The not-so-rapid implosion of the Contracts Clause

In conventional legal histories of the New Deal-era Supreme Court, the 1934 case of Home Building Association v. Blaisdell symbolizes the overthrow of the courts’ willingness to enforce the Constitution’s language providing that “No State shall…pass any…Law impairing the Obligation of Contracts.” The Court by a 5-4 margin upheld as lawful a Minnesota law enforcing a moratorium on many mortgage obligations. But in fact, argues David Forte at the Federalist Society Review, the decline and fall of the Clause was more complicated. Blaisdell or no, the Court for years continued to strike down many state laws that impaired contracts, and the justices of the Court’s liberal wing sometimes joined, as in Worthen v. Thomas, a unanimous case disallowing Arkansas’s impairment of certain contract rights. It was not until 1945 that Justice Felix Frankfurter retrospectively contrived to interpret Blaisdell as a sweeping repudiation of the older Constitutional order, ushering in the modern era in which few state laws are struck down. It was effectively an act of will by the then Court — and one that could be reversed should there develop will to the contrary.

One Comment

  • But of course government/government worker or government/public service union contracts are still sacrosanct and even statutorily provided benefits have been interpreted as being contracts.

    It matters not how old the “contract” is nor whether or not economic condition have changed drastically nor if the opinion of current voters has changed drastically.