Ogden v. Saunders as the Anti-Lochner

A centerpiece of my Bushrod Washington biography is Ogden v. Saunders, an 1827 Supreme Court case which concluded that states could enact bankruptcy laws that applied prospectively. Ogden is fascinating for many reasons, one of which being that Washington wrote the lead opinion for the majority while Chief Justice Marshall (joined by Justice Story) dissented. We also have Washington's notes on Ogden and get to see him argue with himself (more on that in another post).

Ogden raised two issues. First, was the power to enact bankruptcy laws vested exclusively in Congress by the Constitution? Second, would a state bankruptcy law violate the Contracts Clause? [Set aside the first issue for now.] Washington reasoned that a prospective state bankruptcy law did not violate the Contracts Clause because state law was the backdrop against which contracts were made. He rejected the idea that natural law (or what he called the moral obligation to honor a promise) was the benchmark. He then ran through a series of examples of state laws that regulated contracts and pointed out that many of them would be invalid under Marshall's dissenting view (though Marshall denied that this was the case).

In a sense, Washington's opinion was the forerunner of Holmes' dissents in the liberty of contract cases. Holmes also like to point out that state laws regulated contracts in all sorts of ways that made the notion of a fundamental right on that subject difficult to understand. Indeed, there are some similarities between what Holmes said and Washington's Ogden opinion that I wonder if there was some unconscious copying going on--Holmes did not cite Ogden--but it's also possible that they reached the same conclusion independently.

One last point for this post--Bushrod was very much a legal positivist. He showed virtually no interest in natural law, except for one circuit opinion in which he threw in some dicta on the subject moving deciding the case on other grounds. This was good in cases such as Ogden or Golden v. Prince, in which he rejected what later became Justice Story's theory of federal common law in Swift v. Tyson. But this was not so good for slavery, which could be upheld only on a positive law basis.

More on Ogden tomorrow.