Court Opinion

ID: 6103832
Source: CourtListenerOpinion
Date Created: 2022-01-14 20:15:23.82282+00
Date Added: 2024-06-11T08:53:40.792280
License: Public Domain

(Slip Opinion)

                    Mutual Consent Provisions in the
                   Proposed Guam Commonwealth Act
Sections of the proposed Guam Commonwealth Act requiring the mutual consent of the
   Government of the United States and the Government of Guam raise serious constitu-
   tional questions and are legally unenforceable.

                                                                              July 28, 1994

       MEMORANDUM OPINION FOR THE SPECIAL REPRESENTATIVE
                FOR THE GUAM COMMONWEALTH

   The Guam Commonwealth Act, H.R. 1521, 103d Cong. (1993), con-
tains two sections requiring the mutual consent of the Government of the
United States and the Government of Guam. Section 103 provides that the
Commonwealth Act can be amended only with mutual consent of the two
governments. Section 202 provides that no federal laws, rules, and regula-
tions passed after the enactment of the Commonwealth Act will apply to
Guam without the mutual consent of the two governments. The Repre-
sentatives of Guam insist that these two sections are crucial for the auton-
omy and economy of Guam. The former views of this Office on the valid-
ity or efficacy of mutual consent requirements included in legislation
governing the relationship between the federal government and non-state
areas—i.e. areas under the sovereignty of the United States that are not
States 1—have not been consistent. 2 We therefore have carefully reex-

   1 Territories that have developed from the stage of a classical territory to that of a
commonwealth with a constitution of their own adoption and an elective governor resent
being called territories and claim that that legal term and its implications are not applica-
ble to them. We therefore shall refer to all territories and commonwealths as non-state
areas under the sovereignty of the United States or briefly as non-state areas.
   2 To our knowledge the first consideration of the validity of mutual consent clauses

occurred in 1959 in connection with proposals to amend the Puerto Rico Federal Rela-
tions Act. At that time the Department took the position that the answer to this question
was doubtful but that such clauses should not be opposed on the ground that they go
beyond the constitutional power of Congress. In 1963 the Department of Justice opined
that such clauses were legally effective because Congress could create vested rights in the
status of a territory that could not be revoked unilaterally. The Department adhered to this
position in 1973 in connection with then-pending Micronesians-status negotiations in a
memorandum approved by then-Assistant Attorney General Rehnquist. On the basis of

                                             1
                        __ Op. O.L.C. Supp. __ (July 28, 1994)

amined this issue. Our conclusion is that these clauses raise serious con-
stitutional issues and are legally unenforceable. 3
   In our view, it is important that the text of the Guam Commonwealth
Act not create any illusory expectations that might mislead the electorate
of Guam about the consequences of the legislation. We must therefore
oppose the inclusion in the Act of any provisions, such as mutual consent
clauses, that are legally unenforceable, unless their unenforceability (or
precatory nature) is clearly stated in the document itself.

                                            I.

             The Power of Congress to Govern the Non-State
             Areas Under the Sovereignty of the United States
               Is Plenary Within Constitutional Limitations

  All territory under the sovereignty of the United States falls into two
groups: the states and the areas that are not states. The latter, whether
called territories, possessions, or commonwealths, are governed by and
under the authority of Congress. As to those areas, Congress exercises the

this advice, a mutual consent clause was inserted in section 105 of the Covenant with the
Northern Mariana Islands. The Department continued to support the validity of mutual
consent clauses in connection with the first 1989 task force report on the Guam Com-
monwealth bill. The Department revisited this issue in the early 1990s in connection with
the Puerto Rico status referendum bill in light of Bowen v. Agencies Opposed to Soc. Sec.
Entrapment, 477 U.S. 41, 55 (1986), and concluded that there could not be an enforceable
vested right in a political status; hence mutual consent clauses were ineffective because
they would not bind a subsequent Congress. We took the same position in the second
Guam task force report issued during the last days of the Bush Administration in January
1993.
    3 Mutual consent clauses are not a novel phenomenon; indeed they antedate the Con-

