Hitherto, most attention has been given to whether Congress, under its constitutional power to regulate interstate commerce, can coerce individuals into engaging in commerce by buying health insurance. Now, the Institute for Justice, a libertarian public interest law firm, has focused on this fact: The individual mandate is incompatible with centuries of contract law. This is so because a compulsory contract is an oxymoron.
The brief, the primary authors of which are IJ’s Elizabeth Price Foley and Steve Simpson, said Obamacare is the first time Congress has used its power to regulate commerce to produce a law “from which there is no escape.” And “coercing commercial transactions” — compelling individuals to sign contracts with insurance companies — “is antithetical to the foundational principle of mutual assent that permeated the common law of contracts at the time of the founding and continues to do so today.”
Throughout the life of this nation, it has been understood that for a contract to be valid, the parties to it must mutually assent to its terms — without duress.
1. clarin wrote:
Presumably if the Act had imposed a tax, instead of a duty to buy, that would be used to purchase cover, that would have been constitutional?
March 26, 3:22 pm | [comment link]
2. Dan Crawford wrote:
If the Supreme Court decides that mandatory insurance is unconstitutional, I sincerely hope that destroys all the states’ compulsory auto insurance laws.
March 26, 8:32 pm | [comment link]
3. St. Jimbob of the Apokalypse wrote:
Dan, the only hangup there is that you aren’t compelled to register, insure, and drive a vehicle. The privilege of driving in contingent on being insured, and driving is voluntary. Obamacare’s insurance scheme is just more compulsory, as breathing is fairly involuntary.
March 26, 8:43 pm | [comment link]
4. Archer_of_the_Forest wrote:
That is an interesting argument, but there are a few holes in it that I think could legally get around it. First of all, I am not sure that common law is applicable here. This is clearly legislation. Common law traditionally derives its power from when there are no governing laws but the courts were forced anyway to deal with the issues though there be no statute governing those issues. Someone being named a “common law” wife comes to mind. There isn’t actually a legal marriage but common law will occasionally make up the fiction to justify dealing with a couple that acts in every way like they are married though they are not. Likewise some states, particularly in the Midwest, have outlawed common law marriage entirely which takes the common law marriage argument completely out of the courts.
Secondly, if the court was to buy that argument of forced contract being oxymoronic in this instance, I think they risk of opening up the flood gates on a number of issues. Isn’t a military draft a “forced contract?” Is not the quartering of troops as prescribed by law a “forced contract?” Is not paying income taxes themselves a “forced contract?” I know I never voluntarily gave my mutual consent for the government to take whole bunch of money out of my earnings, but that’s the nature of government. All those are allowed under the Constitution and its amendments.
Again, while a very interesting argument, it has some major holes.
March 26, 9:24 pm | [comment link]
5. Brian Vander Wel wrote:
George Will—for many years running now—has been one of the most lucid and cogent communicators of conservative political ideals. On this subject he cuts off the barnacles of empty, emotive rhetoric and articulates a sane and rational argument that we ignore at our own peril. For years, I have sought out his answers first on political questions I ask. On this one, he has done it again. Thanks, George!
March 26, 9:37 pm | [comment link]
6. Brian Vander Wel wrote:
Number 4. I think that what Will is arguing is that for a contract to be a contract it must be by mutual consent. We can’t have a contract when one side is forced: at that moment by definition it ceases to be a contract.
Your examples are not contracts. The draft is not a contract. We don’t pay taxes by contract. And the third amendment of the Constitution prohibits the quartering of troops without the owners’ consent, so you have that example exactly backwards.
Now, I am not a lawyer, so I don’t know much of anything here. However, I’m pretty sure that I have a contractual agreement with my issurance company to pay premiums that they in turn will pay for my health care. The think tank Will refers to and Will himself argue in very simple terms that to require this arrangement for all Americans means quite simply that this is no longer a contractual agreement: it is the government extending so far beyond its limits of power that it is claiming the ability to square a circle.
