In the case of Chesapeake & Ohio Railway Company v. Thompson Manufacturing Company, 1925, the Supreme Court ruled in favor of Thompson Manufacturing Co., affirming a lower court's decision that held Chesapeake & Ohio Railway Co. liable for damages due to negligence. The dispute arose when machinery belonging to Thompson was damaged during transport by the railway company and it sued for compensation. The railway company argued that they were not responsible as per their contract which limited liability unless gross negligence could be proven - a standard higher than ordinary negligence under common law principles applicable at the time. However, both lower courts found evidence of such gross negligence on part of the railway company leading to damage beyond repair for some parts of machinery while others required significant repairs before use again.

The dissenting opinion in the case of Chesapeake & Ohio Railway Company v. Thompson Manufacturing Company argued that the majority's decision to hold the railway company liable for damages was incorrect. The dissenters believed that there was no negligence on part of the railway company and hence, it should not be held responsible for any damage caused during transportation. They pointed out that under common law principles, a carrier is not an insurer against all risks but only those which could have been avoided by exercising reasonable care and skill. In this case, they felt there were no grounds to prove such negligence or lack thereof from the evidence presented at trial court level. Therefore, according to them, it would be unjustified to impose liability on Chesapeake & Ohio Railway Company without concrete proof of their failure in duty.