Exclusionary Covenants and the Constitution – III: Zoroastrian Cooperative and Political Liberalism

In the previous post, we discussed – and criticized – the 2005 Supreme Court judgment in Zoroastrian Cooperative on two grounds: first, the Supreme Court was incorrect in conflating statutory policy and public policy; and secondly, it was incorrect in failing to distinguish between holding an exclusionary covenant unconstitutional, and in refusing judicial enforcement of it.

While the judgment of the Court is, I submit, flawed as a general exposition of the law on exclusionary/restrictive covenants, that does not settle the question of whether the outcome of the case was correct. This is because, in addition to its arguments on the freedom of private transactions and restricting public policy to the four corners of the statute, the Court also invoked Article 19(1)(c) of the Constitution – the fundamental freedom to associate. Part of the Court’s public policy arguments, indeed, appear to turn upon the unconstitutionality of requiring persons to “associate” with others that they do not want to associate with, which – according to the Court – would have been the outcome had the exclusionary covenant been left unenforced.

There is, however, a problem with this argument. The statutory right to contract is not the same as the constitutional freedom of association. The Indian Contract Act, for instance, places numerous restrictions upon the freedom to contract that go beyond the Article 19(4)’s permissible limits upon the freedom to associate. More importantly, a quick glance at the Constituent Assembly Debates (here, here, and here) reveals, unsurprisingly, that the freedom of association was considered to be an essential aspect of personal civil liberty, akin to the freedom of speech and the freedom of movement, contractual rights being nowhere mentioned. Historically, the freedom of association has been about protecting the rights of labour unions, religious minorities and other unpopular groups to organize and defend their rights or their ways of life, as the case may be. The important Indian cases have also understood the freedom of association to be about such purposes (see here, here and here). And indeed, Daman Singh would appear to uphold this view, when it expressly rejected the application of 19(1)(c) to Cooperative Societies (the Supreme Court in Zoroastrian Cooperative did attempt to distinguish that case).

Therefore, it is clearly problematic when in Paragraph 29, Zoroastrian Cooperative observed:

“An aspirant to membership in a co-operative society, is at arms length with the other members of the society with whom he enters into the compact or in which he joins, having expressed his willingness to subscribe to the aims and objects of that society. In the context of Section 23 of the Contract Act, something more than possible or plausible argument based on the constitutional scheme is necessary to nullify an agreement voluntarily entered into by a person.” (Paragraph 29)

It is problematic because insofar as the Court speaks about arm’s-length transactions and holds membership in a Cooperative Society akin to a contract, Article 19(c) is not in play. There is, moreover, a bigger problem: to the extent that the Court does hold such membership akin to an arm’s-length contract, then the primary justification for its statutory-policy-equates-public-policy argument is clearly flawed. As we have argued in the previous post, public policy exceptions to contracts constitute a clear common law category, and are not restricted to the four corners of the statute. In Gherulal Parekh, for instance, the Court surveyed a vast body of common law precedent to hold that “public policy” was equivalent to “the public good”, and that there were clear common law categories (e.g., “sexual immorality”) of acts against public policy (for the common law exposition of the public policy exception, see Holman v. Johnson (the clean hands doctrine as an aspect of public policy), and Lord Sumption’s lecture here) . Subsequently, the scope of the public policy exception was vastly (and, in my submission, incorrectly) expanded in Brojo Nath Ganguly, but both these cases were united in implicitly – but clearly – rejecting the four-corners-of-the-statute argument in Zoroastrian Cooperative.** 

We are therefore faced with the following situation: to the extent that Zoroastrian Cooperative is based on principles of contract law, the two major bases for the decision – public policy and freedom of association – are unambiguously incorrect. The case, therefore, can be saved only by arguing that it is not, after all, about contract law – and therefore, crucially, is not precedent for the unconstitutionality of unenforceability of exclusionary/restrictive covenants generally – but about something else that justifies invoking the freedom of association. What might that be?

I suggest that the answer lies in a constitutional provision that was invoked in argument, but not directly relied upon by the Court: Article 29, that guarantees the the rights of “citizens… having a distinct language, script or culture of [their] own…to conserve [it].” This provision, I would argue, helps us to understand why the decision in Zoroastrian Cooperative might have been correct. To fully grasp the philosophical issues at stake, however, we must turn to the important work of John Rawls.

In his book, Political Liberalism, and in the essay Justice as Fairness, Rawls lays out the groundwork of political liberalism. He takes as given the fact that in a liberal democracy, with political institutions that allow reasonably free thought and discussion, over time, citizens will come to affirm very different world views, religions, moral codes and ways of life (these he calls “comprehensive doctrines”: examples would be christianity, hinduism, utilitarianism, and so on). This basic fact of pluralism is something that characterizes – and is a permanent feature of – a modern liberal democracy. Insofar as these differing philosophies, religions and world views are reasonable (that is, consistent with the basic liberal idea of society as a system of fair cooperation between free and equal persons), Rawls takes their existence (being the upshot of the free exercise of reason by autonomous individuals) to be of value.  The basic question, then, is this: how is it possible for there to exist over time a just and stable society of free and equal citizens, who remain profoundly divided by reasonable religious, philosophical and moral doctrines? (PL, p. 4)

