Amicus Curiae Brief — Phillips v. Washington Legal Foundation

_ |

Bite

(00) oct wo wet

No. 96-1578

In The

Supreme Court of the United States

October Term, 1997

+

HON. THOMAS R. PHILLIPS, et al.,

Petitioners,

WASHINGTON LEGAL FOUNDATION, et al.,

Respondents.

>

On Writ Of Certiorari

To The United States Court Of Appeals

For The Fifth Circuit

¢

BRIEF OF THE ASSOCIATION FOR

OBJECTIVE LAW AS AMICUS CURIAE

SUPPORTING RESPONDENTS

7

STEPHEN PLAFKER

1538 Marion Drive

Glendale, CA 91205-3721

(818) 956-3288

Attorney for Amicus Curiae

COCKLE LAW BRIEF PRINTING CO., (800) 225-6964

OR CALL COLLECT (402) 342-2831

TABLE OF CONTENTS

INTEREST OF AMICUS CURIAE

SUMMARY OF ARGUMENT

ARGUMENT

A. Summary of the Texas IOLTA Program

B. The Importance of Property Rights

CONCLUSION ...

TABLE OF AUTHORITIES

Page

Cases

Andrus v. Allard, 444 U.S. 51 (1979) ..............4.. 12

Bayard v. Singleton, 1 Martin 42 (N.C. 1797).......... i)

Berman v. Parker, 348 U.S. 26 (1954) ..............05- 12

Citizens’ Savings & Loan Association v. Topeka, 20

Wall. (67 US.) GBS (167)... .ctcuesssconnneseaaee 14

City of Oakland v. Oakland Raiders, 32 Cal.3d 60, 183

Cal.Rptr. 673, 646 P.2d 835 (1982).............00- 12

Edwards v. California, 314 U.S. 160 (1941)............. 6

Everson v. Board of Education, 330 U.S. 1 (1947)....... 4

Grand Rapids School District v. Ball, 473 U.S. 373

th.) rrr 4

Griswold v. Connecticut, 381 U.S. 479 (1965)........... 6

Grosjean v. American Press Co., 297 U.S. 233 (1936) ..... 5

Hawaii Housing Authority v. Midkiff, 467 U.S. 229

(| 12

Liggett & Myers Tobacco Company v. United States,

274 US. 215 (1987) ..0000000800000nn eee 12

Miami Herald Publishing Co. v. Tornillo, 418 U.S. 241

(2974) . 0. ccccceceseesedene bneebee enn ain 5

New York Times Co. v. Sullivan, 376 U.S. 254 (1964) ..... 5

Pierce v. Society of Sisters, 268 U.S. 510 (1925)......... 5

PruneYard Shopping Center v. Robins, 447 U.S. 74

(UDBG) . . 000000 e0 0 69 56.be nme si einme sme nnenennnn 5

s~-— —EE

TABLE OF AUTHORITIES — Continued

Page

West Virginia State Board of Education v. Barnette,

iene ak ines wonsecnsese ce ses 5

Wooley v. Maynard, 430 U.S. 705 (1977)............... 5

State Rutes

Rules Governing the Operation of the Texas Equal

Access to Justice Program, Rule 15 ................ 3

Booxs

Charles Francis Adams (ed.), The Works of John

Adams, Second President of the United States

ENE ENS TST EUEPPOTCEPPELELE TTT TET 8

William Blackstone, Commentaries on the Laws of

SEE GUE esc svcccccccsccccccocccssscsccccccess 7

Henry Steele Commager, Documents of American

BOUT OP BOO CURED ec ccc cccccccscccccccccsccccess 5

Harold Holzer (ed.), The Lincoln-Douglas Debates

CSR c heb edabeonédcensepesdtccccccccces )

John Locke, The Second Treatise of Government

ECU RewetembGededtceccececccccesccccces 7

Ayn Rand, The Virtue of Selfishness (1964).......... 9, 13

Ayn Rand, Atlas Shrugged (2985) .............. 6, 13, 14

Joseph Story, Story’s Commentaries on the Constitu-

tion of the United States (1833) ...........----+5005- 4

iv

TABLE OF AUTHORITIES - Continued

Page

MISCELLANEOUS

Brief of Conference of Chief Justices ................. 3

Potisomenn’ Debed. ..cccccccscvcscccscvcesscosccenssss 10

Movie, It’s a Wonderful Life.............----++0e00005 10

Declaration of Independence ............ 66660-00000 13

Note, Constitutional Law — Use of the Police Power for

the Attainment of Aesthetic Considerations, 33 N.

