In the case of Hamilton v. Rathbone in 1899, the U.S Supreme Court dealt with a dispute over inheritance and property rights. The plaintiff, Hamilton, was an heir to a large estate that had been left by her father who died intestate (without leaving a will). She claimed that she was entitled to half of his real estate under New York law as one of two surviving children from his first marriage. However, the defendant Rathbone argued that he held rightful title to all properties through deeds executed by other heirs and descendants. The court ruled in favor of Rathbone stating that while it is true under New York law an undivided half interest would have vested immediately upon death in each child from the first marriage if there were no issue living from any subsequent marriage; however this rule did not apply because at time of father's death there were also surviving children from second marriage which meant all realty descended equally among all children regardless their parentage.

In the dissenting opinion for Hamilton v. Rathbone, Justice Harlan argued that the majority's decision was inconsistent with previous rulings of the court and violated principles of equity. He contended that a person who has been defrauded should not be denied relief simply because they were negligent or failed to exercise due diligence in protecting their interests. Instead, he believed that courts should consider whether there was fraudulent intent on part of the defendant and if it contributed to causing harm to plaintiff’s interest. Furthermore, he disagreed with majority's view about 'constructive notice', stating it shouldn't apply when fraud is involved as it would protect those who commit fraud at expense of victims' rights. Thus, according to him, Mrs.Hamilton had right to recover her property from Mr.Rathbone even though she didn’t immediately realize she’d been defrauded.