Argued: November 7, 2007 -- Decided: March 25, 2008
Opinion Author: Souter
The Federal Arbitration Act (FAA), 9 U. S. C. sec.sec.9-11, provides expedited judicial review to confirm, vacate, or modify arbitration awards. Under sec.9, a court "must" confirm an award "unless" it is vacated, modified, or corrected "as prescribed" in sec.sec.10 and 11. Section 10 lists grounds for vacating an award, including where the award was procured by "corruption," "fraud," or "undue means," and where the arbitrators were "guilty of misconduct," or "exceeded their powers." Under sec.11, the grounds for modifying or correcting an award include "evident material miscalculation," "evident material mistake," and "imperfect[ions] in [a] matter of form not affecting the merits."
After a bench trial sustained respondent tenant's (Mattel) right to terminate its lease with petitioner landlord (Hall Street), the parties proposed to arbitrate Hall Street's claim for indemnification of the costs of cleaning up the lease site. The District Court approved, and entered as an order, the parties' arbitration agreement, which, inter alia, required the court to vacate, modify, or correct any award if the arbitrator's conclusions of law were erroneous. The arbitrator decided for Mattel, but the District Court vacated the award for legal error, expressly invoking the agreement's legal-error review standard and citing the Ninth Circuit's LaPine decision for the proposition that the FAA allows parties to draft a contract dictating an alternative review standard. On remand, the arbitrator ruled for Hall Street, and the District Court largely upheld the award, again applying the parties' stipulated review standard. The Ninth Circuit reversed, holding the case controlled by its Kyocera decision, which had overruled LaPine on the ground that arbitration-agreement terms fixing the mode of judicial review are unenforceable, given the exclusive grounds for vacatur and modification provided by FAA sec.sec.10 and 11.
Held:
1. The FAA's grounds for prompt vacatur and modification of awards are exclusive for parties seeking expedited review under the FAA. The Court rejects Hall Street's two arguments to the contrary. First, Hall Street submits that expandable judicial review has been accepted as the law since Wilko v. Swan, 346 U. S. 427 . Although a Wilko statement--"the interpretations of the law by the arbitrators in contrast to manifest disregard are not subject, in the federal courts, to judicial review for error in interpretation," id., at 436-437 (emphasis added)--arguably favors Hall Street's position, arguable is as far as it goes. Quite apart from the leap from a supposed judicial expansion by interpretation to a private expansion by contract, Hall Street overlooks the fact that the Wilko statement expressly rejects just what Hall Street asks for here, general review for an arbitrator's legal errors. Moreover, Wilko's phrasing is too vague to support Hall Street's interpretation, since "manifest disregard" can be read as merely referring to the sec.10 grounds collectively, rather than adding to them, see, e.g., Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U. S. 614 , or as shorthand for the sec.10 subsections authorizing vacatur when arbitrators were "guilty of misconduct" or "exceeded their powers." Second, Hall Street says that the agreement to review for legal error ought to prevail simply because arbitration is a creature of contract, and the FAA is motivated by a congressional desire to enforce such agreements. Dean Witter Reynolds Inc. v. Byrd, 470 U. S. 213 . This argument comes up short because, although there may be a general policy favoring arbitration, the FAA has textual features at odds with enforcing a contract to expand judicial review once the arbitration is over. Even assuming sec.sec.10 and 11 could be supplemented to some extent, it would stretch basic interpretive principles to expand their uniformly narrow stated grounds to the point of legal review generally. But sec.9 makes evident that expanding sec.10's and sec.11's detailed categories at all would rub too much against the grain: sec.9 carries no hint of flexibility in unequivocally telling courts that they "must" confirm an arbitral award, "unless" it is vacated or modified "as prescribed" by sec.sec.10 and 11. Instead of fighting the text, it makes more sense to see sec.sec.9-11 as the substance of a national policy favoring arbitration with just the limited review needed to maintain arbitration's essential virtue of resolving disputes straightaway. Dean Witter, supra, at 217, 219, distinguished. Pp. 7-12.
