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The power of the federal courts to enforce the terms of private agreements is at all times exercised subject to the restrictions and limitations of the public policy of the United States as manifested in the Constitution, treaties, federal statutes, and applicable legal precedents.
In 1906, twenty of thirty-one lots in the 100 block of Bryant Street, Northwest, in the City of Washington, were sold subject to a covenant stipulating that the said lot shall never be rented, leased, sold, transferred or conveyed unto any Negro or colored person, under a penalty of Two Thousand Dollars ($2,000), which shall be a lien against said property. The lots were then sold to petitioners, who were found to be Negroes. Suits were instituted in the District Court by respondents, who own other property in the block subject to the terms of the covenants, praying for injunctive relief to enforce the terms of the restrictive agreement. After a hearing, the trial court entered a judgment declaring null and void the deeds of the Negro petitioners. The judgment was affirmed by the appellate court. On further appeal, petitioners argued that such governmental action on the part of the courts of the District of Columbia is forbidden by the due process clause of the Fifth Amendment of the Federal Constitution.
Did the judicial enforcement of racial restrictive agreements by the federal courts of the District of Columbia violate the Fifth Amendment of the Federal Constitution?
The United States Supreme Court reversed the decision allowing judicial enforcement of racially restrictive covenants by the federal courts. The Court held that the Civil Rights Act, 8 U.S.C.S. § 42, prohibited enforcement of the covenant by the federal courts. The statute, by its terms, required that all citizens of the United States would have the same rights as those enjoyed by other citizens to inherit, purchase, lease, sell, hold, and convey real and personal property. The district court's action in enforcing the covenant denied petitioners that right. Therefore, the action on the covenant could not stand. It was not consistent with the public policy of the United States to permit federal courts to exercise general equitable powers to compel action denied the state courts, where such state action was held to be violative of the guaranty of the equal protection of the laws.