Fletcher v. Peck

Essential Facts

• Fletcher v. Peck is a landmark Supreme Court Case.
• It developed from the controversy surrounding the Georgia Yazoo Land Scandal (1795).
• The decision was handed down on March 16, 1810.
• The Supreme Court, led by Chief Justice John Marshall, affirmed a state’s authority over land within its borders.
• The Court ruled that a State could not nullify a contract it was involved in because of the Commerce Clause of the United States Constitution.
• The decision struck down the Yazoo Rescinding Act of 1796 and upheld the Yazoo Land Act of 1795.
• One of the issues in the case was whether or not Native American Indians living on the Yazoo Lands owned them or were simply occupying them with permission of the United States.

Significance

Fletcher v. Peck is important to American History because it established the Supreme Court’s authority to rule a state law unconstitutional. It was also the first Supreme Court case to discuss the validity of land titles of Indians living within the United States’s borders.

Fletcher v. Peck History and Overview

Fletcher v. Peck resulted from a series of events involving the sale of lands occupied by the Indians living on the Western Lands of the State of Georgia.

Land Speculation and Land Companies

As the colonies stabilized during the Colonial Era, Americans looked westward for new lands to settle. Savvy investors turned to Land Speculation — an investment strategy of buying and selling real estate for profit — in hopes of making their fortunes. 

Investors often pooled their resources and formed Land Companies. This allowed them to buy large tracts of land, divide them into smaller parcels, and resell the smaller parcels to individuals or other companies. Examples of land companies during the Colonial Era are:

• The Ohio Company of Virginia — The company purchased territory in the Ohio Valley Region and had it surveyed by Christopher Gist. 
• The Onion River Land Company — Ethan Allen and his brothers formed this company and bought land in the New Hampshire Grants.

Georgia’s Western Lands and the Yazoo Region

• Following the American Revolutionary War, Georgia took control of territory west of the Chattahoochee River along the Yazoo River.
• The Yazoo River meets the Mississippi River near present-day Vicksburg, Mississippi.
• Known as the “Yazoo Lands” because of the river, it was occupied by various tribes, including the Cherokee, Choctaw, Chickasaw, and Creek.
• Although most states ceded their “Western Lands” to Congress, Georgia did not.

Yazoo Land Act of 1795

Georgia did not have the resources to defend the region or pay money owed to its veterans who fought in the American Revolutionary War. Some Georgia officials believed the Federal Government would eventually claim the Yazoo Lands, so they decided to try to sell them to Land Companies before they were ceded to the government.

• After failed attempts to sell the land, an agreement was finally reached with four companies in 1794:
  • Georgia Company
  • Georgia Mississippi Company
  • Tennessee Company
  • Upper Mississippi Company
• One of Georgia’s U.S. Senators, James Gunn, helped organize the deal.
• The Yazoo Region was divided into four parcels, with one parcel sold to each company.
• The companies agreed to buy 35 million acres of land for $500,000 — roughly 1.5 cents an acre.
• The payment on the four parcels was due by November 1, 1795.
• The land was roughly two-thirds of Georgia’s land west of the Chattahoochee River.
• The Georgia Legislature voted in favor of the Act.
• Nearly everyone who voted for the Act was guilty of accepting a bribe from the land companies in the form of stock in the companies or cash.
• Despite the controversy, Governor George Mathews signed the Yazoo Land Act on January 4, 1795.

Yazoo Land Fraud

Passage of the Yazoo Land Act and the corrupt deals are known as the “Yazoo Land Fraud.” It was the largest land fraud scheme of the Federalist Era.

• Citizens of Georgia — and a handful of politicians — were outraged when they learned of the land deal.
• There were also legal concerns over whether Georgia had the right to sell the land.
• Factions emerged that supported the Yazoo Land Act — known as “Yazooists” — and those who opposed it — “Anti-Yazooists.”
• In the next election, most of the Georgia politicians who accepted bribes were voted out of office.
• Meanwhile, the land speculating companies sold their lands in the Yazoo Region, primarily to investors in New England. Sales continued for roughly a year.

