the contract was prompted
by circumstances unforeseen at the time of its formation. The repeal of
the covenant in issue was found to fail both prongs of the test.\1997\
In Spannaus, the Court drew from its prior cases four standards: did the
law deal with a broad generalized economic or social problem, did it
operate in an area already subject to state regulation at the time the
contractual obligations were entered into, did it effect simply a
temporary alteration of the contractual relationship, and did the law
operate upon a broad class of affected individuals or concerns. The
Court found that the challenged law did not possess any of these
attributes and thus struck it down.\1998\
\1991\United States Trust Co. v. New Jersey, 431 U.S. 1, 16
(1977). ``It is not a dead letter.'' Allied Structural Steel Co. v.
Spannaus, 438 U.S. 234, 241 (1978). A majority of the Court seems fully
committed to using the clause. Only Justices Brennan, White, and
Marshall dissented in both cases. Chief Justice Burger and Justices
Rehnquist and Stevens joined both opinions of the Court. Of the three
remaining Justices, who did not participate in one or the other case,
Justice Blackmun wrote the opinion in United States Trust while Justice
Stewart wrote the opinion in Spannaus and Justice Powell joined it.
\1992\United States Trust involved a repeal of a covenant
statutorily enacted to encourage persons to purchase New York-New Jersey
Port Authority bonds by limiting the Authority's ability to subsidize
rail passenger transportation. Spannaus involved a statute requiring
prescribed employers who had a qualified pension plan to provide funds
sufficient to cover full pensions for all employees who had worked at
least 10 years if the employer either terminated the plan or closed his
offices in the State, a law that greatly altered the company's
liabilities under its contractual pension plan.
\1993\431 U.S., 21; 438 U.S., 244.
\1994\431 U.S., 22-26; 438 U.S., 248.
\1995\438 U.S., 245.
\1996\431 U.S., 17-21 (the Court was unsure of the value of the
interest impaired but deemed it ``an important security provision'');
438 U.S. 244-247 (statute mandated company to recalculate, and in one
lump sum, contributions previously adequate).
\1997\431 U.S., 25-32 (State could have modified the impairment
to achieve its purposes without totally abandoning the covenant, though
the Court reserved judgment whether lesser impairments would have been
constitutional, id., 30 n. 28, and it had alternate means to achieve its
purposes; the need for mass transportation was obvious when covenant was
enacted and State could not claim that unforeseen circumstances had
arisen.)
\1998\438 U.S., 244-251. See also Exxon Corp. v. Eagerton, 462
U.S. 176 (1983) (emphasizing the first but relying on all but the third
of these tests in upholding a prohibition on pass-through of an oil and
gas severance tax).
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Whether these two cases portend an active judicial review of
economic regulatory activities, in contrast to the extreme deference
shown such legislation under the due process and equal protection
clauses, is problematical. Both cases contain language emphasizing the
breadth of the police powers of government that may be used to further
the public interest and admitting limited judicial scrutiny.
Nevertheless, ``[i]f the Contract Clause is to retain any meaning at all
. . . it must be understood to impose some limits upon the power of a
State to abridge existing contractual relationships, even in the
exercise of its otherwise legitimate police power.''\1999\
\1999\438 U.S., 242 (emphasis by Court).
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Clause 2. No State shall, without the Consent of the Congress, lay any
Imposts or Duties on Imports or Exports, except what may be absolutely
necessary for executing it's inspection Laws: and the net Produce of all
Duties and Imposts, laid by any State on Imports or Exports, shall be
for the Use of the
[[Page 399]]
Treasury of the United States; and all such Laws shall be subject to the
Revision and Control of the Congress.
