Econ 4040 1st Edition Lecture 8Outline of Current Lecture I. Baby MCurrent LectureBrief Fact Summary. The Sterns entered into a surrogacy contract with the Whiteheads whereby Mrs. Whitehead would bear the child of Mr. Stern through artificial insemination and relinquish custody of the child to the Sterns upon birth. Once the child was born Mrs. Whiteheadfound herself unable to part with the child, and sought to retain custody.Synopsis of Rule of Law. The surrogacy contract is unenforceable due to violation of both statutory law and public policy. Custody must be determined based upon the best interests of the child.Facts. In 1985 William Stern and Mary Beth Whitehead entered into a surrogacy contract stating that Stern’s wife, Elizabeth, was infertile, that they wanted a child, and Mrs. Whitehead was willing to provide that child as mother with Mr. Stern as father. Through artificial insemination using Mr. Stern’s sperm, Mrs. Whitehead would become pregnant. Mrs. Whiteheadwould deliver the born child to the Sterns and terminate her maternal rights so that Mrs. Stern could thereafter adopt the child. Mrs. Whitehead’s husband, Richard, was also a party to the contract; Mrs. Stern was not. Mr. Whitehead promised to do all acts necessary to rebut the presumption of paternity. The contract gave Mrs. Stern sole custody in the event of Mr. Stern’s death. Mr. Stern agreed to pay Mrs. Whitehead $10,000 after the child’s birth, on its delivery to him. He agreed to pay $7,500 to the Infertility Center of New York (ICNY), and ICNY arranged for the surrogacy contract. The history of the parties suggests good faith. However, almost from the moment of birth Mrs. Whitehead realized she could not part with the child. She nonetheless turned her child over to the Sterns on March 30 at the Whiteheads’ home. Later that evening Mrs. Whitehead was stricken with unbearable sadness. The Sterns, concerned that she might commit suicide turned the child over to her on her word that she would return her in a week. It became apparent that Mrs. Whitehead could not return the child, and Mr. Stern filed a complaint seeking enforcement of the surrogacy contract. An order in favor of Stern was entered, and the process server, aided by police, entered Mrs. Whitehead’s home to execute the order. Mr. Whitehead fled with the child. The Whiteheads fled to Florida with Baby M. Police in Florida forcibly removed the child from her grandparent’s homeand turned the child over to the Sterns. At trial, the court held that the surrogacy contract was valid, it ordered Mrs. Whitehead’s parental rightsbe terminated, that sole custody be granted to Mr. Stern, and immediately entered an order These notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute.allowing the adoption of Melissa by Mrs. Stern. The trial court devoted the major portion of its opinion to the question of the baby’s best interests, finding that specific performance would not be granted unless that remedy was in the best interests of the child. On the question of best interests, the Supreme Court agreed substantially with both the trial court’s analysis and conclusions. However, the Court differed in its review and analysis of the surrogacy contract.Issue. Is the surrogacy contract enforceable, and if not, who should gain custody of Baby M?a loquitur.Held. The surrogacy contract is unenforceable, but the Sterns should retain custody based upon the best interests of the child.Statutory Provisions. The surrogacy contract conflicts with: 1) laws prohibiting the use of money in connection with adoptions; 2) law requiring proof of parental unfitness or abandonment beforetermination of parental rights is ordered or an adoption is granted; and 3) laws that make surrender of custody and consent to adoption revocable in private placement adoptions. Considering issue 1, considerable care was taken to not violate the prohibition. The money paid to Mrs. Whitehead was stated to be for her services, not for adoption. The payment to the ICNY was stated to be for legal representation advice, administrative work, and other services. However, it seems clear that the money was paid and accepted in connection with an adoption. The prohibition is strong, constituting a high misdemeanor, because baby-selling potentially results in the exploitation of all parties involved. Considering issue 2, New Jersey law provides for such termination only where there has been a voluntary surrender of a child to an approved agency or the Division of Youth and Family Services (DYFS) accompanied by a formal document acknowledging termination of parental rights, or where there has been a showing of parental abandonment or unfitness. In this case termination was obtained by claiming the benefit of contractual provisions. Since the termination was invalid, the adoption could not properly be granted. Considering issue 3, the provision stating Mrs. Whitehead agrees to surrender custody and terminate all parental rights is intended to be an irrevocable consent, as it contains no clause giving her a right to rescind. The Legislature only provided for one irrevocable consent by statute, a consent to surrender of custody and placement with an approved agency or with DYFS. The contract was designed to circumvent state statutes.Public Policy Considerations. Public policy has always been that children should remain with and be brought up by both of their natural parents. The contract violates state policy that the rights of natural parents are equal concerning their child. There was no counseling of the naturalmother, no evaluation, and no warning. Worst is the contract’s total disregard for the best interests of the child. There is no inquiry to determine the fitness of the Sterns or Mrs. Stern as an adoptive parent, their superiority to Mrs. Whitehead, or the effect on the child. This is the saleof a child, the only mitigating factor being that one of the purchasers is the father. The differences between adoption and a surrogacy contract are important. It is unlikely that surrogacy will survive without money, while there remains a steady supply of potential adoptions. Adoption does relieve the natural mother of the financial burden of the infant, in somesense the equivalent of payment, but theuse of money in adoptions does not produce the problem. In surrogacy, the problem is caused by