In the case of Apache County v. Barth in 1899, the U.S Supreme Court dealt with a dispute over tax assessments on railroad properties. The Atlantic & Pacific Railroad Company had leased its lines to the Atchison, Topeka and Santa Fe Railway Company. However, Apache County in Arizona assessed taxes not only on the physical property but also included franchise value and rolling stock owned by lessee company which was used on lessor's line within county limits. The railway companies refused to pay these additional taxes arguing that they were illegal as per territorial laws. The court ruled in favor of Apache County stating that under territorial law it was permissible for counties to assess taxes based upon all property "used or employed" within their borders regardless of ownership status elsewhere - this included franchises and rolling stock belonging to another entity if they were being used within county boundaries. Thus, even though such assets belonged legally to an out-of-state corporation (the lessee), they could still be taxed locally because their use contributed towards generating income from operations conducted inside county limits.

In the dissenting opinion for Apache County v. Barth, it was argued that the majority's decision to allow Arizona counties to tax Indian reservation lands held by non-Indians contradicted previous court rulings and federal policy. The dissent pointed out that these lands were set aside by Congress specifically for Native American tribes, with a clear intention of shielding them from state taxation. By allowing county taxes on these lands when they are leased or sold to non-Natives, the Court effectively undermined this protection and opened up tribal territories to potential exploitation and loss through tax foreclosure. This could lead not only to economic harm but also disrupt tribal self-governance and sovereignty as guaranteed under U.S law. Therefore, in their view, such taxation should be considered unlawful unless explicitly authorized by Congress.