The decision in White vs. J. M. Brown Amusement Co., Inc. resolves the issue of the proper effect that must be given on contracts where supervening or special events occur during their execution. In the said case, White and J. M. Brown Amusement Co., Inc. entered into a contract wherein the latter would place coin-operated machines in the premises of the former, to the exclusion of other providers of machines. However, while the contract is in force, a local option law prohibiting cash payouts for video gaming.
This law prevented further execution of the contract. However, this law was later invalidated by the Supreme Court of the State of South Carolina. The two parties in this case argue on whether the subsequent invalidation of the local option law had the effect of bringing back the legality and enforceability of the contract.
The case was interesting because it called into operation certain principles on the operation and legality of contracts on one hand and the effect of invalidation of laws on the other. There is the principle that laws that have been struck down by the court stands as though they never existed. This is the argument put forward by Brown in maintaining the validity of the contract.
However, the Supreme Court, in not agreeing with Brown, noted the necessity of upholding the validity of transactions that occurred while a statute operates as valid law, such as in this case, where there were acts committed before the statute was declared unconstitutional.
The Court noted that there are several cases in the State that provides for exceptional circumstances calling for the application of a law as it existed in a particular point in time. The Court decided that this is one instance that necessitates the application of the exception rather than the rule in order to allow the parties to act with certainty and plan their actions accordingly. This rule is deemed by the Court as necessary to maintain stability in the actions of men, so that they would not rely on the possibility of the law being declared unconstitutional later on.