It is brilliant and elegant in its simplicity. Who knows, however, what the Court will do with it.
March 26, 9:58 pm | [comment link]
7. sophy0075 wrote:
A contract formed without mutual consent? Why, that’s just as absurd as to believe that a trust can be created by its would-be beneficiary!
March 27, 12:25 am | [comment link]
8. Northwest Bob wrote:
I notice it is legal to force hospitals to treat non-paying or uninsured patients at hospital emergency rooms. Is sauce for the goose sauce for the gander?
March 27, 1:30 am | [comment link]
9. Katherine wrote:
The auto liability insurance requirements are state requirements, not federal.
March 27, 7:01 am | [comment link]
10. Archer_of_the_Forest wrote:
No. 6, Contracts do not have to be in written “I do this, you do that” form; this is also an understanding of common law. For purposes of Common Law, at least historically, gentleman’s agreements for example are viewed as contracts for purposes of contract law though they are not written. Again, keep in mind, this, like so much other stuff from Common Law, is all legal fiction that courts make up to satisfy themselves.
I would argue, as an aside, that a draft is indeed a forced contract. The draftee has to agree to work for the government in a war and is paid accordingly. Draftees have to swear the oath and enter into contractual obligations and behave according to the Military Uniform Code. While not a formal business contract, there is a service rendered and a remuneration (payment), and if either party violates the outlines duties and payment, legal action remedy is invoked. How is that not a contract? Same for the quartering of troops.
Same for the paying of taxes, though I will grant you that is an outre example. I work and pay taxes and receive (in theory) government benefits in the form of interstate highways, medicare at retirement (again, in theory), defense from the military, etc. Granted, this is premised more on “social contract” theory, but it is a contract nonetheless. Although, I was thinking about this last night, and I think if the Court wanted to rule against this law, I think they could invoke this idea of income tax as contract because it took a Constitutional Amendment for the Income Tax to be labelled constitutional in the courts. That argument could work both ways legally.
Likewise, Contracts, again in Common Law, do not necessary have to be by mutual consent. A trust fund can be set up where the potential beneficiary is not allowed to have a say in when he or she gets money derivative from the trust (look at legacy trusts). Look also historically at marriage contracts in Common Law having to do with the Fee Tail (think the legal title mess in the estate in Downton Abbey).
I can also think of a takings of property by the government in the form of a condemnation of land for use for a highway or whatever. That contact is forced on people. The land owner is forced to render title to the land and is forced have to take the money or remuneration that is offered by the government. Given there has to be “fair market value,” which is often a sham; just look at what’s happening in Connecticut. And yet all that is written up as a formal contract, whether the person wants to be bought out or not, particularly if the land in a family farm with a lot of sentiment value. This is justified under the doctrine of the “common good” in terms of Common Law.
I have a feeling if the court upholds this law, and they want to circumvent this Common Law-Mutual Consent argument proposed here, they will simply invoke “common good”-it covers a multitude of crimes in English Common Law and has tons of precedent.
March 27, 8:36 am | [comment link]
11. Dan Crawford wrote:
#9 So if a state mandate is unconstitutional, it is nonetheless legal.
March 27, 3:20 pm | [comment link]
12. Archer_of_the_Forest wrote:
No. 11, depends on whether you think the US Constitution’s Bill of Rights applies to States or not.
But, seriously, I don’t think No. 9 can that easily divorce the state and federal on the issues of auto insurance because a lot of what the states institute in terms of that is directly at the behest (threat) of the Federal government. In other words if you don’t meet Federal guidelines on those issues, the State doesn’t get Federal road funding (amongst other things.) Same is true with seat belt laws.