stitution. Section 14 of the Northwest Ordinance contained six “articles of compact
between the original States and the people and States in the said territory,” which shall
“forever remain unalterable, unless by common consent.” These articles were incorpo-
rated either expressly or by reference into many early territorial organic acts. Clinton v.
Englebrecht, 80 U.S. (13 Wall.) 434, 442 (1872). The copious litigation under these
“unalterable articles” focused largely on the question whether the territories’ obligations
under them were superseded by the Constitution, or when the territory became a state, as
the result of the equal footing doctrine. We have, however, not found any cases dealing
with the question whether Congress had the power to modify any duty imposed on the
United States by those articles.

                                            2
        Mutual Consent Provisions in the Proposed Guam Commonwealth Act

combined powers of the federal and of a state government. These basic
considerations were set out in the leading case of National Bank v. County
of Yankton, 101 U.S. (11 Otto) 129 (1880). There the Court held:
         It is certainly now too late to doubt the power of Congress to gov-
      ern the Territories. There have been some differences of opinion as
      to the particular clause of the Constitution from which the power is
      derived, but that it exists has always been conceded. 4
         ...
         All territory within the jurisdiction of the United States not in-
      cluded in any State must necessarily be governed by or under the au-
      thority of Congress. The Territories are but political subdivisions of
      the outlying dominion of the United States. Their relation to the gen-
      eral government is much the same as that which counties bear to the
      respective States, and Congress may legislate for them as a State
      does for its municipal organizations. The organic law of a Territory
      takes the place of a constitution as the fundamental law of the local
      government. It is obligatory on and binds the territorial authorities;
      but Congress is supreme, and for the purposes of this department of
      its governmental authority has all the powers of the people of the
      United States, except such as have been expressly or by implication
      reserved in the prohibitions of the Constitution.
Id. at 132–33 (footnote added).

    4 Some derived that power from the authority of the United States to acquire territory,

others from the mere fact of sovereignty, others from the Territory Clause (U.S. Const.
art. IV, § 3, cl. 2) pursuant to which Congress has “Power to dispose of and make all
needful Rules and Regulations respecting the Territory or other Property belonging to the
United States.” See, e.g., Am. Ins. Co. v. Canter, 26 U.S. (1 Pet.) 511, 542 (1828);
Mormon Church v. United States, 136 U.S. 1, 42–44 (1890); Downes v. Bidwell, 182
U.S. 244, 290 (1901).
    At present, the Territory Clause is generally considered to be the source of the power
of Congress to govern the non-state areas. Hooven & Allison Co. v. Evatt, 324 U.S. 652,
673–74 (1945); Examining Bd. of Eng’rs, Architects & Surveyors v. Flores de Otero, 426
U.S. 572, 586 (1976); Harris v. Rosario, 446 U.S. 651 (1980); see also Wabol v. Villacru-
sis, 958 F.2d 1450, 1459 (9th Cir. 1992).

                                            3
                    __ Op. O.L.C. Supp. __ (July 28, 1994)

