In Rutherford v. Greene's Heirs, the Supreme Court of the United States ruled that a state could not pass laws which would interfere with or impair contracts made under another state’s jurisdiction. The case involved an agreement between two individuals from different states in which one party agreed to purchase land owned by the other party in North Carolina. After purchasing the land, however, North Carolina passed a law invalidating such agreements and allowing for repossession of any lands sold without proper authorization from its legislature. The court held that this law was unconstitutional as it interfered with contractual obligations created under another state’s authority and thus violated Article IV Section 1 of the Constitution (the Full Faith and Credit Clause). This decision established important precedent regarding interstate commerce and contract rights within our federal system.

In Rutherford v. Greene's Heirs, the Supreme Court was tasked with determining whether a deed of trust executed by William Greene in 1783 to his son-in-law, John Rutherford, was valid and binding upon the death of William Greene. The majority opinion held that it was not valid because it had not been recorded before Mr. Green's death as required by North Carolina law at the time; however, Justice Story dissented from this ruling on two grounds: firstly that recording laws should be applied prospectively rather than retrospectively and secondly that even if they were applied retrospectively in this case there were sufficient facts present to make an exception for equitable reasons. In particular he argued that since Mr. Rutherford had acted in good faith reliance on the deed prior to its being recorded and since no one else would suffer any prejudice or harm due to him receiving title then equity demanded he receive title despite noncompliance with recording requirements under state law at the time of execution