In the case of Carey v. Donohue, Trustee in Bankruptcy of Humphreys (1915), the United States Supreme Court was tasked with determining whether a bankruptcy trustee could recover payments made by an insolvent debtor to a creditor within four months prior to filing for bankruptcy. The debtor had given promissory notes as payment and these were subsequently endorsed over to another party before they matured. The court ruled that under Section 60b of the Bankruptcy Act, such transactions are considered preferential if done while insolvent and can be recovered by trustees unless it can be proven that when receiving them, the endorsee acted in good faith without knowledge or reasonable cause to believe that a preference was intended or insolvency existed at the time. In this particular case, there wasn't sufficient evidence presented proving good faith on part of endorsee so judgment went against him allowing trustee's recovery claim.

In the dissenting opinion for Carey v. Donohue, the justice argued that the majority's decision was inconsistent with previous rulings and interpretations of bankruptcy law. The dissent focused on whether a bankrupt individual could be compelled to pay debts from their future earnings or property acquired after filing for bankruptcy. The justice believed that such compulsion violated both statutory and constitutional protections against imprisonment for debt, as well as principles of equity in bankruptcy proceedings. They also pointed out potential issues with enforcing such orders, including difficulties in determining what constitutes "future earnings" or "property." Ultimately, they concluded that allowing creditors to reach beyond an individual's existing assets at the time of declaring bankruptcy would undermine one of its fundamental purposes: providing a fresh start free from overwhelming financial burdens.