The framers of the Constitution provided that the new national government would be divided into three branches. The third was to be a court system, an institution that did not exist in the previous national government under the Articles of Confederation. However, the Constitution set out only the barest of outlines for the new judiciary, unlike the legislative and executive branches that were extensively detailed and circumscribed. Thus the first Congress had to flesh out the Constitution by creating a court structure.
The Judiciary Act of 1789 ranks as one of the most important enactments Congress has ever undertaken, more akin to a constitutive act (like amendments to the Constitution) than to ordinary legislation. The task was arduous, given the weakness of the new government and the extreme political sensitivity of many features of the court system. Congress struggled with the problem during the whole of its long first session, and the act that finally emerged in September 1789 was thought by many to be a sound but temporary compromise. Yet, thanks to a combination of astute political foresight, hard work, and luck, most of the important features of the national judiciary established by the act are with us today.
The act’s most enduring feature was also the aspect that most surprised contemporaries: a three-tiered hierarchical judicial structure. At the bottom were district courts, each with a single district judge, one in each state except Virginia and Massachusetts, which had two. (The remote Kentucky district of Virginia demanded its own court as the price of staying in the union, and the Maine portion of Massachusetts also received a court). At the top was a Supreme Court, staffed by five associate justices and one *chief justice. In between were three circuit courts, the Southern (consisting at the time of South Carolina and Georgia; North Carolina was added in 1790 after it joined the union), the Eastern (containing New York, Connecticut, Massachusetts, and New Hampshire; Rhode Island was added in 1790 and Vermont in 1791, when they joined the union), and the Middle (comprising Virginia, Maryland, Pennsylvania, Delaware, and New Jersey). In order to reduce expenses for the nation and for poor litigants, the circuit courts were not staffed with their own judges. Rather, each district judge sat in the circuit court when it convened in his state, and two itinerant Supreme Court judges joined them during each of three twice-yearly circuits. Since the broad trial jurisdiction of the circuit courts included the most sensitive and disputed kinds of federal cases, decisions there would be made by the most respected federal jurists, making costly appeals less likely. (The circuit courts are now known as the *Courts of Appeal, are solely appellate, and are staffed with their own judges, but the three-tiered arrangement has persisted.)
Both the hierarchy and the number of national courts surprised most Americans in 1789. All courts were trial courts at that time. No courts were confined to ruling on purely legal issues appealed from inferior courts, and an “appeal” might connote a new trial before a court containing more judges. However, opponents of the Constitution’s ratification had feared that an “appellate” jury trial (or merely the Supreme Court sitting without a jury) might overturn facts found below by a local jury. To calm these fears and thus to reduce antagonism to the new centralized government, the Judiciary Act prohibited the Supreme Court from rehearing facts, thus limiting it to questions of law and coincidentally giving it hierarchical control over the lower federal courts in issues of law. Today all state and federal appellate courts follow this model, but it was a remarkable novelty in 1789.
If Americans had been polled in 1788, a large majority would probably have predicted that trials of cases coming within federal jurisdiction would take place in the various state supreme courts (see state courts). Many Americans anticipated that the only federal courts would consist of a few *admiralty judges scattered among seaports, dealing with maritime matters, and a single appellate Supreme Court. Such a scheme would have kept costs low while assuaging the fears of state judges and localistic opponents of the Constitution that federal courts would swallow up state court jurisdiction. Virginia Senator Richard Henry Lee and others supported this model in the first Congress, but nationalists led by Connecticut Senator (and later Chief Justice) Oliver *Ellsworth beat back the challenge. They desired a highly articulated court system so that crucial cases could be tried before national judges (rather than (p. 545) state judges susceptible to strong antinational pressure), and so that the majesty and power of an otherwise small and distant, distrusted new national government might be brought closer to everyone’s doorstep.
A second alternative model was also rejected by the first Congress. This system, known as nisi prius, was patterned on the extant court systems in England, Massachusetts, and New York, among other jurisdictions. It would have entailed a large Supreme Court that would have traveled in groups of two or three to try federal cases in the hinterlands, then would have periodically returned to the capital to decide difficult issues of law as a group. There would have been no other federal courts. If either the Lee plan or the nisi prius plan had been adopted, our judicial landscape (and probably our constitutional history) would have been vastly different than it has been.
The fear widespread in 1787–1789 that the federal courts might swallow up state court jurisdiction was a rational one. The Constitution used quite broad, inclusive, and vague language to describe the jurisdiction that the federal judiciary would exercise. *Article III, section 2 states in pertinent part that “the judicial Power [of the United States] shall extend to all Cases” arising under the Constitution or federal law or treaties, and to controversies “between Citizens of different States … and between … the Citizens [of a State] and foreign … Citizens or Subjects” (emphasis added).
The political disputes that led James *Madison and others to demand a national court system in the first place involved state court refusal to enforce ordinary debt *contracts during the depression years of the 1780s. Hatred of the British impelled thousands of Americans to repudiate all or part of the debts that had been contracted with British merchants before the Revolution and that had remained unpaid when the courts closed on the eve of that bloody eight-year struggle. Despite prohibitions in the peace treaty with Great Britain, state legislatures continued to pass court-closing and debt-reducing acts that made collection of British debts difficult or impossible. They also enacted moratorium laws postponing, and legal tender laws allowing reductions in, the obligations Americans owed to domestic creditors, many of whom were speculators and many of whom, relative to the debtors, lived out of state. Many state courts respected the anticreditor message sent by the economically hard-pressed majority, enforcing this legislation and in some instances adding to its contract-repudiating effects.