Yazoo Rescinding Act

Georgia Senator James Jackson returned to Georgia to undo Gunn’s land deal. Jackson led a successful legal campaign to overturn the Yazoo Land Act, expunge it from the state’s records, and have the records publicly burned. However, rescinding the act created a significant legal situation.

• On February 13, 1796, Governor Jared Irwin signed the Yazoo Rescinding Act:
  • The original Yazoo Land Sale to the four companies was nullified.
  • Georgia revoked all contracts related to the Yazoo Land Act.
  • Georgia reclaimed the Yazoo Land Tracts.
  • A fund was established to reimburse individuals and companies that had purchased land.
• The state destroyed the records related to the original sale, except for one copy of the Yazoo Land Act, which was sent to President George Washington.
• An announcement was ordered to be published in newspapers nationwide.

Federalists vs. Democratic-Republicans

• Yazooists (Federalists) and Anti-Yazooists (Democratic-Republicans) aligned largely on party lines.
• James Gunn was a Federalist, while James Jackson was a Democratic-Republican.
• Jackson used the controversy against the Federalists, many of whom were involved in the Yazoo Land Fraud.
• The Democratic-Republicans also stalled efforts to turn over Georgia’s Western Lands to the Federal Government so the investors could not access them.

The Yazoo Claim Fund

• Even though Georgia claimed control of the Yazoo Land Tracts, some investors still argued their titles were valid.
• Many refused to apply for reimbursement from the fund because they lost their claim if they accepted the money.
• They hoped the Federal Government or the courts would validate their claims.
• Part of the difficulty was the lands were inhabited by Indians.
• In the court proceedings that followed, investors in the New England Mississippi (NEM) Land Company insisted they did not know about the repeal of the Yazoo Land Act.
• Anti-Yazooists argued they were not ignorant because the announcement had been printed in the papers.

Formation of the Mississippi Territory

During the debate over the Yazoo Lands, arguments were made that the territory already belonged to the United States and not Georgia. This was based on the idea it was part of the Proclamation of 1763 and transferred to Congress in the Treaty of Paris (1783).

• The Federal Government took action in response to the controversy.
• On April 7, 1798, President John Adams signed legislation establishing the Mississippi Territory.
• It included territory that had been acquired from Spain in Pickney’s Treaty of San Lorenzo and was part of the Yazoo Lands.
• Today, it makes up the lower portions of Alabama and Mississippi.
• Congress was concerned about the settlement of the Yazoo Lands and potential conflicts with the Indians.
• The legislation authorized Congress to start negotiations with Georgia to acquire the land between Georgia and the Mississippi River, north of the Mississippi Territory and south of Tennessee.
• The Mississippi Territory was organized like the Northwest Territory. However, slavery was permitted.

Settlement of the Yazoo Land Tracts Blocked

• When the Mississippi Territory was created, the NEM Land Company and others still tried to colonize their Yazoo Lands.
• However, these plans were blocked by Jackson and the Democratic-Republicans.
• By 1800, the land speculators had decided to abandon colonization plans and sought to clarify the legal standing of their titles through the courts.

Compact of 1802 and the Georgia Cession

• James Jackson helped organize the Compact of 1802 to simplify the legal issues surrounding the Yazoo Region.
• The Compact transferred the Yazoo Land Tracts to the Federal Government.
• The government paid $1.25 million for the land.
• The government also promised to eliminate the land claims of the Indians peacefully.
• Known as the “Georgia Cession,” the land was eventually added to the Mississippi Territory.
• As part of the agreement, slavery was expanded to the Georgia Cession.

Congressional Debate Over Yazoo Claims

• The debate over the Yazoo Land Tracts continued.
• The NEM Land Company investors and Yazooists lobbied Congress.
• The investors wanted their money back, while the Yazooists wanted the Yazoo Rescinding Act overturned.
• A prominent Yazooist was Joseph Story, who became an Associate Justice on the United States Supreme Court.
• Anti-Yazooists continued to reject the claims due to the corruption that led to the Yazoo Land Act.
• John Randolph of Virginia and George Troup of Georgia were leading opponents of refunding the investors. Both were Democratic-Republicans and wanted the Yazoo Rescinding Act upheld.
• Troup argued that if Congress ignored the Yazoo Rescinding Act, it would undermine Georgia’s authority. In doing this, Troup made it a States’ Rights issue.
• After Congress failed to reimburse the NEM Land Company, the investors turned to the courts.

