In the case of Gisborn v. Charter Oak Life Insurance Company, 1891, the U.S Supreme Court was tasked with determining whether a life insurance policy could be invalidated due to false statements made by the insured party during application. The plaintiff, Mrs. Gisborn, had taken out an insurance policy on her husband's life from Charter Oak Life Insurance Company and upon his death sought to collect benefits. However, it was discovered that Mr. Gisborn had provided incorrect information about his health condition in his application for coverage - specifically regarding alcohol consumption and previous illnesses - which led the company to deny payment on grounds of misrepresentation or concealment of material facts. The court ruled in favor of Charter Oak Life Insurance Company stating that if an applicant knowingly makes false representations concerning their health status when applying for a life insurance policy then such conduct constitutes fraud thereby rendering any subsequent contract null and void even if those misrepresented conditions did not contribute directly to their death.

In the dissenting opinion for Gisborn v. Charter Oak Life Insurance Company, the justice disagreed with the majority's interpretation of insurance law and contract principles. The justice argued that an insurance policy should be treated as a contract between two parties, where both sides have obligations to fulfill. In this case, he believed that Mr. Gisborn had fulfilled his obligation by paying premiums on time while alive and thus his beneficiaries were entitled to receive benefits after his death regardless of any alleged misrepresentations in the application process. He also pointed out that there was no evidence showing these supposed inaccuracies were intentional or fraudulent which could justify voiding the policy under common law principles of fraud or misrepresentation.