In the 1905 case Graham, County Auditor for Greenwood County v. Folsom, the U.S Supreme Court dealt with a dispute over land taxes in South Carolina. The plaintiff, Mr. Graham, argued that he was entitled to collect back-taxes on certain lands from Mrs. Folsom who had purchased them after they were sold for unpaid taxes by a previous owner. Mrs. Folsom contended that she should not be held responsible as she bought the property without knowledge of any tax arrears and believed it to be free of encumbrances based on her purchase at a tax sale conducted by county officials. The court ruled in favor of Mrs.Folsom stating that once property is sold at public auction due to non-payment of taxes and subsequently purchased in good faith without notice or knowledge about any outstanding claims or liens against it; then such purchaser cannot be held liable for payment of those past dues unless there are explicit statutory provisions requiring so under state law.

The dissenting opinion in the case of Graham v. Folsom argued that the majority's decision to uphold a tax assessment on property owned by a religious organization was incorrect. The dissenting justices believed that this ruling violated the constitutional principle of separation between church and state, as it allowed for taxation of properties used exclusively for religious purposes. They contended that such taxation could potentially hinder or even prevent these organizations from carrying out their missions, thus infringing upon their right to free exercise of religion. Furthermore, they disagreed with the majority's interpretation of what constitutes "use" under South Carolina law, arguing instead that any use related to an organization’s mission should be considered exempt from taxation.