The Eleventh Amendment and the Contracts Clause (Part I)

It is important to evaluate the adaption of the Eleventh Amendment and its interpretation to see how individual sovereignty and personal contract rights started to diminish very early in United States history.

Eleventh Amendment legal scholars, Clyde Jacobs and Kurt Lash, give some credence that the original intent of the Article III, Section 2 of the Constitution was to provide States sovereign immunity from citizens of different States. Article III, Section 2 provides “The judicial Power shall extend to all Cases, in Law and Equity, arising under this Constitution, the Laws of the United States, and Treaties made, or which shall be made, under their Authority;--to all Cases affecting Ambassadors, other public Ministers and Consuls;--to all Cases of admiralty and maritime Jurisdiction;--to Controversies to which the United States shall be a Party;-- to Controversies between two or more States;--between a State and Citizens of another State;--between citizens of different States, and between a State, or the Citizens thereof, and foreign States, Citizens or Subjects.” The Eleventh Amendment provides: “The Judicial power of the United States shall not be construed to extend to any suit in law or equity, commenced or prosecuted against one of the United States by Citizens of another State, or by Citizens or Subjects of any Foreign State.” In essence, the Eleventh Amendment repeals the clause “between a State and Citizens of another State” of Article III, Section 2.

Jacobs and Lash argue that immunity may be implied in Article III, Section 2, but that seems unlikely. Jacobs argues that “Controversies between two or more States” means the States have immunity or it could disrupt the peace and tranquility of the nation. For controversies between States to be resolved one State must waive its sovereign immunity for the case to move forward. Both Jacobs and Lash further contend the text fails to define whether or not a State could be a plaintiff or defendant. In other words, in their view, a State may bring suit against a citizen as a plaintiff but States cannot be a defendant in suits brought forth by citizens using a very strict reading of the clause. These are not very strong arguments. The strongest argument is that diplomatic immunity arose from the 1789 Judiciary Act interpreting Article III, Section 2. But should diplomats who commit crimes against United States citizens receive immunity from criminal prosecution? It is hard to imagine our Founders, who just finished a War to free itself of crimes committed by English nobility, would provide diplomats immunity from criminal prosecution in the Constitution. The reason diplomats receive immunity is to maintain peace and tranquility among the nations. But any diplomat who gets away with crimes, hiding behind immunity, would also create friction between nations.

The Eleventh Amendment controversy started just four years after the ratification of the Constitution. In Chisholm v. Georgia (1793), the Court correctly ruled (by a 4-1 margin – Only 5 Supreme Court Justices presided over the Court in the early years) that individual citizens could sue State governments because sovereignty rests with the people, not the States per the Ninth Amendment and the Declaration of Independence. However, the ratification of the Eleventh Amendment, in 1795, superseded and repudiated the Chisholm decision. The Eleventh Amendment essentially provided State governments with the power to default on loans with citizens from different States – obviously a violation of any contract.

Prior to Chisholm, there were a few cases that provided precedent to support the Chisholm holding. The Court allowed a foreigner to sue the State of Maryland in Van Staphorst v. Maryland (1791, the case was resolved before trial). Of significance, Maryland did not contest the suit using sovereign immunity. In Oswald v. New York (1792), the Court held that the State of New York owed a widower back pay for her deceased husband’s salary. New York contested the lawsuit using sovereign immunity since they believed they were free from being sued by a person from another State (Pennsylvania).

In English law, Justice John Holt wrote “If the plaintiff has a right, he must of necessity have means of vindication if he is injured in the exercise or enjoyment of it.” Justice James Wilson wrote one of four brief Supreme Court majority opinions for Chisholm citing it is the people of the United States that are the sovereign power, not the States or federal government. Wilson’s opinion was joined by fellow Constitutional Conventionalist John Blair, Chief Justice John Jay (author of five Federalist Papers), and William Cushing. In fact, Wilson, Edmund Randolph and Oliver Ellsworth (future Chief Justice) were on the five-member committee responsible for drafting the Constitution. This committee took proposals from Constitutional Convention members and wrote document drafts which were reviewed, debated, and edited by the entire convention. Without a doubt these founders understood the intent of Article III, Section 2. At the Pennsylvania ratifying convention Wilson proclaimed “[I]mpartiality is the leading feature, there ought to be a tribunal where both parties (State and citizen) stand on a just and equal footing.” Jay suggested since States could sue citizens it only seem fair that citizens could sue States. Attorney General Edmund Randolph, who defended Chisholm, said although States are sovereigns, governments were created for the happiness of the people. Randolph understood protecting the rights of the people is the main objective of governments. James Iredell of North Carolina dissented backing the sovereign immunity argument. However, there is no record of Iredell contesting the meaning of Article III, Section 2 at the Constitutional Convention or the North Carolina ratifying convention.

Iredell’s dissent consisted of a very broad reading of the Article III, Section 2 and his reliance on the law of nations or foreign law. Iredell saw an analogy between civilian suits being denied against a sovereign country (England) and therefore, he reasoned, civilian suits should be denied against sovereign States. Reviewing foreign law is an acceptable action for Supreme Court justices, but it should only be used for guidance. Any opinion must be based on the Constitution and not just foreign laws.