Peck Sells to Fletcher

• On May 14, 1803, Peck sold 15,000 acres of his land to Robert Fletcher of New Hampshire for $3,000.
• According to most accounts of Fletcher v. Peck, Fletcher was concerned about the validity of the land title.
• Peck told Fletcher he believed the title was good and valid.
• However, Fletcher sued Peck almost immediately, and a Writ of Attachment, a court order demanding the seizure of property, was delivered to Peck on May 18.
• The transaction was very likely orchestrated by the NEM Land Company because the investors could not legally sue Georgia.
  • This was due to the 11th Amendment, which limits non-citizens from suing states in Federal Court.
  • Citizens of New England States, like Massachusetts, could not sue Georgia.

The NEM Land Company Turns to the Courts

In June 1803, the company orchestrated the lawsuit between Peck and Fletcher. Ultimately, legal action centered on the Yazoo Rescinding Act. The goal was to force the courts to provide an “advisory opinion” regarding the Yazoo Rescinding Act.

• Yazooists wanted it overturned. This would uphold the original sales. Investors would be able to ask for a refund from the Georgia fund or sell their land claims.
• Anti-Yazooists wanted it upheld. This would allow Georgia to sell the land to the Federal Government.

Fletcher v. Peck Begins — June 1803

• In Fletcher v. Peck, Fletcher argued the land title was no good, and he wanted a refund.
• Fletcher’s lawyers were Rufus G. Amory and Joseph Hall.
• Peck’s lawyers were William Sullivan, Perez Morton, and Samuel Dexter.
• The NEM Land Company did not aggressively pursue the case in the courts, because it hoped Congress would approve a bill compensating the investors and ending the entire affair.
• Because of this, both parties requested the court to delay the hearing. 
• Critics of the case argued it was not a legitimate lawsuit and should be thrown out.

Fletcher v. Peck — October 1806

• The case was heard before the U.S. Circuit Court in Boston in October 1806.
• It was a complex case and lawyers on both sides worked to ensure it only presented legal issues for the Court to determine.
• Judgment in the case was not delivered until October 1807, when the Circuit Court ruled in favor of Peck.
• Justice William Cushing ruled the original deed was good.
• Fletcher filed an appeal with the Supreme Court in February 1808.
• The case was put on the docket for February 1809.

Fletcher v. Peck — March 1809

• The case was argued before the court in March 1809.
• The Justices were aware of the issues surrounding the legitimacy of the case.
• The proceedings lasted for four days.
• The NEM Land Company hired John Quincy Adams to represent Peck. During his time in the Senate, Adams was known to support the claims of the investors.
• Luther Martin represented Fletcher.
• Adams and Martin were both Federalists, which contributed to criticism the case was not legitimate. However, Adams had recently resigned from his Senate seat due to differences with the Federalist Party.
• The Court initially reversed the Circuit Court’s decision due to a technicality in Peck’s arguments.
• This threatened to send the case back to the Circuit Court, but Adams and Martin worked out an agreement to keep the case with the Supreme Court.
• The Supreme Court to hear the case during its next term.

During the 1809 arguments, the title to the land was discussed. Luther Martin argued the Indians only had the right to access the land for hunting, per the Proclamation of 1763. Martin also said the United States owned the land, not Georgia.

Despite efforts by the NEM Land Company to orchestrate the court case, John Quincy Adams does not appear to have been aware. Adams was also the first future President of the United States to argue a case before the Supreme Court.

Fletcher v. Peck — February 1810

• The second hearing was in 1810.
• The proceedings took one day.
• By this time, John Quincy Adams had accepted the role of Minister to Russia.
• Joseph Story and Robert Goodloe Harper represented Peck. Both were Yazooists who wanted the Court to rule the Yazoo Rescinding Act was unlawful.
• Luther Martin continued to represent Fletcher.

