December 30, 2009

Other people's money: Davenport back in state supreme court

By Other people's money: Davenport back in state supreme court

Author: Daniel Himebaugh

The Supreme Court of Washington has once again granted review in Davenport v. Washington Education Association, a case that began as a class action on behalf of public school teachers almost ten years ago.

In 2007, PLF supported the teachers as amicus curiae at the U.S. Supreme Court, where the Court upheld a Washington law that required public employee unions to obtain the consent of non-member teachers before spending the teachers' agency fees on the unions' political activity.  Now, having won a constitutional victory at the nation's highest court, the teachers are fighting for reimbursement of the fees they paid to the WEA.

Washington's agency fee system is stunningly direct in its operation.  The state grants public employee unions (which are actually private entities) the authority to collect "agency fees" from employees who work in the profession the union represents, even when the employees are not members of the union.  The WEA, for example, extracts money from the paychecks of all public school teachers in districts where the WEA represents teachers, whether the teachers are members of the union or not.

The philosopher Frederic Bastiat had a name for such a system: "legal plunder."  In his famous 1850 work, The Law, Bastiat wrote that, "Sometimes the law defends plunder and participates in it. . . .  See if the law takes from some persons what belongs to them, and gives it to other persons to whom it does not belong. . . .  The person who profits from this law will complain bitterly, defending his acquired rights. . . .  Do not listen to this sophistry by vested interests.  The acceptance of these arguments will build legal plunder into a whole system."

Unfortunately for Washington's non-union teachers, the Court did not strike down the agency fee system as "legal plunder," and a quick legislative fix in Olympia while the decision was pending rendered the Court's decision to uphold spending restrictions practically ineffectual.

The latest appeal, however, involves the question of paying back the money.  In December 2008, the Washington Court of Appeals held that the teachers have a claim for restitution of the agency fees that the union spent on political activity without their consent.  Restitution is based on the equitable principle that a person who receives money from another must return it if the circumstances of its receipt or retention are such that, as between the two persons, it is unjust for him or her to retain it.  The crux of the court's opinion is the holding that a transfer made under "compulsion of law" can be the subject of a claim for restitution if it is "subject to a condition the later failure of which deprives it of its initially lawful justification."  In the case of the teachers, the Court of Appeals found that the union's receipt of the money, though authorized by state statute, lost its "lawful justification" when the union spent it on political activity without obtaining the teachers' consent.

The case has not yet been set for review in the Supreme Court of Washington.

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