In the 1947 case Federal Crop Insurance Corp. v. Merrill, the U.S Supreme Court ruled that a government agent's misrepresentation of eligibility for federal crop insurance did not bind the government to provide coverage when regulations clearly stated otherwise. The Merrills, wheat farmers in Washington state, were incorrectly informed by a local county agricultural agent that they could insure their winter wheat under a new program from the Federal Crop Insurance Corporation (FCIC). They purchased an insurance policy but later discovered it was invalid as FCIC rules explicitly excluded winter wheat from coverage. When drought destroyed their crops and FCIC refused to pay out on their claim due to this exclusion, they sued for breach of contract. The court held in favor of FCIC stating "the Government could not be bound beyond its actual authority by its officers' actions". This ruling established precedent regarding estoppel against public agencies - meaning citizens are expected to know laws and regulations; ignorance or misinformation does not excuse non-compliance nor obligate agencies beyond written statutes.

In the dissenting opinion for Federal Crop Insurance Corp. v. Merrill, Justice Robert H. Jackson argued that the majority's decision was too harsh and unfair to ordinary citizens who cannot be expected to have knowledge of every detail in government regulations or bulletins, especially when they are not readily accessible to them. He believed that it is unreasonable for a governmental agency like the Federal Crop Insurance Corporation (FCIC) to deny claims based on technicalities in their rules which were unknown by policyholders at the time of purchase. In this case, he felt that since FCIC’s agent had assured Merrills about their eligibility for insurance coverage against wheat crop failure due to drought, it was unjustified for FCIC later on denying payment citing an obscure regulation prohibiting such coverage under given circumstances as per its bulletin which wasn't easily available publicly.