  County of Yankton was anticipated in Chief Justice Marshall’s semi-
nal opinion in American Insurance Co. v. Canter, 26 U.S. (1 Pet.) 511,
542–43, 546 (1828). The Chief Justice explained:
        In the mean time [i.e., the interval between acquisition and state-
     hood], Florida continues to be a territory of the United States; gov-
     erned by virtue of that clause in the Constitution, which empowers
     Congress “to make all needful rules and regulations, respecting the
     territory, or other property belonging to the United States.”
        Perhaps the power of governing a territory belonging to the United
     States, which has not, by becoming a state, acquired the means of
     self-government, may result necessarily from the facts, that it is not
     within the jurisdiction of any particular state, and is within the power
     and jurisdiction of the United States.
        ...
        In legislating for them [the Territories], Congress exercises the
     combined powers of the general, and of a state government.
Id. at 542–43, 546.
   The power of Congress to govern the non-state areas is plenary, like
every other legislative power of Congress, but it is nevertheless subject
to the applicable provisions of the Constitution. As Chief Justice Mar-
shall stated in Gibbons v. Ogden with respect to the Commerce Power:
“This power [the Commerce Power], like all others vested in Congress is
complete in itself, may be exercised to its utmost extent, and acknowledg-
es no limitations, other than are prescribed in the constitution.” 22 U.S.
(9 Wheat.) 1, 196 (1824) (emphasis added).
   This limitation on the plenary legislative power of Congress is self-
evident. It necessarily follows from the supremacy of the Constitution.
See, e.g., Hodel v. Va. Surface Mining & Reclamation Ass’n, 452 U.S.
264, 276 (1981). That the power of Congress under the Territory Clause is
subject to constitutional limitations has been recognized in County of
Yankton, 101 U.S. at 133; Downes v. Bidwell, 182 U.S. 244, 290–91
(1901); and District of Columbia v. Thompson Co., 346 U.S. 100, 109
(1953).

                                      4
        Mutual Consent Provisions in the Proposed Guam Commonwealth Act

   Finally, the power of Congress over the non-state areas persists “so
long as they remain in a territorial condition.” Shively v. Bowlby, 152
U.S. 1, 48 (1894); see also Hooven & Allison Co. v. Evatt, 324 U.S. 652,
675 (1945) (recognizing that, during the intermediary period between the
establishment of the Commonwealth of the Philippine Islands and the
final withdrawal of United States sovereignty from those islands, “Con-
gress retains plenary power over the territorial government”).
   The plenary congressional authority over a non-state area thus lasts as
long as the area retains that status. It terminates when the area loses that
status, either by virtue of its admission as a state, or by the termination of
the sovereignty of the United States over the area by the grant of inde-
pendence or by its surrender to the sovereignty of another country.

                                            II.

          Congressional Legislation Relating to the Government
                    of Non-State Areas Is Revocable

   While Congress has the power to govern the non-state areas, it need not
exercise that power itself. Congress can delegate to the inhabitants of non-
state areas full powers of self-government and an autonomy similar to that
of states, and has done so since the beginning of the Republic. Such
delegation, however, must be “consistent with the supremacy and supervi-
sion of National authority.” Clinton v. Englebrecht, 80 U.S. (13 Wall.)
434, 441 (1872); Puerto Rico v. Shell Co., 302 U.S. 253, 260, 261–62
(1937). The requirement that the delegation of governmental authority to
the non-state areas be subject to federal supremacy and federal supervi-
sion means that such delegation is necessarily subject to the right of
Congress to revise, alter, or revoke the authority granted. Dist. of Colum-
bia v. Thompson Co., 346 U.S. 100, 109 (1953) 5; see also United States v.

   5 Thompson dealt with the District of Columbia’s government which is provided for

by Article I, Section 8, Clause 17 of the Constitution, rather than with the non-state areas
as to whom the congressional power is derived from the Territory Clause. The Court,
however, held that in this area the rules relating to the congressional power to govern the
District of Columbia and the non-state areas are identical. Indeed, the Court relied on
cases dealing with non-state areas—e.g., Hornbuckle v. Toombs, 85 U.S. (18 Wall.) 648,
655 (1874), and Christianson v. King County, 239 U.S. 365 (1915)—where it held that

                                             5
                         __ Op. O.L.C. Supp. __ (July 28, 1994)

