Levy v. Gadsby was a landmark case in which the United States Supreme Court held that an individual's right to contract is protected by the Constitution. The dispute arose when Levy, a merchant from Pennsylvania, entered into an agreement with Gadsby of Maryland to purchase goods on credit and then failed to pay for them. Gadsby sued Levy for breach of contract and sought damages under Maryland law. However, Levy argued that he could not be held liable because his rights under the U.S. Constitution had been violated due to state laws restricting contracts between citizens of different states (the so-called "interstate commerce clause"). In its decision, the court found in favor of Levy and ruled that individuals have a fundamental right to enter into contracts without interference from state governments or other entities; this ruling established important precedent regarding constitutional protections for contractual agreements between private parties as well as interstate commerce more generally.

In Levy v. Gadsby, the Supreme Court ruled that a contract between two parties was not enforceable because it had been made without consideration. The dissenting opinion argued that there should be an exception to this rule in cases where one party has already performed their part of the agreement and is relying on the other party to fulfill theirs. This would prevent injustice from occurring when one person has done what they promised but then cannot get anything in return due to lack of consideration. Furthermore, if contracts are only enforced when both parties have given something up or provided some benefit, then people will be discouraged from entering into agreements with each other for fear of being taken advantage of by someone who does not intend to keep their end of the bargain. The dissent concluded that enforcing such contracts would help maintain fairness and encourage trust among citizens engaging in business transactions with each other.