Sipes v. McGhee
1947 Mich. LEXIS 288, 316 Mich. 614, 25 N.W.2d 638 (1947)
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Rule of Law:
The judicial enforcement of a private contractual agreement, such as a racially restrictive covenant limiting property occupancy, does not constitute state action and therefore does not violate the Equal Protection Clause of the Fourteenth Amendment. Racially restrictive covenants on property occupancy are not void as against public policy.
Facts:
- Benjamin Sipes and other homeowners owned property in a Detroit subdivision.
- In 1935, property owners in the subdivision entered into a mutual agreement creating a restrictive covenant on their properties.
- The covenant stated: “This property shall not be used or occupied by any person or persons except those of the Caucasian race.”
- The agreement required at least 80% of property owners in the block to assent for it to be effective, a condition which was met.
- In November 1944, Orsel and Minnie McGhee, who are not of the Caucasian race, purchased a property within the subdivision.
- The deed conveying the property to the McGhees stated it was “subject to existing restrictions as of record.”
- The McGhees subsequently moved into and occupied the property.
Procedural Posture:
- Benjamin Sipes and other homeowners filed a lawsuit against Orsel and Minnie McGhee in the Circuit Court for Wayne County, Michigan, which is a trial court.
- The plaintiffs sought a decree to enforce the racially restrictive covenant and enjoin the McGhees from occupying the property.
- The trial court found in favor of the plaintiffs, issuing a decree that upheld and enforced the covenant.
- The defendants, Orsel and Minnie McGhee, as appellants, appealed this decision to the Supreme Court of Michigan.
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Issue:
Does the judicial enforcement of a private, racially restrictive covenant that prohibits non-Caucasians from occupying a property violate the public policy of Michigan or the Equal Protection Clause of the Fourteenth Amendment?
Opinions:
Majority - Bushnell, J.
No. The judicial enforcement of a private, racially restrictive covenant does not violate Michigan public policy or the Fourteenth Amendment because it is a private contractual matter, not state action. The court relies on its precedent in Parmalee v. Morris, which upheld a similar restrictive covenant, and finds no compelling reason to overturn it. It distinguishes between restrictions on occupancy, which it holds are permissible private contracts, and restrictions on sale (alienation), which are void. The court rejects the argument that the covenant's language is uncertain. Crucially, it reasons that the Fourteenth Amendment's prohibition on state action does not extend to a court's enforcement of a private agreement, as this would deny the plaintiffs their own constitutional right to enforce their contracts. The court concludes that it is bound by established principles of property and contract law.
Analysis:
This decision represents the prevailing view of the state action doctrine before the landmark U.S. Supreme Court case of Shelley v. Kraemer (which reversed this very case on appeal). It illustrates a judicial philosophy that strictly separates private contractual rights from public constitutional obligations, allowing courts to enforce privately-created segregation. The court's prioritization of stare decisis and freedom of contract over equal protection arguments demonstrates the significant legal barriers that existed to challenge housing discrimination. This case is a critical historical marker showing the legal framework that Shelley v. Kraemer would ultimately dismantle by holding that judicial enforcement of such covenants is indeed state action.
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