The Contract Clause and State Police Power
HERETOFORE we have been concerned with national power -- the power of Congress to regulate commerce and to tax and spend, and the relation of this Congressional power to state power in the same areas. Out of the Court's interpretation of national authority emerged one of the first great antinomies of constitutional law -- national supremacy versus dual federalism. By 1937 the Court had largely resolved that conflict in favor of national power.
This chapter features another major antinomy -- the doctrine of vested rights (the general import of which is that "the effect of legislation on existing property rights was a primary test of its validity") versus state police power (the power to promote the health, safety, morals, and general welfare). Throughout much of our history, the state police power has been limited by the commerce clause. We are now to explore the limitations of state power that flow from the doctrine of vested rights.
The struggle between vested rights and police power is a more modern form of the earlier conflict between theories of natural rights, on the one hand, and the principle of legislative supremacy on the other. On this side of the Atlantic, these two doctrines represent the reaction upon each other of the prerevolutionary contest between the natural rights of the colonists and the legislative supremacy of the mother country. The same phenomenon is manifest after 1776 in the efforts of state legislative majorities to regulate the property and contract rights of individual citizens.
Of the two doctrines, that of vested rights is of earlier origin, rooted as it is in the notion that property is the basic social institution, antedating civil society itself. Property fixes the limits within which even the supreme legislative authority may properly operate. Indeed, the main function of government, its raison d'être, is to protect property. "The right of acquiring and possessing property and having it protected," Justice Patterson wrote in an early Supreme Court opinion, "is one of the natural inherent and unalienable rights of man. Men have a sense of property: property