DWYER v. DUNBAR was a case heard by the United States Supreme Court in 1866. The case involved a dispute between two parties over a contract for the sale of a steamboat. The plaintiff, DWYER, had contracted with the defendant, DUNBAR, to purchase a steamboat for $2,000. DWYER paid the full amount, but DUNBAR refused to deliver the boat. DWYER then sued DUNBAR for breach of contract. The Supreme Court held that DUNBAR was liable for breach of contract. The Court found that DUNBAR had failed to fulfill his contractual obligations and had acted in bad faith. The Court also held that DWYER was entitled to damages for the breach of contract. The Court awarded DWYER the full amount of the purchase price, plus interest and costs. The Court's decision in DWYER v. DUNBAR established the principle that a party who breaches a contract is liable for damages. This case also established the principle that a party who acts in bad faith is liable for additional damages. This case is an important precedent in contract law and has been cited in numerous subsequent cases.

In the case of Dwyer v. Dunbar, the Supreme Court was asked to decide whether a contract between two parties could be enforced if it had been made in violation of state law. The majority opinion held that such contracts were unenforceable and should not be recognized by courts. However, Justice Field dissented from this ruling on the grounds that enforcing these contracts would not violate public policy or morals as they did not involve any illegal activity beyond what was already prohibited by state law. He argued that allowing parties to enforce their agreements would promote justice and fairness among citizens and encourage them to enter into lawful transactions with each other without fear of having their rights disregarded by courts. Furthermore, he noted that refusing to recognize such contracts might lead people who are unaware of applicable laws to unknowingly enter into invalid agreements which could result in great hardship for one party or both parties involved in the transaction.