Rawls’ answer is to find an overlapping consensus – that is, a set of principles of justice, upon which public/State coercion is based and justified – that can be endorsed by – or at least, are consistent with – the plurality of reasonable comprehensive doctrines affirmed by the citizens of the polity. And that can happen only if these principles of justice are “independent of the opposing and conflicting philosophical and religious doctrines that citizens affirm.” (PL, p. 9) This is what Rawls means by a “political conception of justice”: that is, a conception that applies to “society’s main political, social and economic institutions, and how they fit together into one unified system of social cooperation…” (PL 11, 39),  without affirming or denying the truth or validity of religious/moral ideas and philosophies, and what they have to say about life, personhood, character, familial and associational relationships, and so on. What is crucial to the political conception of justice is that: “its content is expressed in terms of certain fundamental ideas seen as implicit in the public political culture of democratic society. This public culture comprises the political institutions of a constitutional regime and the public traditions of their interpretation, as well as historic texts and documents that are common knowledge. Comprehensive doctrines of all kinds – religious, philosophical and moral – belong to what we may call the “background culture” of civil society. This is the culture of the social, not of the political- it is the culture of daily life, of its many associations: churches etc. In a democratic society there is a tradition of democratic thought, the content of which is at least familiar and intelligible to the educated common sense of citizens generally. Society’s main institutions, and their accepted forms of interpretation, are seen as a fund of implicitly shared ideas and principles.” (PL, p. 14 – 16)

In other words, not only must the principles of justice that govern the social, economic and political structures of society be restricted to the domain of the political, but the arguments used to defend and justify them must belong to the domain of public reason – that is, modes of argument, proof and evidence affirmed by the plurality of citizens holding their diverse comprehensive doctrines. One major reason for this is the basic principle of liberal legitimacy, that holds that “coercive power is legitimately exercisable only when it is exercised in accordance with a constitution the essentials of which all citizens may reasonably be expected to endorse in the light of principles and ideals acceptable to them as reasonable and rational.” (PL, p. 217) And this, in turn, implies that, because given the fact of reasonable pluralism, a public and shared basis of justification that applies to comprehensive doctrines is lacking in the public culture of a democratic society… reasonable persons will think it unreasonable to use political power to repress comprehensive views that are not unreasonable, though different.”  (PL, p. 61)

In other words, as Dworkin puts it in this essay (and this chapter), the basis of political liberalism is a refusal to impose the majority’s idea of the good upon all of society, and allow everyone the freedom to pursue their own conceptions of the good (as opposed to perfectionism, which allows the State to choose one vision of the good and enforce it through law).

Let us now apply these abstract ideas. While political liberalism is based upon the idea of remaining neutral between competing visions of the good, and restricting the principles of justice and coercion to the political, it is also a simple fact that a majority of a polity’s laws go beyond the narrowly political sphere, and enact the moral sentiments of the majority. Often, then, obedience to such laws would be in conflict with other communities’ pursuit of the good, as they see it. Insofar as such pursuit does not clash with the basic liberal idea of society as a system of cooperation between free and equal citizens, political liberalism such communities should be permitted to follow their own vision of the good. To put the matter concretely: political liberalism would not grant minority groups exceptions from following basic criminal laws against, for instance, murder and violence, but it would – to take a Rawlsian example – grant them exceptions from compulsory public education (insofar as their own system of education did not violate the basic liberal principle mentioned above). The famous case in this context is Wisconin v. Yoder, where the US Supreme Court permitted the Amish community to homeschool its children, consistent with its own vision of what the ideal education should be, after confirming that the Amish system was not itself in violation of the principles of liberal citizenship.

The claim of the exclusionary covenant in Zoroastrian Cooperative to not just validity (contra legitimate public policy concerns), but actual judicial enforcement (contra the unimpeachable leal reasoning of Shelley v. Kramer) must surely rest upon this basic idea: insofar as a community believes that the survival of its own set of cultural values qua community depends on its members – and only its members – living together and in proximity with each other (and not upon a politically illiberal conception of race/cultural superiority, the eradication of which is the whole point of Article 15), the principles of Article 19(1)(c) and Article 29 are attracted, and the contrary non-discrimination principle of Article 15 is not. In such cases, the exclusionary covenant is both valid, and may be judicially enforced. Of course, the Court must look into whether the claim in question is actually justified on fact.

What I hope this demonstrates is that if Zoroastrian Cooperative is correct, then its very correctness, grounded in ideas of political liberalism, restricts its scope of operation to narrow sets of facts akin to the very facts of that case. It is not a general precedent for the validity and enforceability of exclusionary covenants (it would not, for instance, legitimate exclusionary covenants against Dalits, or Muslims, or women). As to enforceability, as I have argued before, Shelley v. Kramer applies squarely to India, and ought to be followed – the judiciary, as one wing of the State, must not enforce covenants that, had they been an instance of State action, would have failed an Article 15 test. As to validity, in the next – and last – post in this series, I shall analyze the impact of IMA v. UoI upon that very question.

** My thanks to V. Niranjan for clarifying this point.


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Filed under Exclusionary/Restrictive Covenants, Non-discrimination, Political Liberalism, Political Theory

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