Cas. L. Row. GBF (ISGBD. 2. cccccccccccccsccccccesss 12

INTEREST OF AMICUS CURIAE!

THE ASSOCIATION FOR OBJECTIVE LAW (TAFOL)

is a Missouri non-profit corporation whose purpose is to

advance Objectivism, the philosophy of Ayn Rand, as the

basis of a proper legal system. TAFOL’s supporters are

lawyers, law students and others, some residing in Texas,

who subscribe to Ayn Rand’s philosophy and who would

suffer harm should this Court reverse the decision of the

court below. The non-lawyers are clients and potential

clients of lawyers. In the ordinary course of events, their

lawyers would hold some of their money in a trust

account. Under IOLTA, the proceeds of this money would

be used for programs which work against their self-

interest. The lawyer supporters would be conscripted to

assist in what amounts to theft of their clients’ property.

°

SUMMARY OF ARGUMENT

TAFOL’s opposition to the IOLTA program is based

on Ayn Rand's political principles which are, of necessity,

! All parties to the within action have consented to the

filing of the brief, and letters containing these consents have

been filed with the Clerk of this Court.

No counsel for any party to the within action has authored

this brief in whole or in part. Respondent, Michael J]. Mazzone,

is president of amicus curiae, The Association for Objective

Law; he provided criticism and editorial comments of drafts of

the brief. The Association for Objective Law has borne all costs

of preparation and submission of this brief; there have been no

monetary contributions in connection with the preparation of

this brief from any party to this case or from any other person or

entity.

based on her metaphysics, epistemology and ethics. The

basis of her ethical theory is rational self-interest. Its

economic-political consequence is laissez-faire capitalism.

Each individual has the absolute right to his own life.

This necessitates control over his property without inter-

ference so long as he does not violate anyone else's

rights. The sole function of government is to protect all

rights, especially the right of property.

The IOLTA program is based on the opposite moral

premise: that man is obligated to serve others. The politi-

cal consequence of this premise is that one may be forced

to support others. Many, if not most, of the suits sup-

ported by IOLTA money are directed at enforcement of

what are euphemistically called “entitlements,” i.e., forc-

ing those who have money to support those who do not,

IOLTA is a program that violates rights; it is a reversal of

the proper function of government.

It will be shown by quotations from English and

American intellectual leaders throughout the years that

the American system of government is implicitly based

on Objectivist principles. Because the IOLTA program

conflicts with these principles, it cannot be upheld.

7

ARGUMENT

A. Summary of the Texas IOLTA Program

William R. Summers is a businessman who regularly

hires lawyers to represent him. As a condition of their

representation, these lawyers require him to advance

retainer fees which are held in trust accounts. In addition

to retainer fees, these accounts typically contain clients’

money held for investment purposes and money held

pending distribution.

The law at issue in this case requires that the money

in these accounts be made available to earn interest to

provide legal services to low-income persons. Typical of

the uses of the money are suits

to secure entitlement to benefits such as, but not

limited to, social security, aid to families with

dependent children, food stamps, special educa-

tion for the handicapped, Medicare, Medicaid,

subsidized or public housing, or other eco-

nomic, shelter or medical benefits provided

directly to indigent individuals.

Rules Governing the Operation of the Texas Equal Access

to Justice Program, Rule 15, J.A. 118-119.

No one ever asked Mr. Summers whether he wanted

his money to be used to generate income to support these

suits. When he complained, he found the chief justice of

every state in the country declaring his claim of owner-

ship a “fantasy,” sneering at his money as “paltry,” refer-

ring to him as “silly.”? His lawyers were not given the

freedom to determine how their accounts were to be

used, nor whether they were willing to keep records for

the benefit of the favored. Nor were the bankers asked

whether giving the interest, and keeping the records, is

economical.

The IOLTA program thus takes proceeds of the

efforts of Mr. Summers, and of others in positions similar

to him. It conscripts the efforts and resources of lawyers

2 Brief of Conference of Chief Justices 8, 12.

and banks, making them aiders and abetters in the confis-

cation of their clients’ money.

B. The Importance of Property Rights

The fundamental problem with the IOLTA program is

its ethical premise: that man has an obligation to serve

others. The political consequence of this premise is that

the state of Texas may declare that, unless Mr. Summers

chooses to forego effective legal representation, he must

put his funds at the disposal of the state. His own con-

cerns are unimportant.

