The Central National Bank v. Stevens case in 1897 revolved around a dispute over the payment of bonds issued by the city of Topeka, Kansas. The bank purchased these bonds from Mr. Stevens who was acting as an agent for the city at that time and later refused to pay them on maturity claiming they were invalid due to irregularities in their issuance process. The Supreme Court ruled against Central National Bank stating that even if there were procedural errors during issuance, it did not affect their validity since they had been sold in good faith and accepted without any objections initially by the bank itself. Therefore, according to this ruling, when securities are bought openly without raising concerns about their legality or authenticity at first instance then such issues cannot be used as grounds for non-payment later on.

The dissenting opinion in the Central National Bank v. Stevens case argued that the majority's decision to allow a bank to sue for recovery of payments made under mistake was incorrect. The dissenting justices believed that, as per existing law and precedent, banks should bear the risk of loss when they make mistakes such as paying on forged checks or drafts. They contended that it is part of a bank's business to know its customers' signatures and if it fails in this duty due to negligence or oversight, then it must suffer the consequences rather than passing them onto innocent third parties who received payment in good faith. Furthermore, they pointed out inconsistencies with previous rulings where banks were held liable for their errors without recourse against those who innocently benefited from them.