Written by attorneys — see sources below.
A stipulation between two or more states or between a state and a foreign power. Such an arrangement requires the consent of Congress when it tends to increase the political power of the participating states in a manner that may encroach upon or interfere with the just supremacy of the United States.
Virginia and Tennessee appoint commissioners to survey and mark their shared boundary without first obtaining congressional approval. The states later seek judicial enforcement of the resulting line. The court must decide whether the arrangement constitutes an agreement or compact that needed prior congressional consent.
Oregon conditions an alien's right to inherit property on the existence of reciprocal inheritance rights in the alien's home country and on the absence of confiscatory policies there. The statute produces incidental effects on foreign relations. The Court examines whether these effects amount to an agreement or compact with foreign powers that requires congressional consent.
An Oregon resident died intestate in 1962, leaving an estate that included both real and personal property. The decedent's sole heirs, who resided in East Germany, sought to inherit under Oregon probate proceedings. Members of the Oregon State Land Board petitioned the probate court for escheat of the net proceeds of the estate under Oregon Revised Statutes § 111.070. The statute conditioned a nonresident alien's right to inherit on proof of three requirements. One requirement was the existence of a reciprocal right of United States citizens to take property on the same terms as citizens or inhabitants of the foreign country. Another was the right of United States citizens to receive payment within the United States of funds originating from estates in the foreign country. A third was the right of the foreign heirs to receive the proceeds without confiscation in whole or in part by the foreign government. The burden rested on the nonresident alien to establish these facts. The provision concerning confiscation had been added to the statute in 1951, expanding upon earlier general reciprocity language. The Oregon Supreme Court held that Article IV of the 1923 Treaty of Friendship, Commerce and Consular Rights with Germany permitted the East German heirs to take the real property but, following Clark v. Allen, did not permit them to take the personal property. The United States Supreme Court noted probable jurisdiction. In applying the statute in this and related cases, Oregon courts examined the credibility of diplomatic statements from communist-controlled countries, the discretion exercised by foreign banking authorities in issuing licenses for fund transfers, and the political structures under which foreign inheritance laws operated. The Department of Justice appeared as amicus curiae and stated that it did not contend the application of the statute in this case unduly interfered with the United States' conduct of foreign relations.
View caseA bank chartered in Georgia seeks to conduct business in Alabama without obtaining a local charter. Alabama officials challenge the bank's authority. The Court considers whether the bank's operations rest on an implicit agreement or compact between the two states that would require congressional approval.
The three cases consolidated before the Supreme Court in 1839 arose from writs of error to the Circuit Court for the Southern District of Alabama. The lead case, Bank of Augusta v. Joseph B. Earle, involved a Georgia-chartered bank that had authorized its agent Thomas M'Gran to purchase bills of exchange in Mobile using funds derived from Georgia transactions. M'Gran discounted a bill in Alabama for the bank's benefit and to remit the proceeds northward. Similar transactions formed the basis of the New Orleans and Carrollton Railroad Company case, submitted on the same arguments, and the Bank of the United States v. Primrose case, which featured parallel purchases by agents of that federally chartered institution. The defendant in the lead case defended upon facts admitted by the plaintiffs, contending that the Georgia corporation could not lawfully exercise its powers in Alabama. The circuit court accepted that defense in the Bank of Augusta matter and entered judgment for the defendant, prompting the writs of error. Counsel for the several banks argued the appeals while opposing counsel represented Earle and Primrose. Although the records contained minor factual variations, none altered the core legal questions of corporate capacity and Alabama policy.
View caseTreaties, alliances, and confederations are absolutely forbidden to the states. Agreements and compacts may be made with congressional consent. The distinction turns on whether the arrangement is political in nature and tends to increase state power at the expense of federal supremacy.
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Consent is required when the agreement is directed to the formation of any combination that tends to increase the political power of the states and may encroach upon or interfere with federal supremacy. Not every agreement between states triggers the requirement.
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No. Only those that encroach on federal supremacy require congressional consent. The national government alone controls foreign relations, so states lack authority to adjust controversies with foreign powers through agreements that affect national interests.
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…S., at 517. The Court noted that California had not violated any express command of the Constitution by entering into a treaty, agreement or compact with foreign countries. It said that "[w]hat California has done will have some incidental or indirect effect in foreign countries. But that is true of many state laws which none would…