The industry’s premier estates, gifts, and trusts resource that features research, planning, and implementation tools on one platform — backed by the nation's leading...
Horwood Marcus & Berk Chartered, Chicago, IL
In its first look at same-sex marriage, the U.S. Supreme Court has ruled unconstitutional the federal definition of marriage. However, in the wake of its decision, many questions are left unanswered.
U.S. v. Windsor
On June 26, 2013, the U.S. Supreme Court, in the case of U.S. v. Windsor, 1 held unconstitutional §3 of the Defense of Marriage Act (DOMA), which limited the federal definition of spouses to heterosexual couples only. Justice Kennedy wrote the majority opinion for a divided 5-4 Court. The other sections of the law were not at issue in this case.
The facts were simple. Two New York residents, Edith Windsor and Thea Spyer, were validly married under Canadian law in Canada. At the time, New York did not allow for same-sex marriage but recognized the validity of same-sex marriages entered into in jurisdictions that did allow them. When Spyer died, she left her entire estate to Windsor who sought to claim the federal marital deduction. The IRS denied the deduction, and Windsor brought suit contending that DOMA was unconstitutional.
The Court first answered the question of whether it had jurisdiction to consider the case. Windsor had previously won on appeal, and the Executive branch had stated that it refused to defend. Therefore, the argument, and one of the dissent's arguments, was that there was no justiciable controversy because both parties (Windsor and the United States) agreed on the issue.
The Court addressed standing under Article III of the U.S. Constitution, which is interpreted to require: (1) an injury in fact that is: (a) concrete and particularized and (b) actual or imminent; (2) causation between the injury and the complained-of conduct; and (3) likelihood that the injury will be redressed by a favorable decision. The Court held that the United States still had Article III standing even though it agreed with the Plaintiff. The injury to the United States was the return of estate tax payment on Windsor's deceased spouse's estate. This loss to the Treasury was a real and immediate economic injury caused by Windsor's argument (that she was entitled to the marital deduction) and could be redressed by a favorable outcome in the case.
Next, the Court addressed the prudential limits on standing, stating that the major concern with deciding a case in which both parties agree on the outcome is that there will be no actual controversy and the proceeding will be non-adversary. The Court pointed out that "the relevant prudential factors that counsel against hearing this case are subject to `countervailing considerations [that] may outweigh the concerns underlying the usual reluctance to exert judicial power.'" One consideration the Court looked to is how well amici curiae can defend the constitutionality of the act in question. The Court held that the Bipartisan Legal Advisory Group (BLAG) attorneys, who took up the defense of DOMA and were funded by the Republican-led House of Representatives, presented "substantial argument for the constitutionality of §3 of DOMA" that satisfied the prudential concerns. Further, although a case may come up in the future without any prudential concerns, too much time and money would be wasted in waiting for such a case when the Court can answer the question now.
The Court concluded the discussion on standing with a comment on the procedural issues created by the Executive's decision not to defend §3 of DOMA. The Court, essentially, "defended its turf," arguing that, if the Executive agrees with a plaintiff that a certain law is unconstitutional such that judicial review is precluded, "the Supreme Court's primary role in determining the constitutionality of a law that has inflicted real injury on a plaintiff who has brought a justiciable legal claim would become only secondary to the President's."
Constitutionality of §3 of DOMA
The first argument for the unconstitutionality of DOMA was that it is not the federal government's place to determine what a marriage is: "By history and tradition the definition and regulation of marriage … has been treated as being within the authority and realm of the separate States." The Court admitted that Congress can constitutionally enact some laws regulating marriage to further federal policy. However, Justice Kennedy, writing for the Court, stated that DOMA is widely applicable to over 1,000 federal statutes and all federal regulations.
Justice Kennedy went on to state: "State laws defining and regulating marriage, of course, must respect the constitutional rights of persons … but, subject to those guarantees, `regulation of domestic relations' is `an area that has long been regarded as a virtually exclusive province of the States'" (internal citations removed). Therefore, the Court held that states can differ in their definitions of marriage, as long as the definitions are constitutional, but the federal benefits and obligations must be uniform for any couple in any state with the title of "married." The federal government cannot define marriage across all states, but its definition must be as inclusive as the most inclusive state.