Duties on Exports or Imports
Scope.--Only articles imported from or exported to a foreign
country, or ``a place over which the Constitution has not extended its
commands with respect to imports and their taxation,'' are comprehended
by the terms ``imports'' and ``exports.''\2000\ With respect to exports,
the exemption from taxation ``attaches to the export and not to the
article before its exportation,''\2001\ requiring an essentially factual
inquiry into whether there have been acts of movement toward a final
destination constituting sufficient entrance into the export stream as
to invoke the protection of the clause.\2002\ To determine how long
imported wares remain under the protection of this clause, the Supreme
Court enunciated the original package doctrine in the leading case of
Brown v. Maryland. ``When the importer has so acted upon the thing
imported,'' wrote Chief Justice Marshall, ``that it has become
incorporated and mixed up with the mass of property in the country, it
has, perhaps, lost its distinctive character as an import, and has
become subject to the taxing power of the State; but while remaining the
property of the importer, in his warehouse, in the original form or
package in which it was imported, a tax upon it is too plainly a duty on
imports, to escape the prohibition in the Constitution.''\2003\ A box,
case, or bale in which separate parcels of goods have been placed by the
foreign seller is regarded as the original package, and upon the opening
of such container for the purpose of using the separate parcels, or of
exposing them for sale, each loses its character as an import and
becomes subject to taxation as a part of the general mass of property in
the State.\2004\ Imports for manufacture cease to be such when the
intended processing takes place,\2005\ or when the original packages are
broken.\2006\ Where a manufacturer imports merchandise and stores it in
his warehouse in the original
[[Page 400]]
packages, that merchandise does not lose its quality as an import, at
least so long as it is not required to meet such immediate needs.\2007\
The purchaser of imported goods is deemed to be the importer if he was
the efficient cause of the importation, whether the title to the goods
vested in him at the time of shipment, or after its arrival in this
country.\2008\ A state franchise tax measured by properly apportioned
gross receipts may be imposed upon a railroad company in respect of the
company's receipts for services in handling imports and exports at its
marine terminal.\2009\
\2000\Hooeven & Allison Co. v. Evatt, 324 U.S. 652, 673 (1945).
Goods brought from another State are not within the clause. Woodruff v.
Parham, 8 Wall. (75 U.S.) 123 (1869).
\2001\Cornell v. Coyne, 192 U.S. 418, 427 (1904).
\2002\Richfield Oil Corp. v. State Bd. of Equalization, 329 U.S.
69 (1946); Empress Siderurgica v. County of Merced, 337 U.S. 154 (1947);
Kosydar v. National Cash Register Co., 417 U.S. 62 (1974).
\2003\12 Wheat. (25 U.S.) 419, 441-442 (1827).
\2004\May v. New Orleans, 178 U.S. 496, 502 (1900).
\2005\Id., 501; Gulf Fisheries Co. v. MacInerney, 276 U.S. 124
(1928); McGoldrick v. Gulf Oil Corp., 309 U.S. 414 (1940).
\2006\Low v. Austin, 13 Wall. (80 U.S.) 29 (1872); May v. New
Orleans, 178 U.S. 496 (1900).
\2007\Hooven & Allison Co. v. Evatt, 324 U.S. 652, 667 (1945).
But see Limbach v. Hooven & Allison Co., 466 U.S. 353 (1984) (overruling
the earlier decision).
\2008\Id., 664.
\2009\Canton R. Co. v. Rogan, 340 U.S. 511 (1951).
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Privilege Taxes.--A state law requiring importers to take out a
license to sell imported goods amounts to an indirect tax on imports and
hence is unconstitutional.\2010\ Likewise, a franchise tax upon foreign
corporations engaged in importing nitrate and selling it in the original
packages,\2011\ a tax on sales by brokers\2012\ and auctioneers\2013\ of
imported merchandise in original packages, and a tax on the sale of
goods in foreign commerce consisting of an annual license fee plus a
percentage of gross sales,\2014\ have been held invalid. On the other
hand, pilotage fees,\2015\ a tax upon the gross sales of a purchaser
from the importer,\2016\ a license tax upon dealing in fish which,
through processing, handling, and sale, have lost their distinctive
character as imports,\2017\ an annual license fee imposed on persons
engaged in buying and selling foreign bills of exchange,\2018\ and a tax
upon the right of an alien to receive property as heir, legatee, or
donee of a deceased person\2019\ have been held not to be duties on
imports or exports.
