Shelley v. Kraemer, 334 U.S. 1 (1948), is a United States Supreme Court case which held that courts could not enforce racial covenants on real estate.
In 1945, a black family by the name of Shelley purchased a house in St. Louis, Missouri. At the time of purchase, they were unaware that a restrictive covenant had been in place on the property since 1911. The restrictive covenant barred "people of the Negro or Mongolian Race" from owning the property. Louis Kraemer, who lived ten blocks away from the purchased housing, sued to restrain the Shelleys from taking possession of the property they had purchased. The Supreme Court of Missouri held that the covenant was enforceable against the purchasers because the covenant was a purely private agreement between the original parties thereto, which "ran with the land" and was enforceable against subsequent owners; since the restriction purported to run in favor of an estate rather than merely a person, it could be enforced against third parties. A materially similar scenario took place in the companion case McGhee v. Sipes from Detroit, Michigan, where the McGhees purchased land subject to a similar restrictive covenant. The Supreme Court consolidated the two cases for oral arguments.
The Court considered two questions. First, are racially-based restrictive covenants legal under the Fourteenth Amendment of the United States Constitution? Secondly, can they be enforced by a court of law?
The United States Supreme Court held that racially-based restrictive covenants are, on their face, invalid under the Fourteenth Amendment. Private parties may voluntarily abide by the terms of a restrictive covenant but may not seek judicial enforcement of such a covenant because enforcement by the courts would constitute state action. Since such state action would necessarily be discriminatory, the enforcement of a racially-based restrictive covenant in a state court would violate the Equal Protection Clause of the Fourteenth Amendment.
The court rejected an argument that since state courts would enforce a restrictive covenant against white persons, judicial enforcement of restrictive covenants would not be a violation of the Equal Protection Clause. The court noted that the Fourteenth Amendment guaranteed individual rights, and equal protection of the law is not achieved with the imposition of inequalities.
The attorneys who argued the case for the McGhees were Thurgood Marshall and Loren Miller. The United States Solicitor General, Philip Perlman, who argued in this case that the restrictive covenants were unconstitutional, had previously in 1925 as the city solicitor of Baltimore acted to support the city government's segregation efforts