Sharpnack, 355 U.S. 286, 296 (1958); Harris v. Boreham, 233 F.2d 110,
113 (3d Cir. 1956); Firemen’s Ins. Co. v. Washington, 483 F.2d 1323,
1327 (D.C. Cir. 1973). The power of Congress to delegate governmental
powers to non-state areas thus is contingent on the retention by Congress
of its power to revise, alter, and revoke that legislation. 6 Congress there-
fore cannot subject the amendment or repeal of such legislation to the
consent of the non-state area.
   This consideration also disposes of the argument that the power of
Congress under the Territory Clause to give up its sovereignty over a non-
state area includes the power to make a partial disposition of that authori-
ty, hence Congress could give up its power to amend or repeal statutes
relating to the governance of non-state areas. As shown above, the reten-
tion of the power to amend or repeal legislation delegating governmental
powers to a non-state area is an integral element of the delegation power.
Congress therefore has no authority to enact legislation under the Territo-
ry Clause that would limit the unfettered exercise of its power to amend or
repeal.
   The same result flows from the consideration that all non-state areas are
subject to the authority of Congress, which, as shown above, is plenary.
This basic rule does not permit the creation of non-state areas that are
only partially subject to congressional authority. The plenary power of
Congress over a non-state area persists as long as the area remains in that
condition and terminates only when the area becomes a state or ceases to
be under United States sovereignty. There is no intermediary status as far
as the congressional power is concerned.

Congress can delegate its legislative authority under Article I, Section 8, Clause 17 to
the District, subject to the power of Congress at any time to revise, alter, or revoke that
authority.
   6 Congress has exercised this power with respect to the District of Columbia. The Act

of February 21, 1871, ch. 62, 16 Stat. 419, gave the District of Columbia virtual territorial
status, with a governor appointed by the President, a legislative assembly that included an
elected house of delegates, and a delegate in Congress. The 1871 Act was repealed by the
Act of June 20, 1874, ch. 337, 18 Stat. 116, which abrogated among others the provisions
for the legislative assembly and a delegate in Congress, and established a government by
a commission appointed by the President.

                                             6
       Mutual Consent Provisions in the Proposed Guam Commonwealth Act

  The two mutual consent clauses contained in the proposed Common-
wealth Act therefore are subject to congressional modification and repeal.

                                    III.

     The Rule that Legislation Delegating Governmental Powers
      to a Non-State Area Must be Subject to Amendment and
     Repeal Is but a Manifestation of the General Rule That One
       Congress Cannot Bind a Subsequent Congress, Except
       Where it Creates Vested Rights Enforceable Under the
            Due Process Clause of the Fifth Amendment

   The rule that Congress cannot surrender its power to amend or repeal
legislation relating to the government of non-state areas is but a specific
application of the maxim that one Congress cannot bind a subsequent
Congress and the case law developed under it.
   The rationale underlying that principle is the consideration that if one
Congress could prevent the subsequent amendment or repeal of legislation
enacted by it, such legislation would be frozen permanently and would
acquire virtually constitutional status. Justice Brennan expressed this
thought in his dissenting opinion in United States Trust Co. v. New Jersey,
a case involving the Contracts Clause (U.S. Const. art. I, § 10, cl. 1):
     One of the fundamental premises of our popular democracy is that
     each generation of representatives can and will remain responsive to
     the needs and desires of those whom they represent. Crucial to this
     end is the assurance that new legislators will not automatically be
     bound by the policies and undertakings of earlier days . . . . The
     Framers fully recognized that nothing would so jeopardize the legit-
     imacy of a system of government that relies upon the ebbs and flows
     of politics to “clean out the rascals” than the possibility that those
     same rascals might perpetuate their policies simply by locking them
     into binding contracts.
431 U.S. 1, 45 (1977).
  Nonetheless, the maxim that one Congress cannot bind a future Con-
gress, like every legal rule, has its limits. As early as 1810, Chief Justice
Marshall explained in Fletcher v. Peck:
                                     7
                    __ Op. O.L.C. Supp. __ (July 28, 1994)

