Deery v. Cray was a case heard by the United States Supreme Court in 1866. The dispute arose from an agreement between two parties, Deery and Cray, to purchase land together for $2,000. After paying half of the agreed amount, Deery refused to pay any more until he received assurance that his title would be clear of all encumbrances or liens on the property. When Cray failed to provide such assurance within a reasonable time period as specified in their agreement, Deery sued him for breach of contract and sought damages equal to what he had already paid plus interest accrued during this time period. The Supreme Court held that since there was no evidence presented at trial showing that either party acted fraudulently or with malicious intent when entering into their agreement nor did they fail to perform any part thereof according to its terms; therefore it could not be said that either party breached their contractual obligations and thus neither were liable for damages resulting from non-performance under those circumstances.

In Deery v. Cray, the Supreme Court was asked to decide whether a contract between two parties could be enforced when it had been made in violation of an existing state law. The majority opinion held that the contract was void and unenforceable because it violated public policy as expressed by the state legislature through its enactment of a statute prohibiting such contracts. However, Justice Field dissented from this decision on several grounds. He argued that if one party had already performed their part of the agreement before learning about the prohibition against such contracts, then they should not be denied compensation for their labor or services rendered under said agreement simply because it happened to violate some other law at the time of formation. Furthermore, he reasoned that since no actual harm resulted from enforcing this particular contract – which would have been paid out regardless – there was no reason why either party should suffer any loss due to its invalidity under current laws and regulations.