Hill v. Merchants' Mutual Insurance Company was a Supreme Court case decided in 1891. The case involved a dispute between the plaintiff, Hill, and the defendant, Merchants' Mutual Insurance Company, over a fire insurance policy. Hill had purchased a policy from Merchants' Mutual Insurance Company to cover his property in the event of a fire. When a fire occurred, Hill made a claim for the damages, but the company refused to pay, claiming that the policy had been cancelled prior to the fire. Hill then sued the company for breach of contract. The Supreme Court held that the insurance company was liable for the damages, as the policy had not been cancelled prior to the fire. The Court found that the company had failed to provide Hill with proper notice of the cancellation, and thus the policy was still in effect at the time of the fire. The Court also held that the company was liable for the damages, as it had failed to fulfill its contractual obligations. In the end, the Supreme Court ruled in favor of Hill, ordering the insurance company to pay the damages. This case established the principle that an insurance company must provide proper notice of cancellation in order to be relieved of its contractual obligations.

In the case of Hill v. Merchants' Mutual Insurance Company, Justice Harlan delivered a dissenting opinion in which he argued that the majority's decision was wrongfully based on an interpretation of state law rather than federal common law. He believed that since this case involved interstate commerce and had been brought before a federal court, it should be decided according to federal common law principles instead of being determined by state laws. Furthermore, he argued that under those principles, the insurer would have been liable for damages due to its failure to pay out claims promptly as required by contract. In conclusion, Justice Harlan felt strongly that the Court should have applied federal common law when deciding this case and not relied solely on state statutes or regulations in order to reach their ruling.