This section is from the book "The Law Of Contracts", by William Herbert Page. Also available from Amazon: Commercial Contracts: A Practical Guide to Deals, Contracts, Agreements and Promises.
The right to avoid a contract under which the party avoiding it has received a valuable consideration is not a contract right; and therefore a subsequent statute which destroys this right to avoid the contract does not impair the obligation of contracts.1 Thus a law making legal a past payment of license fees for the sale of intoxicating liquors made to the "It cannot be said that such legislation, though wrong officers,2 or one requiring a county to pay money received by it on invalid bonds,3 or one making valid a contract for paving a city street, invalid when made because the statutory notice had not been given,4 is not affected by this clause. If the parties have made an actual agreement upon a valuable consideration, a subsequent statute may make such contract valid even if when made it was void and not merely voidable.5 Thus a statute making valid a prior contract of a foreign corporation which when made is invalid by reason of omission to comply with the statute requiring a certificate of incorporation and a statement of its condition,6 or because of the omission of the corporation to pay to the state the proportion of its dividends required by statute.7 or one making valid a conveyance by expectant heirs in certain cases,8 or by a married woman after a divorce has been granted to her without proper service on her husband, although he had actual notice of the pendency of the action,9 or one curing the defective acknowledgment of a corporate charter,10 or curing a defect in a conveyance, which consisted in its acknowledgment before a notary who was a stockholder in a corporation which was a party thereto,11 or making contracts tainted with usury, valid upon retrospective in its nature, impaired the obligation of the contract. It rather enables the parties to enforce the contract that they intended to make." Gross v. Mortgage Co., 108 U. S. 477. 488; quoted in Butler v. Loan Association, 97 Tenn. 679, 687; 37 S. W. 385.
S. W. 817; People v. Commissioner, 47 N. Y. 501; Synod of Dakota v. State, 2 S. D. 366; 14 L. R. A. 418; 50 N. W. 632. So with contracts to exempt from taxation. Lord v. Litchfield, 36 Conn. 116; 4 Am. Rep. 41; overruling Atwater v. Wood-bridge, 6 Conn. 223; 16 Am. Dec. 46; Bradley v. McAtee, 7 Bush. (Ky.) 667; 3 Am. Rep. 309.
4 Tacoma Land Co. v. Young, 18 Wash. 495; 52 Pac. 244.
5 New Orleans v. Waterworks Co., 142 U. S. 79; New Orleans Waterworks Co. v. Rivers, 115 U. S. 674; City of Walla Walla v. Water Co., 172 U. S. 1; Westminster Water Co. v. Westminster, - Md. - ; 56 Atl. 990: Clarksburg Electric Light Co. v. Clarksburg, 47 W. Va. 739; 50 L. R. A. 142; 35 S. E. 994.
6 Capital City, etc., Co. v. Tallahassee, 42 Fla. 462; 28 So. 810.
7 Underground R. R. v. New York, 116 Fed. 952.
8 State v. Stearns, 72 Minn. 200; 75 N. W. 210; reversed on another point in Stearns v. Minnesota, 179 U. S. 223.
9 Covington v. Commonwealth (Ky.), 39 S. W. 836.
1 Watson v. Mercer, 8 Pet. (U. S.) 88; Satterlee v. Matthewson, 2 Pet. (U. S.) 380; affirming 16 S. & R. (Pa.) 169; Burget v. Merritt, 155 Ind. 143; 57 N. E. 714; Wistar v. Foster, 46 Minn. 484; 24 Am. St. Rep. 241; 49 N. W. 247; Farms-worth, etc., Co. v. Trust Co., 84 Minn. 62; 86 N. W. 877; Mutual Benefit Life Ins. Co. v. Winne, 20 Mont. 20; 49 Pac. 446; Bleakney v. Bank, 17 S. & R. (Pa.) 64; 17 Am. Dec. 635; Swope v. Jordan, 107 Tenn. 166; 64 S. W. 52; Shields v. Land Co., 94 Tenn. 123; 45 Am. St. Rep. 700; 26 L. R. A. 509; 28 S. YV. 668; Romaine v. State, 7 Wash. 215; 34 Pac. 924.
2 State v. Patterson, 53 N. J. L. 120; 20 Atl. 828.
3 New York Life Ins. Co. v. Cuyahoga Co., 106 Fed. 123; 45 C. C. A. 233. See Sec. 1064. State v. Dick-erman. 16 Mont. 278; 40 Pac. 698.
4 Windsor v. Des Moines, 101 la. 343; 70 N. W. 214.
5 Welch v. Wadsworth, 30 Conn. 149; 79 Am. Dec. 236.
6 Clark v. Darr. 156 Ind. 692; 60 N. E. 688; Mutual Benefit Life Ins. Co. v. Winne, 20 Mont. 20; 49 Pac.
446; Swope v. Gordan. 107 Tenn. 166; 64 S. W. 52; Butler v. Loan Association. 97 Tenn. 679; 37 S. W. 385. To the same effect, see Gross v. Mortgage Co., 108 U. S. 477; United States Mortgage Co. v. Gross, 93 111. 483.
7 Bleakney v. Bank, 17 S. & R. (Pa.) 64; 17 Am. Dec. 635.
8 Burget v. Merritt, 155 Ind. 143; 57 N. E. 714.
9 Wistar v. Foster, 46 Minn. 484; 24 Am. St. Rep. 241; 49 X. W. 247.
10 Shields' v. Land Co., 94 Tenn. 123; 45 Am. St. Rep. 700; 26 L. R. A. 509; 28 S. W. 668.
11 Steger v. Traveling Men's, etc., Association, 208 111. 230; 70 N. B. 236.
certain terms,12 or one making valid a contract invalid when made because unstamped,13 or contracts invalid when made because made on Sunday,14 is in each case valid.
A subsequent curative act may itself become a part of the contract upon renewal so that it cannot be repealed thereafter to the impairment of the obligation of such contract. Thus a loan was made by a loan association when the law then in force made such loan usurious on account of the premiums charged. Subsequently the statute was modified so as to permit such loans. The loan was then renewed, a new note being given. Subsequently this modification of the statute was itself repealed. It was held that the loan made valid by its renewal under the second statute could not be made invalid by the third.15 However, where nothing of value has been received by the party seeking to avoid the contract, it seems that a curative act is unconstitutional. Thus under an unconstitutional statute warrants were given for the scalps of certain wild animals. It was held that a subsequent curative act, attempting to validate such warrants was itself unconstitutional.16