\2010\Brown v. Maryland, 12 Wheat. (25 U.S.) 419, 447 (1827).
\2011\Anglo-Chilean Corp. v. Alabama, 288 U.S. 218 (1933).
\2012\Low v. Austin, 13 Wall. (80 U.S.) 29, 33 (1872).
\2013\Cook v. Pennsylvania, 97 U.S. 566, 573 (1878).
\2014\Crew Levick Co. v. Pennsylvania, 245 U.S. 292 (1917).
\2015\Cooley v. Port Wardens, 12 How. (53 U.S.) 299, 313 (1851).
\2016\Waring v. The Mayor, 8 Wall. (75 U.S.) 110, 122 (1869).
See also Pervear v. Massachusetts. 5 Wall. (72 U.S.) 475, 478 (1867);
Schollenberger v. Pennsylvania, 171 U.S. 1, 24 (1898).
\2017\Gulf Fisheries Co. v. MacInerney, 276 U.S. 124 (1928).
\2018\Nathan v. Louisiana, 8 How. (49 U.S.) 73, 81 (1850).
\2019\Mager v. Grima, 8 How. (49 U.S.) 490 (1850).
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Property Taxes.--Overruling a line of prior decisions which it
thought misinterpreted the language of Brown v. Maryland, the Court now
holds that the clause does not prevent a State from levying a
nondiscriminatory, ad valorem property tax upon goods that are no longer
in import transit.\2020\ Thus, a company's inventory of
[[Page 401]]
imported tires maintained at its whole distribution warehouse could be
included in the State's tax upon the entire inventory. The clause does
not prohibit every ``tax'' with some impact upon imports or exports but
reaches rather exactions directed only at imports or exports or
commercial activity therein as such.\2021\
\2020\Michelin Tire Corp. v. Wages, 423 U.S. 276 (1976),
overruling Low v. Austin, 13 Wall. (80 U.S.) 29 (1872), expressly, and,
necessarily, Hooven & Allison Co. v. Evatt, 324 U.S. 652 (1945), among
others. The latter case was expressly overruled in Limbach v. Hooven &
Allison Co., 466 U.S. 353 (1984), involving the same tax and the same
parties. In Youngstown Sheet & Tube Co. v. Bowers, 358 U.S. 534 (1959),
property taxes were sustained on the basis that the materials taxed had
lost their character as imports. On exports, see Selliger v. Kentucky,
213 U.S. 200 (1909) (property tax levied on warehouse receipts for
whiskey exported to Germany invalid).
\2021\Michelin Tire Corp. v. Wages, 423 U.S. 276, 290-294
(1976). Accord: R. J. Reynolds Tobacco Co. v. Durham County, 479 U.S.
130 (1986) (tax on imported tobacco stored for aging in customs-bonded
warehouse and destined for domestic manufacture and sale); but cf. Xerox
Corp. v. County of Harris, 459 U.S. 145, 154 (1982) (similar tax on
goods stored in customs-bonded warehouse is preempted ``by Congress'
comprehensive regulation of customs duties;'' case, however, dealt with
goods stored for export).
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Inspection Laws.--Inspection laws ``are confined to such
particulars as, in the estimation of the legislature and according to
the customs of trade, are deemed necessary to fit the inspected article
for the market, by giving the purchaser public assurance that the
article is in that condition, and of that quality, which makes it
merchantable and fit for use or consumption.''\2022\ In Turner v.
