In the case of Bienville Water Supply Company v. Mobile, 1899, the Supreme Court dealt with a dispute between a private water supply company and the city of Mobile, Alabama. The Bienville Water Supply Company had entered into an agreement to provide water services for the city but later claimed that it was unable to fulfill its obligations due to unforeseen difficulties in obtaining sufficient quantities of good quality water. The City sued for breach of contract and won at trial court level; however, on appeal by Bienville Water Supply Co., this decision was reversed by Alabama's highest court. The U.S Supreme Court then took up the case and ruled in favor of Mobile City. It held that when a party enters into a contract knowing full well there may be potential obstacles or challenges ahead which could prevent them from fulfilling their contractual obligations - as was arguably true here - they cannot later use these same issues as an excuse not to perform under said agreement.

In the dissenting opinion for the case of Bienville Water Supply Company v. Mobile, Justice Harlan disagreed with the majority's view that a contract between a city and a water company could be altered by subsequent legislation without violating constitutional protections against impairing contractual obligations. He argued that such contracts should not be subject to change at will by either party, especially when they involve public utilities where stability is crucial. The justice contended that if cities can unilaterally alter these agreements, it would discourage private investment in public infrastructure due to fears of unpredictable changes in terms and conditions. Furthermore, he believed this ruling contradicted previous court decisions which upheld the sanctity of contracts against legislative interference. Therefore, he concluded that any law allowing such alterations was unconstitutional as it violated Article I Section 10 Clause 1 of U.S Constitution prohibiting states from passing laws impairing obligation of contracts.