In the 1905 case of Carroll v. Greenwich Insurance Company of New York, the U.S Supreme Court was tasked with determining whether an insurance policy could be voided due to misrepresentation or concealment by the insured party. The plaintiff, Carroll, had taken out a fire insurance policy on his property from Greenwich Insurance Company but failed to disclose that he had previously been denied coverage by another insurer due to suspicious fires at his properties. When a fire occurred and Carroll filed for compensation under his policy, Greenwich refused payment on grounds of fraud and misrepresentation. The court ruled in favor of Greenwich Insurance Company stating that any concealment or false representation made in obtaining an insurance contract is sufficient ground for rescission even if it did not contribute directly towards causing damage covered under the policy.

The dissenting opinion in the case of Carroll v. Greenwich Insurance Company of New York argued that the majority's decision was incorrect because it failed to properly consider and apply established legal principles regarding insurance contracts. The dissent contended that an insurer should not be allowed to deny coverage based on a technicality, especially when there is no evidence that the insured intentionally misrepresented or concealed material facts. It also criticized the majority for ignoring precedent which holds that ambiguities in insurance policies should be construed against insurers who draft them, and instead placing an undue burden on policyholders to understand complex contract language. Furthermore, it disagreed with the majority's interpretation of what constitutes "material" information in determining whether a misrepresentation voids coverage under an insurance policy.