rom the Civil Law and its
appearance in the contracts clause is supposed to have been due to James
Wilson, a graduate of Scottish universities and a Civilian. Actually the
term as used in the contracts clause has been rendered more or less
superfluous by the doctrine that the law in force when a contract is
made enters into and comprises a part of the contract itself.[1596]
Hence the Court sometimes recognizes the term in its decisions applying
the clause, sometimes ignores it. In Sturges _v._ Crowninshield,[1597]
decided in 1819, Marshall defines "obligation of contract" as "the law
which binds the parties to perform their agreement"; but a little later
the same year he sets forth the points presented for consideration in
Trustees of Dartmouth College _v._ Woodward[1598] to be: "1. Is this
contract protected by the Constitution of the United States? 2. Is it
impaired by the acts under which the defendant holds?"[1599] The word
"obligation" undoubtedly does carry the implication that the
Constitution was intended to protect only _executory_ contracts--i.e.,
contracts still awaiting performance; but as is indicated in a moment,
this implication was early rejected for a certain class of contracts,
with immensely important result for the clause.
"Impair."--"The obligations of a contract," says Chief Justice
Hughes for the Court in Home Building and Loan Association _v._
Blaisdell,[1600] "are impaired by a law which renders them invalid, or
releases or extinguishes them * * * and impairment, * * *, has been
predicated of laws which without destroying contracts derogate from
substantial contractual rights."[1601] But he straight-away adds: "Not
only are existing laws read into contracts in order to fix obligations
as between the parties, but the reservation of essential attributes of
sovereign power is also read into contracts as a postulate of the legal
order. The policy of protecting contracts against impairment presupposes
the maintenance of a government by virtue of which contractual relations
are worth while,--a government which retains adequate authority to
secure the peace and good order of society. This principle of
harmonizing the constitutional prohibition with the necessary residuum
of State power has had progressive recognition in the decisions of this
Court."[1602] In short, the law from which the obligation stems must be
understood to include Constitutional Law and, moreover, a "progressive"
Constitutional Law
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