Consider this illustration (I hate doing these because they are never quite apples to apples). What happens when YOU violate a contract? The other party takes you to court, a state or federal court, authorized by a state constitution or the US Constitution to apply positive laws concerning contracts which the state/federal legislature has passed via that same constituted authority (or perhaps similarly valid common law precedents, which such positive law governments enforce). What such authority was there over sovereign states in the late 18th century? None.
Here is the flaw in your illustration: For any State that had ratified the Articles of Confederation and Perpetual Union, there was a court with authority over that State. That court is specified in the Articles themselves, in Article IX. Each and every State in the Confederation and Perpetual Union has bound themselves to abide by the Articles faithfully and thus to abide by the decisions of that court.