Contracts Clause – Constitution Article 1 §10.1

On Wednesdays we study the Constitution. Last week I finished Article 1, Section 9 (ostensibly limiting the powers of Congress) with the Emoluments Clause. This week I’m starting Article 1, Section 10, which limits the powers of the states. Article 1 §10.1 is kind of a laundry list, and much of it parallels the powers and limitations of Congress. The Annotated Constitution has 40 pages of case law and interpretation of it’s various phrases. I’ll try to be more concise.

Constitution Article 1 §10.1

No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.

Entering into Treaty, Alliance, or Confederation

During the Civil War, the Court relied this clause to determine that the Confederacy could not legally exist. Now the clause is significant for limiting the power of the states to deal with international relations. Important legal tests of the clause include Holmes v. Jennison, which determined that a state had no power to deliver a fugitive to a foreign state; United States v. California, in which the federal government paramount rights in and power over the oil-rich three-mile marginal belt along the California coast belt, including full dominion over the resources of the soil under the water; and Skiriotes v. Florida, which decided that states could legislate the actions of their citizens upon the high seas as long as it doesn’t conflict with federal law.

Granting Letters of Marque and Reprisal

States cannot grant letters of marque and reprisal because the Constitution already gave that power to Congress in Article 1 §8.11. ‘Nuff said.

Coining Money

States cannot coin money because the Constitution already gave that power to Congress in Article 1 §8.5.

Emitting Bills of Credit

There’s a bit more to say about bills of credit, and that’s too bad, because I don’t really know what “bills of credit” mean. It sounds like extending a line of credit, but according to ye olde annotated, when the Constitution says “bills of credit,” it means a

medium of exchange, intended to circulate between individuals, and between the government and individuals, for the ordinary purposes of society

So… money. See above.

Tender in Payment of Debts

In Gwin v. Breedlove (1844) the Court determined that when a state court awards damages, the recipient is entitled to demand payment in gold or silver. In 1923, Farmers & Merchants Bank v. Federal Reserve Bank modified that decision by allowing payment by check. I think. I found these two cases confusing, and if anyone wants to clarify, feel free to do so in the comments.

Bill of Attainder and Ex Post Facto Laws

First, a definition:

at·tain·der

noun historical

noun: attainder; plural noun: attainders

the forfeiture of land and civil rights suffered as a consequence of a sentence of death for treason or felony.

It’s no surprise that the Civil War presented a host of legal challenges and new questions to interpret the Constitution. What is a surprise is how much of that case law has to do with not punishing former Confederates. I’ve commented before on how strangely eager we were to forgive and forget the near-destruction of the Union, and here is another example. After the Civil War statutes excluding former Confederates from certain types of employment were held invalid as being bills of attainder in Cummings v. Missouri. Other cases with obvious parallels were less successful. Apparently, being a communist is worse than taking up arms against the nation.

Anyway, this part of the clause limiting states’ power closely parallels the limitations on Congressional powers in Article 1 §9.3.

Impairing the Obligation of Contracts

There are at least a dozen pages of case law on this part of the clause in the Annotated Constitution. They mostly seem to chip away at this restriction, but the Annotations assure us that the Contract Clause is not “totally moribund” because it still affords a solid and palpable barrier against legislative erosion of the remedial rights of creditors. That sentence (abridged from the original) kind of makes my eyes do little anime circles.

via GIPHY

If you are a creditor seeking your remedial rights, I urge you to look into this clause further and come back and explain it to me.

Titles of Nobility

We talked about this last week.