Final answer:
John C. Calhoun's nullification theory suggested that states, seen as sovereign entities under the compact of the Constitution, had the right to nullify federal laws within their borders. This theory was especially pertinent during the nullification crisis revolving around the Tariff of 1828.
Step-by-step explanation:
John C. Calhoun's theory of nullification was grounded in the belief that the United States was a compact between sovereign states, and thus, states had the authority to nullify federal laws within their territory. The correct answer that captures Calhoun's argument is 'Given that the United States comprised sovereign states, special popular conventions held the authority to annul federal laws.'
Calhoun argued based on Article VII of the Constitution, which indicated that the states — not the people — would ratify the document. Hence, when a state deemed a federal law unconstitutional, it could call a special state convention to declare the law null and void within that state's borders. This argument became a cornerstone during the nullification crisis over the Tariff of 1828, leading to significant political tension between the proponents of federal authority and those advocating for states' rights.