B. The Contract Clause: What Does It Add to the Due Process Limitation?

"No State shall ... pass ... any Law impairing the Obligation of Contract..."

• What is the purpose of this provision?
• "promote confidence in stability of contractual obligations" (U.S. Trust)
• debtor-relief laws rampant in pre-Constitutional state legislatures
• What limitations are implicit in the language?
• states: does the clause apply to the federal government?
• pass any law: what about a judicial change in the common law?
• impair obligation: does it apply to laws affecting future contracts?
• UNITED STATES TRUST CO. V. NEW JERSEY, p. 520 (1978)
• does the clause apply to impairments of contracts between state and private persons? Fletcher v. Peck (1810), Dartmouth College Case (1819)
• does the contract involve a commitment which the state has the power to make?
• restricting future regulation? Stone v. Mississippi (1880); Slaughterhouse Cases II (1884)
• financial commitment?
• what standard of review applies to laws impairing obligation of public contracts?
• is the state's purpose important, or at least of legitimate public interest?
• is the impairment necessary?  What alternative means were available to achieve the state’s purpose?
• is the impairment reasonable?

• ALLIED STRUCTURAL STEEL CO. V. SPANNAUS, p. 527 (1978)
• what is the impairment here, and how severe is it?
• what standard of review does the Court apply? Is it different from that in U.S. Trust?
• broad, generalized economic or social problem
• area already subject to state regulation
• temporary alteration of contractual relationships
• is there an emergency here, as in Blaisdell?
• what alternatives did the State have?
• Energy Reserves Group, Inc. v. Kansas Power & Light Co., p. 533 (1983)
• What impairment is involved here? Is it "severe"? "Substantial"?
• what standard of review is applicable?
• Exxon Corp. v. Eagerton, p. 536 (1983)
• are there impairments of existing contract obligations?
• is the primary effect of the law prospective?
• If so, does the K-Clause apply?