Several provisions of the Constitution could bring ordinary contract cases involving such debts into the federal courts: such cases might be controversies between citizens of different states, or between a citizen and a foreigner; they might involve a statute contrary to the peace treaty, and thus “arise” under it; or they might involve a violation of the prohibitions in Article I, section 10 against a state’s “mak[ing] any Thing but gold and silver Coin a Tender in Payment of Debts” or passing “Law[s] impairing the Obligation of Contracts,” and thus “arise” under the Constitution. Many opponents of the Constitution did not want these cases taken away from the state courts. The Constitution’s opponents also objected to the breadth and vagueness of the Constitution’s jurisdictional language. The framers’ avowed purpose of greatly strengthening the national government portended the possible sweep of many other ordinary cases into federal court. Especially upsetting was the possibility that ordinary cases between citizens of different states involving small amounts might allow out-of-state plaintiffs to win by default against poor and middling defendants unable to travel, or to bring their witnesses great distances to appear in federal court. The movement to amend the Constitution, which resulted in the adoption of the *Bill of Rights in 1791, had a strong component of support from these opponents of the Constitution, who wished to restrict federal court jurisdiction severely (although nothing in the Bill of Rights as enacted directly accomplished such an objective).
The fears of the Constitution’s opponents were partially neutralized by the Judiciary Act of 1789, as Congress adopted restrictions on the jurisdiction that might have been allotted to the federal courts under a full and broad reading of the Constitution. The least controversial types of jurisdiction—admiralty, petty crimes, collection of revenue—were lodged in the single-judge district courts.
Much more controversial were cases involving citizens of two or more states (“diversity” suits) and those involving a United States citizen on one side and a foreigner on the other (“alienage” suits) (see diversity jurisdiction). While debt contract cases were the primary reasons for these types of jurisdiction, nothing in Article III prevented many other kinds of suits from being taken to federal court under them. Three judges, two of whom were members of the Supreme Court, would sit at the trial of such cases in the circuit courts, ensuring litigants more wisdom and care at their trials. Congress imposed an absolute amount-in-controversy limitation of $500—a large sum in 1789—on alienage and diversity cases, so that defendants involved in suits of less than that amount could not be taken to federal court by out-of-state or alien plaintiffs. Further, federal jurisdiction over diversity and *alienage suits was made concurrent, giving such plaintiffs their (p. 546) choice of state or federal court. If the state court were chosen, and the defendant decided at the beginning of the suit not to transfer the case to federal court, the case would remain in the state court, as no avenue of appeal to the Supreme Court from state courts in diversity or alienage cases was permitted. (These restrictions persist today, although the amount-in-controversy limitation now is $75,000.) A further amount-in-controversy limitation of $2,000 was placed upon appeal of alienage and diversity cases to the Supreme Court, lessening even further the likelihood that poor defendants would be twice subjected to expensive travel.
The most controversial type of jurisdiction was that over cases “arising” under the Constitution, treaties, or laws of the United States (*“federal question” suits). Today we have comprehensive federal regulatory legislation that gives rise to many federal question suits. However, such legislation was nonexistent in 1789. Modern readers have difficulty understanding the fears that such an open-ended jurisdiction raised in the minds of opponents of the Constitution. Might “laws of the United States” encompass the laws of all the states? What state control over its domestic affairs could be wrested away by the federal negotiation of a treaty with a foreign power?
On the other hand, proponents of the Constitution saw this as the most important type of federal jurisdiction. They believed that the courts could use it to repel attacks upon the new Constitution. The most significant restriction in the Judiciary Act of 1789 gave the trial of federal question suits to the state courts. Only upon appeal to the Supreme Court after a final decision was had in the highest court of a state might a federal question actually reach a federal court. (Except for a brief interlude in 1801–1802, federal courts did not obtain general trial jurisdiction over federal questions until 1875.)
The restrictions astutely placed in the Judiciary Act of 1789 were successful in preventing any jurisdictional limitations or restrictions from being adopted as amendments to the Constitution. Proponents of the new government grumbled about these restrictions and about the undignified and arduous *circuit riding that Supreme Court judges were forced to make, and planned to enact appropriate changes. They eventually did so in the *Judiciary Act of 1801, the famous “midnight judges’ act,” but Thomas *Jefferson and the Republicans repealed this new law in 1802 as their first action after coming to power. The Judiciary Act of 1789 attained hallowed status as the enduring blueprint for America’s judicial structure.
See also judicial power and jurisdiction; lower federal courts.
Julius Goebel, Jr., History of the Supreme Court of the United States, vol. 1, Antecedents and Beginnings to 1801 (1971). Wythe Holt, “‘To Establish Justice’: Politics, the Judiciary Act of 1789, and the Invention of the Federal courts,” Duke Law Journal (December 1989): 1421–1531. Wilfred J. Ritz, Rewriting the History of the Judiciary Act of 1789: Exposing Myths, Challenging Premises, and Using New Evidence (1990). Charles Warren, “New Light on the History of the Federal Judiciary Act of 1789,” Harvard Law Review 37 (November 1923): 49–132.