Stalland v. South Dakota Bd. of Bar Examiners, Civ. No. 81-3046.

Decision Date15 January 1982
Docket NumberCiv. No. 81-3046.
Citation530 F. Supp. 155
PartiesRe: Luther M. STALLAND v. SOUTH DAKOTA BOARD OF BAR EXAMINERS; Thomas E. Simmons, Thomas C. Adam, Robert B. Frieberg, all members of the South Dakota Board of Bar Examiners; Supreme Court of the State of South Dakota; Roger L. Wollman, Francis G. Dunn, Robert E. Morgan, Jon Fosheim, Frank E. Henderson, all Justices of the Supreme Court of South Dakota.
CourtU.S. District Court — District of South Dakota

Wm. J. Srstka, Jr., Pierre, S. D., K. Peter Stalland, Minneapolis, Minn., for plaintiff.

Douglas E. Kludt, Asst. Atty. Gen., Robert C. Riter, Pierre, S. D., for defendants.

MEMORANDUM OPINION

BOGUE, Chief Judge.

This action concerns the constitutional validity of S.D.C.L. 16-16-2 and 16-16-7 which provide that an applicant for admission to practice law in South Dakota must be a resident of this state.1 Luther Stalland, the plaintiff, claims the residency requirement violates the privileges and immunities clause of article IV, section 2 of the Federal Constitution, and both the due process and equal protection clauses of the fourteenth amendment to the Federal Constitution. Plaintiff requests declaratory and injunctive relief. Jurisdiction exists under 28 U.S.C. §§ 1331, 1343 and 42 U.S.C. § 1983.

The defendants in this action include the South Dakota Board of Bar Examiners, the individual members of the Board, the South Dakota Supreme Court, and the individual justices of the Court. The South Dakota Bar Association also participated as amicus curiae.

By agreement of the parties, the merits of this controversy are before this Court on plaintiff's motion for summary judgment. The material facts are uncontroverted and only a question of law remains to be decided. Although no evidentiary hearing was held, the defendants submitted testimony by affidavit concerning their justifications for the residency requirement. For the reasons stated in this memorandum, this Court grants plaintiff's motion for summary judgment.

FACTS

Plaintiff is a resident of Minnesota, where he has practiced law for nearly thirty years. He is a member of the Bar of the state of Minnesota and practices before the state courts and the United States District Court of Minnesota. Plaintiff intends to engage in the multistate practice of law. While maintaining his Minnesota residency and practice, plaintiff seeks to obtain a license to practice law in South Dakota.

On November 12, 1980, plaintiff applied for admission to practice law in South Dakota. Defendant Board of Bar Examiners denied this application on March 21, 1981. Plaintiff requested the defendant Supreme Court to review the Board's decision under S.D.C.L. 16-16-16. On July 23, 1981, the Supreme Court sustained the Board's decision to deny plaintiff's application. Plaintiff then initiated this action.

The South Dakota bar residency requirement, S.D.C.L. 16-16-2, clearly discriminates against nonresidents. Defendants do not dispute this fact. The residency requirement denies a nonresident attorney, who might be otherwise eminently qualified, the right to practice law on a multistate basis, perhaps specializing in a narrow area of the law. Further, S.D.C.L. 16-16-2 burdens the practice of law by attorneys employed by multistate corporations. Gordon v. Committee on Character and Fitness, 48 N.Y.2d 266, 422 N.Y.S.2d 641, 397 N.E.2d 1309 (1979). Defendants did not dispute plaintiff's moral fitness or legal competence but denied plaintiff's application based solely upon the residency requirement. This Court, therefore, will address plaintiff's principal challenge to S.D.C.L. 16-16-2, based on the privileges and immunities clause of article IV, § 2.2

I.

The United States Constitution, article IV, § 2, provides: "The citizens of each State shall be entitled to all the Privileges and Immunities of Citizens in the several states." Essentially, the clause forbids a state to discriminate against citizens of other states in favor of its own citizens.3 By "making noncitizenship or nonresidence an improper basis for locating a special burden, the clause implicates not only the individual's right to nondiscriminatory treatment but also, perhaps more so, the structural balance essential to the concept of federalism," Austin v. New Hampshire, 420 U.S. 656, 659, 662, 95 S.Ct. 1191, 1193, 1195, 43 L.Ed.2d 530 (1975). Thus, the privileges and immunities clause "establishes a norm of comity (cites omitted) that is to prevail among the States with respect to their treatment of each other's residents." Hicklin v. Orbeck, 437 U.S. 518, 523, 98 S.Ct. 2482, 2486, 57 L.Ed.2d 397 (1978).

