In the case of Vicksburg Waterworks Company v. Vicksburg, 1901, the U.S Supreme Court was tasked with determining whether a city could terminate its contract with a water company before the agreed-upon expiration date without violating constitutional rights. The City of Vicksburg had entered into an agreement to purchase water from the Vicksburg Waterworks Company for thirty years but later passed an ordinance to end this contract after only ten years and establish its own water system instead. The Waterworks Company argued that this action violated their Fourteenth Amendment rights by depriving them of property without due process and impairing contractual obligations. However, upon review, the Supreme Court ruled in favor of the City of Vicksburg stating that no individual or corporation has inherent right in perpetuity to furnish public supplies such as water; it is always subject to governmental control for public good.

In the dissenting opinion for Vicksburg Waterworks Company v. Vicksburg, it was argued that the city of Vicksburg's decision to construct its own water system and cease using the services of the plaintiff, a private company with which it had an existing contract, did not constitute a violation of due process or impairment of contracts under federal law. The dissenting justices believed that this case should be viewed as one involving eminent domain rather than contractual rights. They maintained that cities have inherent powers to provide essential public utilities like water supply systems and can exercise these powers without infringing on constitutional protections for private property rights or contracts. Furthermore, they contended that any financial losses suffered by the plaintiff as a result were incidental consequences arising from lawful government action rather than unlawful interference with contractual relations.