The alternative moral basis is the ethics of rational

self-interest. Each individual has a moral right to his own

life. He decides how he is to expend his efforts and how

the results of these efforts are to be used. The political

consequence of this ethical theory is a limited govern-

ment whose sole function is to secure liberty. The right to

property is central to the implementation of this function.

To the extent a man is forced to let someone else use his

belongings, he is not free.

Consider the following examples:*

e The prohibition of an established religion is

essentially a rule that the state may not take

one’s property to support religion. Grand

Rapids School District v. Ball, 473 U.S. 373, 385,

392 (1985); Everson v. Board of Education,

3 The cases in the following list are cited, not as authority,

but as illustrations of the statements with which they are

associated.

5

330 U.S. 1, 11-12, 16 (1947); Virginia Statute of

Religious Liberty (1786), Henry Steele Com-

mager, Documents of American History to 1898

(1963) 125.

The free exercise of religion requires the abil-

ity to construct and control buildings and to

profit from business relationships. Pierce v.

Society of Sisters, 268 U.S. 510, 532, 534, 535

(1925).

Without complete control over property,

every businessman serving the public can be,

and many are, forced to support views to

which he is opposed, despite the rule of West

Virginia State Board of Education v. Barnette,

319 U.S. 624 (1943), Wooley v. Maynard, 430

U.S. 705 (1977), and Miami Herald Publishing

Co. v. Tornillo, 418 U.S. 241 (1974). Prune Yard

Shopping Center v. Robins, 447 U.S. 74, 85 et

seq. (1980).

Freedom of the press requires control over

printing presses, buildings to house them,

newsprint, trucks, and money (Grosjean v.

American Press Co., 297 U.S. 233 (1936)) as

well as confidence that the proceeds of the

sales of newspapers will not be taken

because of disagreements with what is pub-

lished (New York Times Co. v. Sullivan, 376

U.S. 254 (1964)).

No one can sit alone in his own house and

peacefully read pornography without the

ability to lock the doors against those who

disapprove. Stanley v. Georgia, 394 U.S. 557

(1969).

The protection of the “intimate relation of

husband and wife and their physician's role

in one aspect of that relation” (Griswold v. The right of property is one of the foundations of the

Connecticut, 381 U.S. 479, 482 (1965)) con- United States. Its importance was stated by the nation’s

cerns nothing more than the ability to intellectual grandfather:

exchange money for physical items.

The great and chief end, therefore, of men’s

¢ To travel from place to place, one must have f uniting into commonwealths and putting them-

control over an automobile and money to selves under government is the preservation of

buy gasoline, to maintain the automobile, their property.

and to buy food and shelter on the way. ;

Edwards v. California, 314 US. 160 (1941). ngs cas The Second Treatise of Government (1952) 71

physical objects — the right to exclude others from one’s

, So great moreover is the regard of the law

property — is the essence of property rights. In each case,

for private property, that it will not authorize

this Court was asked to protect an intellectual or abstract the least violation of it; no, not even for the

right. (Sometimes the request was successful, sometimes good of the whole community. If a new road, for

not.) In fact, each of these claims was a demand for instance, were to be made through the grounds

_ of a private person, it might perhaps be exten-

sively beneficial to the public; but the law per-

mits no man, or set of men, to do this without

Just as man can’t exist without his body, so consent of the owner of the land. In vain may it

no rights can exist without the right to translate ni ey “% a ay of Oe ~ cay i ought

one’s rights into reality — to think, to work and 7 a st dap thre a aan ees ance re

eee, ee ee any public tribunal, to be the judge ofthis com

<<: 3 Pale « mon g , and to decide whether it expe-

par ay eye od Byoseg a with dient or no. Besides, the public good is in

ie woe eee Se oes nothing more essentially interested, than in the

protection of every individual’s private rights,

as modelled by the municipal law.

undisturbed control over property. This control is neces-

sary for the free exercise of any human activity:

The source of property rights is the law of

causality. All property and all forms of wealth

are produced by man’s mind and labor. As you 1 William Blackstone, Commentaries on the Laws of England

cannot have effects without causes, so you can- (1979) *135.4

not have wealth without its source: without

intelligence.

4 Blackstone continues with the observation that the state

Ayn Rand, Atlas Shrugged (1985) 1062. does condemn property. “[A]nd even this is an exertion of

Its importance was understood by the Founding Fathers:

[T]he original meaning of the word republic

could be no other than a government in which

the property of the people predominated and

governed; and it had more relation to property

than liberty. It signified a government, in which

the property of the public, or people, and of

every one of them, was secured and protected

by law. This idea, indeed, implied liberty;

because property cannot be secure unless the

man be at liberty to acquire, use, or part with it,

at his discretion, and unless he have his per-

sonal liberty of life and limb, motion and rest,

for that purpose.