March 27, 4:37 pm | [comment link]
13. Daniel Muth wrote:
“Archer_of_the_Forest” - 100% of the examples you have cited are between the individual and the government, which I would have thought a significantly different thing from a contract between private citizens, as this one is. Perhaps you could either cite an example of the latter or explain how it is essentially the same thing. As to auto insurance, the matter at hand, as noted by #3, is use of the vehicle on government roads, not merely being a citizen, the two things differing somewhat, I should think.
March 27, 5:20 pm | [comment link]
14. Archer_of_the_Forest wrote:
The Black’s Law Dictionary defines contract as, “An agreement between two or more parties creating obligations that are enforceable or otherwise recognizable at law.” Blacks Law Dictionary also defines party as “one who takes part in a transaction.” Thus, a contract does not have to be between two individual people.
A contract can be between an individual and any number of entities, or between two entities between themselves. For example an individual signing a contract with a bank for a loan or a business contract between corporations. Likewise, a contract can involve numerous parties.
Likewise, the government has standing to bring a case to court, thereby, it would be a preposterous fiction to say that the Government does has standing as a party to bring suits but then doesn’t have standing to enter into contracts. The Government enters into contracts all the time. Just look at the private sector deals for the Defense Department for one example.
I bring this up because the SCOTUS just a year or so back rendered that (in my opinion asinine) opinion having to do with soft money and Super PACs, etc., basically recognizing corporations as “persons” under the law and thereby the government cannot abridge their freedom of speech in terms of political campaign donations. I am willing to bet that is going to come into play in the forthcoming opinion on this case because the court can now logically (though complete legal fiction in my opinion) apply that precedent to the US Government or in this case Insurance Corporations, saying that they are indeed “persons” and can thereby be enter into contracts, if that hasn’t already been set in prior precedent.
Now, that having been said, the court could use that to uphold the logic in the George Will argument above and say that forcing them into a contract with this “person” is therefore unconstitutional. Or, if they side with the government, can then clarify the preceding case as saying that the Government for purposes of “forced contracts” is not, in fact, a person, and therefore this falls under “common good” like my aforementioned takings of private property for a road or a school or something.
Now, I will attempt to tackle No. 13’s supposition above. If your definition of contract is between 2 private citizens, then you’ve just logically blew legal argument because an Insurance Corporation by your definition is not a “private citizen” either. Therefore, whatever contract-like thing goes on between a private citizen and the Insurance Corporation is not a contract by your definition, therefore this whole “forced contract” defense is moot.
March 27, 6:15 pm | [comment link]
15. Daniel Muth wrote:
#14 - I’ve looked all over my post and I can’t find a definition of “private citizen” anywhere. Regardless, you have not addressed the question: how is the government making contracts between citizens and itself like unto forcing citizens to make contracts with other parties who are not agents of the government? I honestly don’t see how it matters one whit whether that other is an individual or not (frankly, since corporations are comprised neither of robots nor airy philosophies, treating them as citizens always made sense to me, but that’s neither here nor there, I suppose). Perhaps you could explain further. The question stands.
March 27, 6:41 pm | [comment link]
16. Archer_of_the_Forest wrote:
No. 15, I guess I am not understanding what you mean. A contract is a contract regardless of who or what is involved. I am not saying they are necessarily the same; I am saying both things have happened historically. It does not matter whether the contract in question is a contract directly between the federal government and a private citizen or between two private citizens, one of which is acting as an agent in some way or another for the government. The Obama administration is claiming that the Insurance Companies are agents of the government, as they are all working for the common good. (I think this is wrong headed, but that is what they are claiming.)
First of all, just to clarify your terminology: what do you mean by “the government?” Do you mean Federal Congress? the President? the Courts? All three in one? They are all technically “the government.” I am assuming you mean the US Congress, but I just need clarification.