Maryland,\2023\ the Court listed as recognized elements of inspection
laws, the ``quality of the article, form, capacity, dimensions, and
weight of package, mode of putting up, and marking and branding of
various kinds. . . .''\2024\ It sustained as an inspection law a charge
for storage and inspection imposed upon every hogshead of tobacco grown
in the State and intended for export, which the law required to be
brought to a state warehouse to be inspected and branded. The Court has
cited this section as a recognition of a general right of the States to
pass inspection laws, and to bring within their reach articles of
interstate, as well as of foreign, commerce.\2025\ But on the ground
that, ``it has never been regarded as within the legitimate scope of
inspection laws to forbid trade in respect to any known article of
commerce, irrespective of its condition and quality, merely on account
of its intrinsic nature and the injurious consequence of its use or
abuse,'' it held that a state law forbidding the importation of
intoxicating liquors into the State could not be sustained as an
inspection law.\2026\
\2022\Bowman v. Chicago & Northwestern Railway Co., 125 U.S.
465, 488 (1888).
\2023\107 U.S. 38 (1883).
\2024\Id., 55.
\2025\Patapsco Guano Co. v. North Carolina, 171 U.S. 345, 361
(1898).
\2026\Bowman v. Chicago & Northwestern Railway Co., 125 U.S. 465
(1888). The Twenty-first Amendment has had no effect on this principle.
Department of Revenue v. James B. Beam Distilling Co., 377 U.S. 341
(1964).
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[[Page 402]]
Clause 3. No State shall, without the Consent of Congress, lay any
Duty of Tonnage, keep Troops, or Ships of War in time of Peace, enter
into any Agreement or Compact with another State, or with a foreign
Power, or engage in War, unless actually invaded, or in such imminent
Danger as will not admit of delay.
Tonnage Duties
The prohibition against tonnage duties embraces all taxes and
duties, regardless of their name or form, whether measured by the
tonnage of the vessel or not, which are in effect charges for the
privilege of entering, trading in, or lying in a port.\2027\ But it does
not extend to charges made by state authority, even if graduated
according to tonnage,\2028\ for services rendered to the vessel, such as
pilotage, towage, charges for loading and unloading cargoes, wharfage,
or storage.\2029\ For the purpose of determining wharfage charges, it is
immaterial whether the wharf was built by the State, a municipal
corporation, or an individual. Where the wharf was owned by a city, the
fact that the city realized a profit beyond the amount expended did not
render the toll objectionable.\2030\ The services of harbor masters for
which fees are allowed must be actually rendered, and a law permitting
harbor masters or port wardens to impose a fee in all cases is
void.\2031\ A State may not levy a tonnage duty to defray the expenses
of its quarantine system,\2032\ but it may exact a fixed fee for
examination of all vessels passing quarantine.\2033\ A state license fee
for ferrying on a navigable river is not a tonnage tax but rather is a
proper exercise of the police power and the fact that a vessel is
enrolled under federal law does
[[Page 403]]
not exempt it.\2034\ In the State Tonnage Tax Cases,\2035\ an annual tax
on steamboats measured by their registered tonnage was held invalid
despite the contention that it was a valid tax on the steamboat as
property.
\2027\Clyde Mallory Lines v. Alabama, 296 U.S. 261, 265 (1935);
Cannon v. City of New Orleans, 20 Wall. (87 U.S.) 577, 581 (1874);
Transportation Co. v. Wheeling, 99 U.S. 273, 283 (1879).
\2028\Packet Co. v. Keokuk, 95 U.S. 80 (1877); Transportation
Co. v. Parkersburg, 107 U.S. 691 (1883); Ouachita Packet Co. v. Aiken,
121 U.S. 444 (1887).
\2029\Cooley v. Port Wardens, 12 How. (53 U.S.) 299, 314 (1851);
Ex parte McNiel, 13 Wall. (80 U.S.) 236 (1872); Inman Steamship Company
v. Tinker, 94 U.S. 238, 243 (1877); Packet Co. v. St. Louis, 100 U.S.
423 (1880); City of Vicksburg v. Tobin, 100 U.S. 430 (1880); Packet Co.
v. Catlettsburg, 105 U.S. 559 (1882).
\2030\Huse v. Glover, 119 U.S. 543, 549 (1886).