Justice Kennedy went on to discuss that DOMA violated the constitutional rights of equal protection under the law and due process of law because discrimination was not just an effect of the statute, but it was the purpose of it: "DOMA writes inequality into the entire United States Code." Although this case does not decide the constitutionality of denying same-sex marriage, Justice Kennedy incorporated what may become important language for future same-sex marriage cases: DOMA denied "the liberty protected by the Due Process Clause of the Fifth Amendment," which contains "the prohibition against denying any person the equal protection of the laws." The opinion mentioned multiple times that states have the right to define marriage, but only within the limits of the constitution that requires equality.
It is important to note that the Court does not define a level of scrutiny to be used in the case. However, Justice Kennedy pointed out that the law would not pass the rational basis test and, therefore, would be unconstitutional under any level of scrutiny: "The federal statute is invalid, for no legitimate purpose overcomes the purpose and effect to disparage and to injure those whom the State, by its marriage laws, sought to protect in personhood and dignity." Again, this language may be used in the future to invalidate state bans on same-sex marriage. However, Justice Kennedy made it clear that the Court was not making a final judgment on the constitutionality of same-sex marriage bans: "This opinion and its holding are confined to those lawful marriages."
Although the federal government now officially recognizes a valid state sanctioned same-sex marriage for purposes of application of federal law, many issues remain unresolved. For example, many federal agencies, including the IRS and the Social Security Administration, rely on the state of residency (not the state of celebration) to determine who is a spouse. Therefore, moving to a state that does not recognize same-sex marriages could still change who falls into the category of "spouse" under federal law. Further, that same couple is still subject to losing federally-funded, state-administered spousal benefits, such as certain Medicaid benefits. What if one passes away while living in a state that does not recognize same-sex marriage — will the survivor be considered a spouse for purposes of state inheritance laws? What happens to property of same-sex spouses who move to a community property state that does not recognize same-sex marriages? Can same-sex couples who are validly married under one state's law divorce in another state that does not allow same-sex marriage? Does an employee in a valid same-sex marriage have a claim if his or her private or public employer requires him or her to relocate to a state that does not recognize same-sex marriage? Only time, and further litigation, will tell how these issues play out.
Hollingsworth v. Perry
Hollingsworth v. Perry 2 involved a challenge to California's Proposition 8 (Prop 8), which was a voter initiative that banned same-sex marriage in California. State officials refused to defend the law. Instead, the law was defended by the initiative's official proponents, the Petitioners in this case. The district court found Prop 8 unconstitutional. When asked by the Ninth Circuit to determine whether or not the proponents had standing to defend Prop 8's constitutionality, the California Supreme Court concluded that they did. The Ninth Circuit went on to uphold the district court's ruling. Chief Justice Roberts wrote the 5-4 majority opinion holding that the proponents did not have standing.
The opinion discussed that, for a federal court to have authority in a case, there must be an actual case or controversy. To bring the case in front of the court, a party must have more than a mere interest in the outcome. He or she must have standing: A concrete and particularized injury that is actual or imminent, causation, and redressability. In this case, the Court held that there was no concrete or particularized injury.
Chief Justice Roberts stated that there must be an actual controversy at every stage of the litigation: There must be standing at the appellate level just as there must be at the beginning. The original injury clearly existed. Prop 8 banned same-sex couples from marrying. Same-sex couples brought a challenge to Prop 8. Their injury — being unable to marry — was personal and individual and they had a direct stake in the outcome of the case. Therefore, they had standing to challenge Prop 8. The Petitioners in this case wanted to reverse that successful challenge to Prop 8 and get it reinstated as law.
Chief Justice Roberts dismissed all of the Petitioners' standing arguments to find that they did not have standing. He closed the opinion by stating that, without an actual injury, there is no standing: "We have never before upheld the standing of a private party to defend the constitutionality of a state statute when state officials have chosen not to. We decline to do so for the first time here." Because the Court found that the Petitioners have no standing, the Ninth Circuit opinion was without jurisdiction. Therefore, the controlling decision is that of the district court, which found Prop 8 unconstitutional, adding California to the list of 13 states that now allow same-sex marriage.
For more information, in the Tax Management Portfolios, see Horwood, Zaluda, Wolven and Hudgins, 813 T.M., Estate Planning for the Unmarried Adult.
Copyright©2013 by The Bureau of National Affairs, Inc.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)