Abstention Doctrine (Update)

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ABSTENTION DOCTRINE (Update)

In recent years, the Supreme Court has clarified three aspects of the abstention doctrines. First, Quackenbush v. Allstate Insurance Co. (1996) made it clear that abstention is not appropriate in suits for monetary damages, but rather only as to claims for injunctive or declaratory relief. The petitioner, Charles Quackenbush, the California Insurance Commissioner, sued Allstate Insurance Company in state court seeking money damages for breach of contract and torts. Allstate removed the matter to federal court based on diversity jurisdiction.

The federal district court remanded the case to state court on the basis of Burford v. Sun Oil Co. (1942), which provides for federal court abstention when unified state proceedings are needed. The Supreme Court unanimously reversed. The Court concluded that "the power to dismiss under the Burford doctrine, as with other abstention doctrines, derives from the discretion historically enjoyed by courts of equity." Thus, abstention was inappropriate in the suit for money damages. Although the case dealt with only one type of abstention, it contained a broad statement that abstention is not appropriate in suits brought solely for money damages.

Second, in Arizonans for Official English v. Arizona (1997), the Court stressed the importance of federal courts' using state certification procedures when they are available. Many states have laws that allow a federal court to certify questions and send them to the state court for resolution. In a case involving a challenge to Arizona's English-only law, the Court said that certification should be used when there are "novel, unsettled questions" of state law. The Court said that "[t]aking advantage of certification made available by a State may greatly simplify an ultimate adjudication in federal court."

The Court indicated that federal courts should be more willing to abstain when certification procedures exist. The Court emphasized that certification does not involve the delays, expense, and procedural complexity that generally attend the abstention decision.

Finally, in Wilton v. Seven Falls Co. (1995) the Court ruled that in suits for declaratory judgments federal courts have discretion whether to defer to duplicative state proceedings. Wilton, an insurance underwriter, filed a suit for a declaratory judgment in federal court, seeking a ruling that it was not liable to Seven Falls Co. under insurance policies. Seven Falls then filed a suit in state court against Wilton and asked the federal court to dismiss or stay the state court proceedings. The district court granted the stay to avoid duplicative litigation and both the court of appeals and the U.S. Supreme Court affirmed.

Although the exceptional circumstances warranting abstention were not present, the Supreme Court unanimously concluded that the federal court had discretion to abstain under the federal Declaratory Judgment Act. The Court emphasized that the act is written in discretionary terms and that it has been understood to confer on federal courts unique and substantial discretion in deciding whether to declare the rights of litigants. The Court, however, offered little guidance as to the criteria that a federal court should apply in deciding whether to defer to state proceedings when there is a request for a federal declaratory judgment.

None of these decisions creates new abstention doctrines or dramatically changes existing ones. But each clarifies an important aspect of abstention doctrines.

Erwin Chemerinsky
(2000)