\2031\Steamship Co. v. Portwardens, 6 Wall. (73 U.S.) 31 (1867).
\2032\Peete v. Morgan, 19 Wall. (86 U.S.) 581 (1874).
\2033\Morgan v. Louisiana, 118 U.S. 455, 462 (1886).
\2034\Wiggins Ferry Co. v. City of East St. Louis, 107 U.S. 365
(1883). See also Gloucester Ferry Co. v. Pennsylvania, 114 U.S. 196, 212
(1885); Philadelphia Steamship Co. v. Pennsylvania, 122 U.S. 326, 338
(1887); Osborne v. City of Mobile, 16 Wall. (83 U.S.) 479, 481 (1873).
\2035\12 Wall. (79 U.S.) 204, 217 (1871).
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Keeping Troops
This provision contemplates the use of the State's military
power to put down an armed insurrection too strong to be controlled by
civil authority,\2036\ and the organization and maintenance of an active
state militia is not a keeping of troops in time of peace within the
prohibition of this clause.\2037\
\2036\Luther v. Borden, 7 How. (48 U.S.) 1, 45 (1849).
\2037\Presser v. Illinois, 116 U.S. 252 (1886).
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Interstate Compacts
Background of Clause.--Except for the single limitation that the
consent of Congress must be obtained, the original inherent sovereign
rights of the States to make compacts with each other was not
surrendered under the Constitution.\2038\ ``The Compact,'' as the
Supreme Court has put it, ``adapts to our Union of sovereign States the
age-old treaty-making power of independent sovereign nations.''\2039\ In
American history, the compact technique can be traced back to the
numerous controversies that arose over the ill-defined boundaries of the
original colonies. These disputes were usually resolved by negotiation,
with the resulting agreement subject to approval by the Crown.\2040\
When the political ties with Britain were broken, the Articles of
Confederation provided for appeal to Congress in all disputes between
two or more States over boundaries or ``any cause whatever''\2041\ and
required the approval of Congress for any ``treaty confederation or
alliance'' to which a State should be a party.\2042\
\2038\Poole v. Fleeger, 11 Pet. (36 U.S.) 185, 209 (1837).
\2039\Hinderlider v. La Plata Co., 304 U.S. 92, 104 (1938).
\2040\Frankfurter and Landis, The Compact Clause of the
Constitution--A Study in Interstate Adjustments, 34 Yale L.J. 685, 691
(1925).
\2041\Article IX.
\2042\Article VI.
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The Framers of the Constitution went further. By the first
clause of this section they laid down an unqualified prohibition against
``any treaty, alliance or confederation,'' and by the third clause they
required the consent of Congress for ``any agreement or compact.'' The
significance of this distinction was pointed out by
[[Page 404]]
Chief Justice Taney in Holmes v. Jennison.\2043\ ``As these words
(`agreement or compact') could not have been idly or superfluously used
by the framers of the Constitution, they cannot be construed to mean the
same thing with the word treaty. They evidently mean something more, and
were designed to make the prohibition more comprehensive. . . . The word
`agreement,' does not necessarily import and direct any express
stipulation; nor is it necessary that it should be in writing.
\2043\14 Pet. (39 U.S.) 540 (1840).
---------------------------------------------------------------------------
``If there is a verbal understanding, to which both parties have
assented, and upon which both are acting, it is an `agreement.' And the
use of all of these terms, `treaty,' `agreement,' `compact,' show that
it was the intention of the framers of the Constitution to use the
broadest and most comprehensive terms; and that they anxiously desired
to cut off all connection or communication between a State and a foreign
power; and we shall fail to execute that evident intention, unless we
give to the word `agreement' its most extended signification; and so
apply it as to prohibit every agreement, written or verbal, formal or
informal, positive or implied, by the mutual understanding of the
parties.''\2044\ But in Virginia v. Tennessee,\2045\ decided more than a
half century later, the Court shifted position, holding that the
unqualified prohibition of compacts and agreements between States
without the consent of Congress did not apply to agreements concerning
such minor matters as adjustments of boundaries, which have no tendency
to increase the political powers of the contracting States or to
encroach upon the just supremacy of the United States. Adhering to this
later understanding of the clause, the Court found no enhancement of
state power quoad the Federal Government through entry into the
Multistate Tax Compact and thus sustained the agreement among
participating States without congressional consent.\2046\
\2044\Id., 570, 571, 572.