2. In holding the sec.10 and sec.11 grounds exclusive with regard to enforcement under the FAA's expedited judicial review mechanisms, this Court decides nothing about other possible avenues for judicial enforcement of awards. Accordingly, this case must be remanded for consideration of independent issues. Because the arbitration agreement was entered into during litigation, was submitted to the District Court as a request to deviate from the standard sequence of litigation procedure, and was adopted by the court as an order, there is some question whether it should be treated as an exercise of the District Court's authority to manage its cases under Federal Rule of Civil Procedure 16. This Court ordered supplemental briefing on the issue, but the parties' supplemental arguments implicate issues that have not been considered previously in this litigation and could not be well addressed for the first time here. Thus, the Court expresses no opinion on these matters beyond leaving them open for Hall Street to press on remand. Pp. 13-15.
196 Fed. Appx. 476, vacated and remanded.
Souter, J., delivered the opinion of the Court, in which Roberts, C. J., and Thomas, Ginsburg, and Alito, JJ., joined, and in which Scalia, J., joined as to all but footnote 7. Stevens, J., filed a dissenting opinion, in which Kennedy, J., joined. Breyer, J., filed a dissenting opinion.
Argued: October 10, 2007 -- Decided: March 25, 2008
Opinion Author: Roberts
In the Case Concerning Avena and Other Mexican Nationals (Mex. v. U. S.), 2004 I. C. J. 12 (Avena), the International Court of Justice (ICJ) held that the United States had violated Article 36(1)(b) of the Vienna Convention on Consular Relations (Vienna Convention or Convention) by failing to inform 51 named Mexican nationals, including petitioner Medelln, of their Vienna Convention rights. The ICJ found that those named individuals were entitled to review and reconsideration of their U. S. state-court convictions and sentences regardless of their failure to comply with generally applicable state rules governing challenges to criminal convictions. In Sanchez-Llamas v. Oregon, 548 U. S. 331 --issued after Avena but involving individuals who were not named in the Avena judgment--this Court held, contrary to the ICJ's determination, that the Convention did not preclude the application of state default rules. The President then issued a memorandum (President's Memorandum or Memorandum) stating that the United States would "discharge its international obligations" under Avena "by having State courts give effect to the decision."
Relying on Avena andthe President's Memorandum, Medelln filed a second Texas state-court habeas application challenging his state capital murder conviction and death sentence on the ground that he had not been informed of his Vienna Convention rights. The Texas Court of Criminal Appeals dismissed Medelln's application as an abuse of the writ, concluding that neither Avena nor the President's Memorandum was binding federal law that could displace the State's limitations on filing successive habeas applications.
Held: Neither Avena nor the President's Memorandum constitutes directly enforceable federal law that pre-empts state limitations on the filing of successive habeas petitions. Pp. 8-37.
1. The Avena judgment is not directly enforceable as domestic law in state court. Pp. 8-27.
(a) While a treaty may constitute an international commitment, it is not binding domestic law unless Congress has enacted statutes implementing it or the treaty itself conveys an intention that it be "self-executing" and is ratified on that basis. See, e.g., Foster v. Neilson, 2 Pet. 253, 314. The Avena judgment creates an international law obligation on the part of the United States, but it is not automatically binding domestic law because none of the relevant treaty sources--the Optional Protocol, the U. N. Charter, or the ICJ Statute--creates binding federal law in the absence of implementing legislation, and no such legislation has been enacted.
The most natural reading of the Optional Protocol is that it is a bare grant of jurisdiction. The Protocol says nothing about the effect of an ICJ decision, does not commit signatories to comply therewith, and is silent as to any enforcement mechanism. The obligation to comply with ICJ judgments is derived from Article 94 of the U. N. Charter, which provides that "[e]ach ... Member ... undertakes to comply with the [ICJ's] decision ... in any case to which it is a party." The phrase "undertakes to comply" is simply a commitment by member states to take future action through their political branches. That language does not indicate that the Senate, in ratifying the Optional Protocol, intended to vest ICJ decisions with immediate legal effect in domestic courts.
This reading is confirmed by Article 94(2)--the enforcement provision--which provides the sole remedy for noncompliance: referral to the U. N. Security Council by an aggrieved state. The provision of an express diplomatic rather than judicial remedy is itself evidence that ICJ judgments were not meant to be enforceable in domestic courts. See Sanchez-Llamas, 548 U. S., at 347. Even this "quintessentially international remed[y]," id., at 355, is not absolute. It requires a Security Council resolution, and the President and Senate were undoubtedly aware that the United States retained the unqualified right to exercise its veto of any such resolution. Medelln's construction would eliminate the option of noncompliance contemplated by Article 94(2), undermining the ability of the political branches to determine whether and how to comply with an ICJ judgment.
