Doe v. PatakiDoe v. Pataki
Thomas O‘Brien, The Legal Aid Society, New York, N.Y., for Plaintiffs-Appellees.
Before: NEWMAN, CABRANES, and POOLER, Circuit Judges.
NEWMAN, Circuit Judge.
This appeal presents a novel issue arising in the context of interpreting a court-approved stipulation of settlement between private and governmental parties that is equivalent to a consent decree: do terms of the stipulation that recite provisions of state statutes in force at the time of the stipulation bind the governmental defendants to continue those provisions into the future notwithstanding later changes by a state legislature? This issue arises on an appeal by various New York State officials (collectively “the State“) from two orders of the United States District Court for the Southern District of New York (Denny Chin, District Judge) entered in the course of protracted litigation concerning New York‘s Sex Offender Registration Act (“SORA” or the “Act“). The Plaintiffs are a group of convicted sex offenders required to register pursuant to the SORA. The District Court‘s orders, entered April 27, 2006, and July 18, 2006 (explained in detail below), have the effect of preventing the State from applying to the Plaintiffs recent statutory changes that (a) extended the time that many of the Plaintiffs are subject to the Act‘s registration requirements, and (b) broadened for some of the Plaintiffs the extent of the community notification required by the Act. We conclude that the stipulation was negotiated to avoid litigation over the procedures by which the Plaintiffs’ risk levels would be redetermined, that the Plaintiffs are entitled to the benefit of those bargained-for procedures, that the Plaintiffs did not bargain to have the stipulation assure them the continued scope of state statutes existing at the time of the stipulation, and that the stipulation cannot be interpreted to preclude the application of subsequent legislative changes on matters distinct from the subject matter of the litigation. We therefore vacate the challenged orders.
Background
The Sex Offender Registration Act. New York enacted the SORA, New York‘s version of a so-called “Mеgan‘s Law,” in July 1995. See 1995 N.Y. Laws 2870 (codified at
Since its enactment, the SORA has undergone several amendments relevant to this litigation. In 1999, following the District Court‘s ruling that the Act‘s original procedures for determining risk levels violated sex offenders’ procedural due process rights, see Doe v. Pataki (”Doe-SORA III“), 3 F.Supp.2d 456, 473 (S.D.N.Y. 1998), the New York legislature amended the SORA to incorporate the procedural due process protections required by Doe-SORA III, see 1999 N.Y. Laws 3061 (codified at scattered sections of
Next, in 2002, the SORA was again amended to create the classifications of “sexual predator,” “sexually violent offender,” and “predicate sex offender.” See 2002 N.Y. Laws 66 (codified at scattered sections of
In January 2006, as the ten-year registration period for many level one and level two registrants was approaching an end, the legislature amended the SORA to increase the length of the registration requirement “to enhance public safety and provide better tracking and monitoring of sex offenders.” 2006 N.Y. Laws 1, § 1. The January 2006 amendment, which prompted the pending round of litigation, increased the registration requirement for level one offenders from ten to twenty years and required level two offenders to register for life, effective as of January 18, 2006. See id. § 3 (to be codified at
To summarize, the SORA, as it currently exists, provides the following. Level one offenders, other than those who have been classified as “sexual predators,” “sexually violent offenders,” or “predicate sex offenders,” must register for twenty years, and information about all level one offenders can be distributed to entities with vulnerable populations but is not maintained in the publicly accessible subdirectory. Level two and level three offenders and all offenders who have been сlassified as “sexual predators,” “sexually violent offenders,” or “predicate sex offenders,” regardless of risk level, must register for life, though level two offenders who have not received such classifications may petition for relief after thirty years. Level two and three offenders are identified in a publicly accessible subdirectory.
