New York v. New Jersey

On Cross-Motions For Judgment On The Pleadings

No. 156, Orig. Argued March 1, 2023—Decided April 18, 2023

In 1953, New York and New Jersey exercised their authority under Article I, §10, of the Constitution to enter into a compact to address corruption at the Port of New York and New Jersey. The Waterfront Commission Compact established a bistate agency known as the Waterfront Commission of New York Harbor, to which the States delegated their sovereign authority to conduct regulatory and law-enforcement activities at the Port. The Compact does not address each State’s power to withdraw from the Compact.

  In 2018, New Jersey sought to unilaterally withdraw from the Compact, over New York’s opposition. New York filed a bill of complaint in this Court, and the parties then filed cross-motions for judgment on the pleadings, with the United States supporting New Jersey as amicus curiae.

Held: New Jersey may unilaterally withdraw from the Waterfront Commission Compact notwithstanding New York’s opposition. Pp. 3–9.

 (a) The interpretation of an interstate compact approved by Congress presents a federal question, see Cuyler v. Adams, 449 U. S. 433, 438, the resolution of which begins with an examination of “the express terms of the Compact,” Tarrant Regional Water Dist. v. Herrmann, 569 U. S. 614, 628. Unlike certain other compacts, the Compact here does not address withdrawal.

 Because the Compact is silent as to unilateral withdrawal, the Court looks to background principles of law that would have informed the parties’ understanding when they entered the Compact. As relevant here, interstate compacts “are construed as contracts under the principles of contract law.” Ibid. Under the default contract-law rule at the time of the Compact’s formation, a contract that contemplates “continuing performance for an indefinite time is to be interpreted as stipulating only for performance terminable at the will of either party.” 1 R. Lord, Williston on Contracts §4:23, p. 570. Here, the States delegated their sovereign authority to the Commission on an ongoing and indefinite basis. The default contract-law rule therefore “speaks in the silence of the Compact” and indicates that either State may unilaterally withdraw. New Jersey v. New York, 523 U. S. 767, 784.

 Principles of state sovereignty also support New Jersey’s position. “The background notion that a State does not easily cede its sovereignty has informed” this Court’s “interpretation of interstate compacts.” Tarrant, 569 U. S., at 631. The nature of the delegation at issue here—delegation of a State’s sovereign power to protect the people, property, and economic activity within its borders—buttresses the conclusion that New Jersey can unilaterally withdraw.

 To be clear, the contract-law rule that governs the Compact here does not apply to other kinds of compacts that do not exclusively call for ongoing performance on an indefinite basis—such as compacts setting boundaries, apportioning water rights, or otherwise conveying property interests. Pp. 3–7.

 (b) New York’s additional arguments in support of its view that the Compact should be read to prohibit unilateral withdrawal are unpersuasive. First, New York argues that the Court should interpret the 1953 Compact in light of pre-1953 compacts that were silent on unilateral withdrawal but were understood to forbid it. But many of those compacts concerned boundaries and water-rights allocation—the very kinds of compacts that are not governed by the default contract-law rule authorizing unilateral withdrawal. Second, New York invokes international treaty law, which New York says generally prohibits a signatory nation’s unilateral withdrawal from a treaty absent express language otherwise. But international treaty practice, to the extent it is relevant here, is equivocal. Third, New York points to the past practice of the States’ resolving Commission-related disputes. But that practice says little about whether either State could unilaterally withdraw. Fourth, New York maintains that the Court’s decision will have sweeping consequences for interstate compacts generally. But the Court’s decision does not address all compacts, and States may propose language to compacts expressly allowing or prohibiting unilateral withdrawal. Pp. 7–9.

New Jersey’s motion for judgment on the pleadings granted; New York’s cross-motion for judgment on the pleadings denied.

 Kavanaugh, J., delivered the opinion for a unanimous Court.