Square corners and one-way streets
One of life's little-known secrets (secret, anyway, until it is made painfully obvious when it is too late) is that ordinary rules of custom and fairness often do not apply to the government. There is some justification for this — to protect the common interest in public funds, public property, and all — but it still leads to unjust results for folks who expect the government to be just like everyone else.
Just ask the Merrill brothers of Idaho.
In the late 1930s, to encourage farmers to grow crops and to protect them from being wiped out by crop failure, the federal government established a crop insurance program. A.A. Merrill and his brother were wheat farmers. In early 1945, they applied at a local federal office in Bonneville, Idaho for insurance on 460 acres of spring wheat. Four hundred of these acres were reseeded acreage where they had grown winter wheat. The local officials informed them that they qualified for coverage, and forwarded the contract to the main office in Denver.
As it turned out, buried in the fine print of the “Wheat Crop Insurance Regulations,” published by the federal government in something called the “Federal Register,” reseeded land actually did not qualify for the insurance. But apparently no one in the Idaho office was aware of this, and the Merrills' application did not mention that 400 acres were reseeded. Unfortunately, the following July a serious drought destroyed their entire crop.
When the Merrills filed their claim, the government's agents determined that only 60 acres truly qualified for coverage, and refused to pay for the rest. The Merrills sued the government, and won both in the trial court and on appeal. Both courts reasoned that because the Merrills had no knowledge of the regulation, and the government's own employees failed to notify them of the restriction, they should get the coverage.
But the federal government managed to convince the U.S. Supreme Court to accept an appeal in the Merrills' little agricultural dispute. The majority opinion ended up being written by Justice Felix Frankfurter — always a guy to follow legal rules strictly.
This isn't to say he was entirely unsympathetic. “The case no doubt presents phases of hardship,” Frankfurter wrote, noting that the court accepted that the Merrills reasonably believed their entire crop was insured. And he even added, “We assume that recovery could be had against a private insurance company.”
But this was not a private insurance company. And, said Frankfurter, “it is too late in the day to urge that the Government is just another private litigant.” The regulations made 400 acres of the Merrills' crop ineligible for the insurance; they were misled (and harmed) by the government's own agents. But Frankfurter concluded that that was just unfortunate.
This was simply too much for Justice Robert Jackson, who wrote a short, bitter dissent. There was no doubt, he said, that under the law of Idaho, the government would have been held to its contract. And even if federal law determined the outcome, he wrote, “I can see no reason why we should not adopt a rule which recognizes the practicalities of the business.”
Jackson went on, “It may be well enough to make some types of contracts with the Government subject to long and involved regulations published in the Federal Register. To my mind, it is an absurdity to hold that every farmer who insures his crops knows what the Federal Register contains or even knows that there is such a publication. If he were to peruse this voluminous and dull publication as it is issued from time to time in order to make sure whether anything has been promulgated that affects his rights, he would never need crop insurance, for he would never get time to plant any crops.”
Jackson added that if the Government signs contracts with people working in agriculture, “It could not expect them to be lawyers, except in rare instances, and one should not be expected to have to employ a lawyer to see whether his own Government is issuing him a policy which in case of loss would turn out to be no policy at all.”
He concluded with a final complaint, borrowing a phrase from an earlier Supreme Court decision. But in doing so, he got a little carried away with his metaphors: “It is very well to say that those who deal with the Government should turn square corners. But there is no reason why the square corners should constitute a one-way street.”