In the case of Chemical National Bank v. Hartford Deposit Company in 1895, the Supreme Court ruled on a dispute involving two banks and their respective rights to certain funds. The Chemical National Bank had loaned money to a third party who subsequently went bankrupt. This debtor had an account with the Hartford Deposit Company, which was garnished by Chemical National Bank as part of its efforts to recover its loan. However, before this could happen, another creditor claimed these same funds from Hartford Deposit Company for debts owed by the bankrupt party. The main issue at hand was whether or not Connecticut law allowed for such garnishment actions against bank deposits made by insolvent debtors - specifically if it violated federal bankruptcy laws that aim to distribute assets fairly among all creditors. The Supreme Court held that under Connecticut law, such garnishments were indeed permissible and did not conflict with federal bankruptcy laws because they occurred prior to any formal declaration of bankruptcy. Therefore, despite being later declared bankrupt after taking out loans from both banks involved in this case; since no official proceedings were underway when Chemical National initiated its claim over his deposit at Hartford – it retained priority over other creditors.

The dissenting opinion in the case of Chemical National Bank v. Hartford Deposit Company argued that the majority's decision was inconsistent with previous rulings and legal principles regarding bankruptcy law. The dissent contended that a bank should not be able to claim priority over other creditors when it comes to collecting on a debt from an insolvent debtor, especially if the bank had knowledge of the debtor's insolvency at the time it received preferential payments. It also disagreed with allowing banks to use set-off rights as a means of obtaining preference over other creditors, arguing this goes against equitable principles inherent in bankruptcy proceedings which aim for fair distribution among all creditors. Furthermore, they believed that such practices could potentially encourage fraudulent behavior by both banks and debtors seeking to evade their obligations towards other creditors.