The ICJ Statute, by limiting disputes to those involving nations, not individuals, and by specifying that ICJ decisions have no binding force except between those nations, provides further evidence that the Avena judgment does not automatically constitute federal law enforceable in U. S. courts. Medelln, an individual, cannot be considered a party to the Avena decision. Finally, the United States' interpretation of a treaty "is entitled to great weight," Sumitomo Shoji America, Inc. v. Avagliano, 457 U. S., at 184-185, and the Executive Branch has unfailingly adhered to its view that the relevant treaties do not create domestically enforceable federal law. Pp. 8-17.
(b) The foregoing interpretive approach--parsing a treaty's text to determine if it is self-executing--is hardly novel. This Court has long looked to the language of a treaty to determine whether the President who negotiated it and the Senate that ratified it intended for the treaty to automatically create domestically enforceable federal law. See, e.g., Foster, supra. Pp. 18-20.
(c) The Court's conclusion that Avena does not by itself constitute binding federal law is confirmed by the "postratification understanding" of signatory countries. See Zicherman v. Korean Air Lines Co., 516 U. S. 217 . There are currently 47 nations that are parties to the Optional Protocol and 171 nations that are parties to the Vienna Convention. Yet neither Medelln nor his amici have identified a single nation that treats ICJ judgments as binding in domestic courts. The lack of any basis for supposing that any other country would treat ICJ judgments as directly enforceable as a matter of their domestic law strongly suggests that the treaty should not be so viewed in our courts. See Sanchez-Llamas, 548 U. S., at 343-344, and n. 3.
The Court's conclusion is further supported by general principles of interpretation. Given that the forum state's procedural rules govern a treaty's implementation absent a clear and express statement to the contrary, see e.g., id., at 351, one would expect the ratifying parties to the relevant treaties to have clearly stated any intent to give ICJ judgments such effect. There is no statement in the Optional Protocol, the U. N. Charter, or the ICJ Statute that supports this notion. Moreover, the consequences of Medelln's argument give pause: neither Texas nor this Court may look behind an ICJ decision and quarrel with its reasoning or result, despite this Court's holding in Sanchez-Llamas that"[n]othing in the [ICJ's] structure or purpose ... suggests that its interpretations were intended to be conclusive on our courts." id., at 354. Pp. 20-24.
(d) The Court's holding does not call into question the ordinary enforcement of foreign judgments. An agreement to abide by the result of an international adjudication can be a treaty obligation like any other, so long as the agreement is consistent with the Constitution. In addition, Congress is up to the task of implementing non-self-executing treaties, even those involving complex commercial disputes. Medelln contends that domestic courts generally give effect to foreign judgments, but the judgment Medelln asks us to enforce is hardly typical: It would enjoin the operation of state law and force the State to take action to "review and reconside[r]" his case. Foreign judgments awarding injunctive relief against private parties, let alone sovereign States, "are not generally entitled to enforcement." Restatement (Third) of Foreign Relations Law of the United States sec.481, Comment b, p. 595 (1986). Pp. 24-27.
2. The President's Memorandum does not independently require the States to provide review and reconsideration of the claims of the 51 Mexican nationals named in Avena without regard to state procedural default rules. Pp. 27-37.
(a) The President seeks to vindicate plainly compelling interests in ensuring the reciprocal observance of the Vienna Convention, protecting relations with foreign governments, and demonstrating commitment to the role of international law. But those interests do not allow the Court to set aside first principles. The President's authority to act, as with the exercise of any governmental power, "must stem either from an act of Congress or from the Constitution itself." Youngstown Sheet & Tube Co. v. Sawyer, 343 U. S. 579.
Justice Jackson's familiar tripartite scheme provides the accepted framework for evaluating executive action in this area. First, "[w]hen the President acts pursuant to an express or implied authorization of Congress, his authority is at its maximum, for it includes all that he possesses in his own right plus all that Congress can delegate." Youngstown, 343 U. S., at 635 (Jackson, J., concurring). Second, "[w]hen the President acts in absence of either a congressional grant or denial of authority, he can only rely upon his own independent powers, but there is a zone of twilight in which he and Congress may have concurrent authority, or in which its distribution is uncertain." Id., at 637. In such a circumstance, Presidential authority can derive support from "congressional inertia, indifference or quiescence." Ibid. Finally, "[w]hen the President takes measures incompatible with the expressed or implied will of Congress, his power is at its lowest ebb," and the Court can sustain his actions "only by disabling the Congress from acting upon the subject." Id., at 637-638. Pp. 28-29.