Article IV, § 2, does not identify the subjects with respect to which equality of treatment is required. Admittedly, not all discrimination against nonresidents is prohibited. Concerning the right to vote, Dunn v. Blumstein, 405 U.S. 330, 92 S.Ct. 995, 31 L.Ed.2d 274 (1972), to hold public office, Kanapaux v. Ellisor, 419 U.S. 891, 95 S.Ct. 169, 42 L.Ed.2d 136 (1974), to receive some state services, Shapiro v. Thompson, 394 U.S. 618, 89 S.Ct. 1322, 22 L.Ed.2d 600 (1969), a state may discriminate on the basis of residency. These activities significantly relate to the separate sovereignty of each state. Discrimination against nonresidents with respect to these "privileges" or "rights" does not frustrate the goal of national unification expressed in the clause.4 Furthermore, the clause does not preclude residency distinctions concerning interests or rights which cannot be deemed "fundamental,"5 basic or essential to the maintenance of the Union. Baldwin v. Fish and Game Commission of Montana, 436 U.S. 371, 388, 98 S.Ct. 1852, 1862, 56 L.Ed.2d 354 (1978). In Baldwin, for example, the Supreme Court held that discrimination against nonresidents concerning elk hunting in Montana did not threaten a basic right. See also, State v. Kemp, 73 S.D. 458, 44 N.W.2d 214 (1950), appeal dismissed, 340 U.S. 923, 71 S.Ct. 498, 95 L.Ed. 667 (1951).6

This Court concludes the practice of law in South Dakota is a fundamental or basic right protected under the clause from unjustified discrimination on the basis of residency. Article IV, § 2 plainly and unmistakably secures and protects the right of a citizen of one state to pass into any other state of the Union for the purpose of engaging in lawful commerce, trade or business without molestation. Ward v. Maryland, 12 Wall 418, 430, 20 L.Ed. 449 (1871); Toomer v. Witsell, 334 U.S. 385, 68 S.Ct. 1156, 92 L.Ed. 1460 (1948). In Hicklin, for example, the Supreme Court struck down the Alaska Hire law which granted to Alaska residents a preference for employment in jobs arising in the state's oil and gas industry. 437 U.S. at 531, 98 S.Ct. at 2490. The privileges and immunities clause clearly extends unique protection to nonresidents who wish to engage in their chosen occupation and earn a livelihood within the state on an equal basis with residents. Since S.D.C.L. 16-16-2 discriminates against nonresidents who seek to practice their occupation in the state, the statute therefore is subject to scrutiny under the privileges and immunities clause.7

The privileges and immunities clause bars discrimination against nonresidents "where there is no substantial reason for the discrimination beyond the mere fact that they are citizens of other states." Toomer, 334 U.S. at 396, 68 S.Ct. at 1162. Accordingly, we must analyze defendants' justifications for maintaining the discriminatory burden of S.D.C.L. 16-16-2. First, the state interests served by the discrimination must be "substantial." That is, defendants must demonstrate that "non-citizens constitute a peculiar source of the evil at which the statute is aimed." Toomer, 334 U.S. at 398, 68 S.Ct. at 1163. If the governmental interest is substantial, and some degree of discrimination is permissible, "there must be a reasonable relationship between the danger represented by non-citizens, as a class, and the ... discrimination practiced upon them." Hicklin, 437 U.S. at 526, 98 S.Ct. at 2487, quoting Toomer, 334 U.S. at 399, 68 S.Ct. at 1163. Professor Tribe concludes that this "substantial reason test" "permits disparate treatment of nonresidents, but only where the very fact of their nonresidence demonstrably creates problems for legitimate state objectives that cannot be remedied in less discriminatory ways." L. Tribe, American Constitutional Law, § 6-33, p. 410 (1978).

II.

According to defendants, nonresident attorneys who practice in South Dakota constitute a peculiar source of several evils which S.D.C.L. 16-16-2 was designed to avoid.

(1) The evil of administrative inconvenience: Defendants claim the residency rule protects the state's interest in minimizing its administrative and investigative workload. They argue that applications by nonresident attorneys burden the admission process; the practice of law by nonresident attorneys creates administrative and scheduling problems for state courts.

Defendants failed, however, to demonstrate that nonresidents constitute "a peculiar source" of the evil of "administrative inefficiency." Defendant's brief, p. 23. More important, the Supreme Court indicated administrative convenience may not be a substantial interest sufficient to justify a residency requirement. Sosna v. Iowa, 419 U.S. 393, 406, 95 S.Ct. 553, 560, 42 L.Ed.2d 532 (1975). This Court agrees that the convenience and efficiency of local courts are not "substantial reasons" for permitting a state completely to exclude nonresidents from admission to the bar. Gordon, 397 N.E.2d at 1313; Keenan v. Board of Law Examiners of the State of North Carolina, 317 F.Supp. 1350, 1360 (E.D.N.C. 1970).

(2) The evil of admitting attorneys who are unfamiliar with local customs, attitudes, laws and procedures: First, defendants claim out-of-state attorneys often cannot attend to the "rapidly changing" laws of South Dakota. Defendants also believe nonresident attorneys are ignorant of the general attitudes,...

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