The Airline, Space, and Other Industries Can Use the Constitutional Prohibition against State Laws Impairing the Obligation of Contracts

The U.S. Constitution contains a prohibition against passing any “Law impairing the Obligation of Contracts.” This is known as the “Contract Clause,” and it may be useful in enabling the airline, space, and other international and interstate industries to eliminate, reduce, or minimize state interference with contract obligations, as well as balkanization caused by increasing state laws and regulatory restrictions. In the airline, space, and other international and interstate industries, the ability to enter into contracts provides not only consideration for the parties and their beneficiaries but also for state and federal governments and the public in new territorial spaces. In a significant interpretation of this provision, the U.S. Supreme Court heald, in Sveen v. Melin, that a Minnesota law, which automatically revoked a beneficiary designation of a spouse in an insurance policy, did not violate the Contract Clause. While the Court concluded that the law did not “substantially” impair a contract, Justice Gorsuch, in his dissent, stated an important reason for appreciating the significance of the Contract Clause, in what may be future litigation involving sorting out state and federal rights and solutions. This paper considers and evaluated initial reasons for the Contract Clause and for potential contemporary uses of this Constitutional provision, judicial precedents, reasons for possible applications, and various circumstances under which different desirable and undesirable results may occur.

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  • English

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  • Accession Number: 01849832
  • Record Type: Publication
  • Files: TRIS
  • Created Date: Jun 27 2022 11:58AM