        The principle asserted is that one legislature is competent to repeal
     any act which a former legislature was competent to pass; and that
     one legislature cannot abridge the powers of a succeeding legisla-
     ture.
        The correctness of this principle, so far as respects general legisla-
     tion, can never be controverted. But, if an act be done under a law, a
     succeeding legislature cannot undo it. The past cannot be recalled by
     the most absolute power. Conveyances have been made, those con-
     veyances have vested legal estates, and if those estates may be
     seized by the sovereign authority, still, that they originally vested is
     a fact, and cannot cease to be a fact.
        When, then, a law is in its nature a contract, when absolute rights
     have vested under that contract, a repeal of the law cannot devest
     [sic] those rights.
10 U.S. (6 Cranch) 87, 115 (1810).
  The powers of one legislature to repeal or amend the acts of the preced-
ing one are limited in the case of states by the Contracts Clause and the
Due Process Clause of the Fourteenth Amendment, and in the case of
congressional legislation by the Due Process Clause of the Fifth Amend-
ment. This principle was recognized in the Sinking-Fund Cases:
        The United States cannot any more than a State interfere with pri-
     vate rights, except for legitimate governmental purposes. They are
     not included within the constitutional prohibition which prevents
     States from passing laws impairing the obligation of contracts, but
     equally with the States they are prohibited from depriving persons or
     corporations of property without due process of law. They cannot
     legislate back to themselves, without making compensation, the
     lands they have given this corporation to aid in the construction of
     its railroad. Neither can they by legislation compel the corporation to
     discharge its obligations in respect to the subsidy bonds otherwise
     than according to the terms of the contract already made in that con-
     nection. The United States are as much bound by their contracts as
     are individuals.
99 U.S. (9 Otto) 700, 718–19(1879) (emphasis added); see also Bowen v.
Agencies Opposed to Soc. Sec. Entrapment, 477 U.S. 41, 54–56 (1986).

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       Mutual Consent Provisions in the Proposed Guam Commonwealth Act

                                    IV.

     The Due Process Clause Does Not Preclude Congress from
     Amending or Repealing the Two Mutual Consent Clauses

   The question therefore is whether the Due Process Clause of the Fifth
Amendment precludes a subsequent Congress from repealing legislation
for the governance of non-state areas enacted by an earlier Congress
under the Territory Clause. This question must be answered in the nega-
tive.
   The Due Process Clause of the Fifth Amendment provides: “No person
shall . . . be deprived of life, liberty, or property without due process of
law.” (Emphasis added.) This Clause is inapplicable to the repeal or
amendment of the two mutual consent clauses here involved for two
reasons. First, a non-state area is not a “person” within the meaning of the
Fifth Amendment, and, second, such repeal or amendment would not
deprive the non-state area of a property right within the meaning of the
Fifth Amendment.

                                     A.

         A Non-State Area Is Not a Person in the Meaning of
           the Due Process Clause of the Fifth Amendment

  In South Carolina v. Katzenbach, the Court held that a state is not a
person within the meaning of the Due Process Clause of the Fifth
Amendment. 383 U.S. 301, 323–24 (1966); see also Alabama v. EPA,
871 F.2d 1548, 1554 (11th Cir.) (“The State of Alabama is not included
among the entities protected by the due process clause of the fifth
amendment”); State of Oklahoma v. FERC, 494 F. Supp. 636, 661 (W.D.
Okla. 1980), aff’d, 661 F.2d 832 (10th Cir. 1981).
  Similarly it has been held that creatures or instrumentalities of a state,
such as cities or water improvement districts, are not persons within the
meaning of the Due Process Clause of the Fifth Amendment. City of
Sault Ste. Marie v. Andrus, 532 F. Supp. 157, 167 (D.D.C. 1980); El
Paso County Water Improv. Dist. No. 1 v. Int’l Boundary & Water
Comm’n, 701 F. Supp. 121, 123–24 (W.D. Tex 1988).

