The city and the private right of action.

Author:Diller, Paul A.
 
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INTRODUCTION I. DEFINING THE PRIVATE LAW EXCEPTION A. The Private-Public Law Distinction B. The Evolution of the Private Law Exception C. The Withered Subject-Based Private Law Exception II. A SURVEY OF THE COMPLAINANT-BASED PRIVATE LAW EXCEPTION A. Skeptical States B. Ambiguous States C. Permissive States III. HOME RULE, LOCAL POLICY EXPERIMENTATION, AND THE PRIVATE LAW EXCEPTION A. Local Experimentation and Policy Percolation B. Private Right of Action as Policy Implementation Tool and Means of Affirming Community Norms 1. Increased rule compliance 2. Promotion of individual dignity and community norms C. Examples of Municipally Created Private Rights of Action IV. THE REVERSE-COMMANDEERING COUNTERARGUMENT A. The Structure of State and Municipal Courts B. Local Law in the State Court System C. Recent Case Law and the "Jurisdictional" Objection CONCLUSION APPENDIX: SURVEY OF COMPLAINANT-BASED PRIVATE LAW IN HOME-RULE STATES INTRODUCTION

It has been more than a century since American cities first gained "home rule"--that is, the authority to legislate on a broad range of social and economic policies without prior state legislative approval. Using this authority, cities--and sometimes counties (1)--have increasingly led the way in adopting innovative social policies in areas like public health, civil rights, and environmental protection. Despite enjoying seemingly broad home-rule powers in the vast majority of states, however, cities in several states remain hamstrung by one particular doctrinal limitation on their regulatory authority: they cannot create civil liability between private parties. The lack of power to create private rights of action puts pressure on cities to enforce all ordinances themselves, a costly and inefficient method of ensuring that city policy choices are effectuated. Given the precarious state of municipal finances throughout the nation, the ability of cities to rely on private enforcement to effectuate local policy choices has never been more necessary. This Article argues that cities ought to have the authority to create private rights of action. In doing so, the Article explains why such authority not only fits within the structure of local government law, but also furthers the dynamic of policy experimentation that is the primary normative justification for home rule.

Judicial skepticism toward city authority to create private rights of action has a long pedigree. Shortly after the inception of home rule in the early twentieth century, a consensus developed that city power did not include the authority to regulate "private law." This ill-defined subject matter was said to include topics like contracts, property, torts, wills and trusts, and domestic relations. (2) With little in the way of reasoned explanation, these areas were said to be of such a nature that uniform state regulation was required. The "civil or private law exception" to home-rule powers became a significant barrier to municipal social and economic policymaking, as just about any ordinance could be said to interfere with private law to some degree. For this reason, the ban on city regulation of private law has been relaxed in most states, at least with respect to the subject matters cities may regulate, although its doctrinal persistence occasionally raises problems for cities.

While the subject-based private law exception has faded to a considerable degree, the related but conceptually distinct category of municipal authority to create private rights of action has stubbornly persisted in many states, despite at least one scholar's previous attempt to demonstrate its inconsistency with the logic of home rule. (3) This Article argues that the modern private law exception is not just illogical, but also antithetical to home rule's normative justifications. By depriving cities of a critical weapon in their policy enforcement arsenal, the private law exception can significantly reduce the effectiveness of municipal policy choices. In addition to weakening policies that cities do adopt, the doctrine likely deters cities from enacting other, potentially beneficial regulations in the first place due to concerns about the costs and efficacy of public enforcement. Because it prevents cities from empowering harmed individuals with the right to seek private relief, the private law exception also weakens the ability of the community (i.e., the city) to define and punish conduct it deems wrongful. Making private enforcement more clearly available to municipal policymakers, therefore, will strengthen the efficacy and meaning of current local policy choices and lead to additional legislation that may serve the public good.

To be sure, there are good arguments in favor of retaining some version of the private law exception, and this Article will grapple with them. The most significant argument against city authority to create private rights of action objects to municipal commandeering of the state judiciary to vindicate city goals. At times, this argument is stated in technical terms: cities may not enlarge the jurisdiction of state courts by creating new causes of action. Although this argument has some merit, it too must succumb to the logic of not just home rule, but also the federal constitutional framework of local government. If cities are to serve as "convenient agencies" of the state, as envisioned by the United States Supreme Court in Hunter v. City of Pittsburgh, (4) their legal regimes ought to work in harmony with--rather than separately from--the state's. Indeed, because cities are "agencies" of the state rather than distinct sovereigns, the state courts are obliged to supervise their actions to some degree. That locally created private rights of action might impose some additional costs on the state court system is not reason enough to deny cities this important enforcement tool, at least presumptively.

This Article will proceed in four Parts. Part I explores the history of the private law exception, tracing its evolution within two related contexts: the development of municipal home rule in the United States and changing conceptions of the public-private law distinction. Part I will explain why the definition of private law is critical to understanding the scope of any private law exception. More specifically, Part I will argue that the contemporary private law exception should be understood as a limitation on cities' authority to create private rights of action rather than a limitation of their ability to regulate certain substantive fields of law, and will demonstrate how courts have largely accepted this view in practice, even if not always in their rhetoric. Part II surveys the current legal landscape, describing the degree to which a complainant-based private law exception persists in many states, and how municipal practice is sometimes inconsistent with legal doctrine. Part III explains why cities should have the authority to create private rights of action, and why this power is an important one. Part III further demonstrates how cities have used this power--even when the doctrinal footing is shaky--in significant ways, particularly in the area of antidiscrimination law. Part IV then addresses the most substantial objection to allowing cities to create private rights of action--protecting the state courts from city-imposed costs, which I refer to as the "reverse-commandeering" argument--and explains why this objection does not justify a private law exception.

  1. DEFINING THE PRIVATE LAW EXCEPTION

    Before the emergence of home rule in the late 1800s, most states embraced Dillon's Rule. (5) Articulated by Judge John Dillon, an Iowa Supreme Court justice and then a federal circuit court judge, in his influential postbellum treatise on municipal corporations, the eponymous rule held that cities had scant inherent powers and could exercise only those powers specifically delegated to them by state law. (6) The United States Supreme Court largely embraced Judge Dillon's theoretical conception of local government in the 1907 Hunter case, in which the Court held that cities were mere "political subdivisions" and "convenient agencies" of the state that could be abolished at will. (7) Under Dillon's Rule, cities could regulate matters of "private law," however defined, only if the state legislature had granted them specific authority to do so. Dillon viewed any municipal power that might "touch the right to liberty or property"--by which Dillon, writing in the late nineteenth century, likely meant rights like "freedom of contract"--as "out of the usual range" of municipal powers, and urged that any such grants be read narrowly. (8)

    Around the turn of the twentieth century, a dozen states adopted "home rule" provisions. (9) Rather than require a specific grant of power from the legislature to justify the city's regulation of a certain subject, these provisions offered cities a broader and more permanent source of authority from which to govern. (10) Many of the early home-rule provisions did not delegate plenary legislative authority to local governments, but rather delegated authority to cities to enact laws of "local" concern. (11) This form of home rule, often referred to as "imperio," conceived of cities and states as regulating distinct realms: cities were prohibited from legislating with respect to matters of state concern, while exercising full dominion over "local" matters. (12)

    It was out of this imperio conception of home rule--now largely dated--that the private law exception to city authority emerged. Howard McBain, a political scientist and authority on constitutional law, published a detailed and influential treatise on home rule in 1916, in which he asserted that it was "common understanding" and "universally accepted" that "such general subjects as ... domestic relations, wills and administration, mortgages, trusts, contracts, real and personal property, insurance, banking, corporations...

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