The pending litigation. In March 1996, the Plaintiffs—convicted sex offenders who were incarcerated, on parole, or on probation when the original SORA took effect on January 21, 1996—filed a class action in the District Court, alleging that the Act violated the Ex Post Facto Clause of the Constitution and deprived the Plaintiffs of their due process and equal protection rights. On cross-motions for summary judgment, the District Judge concluded that the SORA‘s community notification provisions violated the Ex Post Facto Clause and enjoined enforcement of these provisions against the Plaintiffs. See Doe v. Pataki (”Doe-SORA I“), 940 F.Supp. 603, 631 (S.D.N.Y.1996). On appeal, this Court reversed the District Judge‘s ruling that the community notification procedures violated the Ex Post Facto Clause and remanded the case for consideration of the Plaintiffs’ other claims. Doe v. Pataki (”Doe-SORA II“), 120 F.3d 1263, 1285 (2d Cir.1997).2
On remand, the Plaintiffs again moved to enjoin enforcement of the SORA, this time on procedural due process grоunds. The District Judge concluded that the registration and community notification provisions of the SORA implicated protected liberty interests, see Doe-SORA III, 3 F.Supp.2d at 467-68, and that the procedures by which risk levels were assigned did not provide adequate due process for protecting these interests, see id. at 468-72. The District Judge entered an injunction requiring that an offender (1) be given a court hearing; (2) receive advance notice of the hearing, its purpose, and the recommended risk level classification; (3) be given the right to retain counsel or the right to have counsel appointed if he cannot afford to retain counsel himself; (4) be given pre-hearing discovery of the evidence on which the risk level recommendation is based; and (5) be given the right to appeal. See id. at 471-72. Moreover, the Judge concluded, the State must bear the burden of proof and must prove the facts supporting the risk level recommendation by clear and convincing evidence. See id. at 472. The District Judge enjoined the State from classifying the Plaintiffs at a risk level other than level one until it reclassified them in accordance with the procedures required by the ruling. See id. at 479.
After the District Judge‘s procedural due process ruling in Doe-SORA III, the parties began settlement discussions. On November 22, 2000, having received no report of a final settlement, the District Judge issued an order dismissing the case without prejudice to reinstatement within sixty days if the parties were unable to reach a final settlement agreement. The parties neither reached agreement within sixty days nor requested an extension of time. Nonetheless, as was represented at the first of two oral arguments, the parties continued to operate as if the injunction was in effect notwithstanding the termination of the case. The parties completed settlement negotiations in June 2004, at which time they jointly moved for reinstatement of the case and approval of a Stipulation of Settlement (“the Stipulation“).3 The District Judge reinstated the action and “so ordered” the Stipulation on June 4, 2004.
Following the January 2006 amendment increasing the duration of the registration requirement for level one and level two offenders, the Plaintiffs filed a motion in the District Court for an order enforcing the Stipulation and enjoining the State from requiring level one or level two Plaintiffs to register beyond ten years. The Plaintiffs contended that paragraph fifteen of the Stipulation and the attached notices bound the State to a ten-year registration requiremеnt for level one and level two Plaintiffs and that the application of the 2006 amendment to these Plaintiffs therefore breached the Stipulation. See Doe-SORA IV, 427 F.Supp.2d at 404. In response, the State argued that the District Court lacked jurisdiction to enforce the Stipulation, id., and that, in any event, the Stipulation could not be construed to impose a ten-year limit on registration because it was concerned with the procedures for assessing risk levels, not the substantive consequences of such assessments, id. at 406. The District Judge, after first rejecting the State‘s jurisdictional argument,6 see id. at 405-06, concluded that the parties had bargained for a ten-year registration period and that application of the January 2006 legislative amendment to level one and level two Plaintiffs therefore breached the parties’ agreement, id. at 408-09. The District Judge enjoined enforcement of the January 2006 amendment to level one and level two offenders covered by the Stipulation, see id. at 413, but stayed his order pending appeal. The State filed a timely notice of appeal.