John Adams, Defence of the Constitutions of Government of

the United States in 5 Charles Francis Adams (ed.), The

Works of John Adams, Second President of the United States

(1851) 454.

Its importance was understood by early courts:

The Court made a few observations on our

constitution and system of government... .

That by the constitution every citizen had

undoubtedly a right to a decision of his prop-

erty by a trial by jury. For that if the Legislature

could take away this right and require him to

stand condemned in his property without a trial,

it might with as much authority require his life

to be taken away without a trial by jury, and

that he should stand condemned to die, without

the formality of any trial at all: that if the mem-

bers of the General Assembly could do this, they

power, which the legislature indulges with caution, and which

nothing but the legislature can perform.”

9

might with equal authority, not only render

themselves the Legislators of the State for life,

without any further election of the people, but

from thence transmit the dignity and authority

of legislation down to their heirs male forever.

Bayard v. Singleton, 1 Martin 42, 45 (N.C. 1797).

Its importance was stated in early treatises:

[Protection of private property] is founded on

natural equity, and is laid down by jurists as a

principle of universal law. Indeed, in a free gov-

ernment, almost all other rights would become

utterly worthless, if the government possessed

an uncontrollable power over the private for-

tune of every citizen. One of the fundamental

objects of every good government must be the

due administration of justice; and how vain it

would be to speak of such an administration,

when all property is subject to the will or

caprice of the legislature, and the rulers.

3 Joseph Story, Story’s Commentaries on the Constitution of

the United States (1833) § 1784 (footnotes omitted).

Its importance was understood by presidents: “[The

principle of slavery] says you work, you toil, you earn

bread, and I will eat it.” Abraham Lincoln in the last

Lincoln Douglas Debate, October 15, 1858, Harold Holzer

(ed.) The Lincoln-Douglas Debates (1993) 359.

Its importance has been stated in a single sentence:

“Without property rights, no other rights are possible.”

Ayn Rand, “Man’s Rights” in The Virtue of Selfishness

(1964) 94.

The IOLTA program is inconsistent with support for

property rights. Its defenders claim that it creates interest

10

without disturbing principal. But it is exclusive control

over principal that makes interest possible. One makes

interest by agreeing to relinquish, for a period of time,

the right to prevent others from using his money. This is

the reason that interest follows principal.

This point is revealed in Petitioners’ use of a speech

from the movie, It’s a Wonderful Life.> The ideal of this

movie is embodied in the character of Peter Bailey, a man

who owns a small town savings and loan association

which he operates by lending to those in need. His life

consists of sacrificing himself and his family for the bene-

fit of his neighbors. When he dies, his son, George, con-

tinues in his footsteps.

George Bailey is the hero of the movie. As a young

man, he has passionate ambitions to leave the town in

which he grew up, to attend college, and to design build-

ings and cities. Step by step, he sacrifices his ambitions to

keep the savings and loan in business so that it can

continue to lend to his neighbors.

This movie views self-interest as evil. It is opposed to

intelligence, common sense, ambitiousness, and success.

The only successful, wealthy character is a banker who is

portrayed as incredibly mean, nasty, dishonest, miser-

able, and totally lacking in ethical principles.

5 “You're thinking of this place all wrong, as if I had the

money back in the safe. The money’s not here. Well, your

money’s in Joe’s house — that’s right next to yours — and in the

Kennedy house, and Mrs. MacLain’s house, and a hundred

others.” Petitioner’s Brief at 30.

11

The scene summarized by Petitioners involves

George Bailey’s last sacrifice. He is just about to leave

town for his honeymoon when he is interrupted with

news that there is a run on his savings and loan. His

neighbors, in a panic, are threatening to withdraw their

money. The speech quoted by Petitioners is the beginning

of his attempt to dissuade them. At first, it appears that

he will fail, but he succeeds with the use of eloquence

and by lending to the depositors the money he had saved

for his honeymoon.

The IOLTA program shares this movie's ethical prem-

ises. Those who have wealth are expected to sacrifice for

the benefit of those who do not. The IOLTA program,

however then adds the inevitable political consequence of

the ethical principle: force. Whereas George Bailey had to

persuade his depositors to put their money to charitable

uses, those running the IOLTA program use the power of

the state. The movie’s speech as delivered by one running

the IOLTA program would read:

You’re thinking of this program all wrong, as if

you have a right to the control of your money.

