New York v. New Jersey
The Court unanimously ruled that New Jersey can exit its 70-year-old joint waterfront-policing agreement with New York on its own, without New York's permission, even though the agreement says nothing about how either state may leave.
The decision gives states a path to exit certain types of bistate agreements unilaterally, using basic contract-law principles to fill in what the compact left unsaid — though the ruling is limited to compacts calling for ongoing joint operations and does not touch border or water-rights agreements.
“In sum, background principles of contract law, reinforced here by principles of state sovereignty and the fact that the States did not intend for the Compact to operate forever, indicate that New Jersey may unilaterally withdraw from the Waterfront Commission Compact.”
The Court's summary of the three interlocking reasons why New Jersey may exit the Compact on its own.
How it got here: New York filed a bill of complaint directly in the Supreme Court, which has original jurisdiction over disputes between states; the Court temporarily blocked New Jersey from withdrawing and later allowed both sides to file cross-motions for judgment on the pleadings.
The Case in Depth
What happened
In 1953, New York and New Jersey created a joint agency — the Waterfront Commission of New York Harbor — to fight organized crime and corruption among dockworkers at their shared commercial port. The two states handed the Commission their police and regulatory powers but never specified whether either could later leave the arrangement. By 2018, New Jersey believed the decades-old setup had become outdated and burdensome: more than 80% of port activity had shifted to its side, and it passed a law to withdraw. New York sued to block the move.
The question before the Court
Can a state unilaterally exit a joint interstate agreement that says nothing about withdrawal, without the other state's consent?
The Court's answer
Yes — New Jersey can exit the Waterfront Commission Compact on its own, without New York's agreement. Because the Compact says nothing about withdrawal, the Court applied a default rule from contract law: any agreement requiring continuing performance for an indefinite period can be ended by either side at will. That principle, reinforced by the idea that states do not easily give up their sovereign powers permanently, meant New Jersey retained the right to leave once it decided the arrangement no longer served its interests.
The ruling is specifically limited to compacts that are silent on withdrawal and call only for ongoing, indefinite joint operations. It does not apply to compacts that draw state borders, divide water rights, or transfer property interests between states, which the Court said follow different rules entirely.
Curious how the Court got there? See the step-by-step legal reasoning →
Why it matters
New Jersey can dissolve the Waterfront Commission and hand its port law-enforcement duties to the state police. More broadly, states locked in bistate compacts that are silent on withdrawal and require only ongoing joint operations now know they can exit without the other partner's consent. States drafting future compacts should add explicit withdrawal language if they want to control exit rights.
What changes now
New Jersey may now proceed with withdrawing from the Waterfront Commission Compact. The Commission will dissolve, and the New Jersey State Police will take over law-enforcement functions on the New Jersey side of the Port. The ruling is final on the merits. Because the holding is expressly limited to compacts that are silent on withdrawal and call only for ongoing indefinite operations, other categories of interstate compacts — including those setting borders or dividing water rights — are unaffected.
What this does not decide
The ruling does not address compacts that draw state borders, divide water rights, or transfer property interests — the Court said those compacts remain governed by different rules even if they too are silent on withdrawal. It also leaves open what happens to any obligations or liabilities the Commission incurred before New Jersey exits.
How the Court got there
The legal reasoning, step by step
- The Court began with the Compact's text, which is the primary guide to what the parties agreed to. The 1953 Compact mentions neither 'withdrawal' nor 'termination' in any relevant context; the amendment provision requires both states' consent, but unilateral withdrawal is not an amendment. So the text does not answer the question.
- Because the Compact is silent, the Court turned to background principles of contract law that would have shaped the parties' understanding when they signed in 1953 — a standard approach the Court has long used to fill gaps in interstate compacts.
- Under the default contract-law rule applicable both in 1953 and today, an agreement that calls for 'continuing performance for an indefinite time is to be interpreted as stipulating only for performance terminable at the will of either party.' The Waterfront Commission Compact fits squarely in that category: it delegated sovereign regulatory and law-enforcement authority to the Commission on an ongoing, open-ended basis.
- State-sovereignty principles reinforced the same conclusion. The Court has long recognized that states do not lightly surrender their sovereign powers. Because the Compact involved delegating a core sovereign function — protecting people, property, and economic activity within a state's borders — to a bistate agency indefinitely, the Court found it especially hard to read that delegation as permanent and irrevocable absent express language saying so.
- Both states agreed the Compact was never intended to run forever. It would make little sense, the Court reasoned, to conclude that the parties silently gave each other a permanent veto over withdrawal if neither ever intended the arrangement to be perpetual.
- The Court explicitly cabined its holding: the contract-law termination-at-will rule applies only to compacts that (1) are silent on withdrawal and (2) call exclusively for ongoing, indefinite performance. It does not extend to compacts that set boundaries, apportion water rights, or otherwise convey property interests — categories where different background rules apply.
Doctrinal impact
Cases affected by this decision
Reaffirms Tarrant Regional Water Dist. v. Herrmann (569 U. S. 614)
Reaffirmed that interstate compacts are construed as contracts and that background contract-law principles fill gaps in compact text.