After the June 2006 amendment took effect, expanding the scope of community notification, the Plaintiffs sought clarification of the District Cоurt‘s stay of the order in Doe-SORA IV granting injunctive relief. In particular, the Plaintiffs sought to confirm that the stay, which had allowed the State, pending appeal, to apply to the Plaintiffs the January 2006 amendment, extending the duration of registration, did not allow the State to apply to the Plaintiffs the June 2006 amendment, extending the scope of community notification. In an order entered July 18, 2006, the District Judge granted the Plaintiffs’ motion, thereby enjoining the State from applying the June 2006 amendment and any subsequent amendments to level one and level two Plaintiffs. See Doe v. Pataki (”Doe-SORA V“), 439 F.Supp.2d 324, 325 (S.D.N.Y.2006) (noting that the stay of the April 27, 2006, injunction was granted only because “there was a risk that class members who were permitted to come off the registry would be difficult to locate for re-registration in the event of a reversal“). The District Judge subsequently denied the State‘s motion for clarification of the July 2006 injunction and later denied the State‘s motion for a stay of that injunction. In denying the State‘s stay motion, the District Judge reasoned that the Stipulation, by referring to the attached notices specifying “the community notification provisions applicable to each risk level,” bound the State to the community notification provisions in effect in 2004 when the Stipulation was аpproved. He concluded, “The New [June 2006] [a]mendment . . . would increase the extent of public notification for both level 1 and level 2 class members beyond what the parties bargained for — and the Court ‘so ordered’ — in the Stipulation.” The State timely appealed the July 2006 injunction. This Court granted the State‘s motion to consolidate the two appeals (from the injunctions in Doe-SORA IV and Doe-SORA V) and denied its motion for a stay, leaving in effect the District Judge‘s stay. After hearing an initial argument, we granted the Plaintiffs-Appellees’ request to hear oral argument in No. 06-3709-cv, the appeal from the injunction in Doe-Sora V, concerning the scope of community notification.
Plaintiffs’ waivers of redetermination hearings. As explained above, the Stipulation provides that level two and level three Plaintiffs are entitled to have their risk levels redetermined pursuant to the procedures ordered by the District Court. The Stipulation also provides for notice to the level two and level thrеe Plaintiffs, informing them of their option to contest the original risk level at a redetermination hearing or to accept the original risk level. The notice included a form for exercising the option and also informed the affected Plaintiffs that failure to return the form would be deemed a waiver of the right to a redetermination hearing. After the January 2006 amendment extending the duration of registration, the Plaintiffs, in their injunction request, complained to the District Court that the waiver provision had become unfair to level two Plaintiffs because some of them who were nearing the end of their ten-year period of registration had waived a redetermination of risk level without awareness of the extension of the registration period to lifetime registration. After the initial oral argument of this appeal, the State advised this Court that it will afford all level two Plaintiffs who waived their redetermination hearing a new opportunity to request such a hearing.
Discussion
The basic principles governing interpretation of consent decrees and their underlying stipulations are well known. Such decrees reflect a contract between the parties (as well as a judicial pronouncement), and ordinary rules of contract interpretation are generally applicable. See United States v. ITT Continental Baking Co., 420 U.S. 223, 236-37, 95 S.Ct. 926, 43 L.Ed.2d 148 (1975); Crumpton v. Bridgeport Education Ass‘n, 993 F.2d 1023, 1028 (2d Cir.1993). Often deference is given to the interpretation made by the district judge who approves the decree, a precept especially appropriate in circumstances where the judge has played a role in supervising the negotiation of the terms of the decree. See, e.g., Audiovisual Publishers, Inc. v. Cenco Inc., 185 F.3d 93, 95-96 (2d Cir.1999); United States v. Local 359, United Seafood Workers, 55 F.3d 64, 68 (2d Cir.1995).7
In the pending case, the Plaintiffs and the District Judge are of the view that these principles and only these principles dictate the outcome of the appeal. In their view, the State is bound to apply the provisions of SORA, including those governing the duration of registration and the scope of community notification, as they existed at the time the decree was entered, because the Stipulation for the decree and the attached notices explicitly mention the duration of registration and the scope of community notification for the various risk levels as they then existed.
Proper construction of the recitations at issue, we believe, depends not only on the words of the Stipulation, but also, and more importantly, on whether thе parties intended to place those words in the agreement as part of a resolution of disputed matters for which the parties had bargained, or only to illustrate the provisions of then-existing state law. That intent, properly assessed based on objective indicia, see Klos v. Polskie Linie Lotnicze, 133 F.3d 164, 168 (2d Cir.1997), can be ascertained initially in this case from the nature of the litigation. After losing their Ex Post Facto Clause challenge to the SORA, the Plaintiffs returned to the District Court solely to challenge the procedures for determining offender risk levels. There is no indication, however, that the Plaintiffs sought to have the duration-of-registration or the scope-of-notification requirements remain unaltered by subsequent state legislation. Maintenance of these requirements was neither the subject of any claim in the lawsuit nor the subject of any bargaining between the parties in the course of settling the lawsuit.9 The Plaintiffs successfully litigated their procedural due process claim and ultimately secured the agreement of the State to incorporate into a consent decree the hearing procedures they had sought.