The Landmark Supreme Court Decision

Chief Justice John Marshall wrote the majority opinion and said Georgia could not revoke the original Yazoo Land Grant because it violated the Contracts Clause of the Constitution, which is found in Article I, Section 10, Clause 1.

The Contract Clause says, “No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.”

The key point is “No State shall…pass any…Law impairing the Obligation of Contracts.”

• On March 16, the court ruled in favor of Peck:
  • Georgia held legal title to the Yazoo lands and had the authority to sell them.
  • Georgia’s Rescinding Act violated the Contract Clause of the Constitution.
  • The Proclamation of 1763 temporarily paused the settlement of western lands but did not alter the physical boundaries of the colonies.
• Marshall wrote, “…no state shall pass any bill of attainder, ex post facto law, or law impairing the obligation of contracts.”
• The dissenting opinion was written by Justice William Johnson, who argued Marshall’s interpretation of the Contracts Clause deprived states of the power of Eminent Domain — the ability to claim private property for public use.

Precedents

• Fletcher v. Peck was the first court case involving the Contract Clause.
• It was the first time the Supreme Court ruled a state law unconstitutional and established the precedent that the Supreme Court had the power to declare state laws unconstitutional through Judicial Review.
• It was also the first time a special interest group — the Yazoo investors — sought to have the Supreme Court hear a case.

Aftermath

• The Court dismissed the case.
• Despite the ruling, Peck and other investors were still denied reimbursement from Congress.
• Democratic-Republicans continued to block compensation bills in the House of Representatives.
• As the War of 1812 loomed, there were changes in the Democratic-Republican Party.
• The opinion shifted that it was reasonable to reimburse the investors and was in the best interest of the United States.
• In 1814, the Federal Government established a $5 million fund to reimburse investors who lost money in the Yazoo Land Fraud.

The Underlying Issue of Indian Land Ownership

Fletcher v. Peck was the first Supreme Court case that dealt with land claimed by Indians. Although it was not a central issue in the case, it was a complex one. 

Before 1783, Indians living in the Yazoo Region were considered legal subjects of the British Crown. Unfortunately, the Treaty of Paris (1783) that ended the American Revolutionary War did not address the legal status of Indians living within the borders of the United States.

In their arguments before the Supreme Court in 1809, Adams and Goodloe argued:

• Indians did not understand the concept of a legal title to land, and the land was “overrun by them, rather than inhabited…” This presented the Indians as nomadic hunter-gatherers and ignored the fact they established villages, planted fields, and practiced agriculture.
• The land had been taken “by conquest.” Further, any treaties with Indians were “…were the effect of conquest…” Because of this, the conquering United States was allowing the Indians to occupy the land.

In his majority opinion, Justice Marshall wrote, “…the Indian title…is certainly to be respected by all courts, until it be legitimately extinguished…” However, the Court did not go so far as to establish the Indians had ownership of the land.

Impact on Georgia Indians

By 1814, the Federal Government had failed to resolve Indian land claims, as promised in the Compact of 1802. As Georgians looked to move westward, the state lobbied Congress to take action and convince the Indians to vacate their lands.

On August 9, 1814, the Creek Nation ceded 22 million acres to the United States, including a portion of its land in Georgia. Although the Treaty of Fort Jackson ended the Creek War, the Creeks refused to cede all their land in Georgia.

The Creeks were offered the opportunity to move west of the Mississippi River but refused. Three years later, the concept of Indian Removal was formally established in a treaty the Cherokee made with the government. In 1826 and 1827, the Creeks negotiated treaties that ceded their remaining land in Georgia.

In 1830, Congress passed the Indian Removal Act, which eventually led to the forced removal of the Cherokees from Georgia.

Fletcher v. Peck APUSH

Fletcher v. Peck is part of the following units and chapters in the AP US History Curriculum:

Unit 4: 1800–1848

American Pageant

• Chapter 11 — Triumphs and Travails of the Jeffersonian Republic (1800–1812)
• Chapter 14 — Forging the National Economy (1790–1860)
• Chapter 17 — Manifest Destiny and Its Legacy