Next week, one of the most powerful private legal groups you’ve never heard of will hold its annual meeting in Washington, D.C. For nearly 100 years, the 3,000- member American Law Institute has exercised enormous influence through what it calls “Restatements” of the common law. Many judges, lawyers, and scholars rely on it for an objective, readable description of what the law is.
As I noted at NRO in 2016:
The ALI’s Restatements are an effort to clarify and codify the common law. In many areas, actual statutes do not govern us, but “case law,” or judicial precedent, does. The ALI tells courts what the case law is, and courts routinely rely on the ALI Restatements as authority for what the law is. The ALI’s work serves as something between Cliff’s Notes and an authoritative encyclopedia of law for many judges.
The Supreme Court cites the ALI every few weeks, on average, in its decisions.
But there must be a clear line between describing what the law is and seeking to establish new law and policy. More and more lawyers think that the ALI has departed from its core mission and is becoming an engine driving novel legal rules. At its annual convention two years ago, ALI leaders proposed adopting a model penal code that would make “affirmative consent,” regarding sexual relations, its official policy. The move was stymied when influential members noted that such a definition would shift the burden of proof on to the accused, something not currently part of our judicial system. As Ashe Schow wrote in the Washington Examiner in 2016:
The accused would have to prove they had received “communicated willingness.” This would mean that any time someone engages in sexual activity, they not only have to make sure they obtain this specific form of consent, but also proof of this consent.
Undaunted, the ALI has spread its legal wings to copyright law, consumer contracts, intentional torts, and insurance. At next week’s ALI annual meeting, a battle royal is expected over a draft Restatement on the law of liability insurance. A group of ALI members say the draft seeks to reshape the law in such a way that will further clog court dockets and raise costs for business and consumers.
Last month, a group of six governors — from Texas, Maine, South Carolina, Nebraska, Utah, and Iowa — sent the ALI a letter warning that the proposed draft is a usurpation of the law-making authority of their state legislatures. The Restatement could also retard economic development, they note, by “creating uncertainty and instability in the liability insurance market.” The governors urged urge ALI members to revise or rescind the draft Restatement.
Leading lawyers agree that the ALI’s draft should return to the drawing board. Victor Schwartz, the chair of the public-policy group for the Washington firm of Shook, Hardy, and Bacon, participated in a recent conference call held by the National Council of Insurance Legislators. On the call, Schwarz noted that the draft uses “weasel words” that will become “litigation fuel.” It will make an insurer liable whenever its defense counsel lacks “adequate” malpractice insurance. “Who in the heck knows it is, or if it isn’t [adequate]?” he asked. No court has ever adopted such a liability theory.
A letter from a group of corporate attorneys notes that the draft “recommends that an insurer that loses a dispute with a policyholder would have to pay that policyholder’s legal fees, but if the insurer prevailed, it would have to pay its own attorney fees.” This is in complete variance with the “American rule” that each party in a legal dispute normally pays its own attorney fees.
Such under-the-radar shifts in reinterpreting the law have bothered legal scholars for several years. “The ALI has more and more become politically correct,” Ronald Rotunda, a law professor at Chapman University and a member of the ALI since 1977, told me before he died earlier this year. “It’s now driving an agenda rather than providing clarity and objective standards to the law.”
Justice Antonin Scalia also issued his own warning about the ALI in 2015, the year before his death. In Kansas v. Nebraska, he wrote:
Modern Restatements . . . are of questionable value, and must be used with caution. . . . Over time, the Restatements’ authors have abandoned the mission of describing the law, and have chosen instead to set forth their aspirations for what the law ought to be.
Scalia argued that such novel views of the law should have “no more weight regarding what the law ought to be than the recommendations of any respected lawyer or scholar.” No longer can one assume that “a Restatement provision describes rather than revises current law.”
You’d think the general ALI membership would realize that the last thing it needs is more public skepticism about the group’s small subgroup of legal experts who draft ALI Restatements. Right now, the growing perception is that the ALI’s legal experts are increasingly ideological trial lawyers and anti-business law professors who are on a crusade and taking the rest of the ALI membership along for the ride.