Federal Tribunals in The United States - Supreme Court Rulings Limiting The Power of Article I and Article IV Tribunals

Supreme Court Rulings Limiting The Power of Article I and Article IV Tribunals

The concept of a legislative court was first defined by Chief Justice John Marshall in the case of American Ins. Co. v. 356 Bales of Cotton, 1 Pet. 511 (1828), which is sometimes referred to as Canter, after a claimant in the case. In this case, a court in what was then the Territory of Florida had made a ruling on the disposition of some bales of cotton that had been recovered from a sunken ship. This clearly fell into the realm of admiralty law, which is part of the federal judicial power according to Article III of the Constitution. Yet the judges of the Florida territorial court had four-year terms, not the lifetime appointments required by Article III of the Constitution. Marshall's solution was to declare that territorial courts were established under Article I of the constitution. As such, they could not exercise the federal judicial power, and therefore the law that placed admiralty cases in their jurisdiction was unconstitutional.

Tenure that is guaranteed by the Constitution is a badge of a judge of an Article III court. The argument that mere statutory tenure is sufficient for judges of Article III courts was authoritatively answered in Ex parte Bakelite Corp.:

... the argument is fallacious. It mistakenly assumes that whether a court is of one class or the other depends on the intention of Congress, whereas the true test lies in the power under which the court was created and in the jurisdiction conferred. Nor has there been any settled practice on the part of Congress which gives special significance to the absence or presence of a provision respecting the tenure of judges. This may be illustrated by two citations. The same Congress that created the Court of Customs Appeals made provision for five additional circuit judges and declared that they should hold their offices during good behavior; and yet the status of the judges was the same as it would have been had that declaration been omitted. In creating courts for some of the Territories Congress failed to include a provision fixing the tenure of the judges; but the courts became legislative courts just as if such a provision had been included.

In Glidden Co. v. Zdanok, the court made the following statement regarding courts in unincorporated territories:

Upon like considerations, Article III has been viewed as inapplicable to courts created in unincorporated territories outside the mainland, Downes v. Bidwell, 182 U.S. 244, 266-267; Balzac v. Porto Rico, 258 U.S. 298, 312-313; cf. Dorr v. United States, 195 U.S. 138, 145, 149, and to the consular courts established by concessions from foreign countries, In re Ross, 140 U.S. 453, 464-465, 480.

Ever since Canter, the federal courts have been wrestling with the division between legislative and judicial courts. The Supreme Court most thoroughly delineated the permissible scope of Article I tribunals in Northern Pipeline Co. v. Marathon Pipe Line Co., 458 U.S. 50 (1982), striking down the statute that created the original U.S. bankruptcy court. The Court noted in that opinion that the framers of the Constitution had developed a scheme of separation of powers which clearly required that the judiciary be kept independent of the other two branches via the mechanism of lifetime appointments. However, the Court noted three situations (based on historical understanding) in which Congress could give judicial power to non-Article III courts:

1. Courts for non-state areas (U.S. territories and the District of Columbia) in which Congress is acting as both local and national government.
2. Military courts (or courts-martial), under the historical understanding and clearly laid out exceptions in the Constitution.
3. Legislative courts established under the premise that, where Congress could have simply given the Executive Branch the power to make a decision, it has the lesser power to create a tribunal to make that decision. This power is limited to adjudication of public rights, such as the settling of disputes between the citizens and the government.

The Court also found that Congress has the power under Article I to create adjunct tribunals, so long as the "essential attributes of judicial power" stay in Article III courts. This power derives from two sources. First, when Congress creates rights, it can require those asserting such rights to go through an Article I tribunal. Second, Congress can create non-Article III tribunals to help Article III courts deal with their workload, but only if the Article I tribunals are under the control of the Article III courts. The bankruptcy courts, as well as the tribunals of magistrate judges who decide some issues in the district courts, fall within this category of "adjunct" tribunals. All actions heard in an Article I tribunal are subject to de novo review in the supervising Article III court, which retains the exclusive power to make and enforce final judgments.

Pursuant to Congress’ authority under Article IV, §3, of the Constitution to "make all needful Rules and Regulations respecting the Territory or other Property belonging to the United States;" Congress may create territorial courts and vest them with subject-matter jurisdiction over causes arising under both federal law and local law. But "the Supreme Court long ago determined that in the 'unincorporated' territories, such as American Samoa, the guarantees of the Constitution apply only insofar as its 'fundamental limitations in favor of personal rights' express 'principles which are the basis of all free government which cannot be with impunity transcended.'"

The Supreme Court noted in Commodity Futures Trading Commission v. Schor, 478 U.S. 833 (1986), that parties to litigation may voluntarily waive their right to an Article III tribunal and thereby submit themselves to a binding judgment from an Article I tribunal.

The U.S. Supreme Court in the course of the opinion from Rassmussen v. United States (197 U.S. 596, 524) declared (p. 352, L. ed. p. 186, Sup. Ct. Rep. p. 1119):

'Alaska is one of the territories of the United States. It was so designated in that order, and has always been so regarded. And the court established by the act of 1884 is the court of last resort within the limits of that territory. It is, therefore, in every substantial sense, the supreme court of that territory.'

Article IV judges do not have the authority to decide petitioners’ appeals or be appointed to a United States Court of Appeals. In Nguyen v. United States (2003), the Supreme Court ruled that a panel of the Court of Appeals consisting of two Article III judges and one Article IV judge did not have the authority to decide petitioners’ appeals.