Fletcher v. Peck

The Court held that a state law repealing land grants violated the Contract Clause, the first time a state statute was struck down as unconstitutional.

Overview

Georgia's legislature, corrupted by bribery in the Yazoo land sales, rescinded millions of acres of grants, punishing innocent purchasers who had bought in good faith. Chief Justice Marshall wrote for a unanimous Court that the rescission impaired contractual obligations in violation of the Constitution. The ruling established that contracts, including land grants, create binding obligations that legislatures cannot casually undo, and it extended judicial review to state laws. Fletcher v. Peck protected private investment in frontier land, bolstered national land markets, and signaled that states would be bound by constitutional limits when dealing with property and contract rights.