\2045\148 U.S. 503, 518 (1893). See also Stearns v. Minnesota,
179 U.S. 223, 244 (1900).
\2046\United States Steel Corp. v. Multistate Tax Comm., 434
U.S. 452 (1978). See also New Hampshire v. Maine, 426 U.S. 363 (1976).
---------------------------------------------------------------------------
Subject Matter of Interstate Compacts.--For many years after the
Constitution was adopted, boundary disputes continued to predominate as
the subject matter of agreements among the States. Since the turn of the
twentieth century, however, the interstate compact has been used to an
increasing extent as an instrument for state cooperation in carrying out
affirmative programs for solving common problems.\2047\ The execution of
vast public undertak
[[Page 405]]
ings, such as the development of the Port of New York by the Port
Authority created by compact between New York and New Jersey, flood
control, the prevention of pollution, and the conservation and
allocation of water supplied by interstate streams, are among the
objectives accomplished by this means. Another important use of this
device was recognized by Congress in the act of June 6, 1934,\2048\
whereby it consented in advance to agreements for the control of crime.
The first response to this stimulus was the Crime Compact of 1934,
providing for the supervision of parolees and probationers, to which
most of the States have given adherence.\2049\ Subsequently, Congress
has authorized, on varying conditions, compacts touching the production
of tobacco, the conservation of natural gas, the regulation of fishing
in inland waters, the furtherance of flood and pollution control, and
other matters. Moreover, many States have set up permanent commissions
for interstate cooperation, which have led to the formation of a Council
of State Governments, the creation of special commissions for the study
of the crime problem, the problem of highway safety, the trailer
problem, problems created by social security legislation, et cetera, and
the framing of uniform state legislation for dealing with some of
these.\2050\
\2047\Frankfurter and Landis, The Compact Clause of the
Constitution--A Study in Interstate Adjustments, 34 Yale L.J. 685
(1925); F. Zimmerman and M. Wendell, Interstate Compacts Since 1925
(Chicago: 1951); F. Zimmerman and M. Wendell, The Law and Use of
Interstate Compacts (Chicago: 1961).
\2048\48 Stat. 909 (1934).
\2049\F. Zimmerman and M. Wendell, Interstate Compacts Since
1925 (Chicago: 1951), 91.
\2050\7 U.S.C. Sec. 515; 15 U.S.C. Sec. 717j; 16 U.S.C.
Sec. 552; 33 U.S.C. Sec. Sec. 11, 567-567b.
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Consent of Congress.--The Constitution makes no provision with
regard to the time when the consent of Congress shall be given or the
mode or form by which it shall be signified.\2051\ While the consent
will usually precede the compact or agreement, it may be given
subsequently where the agreement relates to a matter which could not be
well considered until its nature is fully developed.\2052\ The required
consent is not necessarily an expressed consent; it may be inferred from
circumstances.\2053\ It is sufficiently indicated, when not necessary to
be made in advance, by the approval of proceedings taken under it.\2054\
The consent of Congress may be granted conditionally ``upon terms
appropriate to the subject and transgressing no constitutional
limitations.''\2055\ Congress
[[Page 406]]
does not, by giving its consent to a compact, relinquish or restrict its
own powers, as for example, its power to regulate interstate
commerce.\2056\
\2051\Green v. Biddle, 8 Wheat. (21 U.S.) 1, 85 (1823).
\2052\Virginia v. Tennessee, 148 U.S. 503 (1893).
