Energy Reserves Group, Inc. v. Kansas Power & Light Co.

E285915

Energy Reserves Group, Inc. v. Kansas Power & Light Co. is a 1983 U.S. Supreme Court case that clarified the modern test for evaluating state laws under the Constitution’s Contract Clause, particularly in the context of regulated utility contracts.

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Statements (46)

Predicate Object
instanceOf Contract Clause case
United States Supreme Court case
constitutional law case
appliedIn cases evaluating state interference with private commercial contracts
areaOfLaw constitutional law
contracts
public utility regulation
characteristic deferential to state economic regulation under the Contract Clause
citation 459 U.S. 400
clarified distinction between substantial impairment and permissible adjustment of contractual expectations
role of foreseeability of regulation in assessing substantial impairment
constitutionalProvisionInterpreted Article I, Section 10 of the United States Constitution
surface form: Article I, Section 10, Clause 1 of the United States Constitution

Contract Clause
context natural gas industry regulation in the United States
regulated utility contracts
country United States of America
surface form: United States
court Supreme Court of the United States
decisionDate 1983
decisionType majority opinion
established modern three-part test for evaluating Contract Clause challenges to state laws
fullCaseName Energy Reserves Group, Inc. v. Kansas Power & Light Co. self-linksurface differs
surface form: Energy Reserves Group, Inc. v. Kansas Power & Light Company
holding State regulation that substantially impairs private contracts may be upheld if it serves a significant and legitimate public purpose and is based on reasonable and appropriate means.
Contract Clause of the U.S. Constitution
surface form: The Kansas Natural Gas Price Protection Act did not violate the Contract Clause as applied to the contracts at issue.
impact clarified the modern Contract Clause analysis for state economic and utility regulation
limited the scope of the Contract Clause as a constraint on state regulation of private contracts
jurisdiction Kansas
languageOfProceeding English
legalDoctrine Contract Clause balancing test
deference to legislative judgment in economic regulation
legalIssue Contract Clause of the U.S. Constitution
surface form: Contract Clause of the United States Constitution

constitutionality of state regulation affecting private contracts
state regulation of natural gas price-escalation clauses
petitioner Energy Reserves Group, Inc.
precedentFor subsequent Contract Clause cases involving state economic regulation
relatedConcept economic regulation
police power of the states
public utility rate regulation
respondent Kansas City Power & Light Company
surface form: Kansas Power & Light Company
stateLawInvolved Kansas Natural Gas Price Protection Act
subjectMatter long-term natural gas supply contracts
price-escalation clauses tied to federal regulation
subjectOf scholarly commentary on the weakening of the Contract Clause in the 20th century
testElement whether the adjustment of the contracting parties’ rights and responsibilities is based upon reasonable conditions and is of a character appropriate to the public purpose
whether the state law has operated as a substantial impairment of a contractual relationship
whether the state law is drawn in an appropriate and reasonable way to advance a significant and legitimate public purpose
timePeriod 20th century

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Contract Clause hasKeyCase Energy Reserves Group, Inc. v. Kansas Power & Light Co.
Energy Reserves Group, Inc. v. Kansas Power & Light Co. fullCaseName Energy Reserves Group, Inc. v. Kansas Power & Light Co. self-linksurface differs
this entity surface form: Energy Reserves Group, Inc. v. Kansas Power & Light Company