The U.S. Supreme Court case Zoilo Ibanez De Aldecoa Y Palet et al. v. Hongkong & Shanghai Banking Corporation et al., 1917, revolved around a dispute over the ownership of sugar produced in the Philippines and shipped to New York for sale during World War I. The plaintiffs, Spanish nationals who owned sugar plantations in the Philippines, had borrowed money from Hongkong & Shanghai Banking Corporation (HSBC) using their future crop as collateral under an agreement that HSBC would sell it on their behalf and apply proceeds towards repayment of loans. However, due to wartime conditions and price fluctuations, there was disagreement about whether HSBC had sold at appropriate prices or mismanaged funds received from sales. The court ruled against the plaintiffs' claims that they were entitled to profits made by HSBC beyond what was owed on loans because they did not have any contractual right to such profits; rather these belonged solely to HSBC as per terms agreed upon when loan was granted which allowed bank full discretion over sales decisions including timing and pricing.

The dissenting opinion in the case of Zoilo Ibanez De Aldecoa Y Palet et al. v. Hongkong & Shanghai Banking Corporation et al., argued that the majority's decision was inconsistent with previous rulings and principles of international law. The dissent emphasized that under customary international law, a nation has exclusive jurisdiction over its own citizens within its territory, which includes the right to determine their legal status and regulate their property rights. Therefore, it was inappropriate for U.S courts to interfere with Spain's sovereign authority by adjudicating on a matter involving Spanish nationals' property located in Spain based on an English judgment obtained against them in China. Furthermore, they contended that recognition of foreign judgments should be reciprocal; since England would not enforce American judgments without re-examination on merits, U.S courts should also refuse enforcement unless there is proof of reciprocity.