The limited nature of the litigation strongly indicates that the recitations concerning duration of registratiоn and scope of community notification were not included to secure a prohibition on subsequent state legislation on these topics. Indeed, had the case proceeded to final adjudication in favor of the Plaintiffs, instead of settlement, it is extremely doubtful that the Plaintiffs would have been entitled to a judgment that prohibited the State from amending the then-current provisions concerning duration of registration and scope of community notification.10
However, although federal courts have authority to abrogate state laws on the grounds of claimed unconstitutionality or preemption pursuant to paramount federal legislation, they have only the most limited role when determining whether a state has surrendered some inherent authority, such as its authority to modify state statutory law. We assume that in the course of settling a federal lawsuit, parties could bargain for the continued force of a state law provision as it existed at the time of their agreement. In some circumstances, a state might obtain substantial benefits by narrowing the scope of a ruling of unconstitutionality or lessening the scope of a federal court remedy in exchange for its commitment not to alter a provision of then-existing state law.11 But proper regard for state authority requires a federal court to have a clear indication that a state has intended to surrender its normal authority to amend its statutеs.12
In other contexts concerning state authority, the Supreme Court has similarly instructed federal courts not to impair state authority absent a clear statement that the relevant governing principle applies. For example, the Supreme Court has frequently instructed that a state will not be deemed to have waived its sovereign immunity unless the waiver is “express” and “unequivocal.” College Savings Bank v. Florida Prepaid Postsecondary Education Expense Board, 527 U.S. 666, 680, 119 S.Ct. 2219, 144 L.Ed.2d 605 (1999); see Port Authority Trans-Hudson Corp. v. Feeney, 495 U.S. 299, 306, 110 S.Ct. 1868, 109 L.Ed.2d 264 (1990) (general consent to suit provision insufficient to waive Eleventh Amendment immunity); Pennhurst State School & Hospital v. Halderman, 465 U.S. 89, 99, 104 S.Ct. 900, 79 L.Ed.2d 67 (1984) (state‘s consent must be “unequivocally expressed“); Edelman v. Jordan, 415 U.S. 651, 673, 94 S.Ct. 1347, 39 L.Ed.2d 662 (1974) (waiver of immunity only “by the most express language or by such overwhelming implications from the text as [will] leave no room for any other reasonable construction” (alteration in original) (internal quotation marks omitted)). Similarly, the Court has insisted that an act of Congress purporting to abrogate a state‘s sovereign immunity under section 5 of the Fourteenth Amendment will not be effective unless Congress‘s intent to abrogate is “unmistakably clear.” Nevada Dep‘t of Human Resources v. Hibbs, 538 U.S. 721, 726, 123 S.Ct. 1972, 155 L.Ed.2d 953 (2003); see Kimel v. Florida Board of Regents, 528 U.S. 62, 73, 120 S.Ct. 631, 145 L.Ed.2d 522 (2000) (same); Dellmuth v. Muth, 491 U.S. 223, 228, 109 S.Ct. 2397, 105 L.Ed.2d 181 (1989) (same). In the same vein, the Court has ruled that when Congress imposes a condition on a state‘s receipt of federal funds, it must do so “unambiguously” to ensure that the state‘s acceptance of the “‘contract‘” is “voluntar[y] аnd knowing[].” Pennhurst State School & Hospital v. Halderman, 451 U.S. 1, 17, 101 S.Ct. 1531, 67 L.Ed.2d 694 (1981).
The recitation in the Stipulation of the then-existing duration and notification requirements served a helpful purpose of clarity. The parties needed to know that the Plaintiffs’ risk levels would be redetermined under the regime existing before the 2002 amendment, that the then-existing duration requirements would extend from the date of an offender‘s original registration, and that the then-existing notification requirements would currently apply. The Stipulation and its accompanying notices provided this useful information, but the Stipulation and the decree cannot properly be construed to surrender the State‘s power to modify the recited requirements.13
Conclusion
The orders of the District Court, enjoining the State from applying the January 2006 and June 2006 amendments, are vacated.
