The issue would would find its way into court when the state subsequently (in response to newly prevailing "public norms and values") enacted a law that effectively nullified the arbitration clause. In that context, I think the constitutional issues are framed in Contract Clause jurisprudence, which recognizes the canon of contract construction that surrenders of sovereign authority must appear in unmistakable terms, Charles River Bridge and Bowen, 477 U.S. 41, 52 (1986); the doctrine that a government may not in any event contract to surrender certain reserved powers, Stone v. Mississippi, 101 U.S. 814 (1880); and the principle that a Government's sovereign acts do not give rise to a claim for breach of contract, Horowitz, 267 U.S. 458, 460 (1925)." US v. Winstar, 518 U.S. 839 (1996) provides an overview of the very cloudy landscape .
John Noble
At 12:00 AM -0400 9/5/03, Marc Poirier wrote:
Marty:
I think it is clear that private parties to contracts can select arbitration in advance as the forum for resolving disputes involving public policy matters governed by statute -- such as employment discrimination or securities regulation. That choice typically involves a loss of judicial review on the merits. I suspect, although I am a bit less clear, that a state could do the same thing by contract.
Thus, in terms of what constitutional angles there are within this question, I wonder whether the presence of a constitutional issue affects the ability to choose by contract to resort to arbitration instead of adjudication. I suspect not.
What troubles me about the scenario here (as with the international investment protection version) is a reduction in the use of adjudication, which may reduce dialogue about public norms and values. See generally Owen Fiss, Against Settlement. Using contract to relocate taking claims to arbitration would mean loss of public involvement (no right to intervene or file amicus) no transparency (confidentiality of proceedings) no published opinion, and no appellate review. Depending on how the selection of arbitrators went in each proceeding, it might also result in a different sensitivity to the contextual nuances of takings law as applied. See Palazzolo; Penn Central.
At first blush i see nothing wrong doctrinally with doing this.
Does that help clarify what is puzzling me?
Marc R. Poirier Professor of Law Seton Hall University School of Law One Newark Center Newark, NJ 07102 973-642-8478
"Marty Lederman" <[EMAIL PROTECTED] To: "Marc Poirier" <[EMAIL PROTECTED]> omcast.net> cc: Subject: Re: takings/procedure question 09/04/2003 04:24 PM
Marc: Is your question whether there's something wrong with the *state* ceding its "right" to judicial review; or, are you asking whether the company can "waive" its right to a judicial forum, perhaps as a condition of receiving some benefit? Or is there some other constitutional concern that I'm missing?
Marty Lederman
----- Original Message ----- From: "Marc Poirier" <[EMAIL PROTECTED]> To: <[EMAIL PROTECTED]> Sent: Thursday, September 04, 2003 10:29 PM Subject: takings/procedure question
Question:the
Suppose a state (one of the United States, that is) were wooing a company to locate a big new facility in the state. In addition to other usual kinds of concessions, the company required the state to agree by contract to the following proposition: should any disputes involving the Takings Clause of the United States Constitution arise between the company andstate, with regard to actions taken by the state or its political subdivisions that affect the facility, the dispute will be submitted to binding arbitration, conducted under standard principles of commercial> arbitration, with no subsequent judicial review on the merits. Would suchan arbitration clause be enforceable?
The context in which I ask is an article I am writing on provisions regarding "indirect expropriation" in NAFTA and other free trade agreements, especially after the Trade Act of 2002.. They do submit transnational takings claims to arbitration.
I'm not sure whether this is dead on to the topics of this list serve, although it's no more off-center than where some threads have gone. Besides, I'm not on the civil procedure list serve.
Thanks for any thoughts you may have. If you think an off-list reply is best feel free. If you think it's of interest to the group....
Warmly,
Marc R. Poirier Professor of Law Seton Hall University School of Law One Newark Center Newark, NJ 07102 973-642-8478