In the 1898 case of Auten v. United States National Bank of New York, the U.S. Supreme Court addressed a dispute over payment for bonds that were issued by a railroad company and subsequently purchased by an investor named Auten. The bank had acted as trustee for these bonds but refused to pay Auten when they matured, arguing that it was not liable because it did not personally guarantee payment on them. However, the court ruled in favor of Auten, stating that although banks acting as trustees are generally protected from personal liability unless explicitly stated otherwise in their contracts, this protection does not extend to cases where they have failed to fulfill their fiduciary duties or engaged in misconduct - which was found true in this case due to negligence and failure to protect bondholders' interests properly.

The dissenting opinion in the case of Auten v. United States National Bank of New York argued that the majority's ruling was inconsistent with previous decisions made by the court regarding similar cases. The dissent emphasized that, according to established legal principles, a bank should not be held liable for paying on a forged check if it acted in good faith and without negligence. In this particular case, there was no evidence presented to suggest that the bank had been negligent or acted in bad faith when it paid out on checks bearing what turned out to be forged endorsements. Therefore, holding the bank liable contradicted precedent and unfairly penalized an institution acting within its rights under existing law.