                                     9
                    __ Op. O.L.C. Supp. __ (July 28, 1994)

   The non-state areas, concededly, are not states or instrumentalities of
states, and we have not found any case holding directly that they are not
persons within the meaning of the Due Process Clause of the Fifth
Amendment. They are, however, governmental bodies, and the rationale
of South Carolina v. Katzenbach, 383 U.S. at 301, appears to be that such
bodies are not protected by the Due Process Clause of the Fifth Amend-
ment. Moreover, it is well established that the political subdivisions of a
state are not considered persons protected as against the state by the
provisions of the Fourteenth Amendment. See, e.g., Newark v. New Jer-
sey, 262 U.S. 192, 196 (1923); Williams v. Mayor of Baltimore, 289 U.S.
36, 40 (1933); S. Macomb Disposal Auth. v. Twp. of Washington, 790
F.2d 500, 505, 507 (6th Cir. 1986), and the authorities there cited. The
relationship of the non-state areas to the federal government has been
analogized to that of a city or county to a state. As stated, the Court held
in County of Yankton: “The territories are but political subdivisions of the
outlying dominion of the United States. Their relation to the general
government is much the same as that which counties bear to the respective
States[.]” 101 U.S. at 133.
   More recently, the Court explained that a non-state area is entirely the
creation of Congress and compared the relationship between the Nation
and a non-state area to that between a state and a city. United States v.
Wheeler, 435 U.S. 313, 321 (1978). It follows that, since states are not
persons within the meaning of the Fifth Amendment and since the politi-
cal subdivisions of states are not persons within the meaning of the Four-
teenth Amendment, the non-state areas are not persons within the meaning
of the Due Process Clause of the Fifth Amendment.

                                     B.

  Legislation Relating to the Governance of Non-State Areas Does
Not Create Any Rights or Status Protected by the Due Process Clause
    Regarding Repeal or Amendment by Subsequent Legislation

  As explained earlier, a subsequent Congress cannot amend or repeal
earlier legislation if such repeal or amendment would violate the Due
Process Clause of the Fifth Amendment—i.e., if such amending or repeal-
ing legislation would deprive a person of property without due process of

                                     10
       Mutual Consent Provisions in the Proposed Guam Commonwealth Act

law. It has been shown in the preceding part of this memorandum that a
non-state area is not a person within the meaning of the Due Process
Clause. Here it will be shown that mutual consent provisions in legisla-
tion, such as the ones envisaged in the Guam Commonwealth Act, would
not create property rights within the meaning of that Clause.
   Legislation concerning the governance of a non-state area, whether
called organic act, federal relations act, or commonwealth act, that does
not contain a mutual consent clause is clearly subject to amendment or
repeal by subsequent legislation. A non-state area does not acquire a
vested interest in a particular stage of self-government that subsequent
legislation could not diminish or abrogate. While such legislation has not
been frequent, it has occurred in connection with the District of Columbia.
See Dist. of Columbia v. Thompson Co., 346 U.S. 100, 104–05 (1953);
supra note 6. Hence, in the absence of a mutual consent clause, legislation
concerning the government of a non-state area is subject to amendment or
repeal by subsequent legislation.
   This leads to the question whether the addition of a mutual consent
clause—i.e., of a provision that the legislation shall not be modified or
repealed without the consent of the Government of the United States and
the government of the non-state area—has the effect of creating in the
non-state areas a specific status amounting to a property right within the
meaning of the Due Process Clause. It is our conclusion that this question
must be answered in the negative because (1) sovereign governmental
powers cannot be contracted away, and (2) a specific political relationship
does not constitute “property” within the meaning of the Fifth Amend-
ment.
   As a body politic the Government of the United States has the general
capacity to enter into contracts. United States v. Tingey, 30 U.S. (5 Pet.)
115, 128 (1831). This power, however, is generally limited to those types
of contracts in which private persons or corporations can engage. By
contrast, sovereign “governmental powers cannot be contracted away,”
N. Am. Commercial Co. v. United States, 171 U.S. 110, 137 (1898). More
recently, the Supreme Court held in connection with legislation arising
under the Contracts Clause that “the Contract[s] Clause does not require a
State to adhere to a contract that surrenders an essential attribute of its
sovereignty.” U.S. Trust Co. of N.Y. v. New Jersey, 431 U.S. 1, 23

