• Last updated on November 11, 2022

The Supreme Court’s ruling that the state of Ohio’s attempt to collect a tax from a bank chartered in its state constituted a breach of contract exemplifies the nineteenth century view of contracts and federalism.

Justice James M. WayneWayne, James M.;Dodge v. Woolsey[Dodge v. Woolsey] wrote this 6-3 decision upholding an injunction against the collection of a tax by the state of Ohio on one of the banks chartered in the state. This bank was chartered under an Ohio statute pursuant to the state constitution that allowed it to pay 6 percent of its profits instead of paying taxes. That constitution and law were replaced in 1851 by a new law levying a higher tax than the old percentage of the profits, and John Woolsey, a bank shareholder, sued to enjoin collection of the tax on grounds that the original charter represented a contract that was being infringed by Ohio. The Court upheld this view of the contract and the injunction, although the Court later ruled that such a contractual provision had to be specific to a contract and not just a part of a general statute. However, Dodge was never overturned.Contract, freedom of;Dodge v. Woolsey[Dodge v. Woolsey]Injunctions and equitable remedies;Dodge v. Woolsey[Dodge v. Woolsey]

Contracts clause

Injunctions and equitable remedies

Tax immunities

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