Derived from Article IX of the Articles of Confederation, the Land Grant Jurisdiction Clause was included with the Citizen-State Diversity Clause in order to promote “peace and harmony” among the states. The clauses provide, as Justice Joseph Story put it, an impartial federal tribunal in matters where “a state tribunal might not stand indifferent in a controversy where the claims of its own sovereign were in conflict with those of another sovereign.” Town of Pawlet v. Clark (1815).

The Framers were mindful of the possibility of serious disputes over the western lands among the states and between citizens of the several states and of the same state. It was the same concern that had led to the predecessor clause in the Articles of Confederation. Maryland refused to ratify the Articles of Confederation until 1781— four years after the Continental Congress had approved the document—because of conflicting land claims. Maryland’s primary concern was that Virginia would be able to dominate the national congress should it prevail in its extensive claim to all the lands west “to the South Sea,” as conveyed in its initial royal charter. Moreover, several other states—Massachusetts, Connecticut, North Carolina, South Carolina, and Georgia—had similar, overlapping claims, derived from their own royal charters, and New York, as “suzerain of the Iroquois Indians,” also laid claim to vast expanses of land west of the Delaware River. These conflicting claims threatened to embroil the states in a series of border disputes that were significant enough to place the new union itself at risk.

Virginia’s cession of the lands northwest of the Ohio River in 1783, the parallel cessions of the western lands by the other states over the following decade, and the passage of the Northwest Ordinance while the Constitutional Convention was meeting all defused much potential conflict. These often-overlooked cessions demonstrated the commitment and the sacrifice that the states made for the sake of the future stability of the union. Nonetheless, boundary disputes among ten of the states convinced the Framers of the need of a federal forum to settle such conflicts. The convention rejected a proposal to lodge jurisdiction in the Senate in favor of making it a judicial concern. Further agreements and compromises by the states have largely rendered the Land Grant Jurisdiction Clause obsolete.

A few minor border disputes have occasionally arisen involving citizens of the same state. Schroeder v. Freeland (1951) dealt with a private dispute over ownership of land between Iowa and Nebraska affected by accretion of the Missouri River. The more serious land disputes, over which the Supreme Court has original jurisdiction, typically involve the states themselves. For example, in 1998, the Supreme Court resolved a dispute over portions of Ellis Island in favor of New Jersey over New York. New Jersey v. New York (1998).

The Land Grant Jurisdiction Clause is currently implemented by 28 U.S.C. § 1354, which gives federal district courts jurisdiction without regard to the amount in controversy, United States v. Sayward (1895). Unlike the general diversity jurisdiction clause (Article III, Section 2, Clause 1), which the Court has strictly interpreted to require complete diversity of citizenship between the parties, a lower court has held that jurisdiction under this Clause is not destroyed by the fact that the dispute also extends to citizens of other states, as long as there is at least one defendant who is a citizen of the “same state” claiming under a grant from another state than the plaintiff’s claim. Port of Portland v. Tri-Club Islands, Inc. (1970).

Disputes entirely between citizens of different states, claiming land under grants from different states, can have their cause heard in federal court only under the Citizen-State Diversity Clause. Stevenson v. Fain (1904). Nevertheless, the Land Grant Jurisdiction Clause stands for two important propositions: the federal courts should decide cases in which the state courts would have an apparent bias, and too great a geographic imbalance between members of the union was a threat to the body politic.