(b) The United States marshals two principal arguments in favor of the President's authority to establish binding rules of decision that preempt contrary state law. The United States argues that the relevant treaties give the President the authority to implement the Avena judgment and that Congress has acquiesced in the exercise of such authority. The United States also relies upon an "independent" international dispute-resolution power. We find these arguments, as well as Medelln's additional argument that the President's Memorandum is a valid exercise of his "Take Care" power, unpersuasive. Pp. 29-37.
(i) The United States maintains that the President's Memorandum is implicitly authorized by the Optional Protocol and the U. N. Charter. But the responsibility for transforming an international obligation arising from a non-self-executing treaty into domestic law falls to Congress, not the Executive. Foster, 2 Pet., at 315. It is a fundamental constitutional principle that " '[t]he power to make the necessary laws is in Congress; the power to execute in the President.' " Hamdan v. Rumsfeld, 548 U. S. 557 . A non-self-executing treaty, by definition, is one that was ratified with the understanding that it is not to have domestic effect of its own force. That understanding precludes the assertion that Congress has implicitly authorized the President--acting on his own--to achieve precisely the same result. Accordingly, the President's Memorandum does not fall within the first category of the Youngstown framework. Indeed, because the non-self-executing character of the relevant treaties not only refutes the notion that the ratifying parties vested the President with the authority to unilaterally make treaty obligations binding on domestic courts, but also implicitly prohibits him from doing so, the President's assertion of authority is within Youngstown's third category, not the first or even the second.
The United States maintains that congressional acquiescence requires that the President's Memorandum be given effect as domestic law. But such acquiescence is pertinent when the President's action falls within the second Youngstown category, not the third. In any event, congressional acquiescence does not exist here. Congress' failure to act following the President's resolution of prior ICJ controversies does not demonstrate acquiescence because in none of those prior controversies did the President assert the authority to transform an international obligation into domestic law and thereby displace state law. The United States' reliance on the President's "related" statutory responsibilities and on his "established role" in litigating foreign policy concerns is also misplaced. The President's statutory authorization to represent the United States before the U. N., the ICJ, and the U. N. Security Council speaks to his international responsibilities, not to any unilateral authority to create domestic law.
The combination of a non-self-executing treaty and the lack of implementing legislation does not preclude the President from acting to comply with an international treaty obligation by other means, so long as those means are consistent with the Constitution. But the President may not rely upon a non-self-executing treaty to establish binding rules of decision that pre-empt contrary state law. Pp. 30-35.
(ii) The United States also claims that--independent of the United States' treaty obligations--the Memorandum is a valid exercise of the President's foreign affairs authority to resolve claims disputes. See, e.g., American Ins. Assn. v. Garamendi, 539 U. S. 396 . This Court's claims-settlement cases involve a narrow set of circumstances: the making of executive agreements to settle civil claims between American citizens and foreign governments or foreign nationals. They are based on the view that "a systematic, unbroken, executive practice, long pursued to the knowledge of the Congress and never before questioned," can "raise a presumption that the [action] had been [taken] in pursuance of its consent." Dames & Moore v. Regan, 453 U. S. 654 . But "[p]ast practice does not, by itself, create power." Ibid. The President's Memorandum--a directive issued to state courts that would compel those courts to reopen final criminal judgments and set aside neutrally applicable state laws--is not supported by a "particularly longstanding practice." The Executive's limited authority to settle international claims disputes pursuant to an executive agreement cannot stretch so far. Pp. 35-37.
(iii) Medelln's argument that the President's Memorandum is a valid exercise of his power to "Take Care" that the laws be faithfully executed, U. S. Const., Art. II, sec.3, fails because the ICJ's decision in Avena is not domestic law. P. 37.
223 S. W. 3d 315, affirmed.
Roberts, C. J., delivered the opinion of the Court, in which Scalia, Kennedy, Thomas, and Alito, JJ., joined. Stevens, J., filed an opinion concurring in the judgment. Breyer, J., filed a dissenting opinion, in which Souter and Ginsburg, JJ., joined.