Would Shelley v. Kraemer Be Decided the Same Way Today?

The Supreme Court held that judicial enforcement of racially restrictive covenants constitutes state action that violates the Equal Protection Clause of the Fourteenth Amendment. Chief Justice Vinson's unanimous opinion concluded that while private parties may voluntarily abide by racially restrictive covenants, the involvement of state courts in enforcing such agreements transforms private discrimination into state action. The decision effectively rendered racially restrictive covenants unenforceable, though it did not declare them void.

Shelley v. Kraemer is a landmark in both equal protection and state action jurisprudence. The decision helped dismantle one of the primary legal mechanisms through which residential segregation was maintained in the mid-twentieth century. The Fair Housing Act of 1968 subsequently prohibited racial discrimination in housing sales and rentals, providing a statutory complement to Shelley's constitutional holding.

The state action doctrine developed in Shelley has had a complex legacy. The broad principle that judicial enforcement of private agreements can constitute state action raised profound questions about the boundary between public and private spheres. If court enforcement of a private contract makes the contract's terms attributable to the state, does this mean that all private contracts are potentially subject to constitutional constraints? Courts and scholars have struggled with this implication, generally limiting Shelley to its specific context while acknowledging the theoretical breadth of its reasoning.

Residential segregation remains a defining feature of American metropolitan areas, despite the legal changes wrought by Shelley and the Fair Housing Act. The legacy of racially restrictive covenants—in terms of neighborhood composition, wealth accumulation, school quality, and social networks—persists decades after the covenants became unenforceable. Modern housing discrimination takes subtler forms, including algorithmic bias in mortgage lending, exclusionary zoning, and steering by real estate agents, raising new questions about the adequacy of existing legal tools.

Shelley would almost certainly be decided the same way today. The principle that the state cannot lend its power to enforce racially discriminatory private agreements is firmly established and commands universal support. No current justice would vote to permit judicial enforcement of a covenant that explicitly prohibits the sale of property to persons of a particular race.

The result in Shelley is reinforced by the Fair Housing Act, which provides a comprehensive statutory prohibition on racial discrimination in housing that goes beyond Shelley's constitutional holding. Even if the state action theory of Shelley were somehow questioned, federal statutory law would independently prohibit the conduct at issue. The statutory framework provides a belt-and-suspenders protection for the principle Shelley established.

The more interesting question about Shelley's modern vitality concerns the scope of its state action reasoning. The decision's logic—that judicial enforcement converts private discrimination into state action—has been both praised as essential to meaningful equal protection and criticized as threatening to dissolve the public-private distinction that structures much of constitutional law. The modern Court has generally declined to extend Shelley's state action theory to other contexts, suggesting that the decision is understood as a case about the specific evil of racially restrictive covenants rather than a general principle about judicial enforcement of private agreements.

Shelley's significance in modern property law extends beyond its formal holding. The decision has become a touchstone for discussions about the persistence of structural racism in housing markets, the inadequacy of formal legal equality in addressing entrenched segregation, and the role of law in creating and perpetuating racial inequality. These themes resonate powerfully in contemporary debates about housing policy, reparations, and the scope of antidiscrimination law.

The scholarly debate about Shelley has two dimensions: the correctness of the result and the implications of the reasoning. On the result, there is virtually no disagreement—judicial enforcement of racially restrictive covenants is universally condemned. The debate concerns whether Shelley's state action theory is coherent and what it implies for other contexts. Mark Tushnet has argued that Shelley demonstrates the impossibility of drawing a principled distinction between state action and private action, since all private arrangements ultimately depend on state enforcement mechanisms. If Shelley is correct, Tushnet contends, then the state action limitation on the Fourteenth Amendment becomes incoherent.

Other scholars, including Larry Alexander, have argued that Shelley can be limited to its facts without accepting the broader implication that all judicial enforcement constitutes state action. Alexander contends that the distinctive feature of racially restrictive covenants is that they serve no purpose other than racial exclusion, and that courts can distinguish this context from other private agreements without collapsing the public-private distinction. Richard Epstein has offered a libertarian critique, arguing that while the result in Shelley is correct, the reasoning should focus on the common-law tradition against restraints on alienation rather than the state action doctrine.

• Jones v. Alfred H. Mayer Co. (1968)
• Texas Department of Housing and Community Affairs v. Inclusive Communities Project (2015)
• Village of Arlington Heights v. Metropolitan Housing Development Corp. (1977)
• Brentwood Academy v. Tennessee Secondary School Athletic Association (2001)
• Manhattan Community Access Corp. v. Halleck (2019)