                                     11
                         __ Op. O.L.C. Supp. __ (July 28, 1994)

(1977). 7 In a similar context Mr. Justice Holmes stated: “One whose
rights, such as they are, are subject to state restriction, cannot remove
them from the power of the State by making a contract about them.”
Hudson Water Co. v. McCarter, 209 U.S. 349, 357 (1908). 8
   Agreements or compacts to the effect that the Congress may not amend
legislation relating to the government of a non-state area without the
consent of the latter, or that federal legislation shall not apply to Guam
unless consented to by the Government of Guam, would unquestionably
purport to surrender essential powers of the federal government. They are
therefore not binding on the United States and cannot confer a property
interest protected by the Fifth Amendment. 9
   More generally, the Supreme Court held in Bowen v. Agencies Opposed
to Soc. Sec. Entrapment, 477 U.S. 41 (1986), that the contractual property
rights protected by the Due Process Clause of the Fifth Amendment are
the traditional private contractual rights, such as those arising from bonds
or insurance contracts, but not arrangements that are part of a regulatory

    7 Cases arising under the Contracts Clause holding that a state cannot contract away a

sovereign power are also applicable to the contracts made by the federal government,
because the Contracts Clause imposes more rigorous restrictions on the states than the
Fifth Amendment imposes on the federal government. Pension Benefit Guar. Corp. v.
R.A. Gray Co., 467 U.S. 717, 733 (1984); Nat’l R.R. Passenger Corp. v. Atchison, Topeka
& Santa Fe Ry. Co., 470 U.S. 451, 472–73 n.25 (1985). Hence, when state legislation
does not violate the Contracts Clause, analogous federal legislation is all the more permis-
sible under the Due Process Clause of the Fifth Amendment.
    8 Cited with approval with respect to federal legislation in Norman v. Balt. & Ohio

R.R. Co., 294 U.S. 240, 308 (1935).
    9 Cases such as Lynch v. United States, 292 U.S. 571 (1934), and Perry v. United

States, 294 U.S. 330 (1935), are not contrary to this conclusion. Both cases involved
commercial agreements: Lynch, insurance; Perry, government bonds. In Lynch, the Court
held that Congress could not amend the contract merely to save money “unless, indeed the
action falls within the federal police power or some other paramount power.” 292 U.S. at
579. Perry involved bonds issued by the United States under the authority of Article I,
Section 8, Clause 2 of the Constitution to borrow money on the credit of the United
States. The Court held that Congress did not have the power to destroy the credit of the
United States or to render it illusory by unilaterally abrogating one of the pivotal terms of
the bonds to save money. While the Court held that the United States had broken the
agreement, it nevertheless held that plaintiff could not recover because, as the result of
regulations validly issued by the United States, he had not suffered any monetary damag-
es.

