Northern Pipeline Constr. Company v. Marathon Pipe Line Company

PETITIONER: Northern Pipeline Constr. Company
RESPONDENT: Marathon Pipe Line Company
LOCATION: Minnesota State Capitol Building

DOCKET NO.: 81-150
DECIDED BY: Burger Court (1981-1986)
LOWER COURT:

CITATION: 458 US 50 (1982)
ARGUED: Apr 27, 1982
DECIDED: Jun 28, 1982

ADVOCATES:
John L. Devney - Argued the cause for the appellant, Northern Pipeline Construction
Melvin I. Orenstein - Argued the cause for the appellee, Marathon Pipe Line
Rex E. Lee -

Facts of the case

The Bankruptcy Reform Act of 1978 created a system of bankruptcy courts as an adjunct to the federal system of district courts. This case was decided together with United States v. Marathon Pipeline Co.

Question

Did the Act violate Article III of the Constitution?

Media for Northern Pipeline Constr. Company v. Marathon Pipe Line Company

Audio Transcription for Oral Argument - April 27, 1982 in Northern Pipeline Constr. Company v. Marathon Pipe Line Company

Warren E. Burger:

Thank you, gentlemen.

The case is submitted.

We'll hear arguments next in Northern Pipeline Construction against Marathon Pipe Line and the related case.

We'll just wait for the courtroom to clear Mr. Solicitor General.

I think you may proceed now Mr. Solicitor General.

Rex E. Lee:

Mr. Chief Justice, may it please the Court.

At issue on this case is the constitutionality of the Bankruptcy Act of 1978, which represents Congress' most comprehensive effort in this century and perhaps in history to deal with bankruptcies.

The problems that Congress identified were serious including an increase in the number of annual filings from 10,000 a year to over 254,000 a year in a period of only three decades.

One of the most serious impediments to an efficient bankruptcy system, the Congress found was the court's -- that was the court system, and particularly the confusing distinction between summary and plenary jurisdiction.

The 1978 Act creates a Bankruptcy Act in each district as an adjunct to the District Court.

Judges of the new bankruptcy courts are to be appointed to 14-year terms by the President, with the advice and consent of the Senate.

They may be removed by the “judicial council of the circuit” for “incompetence, misconduct, or disability” and they have plenary jurisdiction over bankruptcy matters.

Warren E. Burger:

Wasn't this on the phased in basis?

Rex E. Lee:

That is correct.

They are the six years -- six-year period but the Act substantively would apply with the exception of the personnel over the interim period.

Warren E. Burger:

In 1984 (Voice Overlap) --

Rex E. Lee:

That is correct, Mr. Chief Justice.

That is correct.

It is the government's position that the constitution does not preclude Congress' chosen resolution of the important and difficult bankruptcy problems that Congress identified.

Article I specification of congressional power to establish uniform laws on the subject of bankruptcies throughout the United States includes the power to establish specialized bankruptcy courts and give them plenary jurisdiction over their narrow specialty of bankruptcy.

There is nothing in the language of Article III towards values that brings that Article into conflict in this case with Article I.

William H. Rehnquist:

Are you saying, General, that any time Congress has granted a specific authority to legislate, it has the authority to create a special system of courts then?

Rex E. Lee:

Certainly not.

William H. Rehnquist:

Then how do you distinguish?

Rex E. Lee:

On the basis of the guidelines that this Court laid down in Palmore which were -- but you have to have, first of all, of course, you have to have one of the specific grant of legislative authority to Congress.

But in addition you have to have a specialized area in which Congress concludes that there is a particularized need warranting distinctive treatment for a specialized court.

William H. Rehnquist:

Can I stop you there?

Rex E. Lee:

Surely.

William H. Rehnquist:

When you say a specialized area, do you mean an area where the judges in filling the courts will have a specialized competence in a particular branch of law?

Rex E. Lee:

As -- my answer to that is, “Yes”, Justice Rehnquist.