Secondly, the government can force contracts in cases involving two parties not of governmental origin. I can think of several examples. The government can end a labor dispute between a union and a corporation by fiat basically. They can force people into contractual arbitration. The government forces people to buy car insurance if they own a car (granted this is usually a state level thing, but mandated by federal law). The Government can force people to divulge privileged information for purposes of a civil suit between non-governmental parties. The State of Connecticut in the case upheld by the SCOTUS forced those landowners to sell their property to another private developer that was not the government. The US Congress forced people into contracts with private utility companies during the Rural Electrification Act and other progressive measures that brought utilities and services like sewers to areas for the first time. The Government has occasionally force businesses to hire a certain quota of minorities (both non-governmental agencies). The government can force people to get innoculations from private hospitals with vaccines from private pharmaceutical companies in the event of pandemics. The list goes on and on, particularly if you look back at the 1930s New Deal stuff. I won’t even go into the powers the President can invoke by executive order that can force people to do things. I grant you, all broad overreaches of federal power, but it has occurred and it will likely continue to occur.
March 27, 10:37 pm | [comment link]
17. Daniel Muth wrote:
#16 - The article claims that the mandate is unprecedented in that the government is coercing contracts between private parties as a condition of citizenship (“from which there is no escape” is the terminology Mr. Will uses). In #4, you seemed to indicate that the article is essentially wrong and that people are forced into contracts with the federal government as a condition of citizenship all the time. I thought there to be a rather clear inference that the argument Mr. Will cites exempts the sorts of obvious examples you cite in #4 since the federal government’s (though surely this applies at other levels as well) powers of coercion with respect to itself are exceptional. My question, then, was whether, if the federal government is exempted as one of the contracting parties, Mr. Will’s argument stands or falls apart.
In #16, you cite several examples of government coercion affecting private contracts, none of which appear to these eyes to meet Mr. Will’s definition of a coerced contract between private parties “from which there is no escape”. One can avoid forced union membership by doing something else, or auto insurance by not driving on government roads, or not buying electricity following the establishment of a rural electrification project, etc. Revealing information about a contract is not the same as entering it, nor is undergoing arbitration. All of which, again, is obvious and debate over which is tedious.
It appears to me that, by either over-generalizing or over-specifying, you seem to manage to miss the point Mr. Will is getting at, but I’m probably misunderstanding you. That’s as it may be. We seem agreed that there are problematic aspects of this legislation and the Supreme Court has an interesting job on its hands. Best regards to you.
March 28, 9:10 am | [comment link]
18. Archer_of_the_Forest wrote:
I never said this instance was common; I have merely stated that it does occur from time to time. I never said anything about it being contingent on citizenship. If that was what you assumed, I apologize for my lack of clarity. That is not what I meant.
I do, however, stand by my assertion that what George Will is arguing is somewhat misguided because he is talking primarily about the precedent from common law. Common law is only applicable in the courts when there is a lack of legislation the governs the scenario in play. The US Congress has the right to deny the writ of certiorari (review) to the Court on any matter or can limit by statute what is at play in terms of what the Court can review. If the US Congress wanted to deny the Courts the right to rule on issues of contractual “no escape” clauses, they could do so. This will never happen, of course, but Congress does have that right under the constitution.
That aside, I did give a clear example from which there is no escape. Go back and look at the legal mandates for things like the Rural Electrification Act. If the public came by where you were living, even if you did not want electricity, you were forced to buy into the private electric companies or water works and accept their service. There was no escape. People had no choice. I suppose they could have sold their house and become homeless, but so is the case for this mandated healthcare. People can stop being American citizens, and thus the mandate can be gotten out of. So, I suppose, if you want to look at it like that, this contract for mandated health care could be viewed as not one “from which there is no escape.”
Here is another example for you that should meet your very narrow view of what is meant by a contract in the bizarre hypothetical scenario that George Will suggests under common law. Private Hospitals must treat patients for emergency care whether they can pay or not. They have to provide this service or risk severe penalties that can range from civil to criminal. There is no escape from this by law, again other than the hospital closing its doors.
But, yes, while this has been fun, I imagine we are just going to have to agree to disagree. I never claimed to know what the answer is.
March 28, 12:37 pm | [comment link]