                                            12
          Mutual Consent Provisions in the Proposed Guam Commonwealth Act

program such as a state’s privilege to withdraw its participation in the
Social Security system with respect to its employees. Specifically, the
Court stated:
          But the “contractual right” at issue in this case bears little, if any,
       resemblance to rights held to constitute “property” within the mean-
       ing of the Fifth Amendment. The termination provision in the
       Agreement exactly tracked the language of the statute, conferring no
       right on the State beyond that contained in § 418 itself. The provi-
       sion constituted neither a debt of the United States, see Perry v.
       United States, supra, nor an obligation of the United States to pro-
       vide benefits under a contract for which the obligee paid a monetary
       premium, see Lynch v. United States, supra. The termination clause
       was not unique to this Agreement; nor was it a term over which the
       state had any bargaining power or for which the State provided inde-
       pendent consideration. Rather, the provision simply was part of a
       regulatory program over which Congress retained authority to amend
       in the exercise of its power to provide for the general welfare.
Id. at 55. Agreements that the Guam Commonwealth Act may not be
amended without the consent of the Government of Guam, or that future
federal statutes and regulations shall not apply to Guam without the
consent of the Government of Guam clearly do not constitute convention-
al private contracts; they are elements of a regulatory system.
   The Department of Justice has at times concluded that a non-state area
may have a vested interest in a specific status which would be immune
from unilateral congressional amendment or repeal. 10 We cannot continue
to adhere to that position in view of the rulings of the Supreme Court that
legislation concerning the governance of a non-state area is necessarily
subject to congressional amendment and repeal, that governmental bodies
are not persons within the meaning of the Due Process Clause, and that
governmental powers cannot be contracted away; and especially of the
exposition in the recent Bowen case that the property rights protected by

  10   Cf. note 2.

                                        13
                         __ Op. O.L.C. Supp. __ (July 28, 1994)

the Due Process Clause are those arising from private law or commercial
contracts and not those arising from governmental relations. 11
   Sections 103 and 202 therefore do not create vested property rights pro-
tected by the Due Process Clause of the Fifth Amendment. 12 Congress
thus retains the power to amend the Guam Commonwealth Act unilateral-
ly or to provide that its legislation shall apply to Guam without the con-
sent of the government of the Commonwealth. The inclusion of such
provisions, therefore, in the Commonwealth Act would be misleading.
Honesty and fair dealing forbid the inclusion of such illusory and decep-
tive provisions in the Guam Commonwealth Act. 13
   Finally, the Department of Justice has indicated that it would honor
past commitments with respect to the mutual consent issue, such as sec-
tion 105 of the Covenant with the Northern Mariana Islands, in spite of its
reevaluation of this problem. The question whether the 1989 Task Force
proposal to amend section 103 of the Guam Commonwealth Act so as to
limit the mutual consent requirement to sections 101, 103, 201, and 301

   11 It is significant that the circumstances in which Congress can effectively agree not to

repeal or amend legislation were discussed in the context of commercial contracts. Bowen,
477 U.S. at 52.
   12 Bowen, it is true, dealt with legislation that expressly reserved the right of Congress

to amend, while the proposed Guam Commonwealth Act would expressly preclude the
right of Congress to amend without the consent of the Government of Guam. The underly-
ing agreements, however, are not of a private contractual nature, and, hence, are not
property within the meaning of the Due Process Clause. We cannot perceive how they can
be converted into “property” by the addition of a provision that Congress foregoes the
right of amendment.
   13 The conclusion that section 202 of the Guam Commonwealth Act (inapplicability of

future federal legislation to Guam without the consent of Guam) would not bind a future
Congress obviates the need to examine the constitutionality of section 202. In Currin v.
Wallace, 306 U.S. 1, 15–16 (1939), and United States v. Rock Royal Co-op., Inc., 307
U.S. 533, 577–78 (1939), the Court upheld legislation that made the effectiveness of
regulations dependent on the approval of tobacco farmers or milk producers affected by
them. The Court held that this approval was a legitimate condition for making the legisla-
tion applicable. Similarly, it could be argued that the approval of federal legislation by the
Government of Guam is a legitimate condition for making that legislation applicable to
Guam. Since, as stated above, a future Congress would not be bound by section 202, we
need not decide the question whether the requirement of approval by the Government of
Guam for every future federal statute and regulation is excessive and inconsistent with the
federal sovereignty over Guam.

                                             14
      Mutual Consent Provisions in the Proposed Guam Commonwealth Act

constitutes such prior commitment appears to have been rendered moot by
the rejection of that proposal by the Guam Commission.

                              TERESA WYNN ROSEBOROUGH
                               Deputy Assistant Attorney General
                                   Office of Legal Counsel

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