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Article I Courts, Substantive Rights, and Remedies for Government Misconduct

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Article I Courts, Substantive Rights, and Remedies for Government Misconduct Article I Courts, Substantive Rights, and Remedies for Government Misconduct DAVID A. CASE* TABLE OF CONTENTS I. INTRODUCTION ...............................................................................103 II. THEORIES OF ARTICLE I COURTS ..................................................108 A. THE REDETERMINIST THEORY OF ARTICLE I COURTS ............108 B. THE INSTITUTIONAL DISCIPLINE MODEL ..............................112 III. ORIGINS OF SOVEREIGN IMMUNITY .............................................116 A. BACKGROUND OF CLAIMS AGAINST THE GOVERNMENT .......116 B. POST-REVOLUTIONARY HOLES IN SOVEREIGN IMMUNITY .... 121 IV. OVERVIEW OF CONSTITUTIONAL VECTORS .................................123 A. THE APPROPRIATIONS CLAUSE ...............................................124 B. THE PETITION CLAUSE ...........................................................126 C. THE CONTROVERSY REQUIREMENT ......................................132 1. A Court's Ultra Vires Activities .................................132 2. The Controversy Clause as a Grantof Power............. 133 3. The Judicial Power to Adjudicate Cases or Controversies ..............................................................134 4. The Power of the Controversy Clause........................... 138 5. Actions of Government Counsel May Not Be a Part of a Controversy.................................................. 142 6. The Government Lawyer as an Agent of the G overnm ent ..............................................................143 V. HISTORICAL ANALYSIS OF EXISTING ARTICLE I COURTS ..........145 * B.A., Bard College (1998); J.D., Benjamin N. Cardozo School of Law (2001); LL.M., (Taxation) Boston University (2003). Special thanks to: my parents, Hal Johnson, Cyrus Soltani, Lillian Robinson, Grethe Kvernes, Henry Binder and Rebecca Kunkel. The views expressed in this paper are my own and not those of any employer in D.C. or Alaska. Many of the sources used in this article that are in the public domain are available at http://case.tm/pubs/Sources.html. NORTHERN ILLINOIS UNIVERSITY LAW REVIEW [Vol. 26 A. HISTORY OF THE COURT OF FEDERAL CLAIMS .................... 146 1. Background ................................................................. 147 2. As an Agent of Congress ............................................... 152 3. Into the Judicial Power ................................................ 154 4. Constructionand Sovereign Immunity .......................... 156 5. The Case and Controversy Clause and Recoupment ............................................................. 158 6. Modern History.............................................................. 163 B. THE TAX COURT ...................................................................... 165 1. Prehistory....................................................................... 166 2. The Board of Tax Appeals .............................................. 171 3. The Tax Court of the United States................................ 177 4. As an Article I Court...................................................... 179 C. U.S. COURT OF APPEALS FOR VETERANS CLAIMS ................... 182 1. Background of Veterans Benefits ................................... 183 2. The Minimum Amount of Review ................................... 185 VI. RIGHTS AND REMEDIES .................................................................. 191 A. CLASSICAL VIEWS OF RIGHTS AND REMEDIES ....................... 192 B. THE HART AND SACKS VIEW OF RIGHTS AND REMEDIES ....... 194 1. General Directives......................................................... 196 2. Primary Rights ............................................................... 197 3. Remedial Rights............................................................. 199 4. Rights of Action ............................................................ 200 C. SOURCES OF SUBSTANTIVE RIGHTS TO FAIR TREATMENT ................................................................... 203 1. The "Better Than Private Litigants" View .................... 203 2. Mary Carter and the Judiciary...................................... 205 3. Substantive Impact of Rules of Professional Responsibility ................................................................ 207 D. THE NINTH CIRCUIT'S DECISION IN DIXON ........................ 208 E. THE FALSE PROHIBITION AGAINST EQUITABLE PRINCIPLES .......................................................... 209 VII. CONCLUSION .................................................................................. 