In the case of Dayton, Trustee, etc. v. Stanard, Treasurer of Pueblo County, Colorado (1915), the U.S Supreme Court was tasked with determining whether a county treasurer had the authority to collect taxes on property that was under federal jurisdiction due to bankruptcy proceedings. The trustee for a bankrupt company argued that since he held title to the property as part of his duties in managing and liquidating assets for creditors' benefit, it should be exempt from local taxation because it fell under federal jurisdiction. However, Stanard insisted on collecting taxes arguing that despite being involved in bankruptcy proceedings; properties were still subject to state laws including tax obligations. The court ruled against Dayton's argument stating that while trustees hold legal title during bankruptcy procedures they do not possess absolute ownership rights over these properties but act more like custodians or managers who are entrusted with safeguarding and disposing off assets for debtors' benefits rather than their own use or profit-making purposes which would have warranted exemption from local taxation rules. Therefore even though such properties may temporarily fall under federal control due to ongoing insolvency cases they remain fundamentally subjected towards fulfilling all relevant state-level statutory requirements including payment of applicable taxes unless explicitly stated otherwise by Congress through specific legislation.

In the dissenting opinion for Dayton, Trustee, etc. v. Stanard, Treasurer of Pueblo County, Colorado (1915), Justice Holmes argued that the majority's decision was inconsistent with previous rulings and principles of law. He contended that a tax deed should not be invalidated simply because it did not specify which year's taxes were unpaid when the property was sold at auction to satisfy its tax lien. According to him, this omission does not necessarily mean that due process rights were violated or that there was fraud involved in obtaining the deed; rather it could merely indicate an administrative error or oversight by government officials responsible for conducting such sales and issuing deeds thereafter. Furthermore, he believed that if any ambiguity existed about what taxes were owed on a property before its sale under a tax lien foreclosure procedure then such uncertainty should be resolved against those who failed to pay their taxes timely thereby causing imposition of liens and eventual sale thereof.