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the Union. The States are likewise prohibited from making laws which may have a tendency to impair the obligations of contracts[1]. If a citizen thinks that an obligation of this kind is impaired by a law passed in his State, he may refuse to obey it, and may appeal to the Federal courts[2].
- ↑ It is perfectly clear, says Mr. Story (Commentaries, p. 503, or in the large edition § 1379), that any law which enlarges, abridges, or in any manner changes the intention of the parties, resulting from the stipulations in the contract, necessarily impairs it. He gives in the same place a very long and careful definition of what is understood by a contract in Federal jurisprudence. A grant made by the State to a private individual, and accepted by him, is a contract, and cannot be revoked by any future law. A charter granted by the State to a company is a contract, and equally binding to the State as to the grantee. The clause of the Constitution here referred to insures, therefore, the existence of a great part of acquired rights, but not of all. Property may legally be held, though it may not have passed into the possessor's hands by means of a contract; and its possession is an acquired right, not guaranteed by the Federal Constitution.
- ↑ A remarkable instance of this is given by Mr. Story (p. 508, or in the large edition § 1388). “Dartmouth College in New Hampshire had been founded by a charter granted to certain individuals before the American Revolution, and its trustees formed a corporation under this charter. The legislature of New Hampshire had, without the consent of this corporation, passed an act changing the organization of the original provincial charter of the college, and transferring all the rights, privileges, and franchises from the old charter trustees to new trustees appointed under the act. The constitutionality of the act was contested, and, after solemn arguments, it was deliberately held by the Supreme Court that the provincial charter was a contract within the meaning of the Constitution (Art. I. sect. 10.), and that the amendatory act was utterly void, as impairing the obligation of that charter. The college was deemed, like other colleges of private foundation, to