Judge POOLER dissents with a separate opinion.
I respectfully dissent. I believe the majority has reached a wrong conclusion because it has ignored basic principles of contract law. While the majority references the guiding principles of contract law, the majority opinion discusses them in only the most limited detail. In another very brief section, which cites only generally inapposite constitutional law, the majority opinion attempts to explain why the state should be treated differently from any other contracting party.
While the district court below devoted substantial analysis to this problem and the relevant doctrine, Doe-SORA IV, 427 F.Supp.2d at 4111-1 (citing, inter alia, United States Trust Co. v. New Jersey, 431 U.S. 1, 17, 97 S.Ct. 1505, 52 L.Ed.2d 92 (1977)),2-1 on appellate review the majority has eschewed this approach, and instead focused on discerning the intentions of the parties. This approach is problematic, since as even defendants-appellants had initially argued, the stipulation is not ambiguous, and we cannot ignore the lack of ambiguity merely because its plain meaning does not correspond with the parties’ alleged intentions.
This court cannot merely point to the absence of additional language specifying the allocation of risk in the event of changed circumstances as a basis for shifting that risk onto the obligee. This approach, along with the imposition of a new clear statement rule retroactively, so as to shift the burden of changed circumstances away from the party who would traditionally bear it, are radical departures from our earlier jurisprudence and the long-standing principles of the common law. Furthermore, if the agreement was ambiguous, the only prudent approach would be to remand to the district court for further fact finding, given the paucity of the record. Instead, the majority opinion relies on the absence of evidence, inapplicable principles of contract interpretation, and faulty analogies to inapposite constitutional law to establish a basis for reformation of the stipulation.
I. Under New York Law and the Principles Embodied in this Circuit‘s Caselaw, the Stipulation at Issue is Not Ambiguous
A dispute over the meaning of a provision in a written instrument after it is executed does not generate ambiguity. It is the text of the agreement itself which must be ambiguous before a court can construe the contract in view of the objective evidence of the parties’ shared intentions. However, the majority opinion does not identify the words, syntax or punctuation that render the stipulation ambiguous, stating only that while “there is no dispute as to the meaning of the words in these recitations,” “there is a dispute [as to their] operative effect.” The first question before us is whether this dispute is legitimate. The majority opinion does not address this question. Rather than pointing to internal textual inconsistencies that might illustrate the purported ambiguity, it proceeds immediately to the determination of how the stipulation should be construed.
This “plain meaning” approach to contract construction is the well-established law of the circuit. Roberts v. Consolidated Rail Corp., 893 F.2d 21, 24 (2d Cir.1989) (“[a]bsent an ambiguity in a written contract, courts will not look to the underlying intent of the parties in executing the contract“); see also O‘Neil v. Ret. Plan for Salaried Employees of RKO Gen., Inc., 37 F.3d 55, 58-59 (2d Cir.1994) (holding that the question of “[w]hether contract language is ambiguous . . . is resolved by reference to the contract alone“) (internal quotation marks omitted); accord Collins v. Harrison-Bode, 303 F.3d 429, 433 (2d Cir.2002) (noting that “[u]nder New York law, the question of ambiguity vel non must be determined from the face of the agreement, without reference to extrinsic evidence“).3-1
Conversely, the majority reasons, without even mentioning the question of ambiguity, that the “[p]roper construction of the recitations at issue, we believe, depends not only on the words of the Stipulation, but also, and more importantly, on whether the parties intended to place these words into the agreement as part of a resolution of disputed matters.” Majority Op. [76] (emphasis added). This approach is contrary to our precedent and the principles of contract law, which the majority agrees should govern. Majority Op. [75].
