In Hollerbach v. United States (1913), the U.S Supreme Court ruled in favor of the government, upholding a decision by the Court of Claims that denied an appeal for additional compensation made by contractor William Hollerbach. The dispute arose from a contract between Hollerbach and the federal government to construct buildings at Fort Sam Houston, Texas. After completion, he claimed extra payment due to alleged misrepresentations about site conditions which led him to underestimate costs during bidding process. However, both lower courts found no evidence supporting his claims of fraud or mistake on part of government officials involved in preparing specifications and drawings for project's bid solicitation package. The Supreme Court agreed with these findings and further noted that contractors bear risk when they submit fixed-price bids based on limited information provided by owners; any unexpected difficulties encountered during construction do not entitle them to additional compensation unless specific provisions are included in their contracts allowing such adjustments.

In the dissenting opinion for Hollerbach v. United States, Justice Holmes disagreed with the majority's interpretation of the law and its application to this case. He argued that there was no legal basis for holding a surety liable when they had not been given proper notice about changes in a contract that could increase their risk or liability. In his view, any alterations made without notifying all parties involved should automatically release the surety from responsibility under common law principles. Furthermore, he contended that it was unjust to hold someone accountable for conditions they were unaware of and did not consent to. This decision seemed contrary to established legal norms regarding contractual obligations and liabilities.