In the Southern Utilities Company v. City of Palatka case in 1924, the Supreme Court ruled on a dispute between a private utility company and a Florida city over water rights. The Southern Utilities Company had been providing water to the City of Palatka under an exclusive franchise agreement that was set to expire in 1936. However, prior to this expiration date, the city decided it wanted to establish its own municipal water system and passed ordinances accordingly. The utility company sued for breach of contract and sought an injunction against these ordinances arguing they violated their exclusive right granted by their franchise agreement with the city. The Supreme Court sided with the City of Palatka stating that while contracts between public bodies (like cities) and private entities are generally respected under law, there is also an overriding principle that no generation has a right to bind all future generations when it comes to matters affecting vital community interests such as public health or safety - which includes access to clean drinking water. Therefore, even though there was technically still time left on their contract with Southern Utilities Company, because establishing its own municipal water supply served important public interest goals for current residents not necessarily represented at time original deal was made; therefore allowing them do so did not violate any constitutional protections around impairment contractual obligations.

In the dissenting opinion for Southern Utilities Company v. City of Palatka, Justice McReynolds expressed his disagreement with the majority's decision to uphold a municipal ordinance that regulated rates charged by a private utility company. He argued that this was an infringement on contractual rights and violated due process under the Fourteenth Amendment. According to him, it is not within the power of municipalities to alter or impair contracts entered into in good faith between parties who are competent to contract; such action would be tantamount to taking property without just compensation which is unconstitutional. Furthermore, he contended that while public utilities may be subject to regulation in terms of service quality and safety standards, price control should only come into play when there’s evidence of unreasonable or discriminatory pricing practices – something he believed wasn't demonstrated in this case.