The importance of our steadfast adherence to the plain meaning rule becomes clear when we consider the unbridled freedom an appellate court has when it is abandoned; we could then rewrite any contract to correspond with what we believe to be the intentions of the parties, utilizing the exceptional equitable remedy of reformation under the guise of contract construction. However, “[t]here is no power at common law to reform a written instrument.” 76 C.J.S. Reformation of Interests § 2; see also e.g. Ivinson v. Hutton, 98 U.S. 79, 82, 25 L.Ed. 66 (1878). Accordingly, “[a] court may neither rewrite, under the guise of interpretation, a term of the contract when the term is clear and unambiguous, nor redraft a contract to accord with its instinct for the dispensation of equity upon the facts of a given case.” Terwilliger v. Terwilliger, 206 F.3d 240, 245 (2d Cir.2000).
Despite this governing precedent, the reformation of the stipulation is precisely what the majority opinion effects. Here, the majority‘s recharacterization of the “operative effect” of these provisions — into a mere reference to the state of the existing law — effectively inserts a new provision of critical importance into the agreement. The contract, as rewritten by the majority, now contains a new provision in the sections referring to SORA‘s notice and duration of registration requirements that reads: “these terms are included only to provide an indication of the existing statutory provisions; the State of New York reserves the right to modify the scope and term of your registration as a sex offender,” despite the fact that “[a] promise . . . with a reserved right to deny or change the effect of the promise, is an absurdity.” Murray v. Charleston, 96 U.S. 432, 445, 24 L.Ed. 760 (1877).
Even if the stipulation is ambiguous, we would be required to address the district court‘s factual findings, to which we owe considerable deference, in far more detail to be confident that vacatur is required. However, the majority opinion does not address this issue squarely, relegating to a footnote the finding that “to whatever extent the District Court might have made . . . finding[s] . . . [they] would be clearly erroneous.” Majority Op. [77 n. 9]. However, since “[w]here there are two permissible views of the evidence [of the parties’ intent], the court‘s pure findings of fact cannot be termed clearly erroneous,” United States Naval Institute v. Charter Communications, Inc., 875 F.2d 1044, 1049 (2d Cir.1989), the majority opinion implicitly holds in the alternative that the district court‘s well-reasoned and thoughtful opinions below contаined findings that were not even plausible. “The reviewing court oversteps the bounds of its duty under Rule 52(a) if it undertakes to duplicate the role of the lower court. In applying the clearly erroneous standard to the findings of a district court sitting without a jury, appellate courts must constantly have in mind that their function is not to decide factual issues de novo . . . . [T]he court of appeals may not reverse it even though convinced that had it been sitting as the trier of fact, it would have weighed the evidence differently.” Anderson v. Bessemer City, 470 U.S. 564, 573-74, 105 S.Ct. 1504, 84 L.Ed.2d 518 (1985).
The district court found that defendants-appellants had “agreed to, and indeed bargained for” the notification procedures applicable to each class of SORA registrants, as embodied in the consent decree. Doe-SORA V, 439 F.Supp.2d at 326, see also Doe-SORA IV, 427 F.Supp.2d at 408-09 (considering how the circumstances of the litigation illuminate the parties’ intentions). While the majority opinion contains a discussion of why the external evidence of the parties’ intentions can be cast in a different light so as to reach a different finding, it does not address the pertinent question, of whether the district court‘s factual findings are so implausible as to constitute an impermissible view of the same record. Majority Op. [15-18]. Consequently, even if this cоurt could demonstrate that the stipulation was ambiguous on its face, vacatur would not be warranted, because the district court‘s conclusion is a permissible view of the evidence.
The majority opinion notes that there was no “objective evidence that the parties intended the duration and scope recitations to have the effect of prohibiting the State from applying future legislation on these topics to the Plaintiffs.” Majority Op. [77 n. 9]. However, the district court relied on the very same type of evidence that the majority argues is dispositive: the context provided by the earlier litigation. See, e.g. Doe-SORA IV, 427 F.Supp.2d at 408-09. If this is not the sort of “objective evidence” that is adequate to support the district court‘s holding, it is not apparent why it would provide a more sufficient basis for this court‘s fact finding, particularly as “few persons are in a better position to understand the meaning of a [settlement] than the district judge who oversaw and approved it.” Local 359, 55 F.3d at 68.
