In the case of Begg et al., Receivers of Manhattan & Queens Traction Corporation v. City of New York et al., 1922, the Supreme Court examined whether a city could legally revoke a street railway's franchise without providing compensation to its bondholders. The Manhattan and Queens Traction Corporation had been granted permission by New York City to operate on certain streets in exchange for annual payments. However, when the company went into receivership due to financial difficulties, it stopped making these payments and as a result, the city revoked its franchise rights. The bondholders argued that this was an unconstitutional taking without just compensation under the Fifth Amendment. The Supreme Court disagreed with their argument stating that while franchises are property protected by constitutional guarantees against uncompensated takings, they are also subject to conditions set forth at their creation which must be adhered to maintain them intact; if those conditions aren't met then forfeiture can occur without any obligation for recompense from government side.

The dissenting opinion in the case of Begg et al., Receivers of Manhattan & Queens Traction Corporation, v. City of New York et al., argued that the majority's decision was a departure from established principles regarding public utility regulation and property rights. The dissent contended that the city had no right to arbitrarily reduce fares without providing just compensation to the company, as this would constitute an unlawful taking under the Fifth Amendment. It further asserted that such actions by municipalities could lead to financial ruin for utilities and discourage private investment in these essential services. The dissent also criticized what it saw as an overreach by courts into matters best left to legislative bodies or regulatory commissions with expertise in rate-setting issues.