Mr. Landlord, you have no choice, you must

support your tenants’ suits against you. Mr. Tax-

payer, you have to support lawyers’ bringing

suits to force you to pay more for welfare. Mr.

Voter, I know you’re opposed to racial quotas;

that doesn’t matter, you have no choice; your

money will go to organizations devoted to over-

turning your vote in the courts. Mr. Employer,

don’t you dare tell us we can’t force you to

support the suit that prevents you from firing

the incompetent employee - the employee

whose actions will subject you to a million dol-

lar harassment suit.

12

These ethical principles are behind every govern-

mental program that takes from those who have and

gives to those who do not. As a result of their acceptance,

limitations on the powers of American state and federal

governments have all but disappeared. Nothing now pre-

vents any American government from taking property for

any purpose. It may take real property to improve the

beauty of its neighborhood: Berman v. Parker, 348 U.S. 26

(1954); Note, Constitutional Law — Use of the Police Power for

the Attainment of Aesthetic Considerations, 33 N.Car. L. Rev.

482, 484 (1955). It may take tobacco products for use by

soldiers: Liggett & Myers Tobacco Company v. United States,

274 U.S. 215 (1927). It may take a sports team on grounds

that its citizens want to watch football: City of Oakland v.

Oakland Raiders, 32 Cal.3d 60, 183 Cal.Rptr. 673, 646 P.2d

835 (1982). It may take property on grounds that the

owner has more than the envious deem appropriate:

Hawaii Housing Authority v. Midkiff, 467 U.S. 229 (1984). It

may make someone’s legally produced property sud-

denly worthless: Andrus v. Allard, 444 U.S. 51 (1979).

In the instant case, this Court can take the first step

in restoring the government's proper functicn. To do so,

one begins by examining the nature of man in civilized

society:

The basic social principle of the Objectivist

ethics is that just as life is an end in itself, so

every living human being is an end in himself,

not the means to the ends or the welfare of

others — and, therefore, that man must live for

his own sake, neither sacrificing himself to

others nor sacrificing others to himself * * *

13

Can man derive any personal benefit from

living in a human society. Yes — if it is a human

society. * * * The basic political principle of the

Objectivist ethics is: no man may initiate the use

of physical force against others. No man - or

group or society or government — has the right

to assume the role of a criminal and initiate the

use of physical compulsion against any man.

Men have the right to use physical force only in

retaliation and only against those who initiate

its use.

Ayn Rand, “The Objectivist Ethics” in The Virtue of Selfish-

ness (1964) 27, 32-33.

Proper governments exist to prevent the initiation of

force and to control its retaliatory use.

The only proper purpose of a government is

to protect man’s rights, which means: to protect

him from physical violence. A proper govern-

ment is only a policeman, acting as an agent of

man’s self-defense, and, as such, may resort to

force only against those who start the use of

force. The only proper functions of government

are: the police, to protect you from criminals;

the army, to protect you from foreign invaders;

and the courts, to protect your property and

contracts from breach or fraud by others, to

settle disputes by rational rules, according to

objective law.

Ayn Rand, Ailas Shrugged (1985) 1062-3.

In the words of the Declaration of Independence, “to

secure these rights, Governments are instituted among

”

men.

14 15

The IOLTA program is an example of government CONCLUSION

acting against its essential purpose, initiating force rather For the reasons stated above, the judgment of the

than preventing it. Mr. Summers, and those like him, are

' Court of A Is should i

forced to use their property for purposes which they do ppeals should be affirmed

Respectfully submitted,

not support.

But a government that initiates the employment STEPHEN PLAFKER

of force against men who had forced no one, the jen Marion Drive

employment of armed compulsion against dis- | aaa aie — 91205-3721

armed victims, is a nightmare infernal machine |

designed to annihilate morality: such a govern- |

ment reverses its only moral purpose and |

switches from the role of protector to the role of

man’s deadliest enemy, from the role of police- |

man to the role of a criminal vested with the )

right to the wielding of violence against victims

deprived of the right of self-defense.

Ayn Rand, Atlas Shrugged (1985) 1063.

In the past, this Court disapproved of depredations

of the government upon property:

To lay with one hand the power of the govern-

ment on the property of the citizen, and with the

other to bestow it upon favored individuals to

aid private enterprises and build up private for-

tunes, is none the less a robbery because it is

done under the forms of law and is called taxa- |

tion. |

Citizens’ Savings & Loan Association v. Topeka, 20 Wall. (87

U.S.) 655, 664 (1874). The Court should return to this

approach.