The majority opines further that “there is no indication that the District Judge participated in developing any of the terms of the Stipulation that resulted in the decree.” Majority Op. [76 n. 7]. That may be true, but it does not establish that the district court was not familiar with the specifics of the dispute between the parties and their attempts at resolution. The District Judge below supervised — over the span of ten years — various challenges plaintiffs-appellants made to SORA, litigation which the majority believes to provide it with the necessary context for its construction of the consent decree. See Doe-SORA III, 3 F.Supp.2d 456 (Chin, J.); Doe-SORA I, 940 F.Supp. 603 (Chin, J.); Doe v. Pataki, 919 F.Supp. 691 (S.D.N.Y. 1996) (Chin, J.). Accordingly, the principle of deference this court announced in Local 359 applies a fortiori in the instant case; there is no compelling argument in the majority opinion why it should be set aside.
The majority believes that the most important features of the context of the agreement are that one of the parties is a state, and that the designated forum for its enforcement is a federal court. While this is not unreasonable in itself, it leads the majority to another departure from this circuit‘s precedent by inspiring the creation of an unprecedented clear statement rule. While the majority opinion presents this new rule as a straightforward application of Supreme Court precedent, it misсonstrues the leading case.
The majority notes that federal courts exhibit a “traditional concern[ ] . . . for restrict[ing] a state‘s inherent powers.” Majority Op. [77]. Accordingly, it reasons that a court construing a consent decree must have “a clear indication that a state has intended to surrender its normal authority to amend its statutes.” Id. at [78]. However, what is at issue here is not a wholesale surrender of the police power or an implicit disavowal of the right to amend the statutes that exercise it, but rather whether a state may make a binding promise to certain of its citizens not to subject them to those future amendments.
The majority relies on United States v. Winstar Corp. to support the novel clear statement rule, which it retroactively applies to plaintiffs-appellants, but the opinion does not engage in the analysis deemed critical by the Supreme Court in that case: whether the particular agreement at issue is of the type to which the unmistakability doctrine — i.e. the doctrine that requires that a contract purportedly binding a state to contractual obligations despite later legislative amendments to clearly indicate its intent to be so bound — is properly applicable:
Injecting the оpportunity for unmistakability litigation into every common contract action would, however, produce the untoward result of compromising the Government‘s practical capacity to make contracts, which we have held to be of the essence of sovereignty itself. From a practical standpoint, it would make an inroad on this power, by expanding the Government‘s opportunities for contractual abrogation, with the certain result of undermining the Government‘s credibility at the bargaining table and increasing the cost of its engagements.
518 U.S. 839, 884, 116 S.Ct. 2432, 135 L.Ed.2d 964 (1996) (plurality opinion).4-1 Accordingly, the majority‘s invocation of the unmistakability doctrine here in support of deference to state sovereignty is perplexing. The state also exercised a sovereign power when executing the stipulation; the majority opinion does not consider whether a federal court‘s declaration that this sovereign act was implicitly limited is consistent with the principles of federalism.5-1
The Supreme Court reaffirmed in Winstar that the government cannot ignore the common-law principle that a party responsible for the changed circumstances that make performance of its contractual obligations impossible cannot evade responsibility by pointing to the changed circumstances, or by asserting that the contract did not spеcify what should occur in that event. 518 U.S. at 904-910. Put simply, “[i]f the adverse event is due to the fault of the obligor, the offending party cannot be heard to cry that performance is impracticable.” 30 Williston on Contracts § 77:1 (4th ed.); see also Restatement (Second) of Contracts § 264 cmt. a (1981).
It follows directly from this principle that a state which amends its laws, such that it cannot perform its contractual obligation, is barred from asserting the defense of impracticability. See, e.g., 14 Corbin on Contracts, § 76.1 (2006) (“[t]he rule favoring discharge [for legal impossibility] following government prohibition does not apply, however, when the government action affects the contractual duties of the government itself.“) The majority opinion turns this principle on its head. More problematically, it manufactures a wide-ranging exception to the common law, that: “the normal rules of construction may vary depending on the nature of the parties and the effect of enforcement,” Majority Op. [76] and applies this exception for the first time here to create an additional hurdle for those attempting to vindicate their contractual rights against the government.