211 2005] ARTICLE I COURTS I. INTRODUCTION In Crowell v. Benson, the Supreme Court recognized Congress's power to create "legislative courts" under Article I of the Constitution.' However, the Court held that, at most, the jurisdiction of "legislative courts" or "Article I courts" extends to "examin[ing] and determin[ing] various matters, arising between the government and others, which from their nature do not require judicial determination and yet are susceptible of it."'2 Although these courts are jurisdictionally limited to hearing suits 1. 285 U.S. 22, 50 (1932) (quoting Exparte Bakelite Corporation, 279 U.S. 438, 451 (1929)); but cf. N. Pipeline Constr. Co. v. Marathon Pipeline Co., 458 U.S. 50, 74 (1982) (To allow legislative courts to adjudicate disputes between private parties "would require that we replace the principles delineated in our precedents, rooted in history and the Constitution, with a rule of broad legislative discretion that could effectively eviscerate the constitutional guarantee of an independent Judicial Branch of the Federal Government."). 2. Bakelite, 458 U.S. at 74. The Supreme Court, in CFTC v. Schor, 478 U.S. 833, 847-59 (1986), later set forth a test to determine whether a tribunal created under Article I or IIIimproperly encroached on the jurisdiction of Article III courts based on an analysis of three non-exhaustive factors: 1) the degree to which the "essential attributes of power" are reserved to Article III courts, and the extent that the agency exercises the jurisdiction and powers normally vested only in Article III courts; 2) the importance of the right to be adjudicated; and 3) the concerns that prompted Congress to depart from Article III norms. In short, because an administrative agency did not exercise all the powers of an Article III court (such as granting writs of habeas corpus) it did not infringe on the matters that were, properly, exclusively in these courts' domain. The Court of Federal Claims has, by statute, the power to hear "references" from Congress. Under the statute, the court sits as a hearing officer over matters which require fact-finding and legal analysis. See infra text accompanying notes 252-256, 260. These courts probably need not follow Article III standing principles when hearing a case that could not be appealed to an Article III court. See Muskrat v. United States, 219 U.S. 346, 362-63 (1911) (holding that the Supreme Court could not hear appeal of an advisory opinion); Pocono Pines Assembly Hotels Co. v. United States, 73 Ct. Cl. 447, 493 (1932) ("[T]he Supreme Court held [in Bakelite] that the Court of Customs Appeals, the Court of Claims, and the courts of the District of Columbia are legislative and not constitutional courts and hence could be invested by Congress with jurisdiction to render advisory opinions, whereas a constitutional court could not be so required."); Am. Mar. Transp. v. United States, 18 Cl. Ct. 283, 290-91 (1989). However, adjudication of congressional references is not subject to appeal and does not constitute a "case or controversy." Therefore, the court may lack the power to compel testimony and issue self-executing writs. Kanehl v. United States, 38 Fed. Cl. 89, 100 n.5 (1997) (Margolis, J.) ("[A] limited exception to the Article Ill standing requirements are advisory rulings issued by this court pursuant to 28 U.S.C. §§ 1492, 2509 .... Such advisory rulings are not considered actual cases or controversies under Article Ill."); In re Dep't. of Def. Cable TV Franchise Agreements, 35 Fed. Cl. 114, 116 (1996): Thus, a dispute over compensation between the United States govern- ment and two private U.S. citizens, who were severely injured by ma- chine gun fire.., would not be a case or controversy under Article III. NORTHERN ILLINOIS UNIVERSITY LAW REVIEW [Vol. 26 against the government, it has been argued that they may also be circum- scribed in the rules of decision that they may apply. In particular, it has been argued that, unlike Article IH courts, 4 they lack the power to alter their substantive determinations based on equitable principles5 and that they lack the inherent power to punish noncompliance with their orders.6 Under Article I § 8 of the Constitution, Congress may "constitute Tri- bunals inferior to the Supreme Court." Article 1I describes the characteris- tics of federal courts, namely that they are staffed by judges with life tenure, whose salaries are insulated from diminution.7 Article 1I1 § 2 declares, in part, that "[t]he judicial power shall extend to all cases, in law and equity, arising under this Constitution, the laws of the United States."' It is, therefore, uncontroversial that the lower courts described in Article This case was appropriate for consideration by the U.S. Court of Claims as a congressional reference case, however, because it was, in the prac- tical sense, if not the legal sense, a real case and a real controversy. Id. The rules of the Court of Federal Claims proceed from the proposition that the court can compel
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