\2053\Virginia v. West Virginia, 11 Wall. (78 U.S.) 39 (1871).
\2054\Wharton v. Wise, 153 U.S. 155, 173 (1894).
\2055\James v. Dravo Contracting Co., 302 U.S. 134 (1937). See
also Arizona v. California, 292 U.S. 341, 345 (1934). When it approved
the New York-New Jersey Waterfront Compact, 67 Stat. 541, Congress, for
the first time, expressly gave its consent to the subsequent adoption of
implementing legislation by the participating States. De Veau v.
Braisted, 363 U.S. 144, 145 (1960).
\2056\Pennsylvania v. Wheeling & Belmont Bridge Co., 18 How. (59
U.S.) 421, 433 (1856).
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Grants of Franchise to Corporations by Two States.--It is
competent for a railroad corporation organized under the laws of one
State, when authorized so to do by the consent of the State which
created it, to accept authority from another State to extend its
railroad into such State and to receive a grant of powers to own and
control, by lease or purchase, railroads therein and to subject itself
to such rules and regulations as may be prescribed by the second State.
Such legislation on the part of two or more States is not, in the
absence of inhibitory legislation by Congress, regarded as within the
constitutional prohibition of agreements or compacts between
States.\2057\
\2057\St. Louis & San Francisco Railway v. James, 161 U.S. 545,
562 (1896).
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Legal Effect of Interstate Compacts.--Whenever, by the agreement
of the States concerned and the consent of Congress, an interstate
compact comes into operation, it has the same effect as a treaty between
sovereign powers. Boundaries established by such compacts become binding
upon all citizens of the signatory States and are conclusive as to their
rights.\2058\ Private rights may be affected by agreements for the
equitable apportionment of the water of an interstate stream, without a
judicial determination of existing rights.\2059\ Valid interstate
compacts are within the protection of the obligation of contracts
clause,\2060\ and a ``sue and be sued'' provision therein operates as a
waiver of immunity from suit in federal courts otherwise afforded by the
Eleventh Amendment.\2061\ The Supreme Court in the exercise of its
original jurisdiction may enforce interstate compacts following
principles of general contract law.\2062\ Congress also has authority to
compel compliance with
[[Page 407]]
such compacts.\2063\ Nor may a State read herself out of a compact which
she has ratified and to which Congress has consented by pleading that
under the State's constitution as interpreted by the highest state court
she had lacked power to enter into such an agreement and was without
power to meet certain obligations thereunder. The final construction of
the state constitution in such a case rests with the Supreme
Court.\2064\
\2058\Poole v. Fleeger, 11 Pet. (36 U.S.) 185, 209 (1837); Rhode
Island v. Massachusetts, 12 Pet. (37 U.S.) 657, 725 (1838).
\2059\Hinderlider v. La Plata Co., 304 U.S. 92, 104, 106 (1938).
\2060\Green v. Biddle, 8 Wheat. (21 U.S.) 1, 13 (1823); Virginia
v. West Virginia, 246 U.S. 565 (1918). See also Pennsylvania v. Wheeling
& Belmont Bridge Co., 13 How. (54 U.S.) 518, 566 (1852); Olin v.
Kitzmiller, 259 U.S. 260 (1922).
\2061\Petty v. Tennessee-Missouri Comm., 359 U.S. 275 (1959).
\2062\Texas v. New Mexico, 482 U.S. 124 (1987). If the compact
makes no provision for resolving impasse, then the Court may exercise
its jurisdiction to apportion waters of interstate streams. In doing so,
however, the Court will not rewrite the compact by ordering appointment
of a third voting commissioner to serve as a tie-breaker; rather, the
Court will attempt to apply the compact to the extent that its
provisions govern the controversy. Texas v. New Mexico, 462 U.S. 554
(1983).
\2063\Virginia v. West Virginia, 246 U.S. 565, 601 (1918).
\2064\Dyer v. Sims, 341 U.S. 22 (1951).
|
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