IV. If the Majority Believes the Contract is Ambiguous, The Proper Disposition is Remand
The majority opinion also fails to mention that the usual evidence that a court ordinarily uses to discern the parties’ intentions is absent from the record before us. If the majority believes that the intentions of the parties are central to the proper construction of the contract, surely these intentions should be probed under oath, rather than relying on the representations of their attorneys at oral arguments. The majority opinion does not advance any reasons why this court should not undertake the normal course of action when we hold that a contract is ambiguous, which is to remand to the district court for an evidentiary hearing on the issue of the parties’ intentions, where the parties might then submit parol evidence and evidence of custom and usage, among any other forms of evidence that might be probative of the parties’ intent. See Int‘l Multifoods Corp. v. Commercial Union Ins. Co., 309 F.3d 76, 87 (2d Cir.2002). To make findings about the intentions of the parties according to the averments of counsel when we can easily remand for reopening of the record and further fact finding is contrary to our precedent that the “resolution of [factual] problems is not the province of an aрpellate tribunal, but of the trial court.” M.W. Zack Metal Co. v. S.S. Birmingham City, 291 F.2d 451, 454 (2d Cir.1961).
Finally, since the government‘s performance under the stipulation was frustrated by the legislation, any court that would decide the outcome of this dispute should have evidence of whether that legislation was foreseeable — a question this court probed at oral argument without success — since “[i]f the risk of impossibility of performance was foreseeable, that contingency should have been addressed in the contract. The absence of such a contractual provision gives rise to an inferenсe that the risk was assumed [by the obligor,]” in this case, the government. 30 Williston on Contracts, § 77.95 (4th ed.).
Instead of allowing for the introduction of the evidence necessary for a well-reasoned resolution, the majority opinion reasons from the absence of evidence. The majority opinion mentions that there is “no indication” that certain events occurred — twice. If it not clear that opening the record would not reveal any such indications, there is no reason why this court should not allow the introduction of what might well prove to be crucial to our determination.
While the question of whether or not the contract is ambiguous is one of law, determining the intent of the parties is not only factual, but often requires a painstaking reconstruction of their motivations and strategies and how these changed over time. “Words and conduct used in the process of making a contract — offers, acceptances, modifications, preliminary communications not themselves operative in any way — all these need interpretation . . . before we can determine the operative effect that should be given to the contract.” 5 Corbin on Contracts, § 24.1 (2006). The majority opinion stаtes that “what is in dispute is the operative effect of these recitations,” Majority Op. [76], but resolves this question without even seeing any evidence of the words and conduct of the parties’ negotiations, never mind attempting to interpret this evidence. This is a difficult endeavor in the best of circumstances: to attempt it with nothing but a cold and bare record as a guide is obdurate.
CONCLUSION
I cannot join in the majority‘s opinion. It dispenses with the plain meaning rule of contractual interpretation by proceeding directly to the question of the parties’ intent without identifying an ambiguity visible on the face of the stipulation; it effectively reforms the stipulation, by means of what is admittedly construction — which this court has no authority to do in the absence of such an ambiguity; it does not adhere to several foundational principles of the common law of contracts; and it resolves the ambiguities as to the parties’ intentions on the basis of an absence of evidence, where it would be a simple matter to reopen the record — which is entirely bare — in order to obtain vital information on several key issues. For these reasons, I respectfully dissent.
Notes
If a plaintiff‘s risk level is determined to be a level 2, that plaintiff will be considered to be a level 2 offender as of March 11, 2002; therefore, the duration of the registration requirement will be 10 years from the date of his or her original registration. If a plaintiff‘s risk level is determined to be a level 3, that plaintiff will be considered a level 3 offender as of March 11, 2002, requiring lifetime registration with the possibility of relief from registration 13 years after the date of his or her original registration. If a plaintiff‘s risk level is reduced to a level 1, that plaintiff will be considered a level 1 offender as of March 11, 2002; therefore, the duration of the registration requirement will be ten years from the date of his or her original registration.
To whatever extent the District Court might have made an implicit finding as to the parties’ intent to maintain the then-existing duration and scope provisions and even if we assume that such a finding was a finding of fact rather than a conclusion of law based on a construction of the Stipulation, such a finding would be clearly erroneous for lack of any objective evidence that the parties intended the duration and scope recitations to be anything other than a reflection of then-current state law and to have the effect of prohibiting the State from applying future legislation on these topics to the Plaintiffs.