The Illinois Surety Company v. The John Davis Company et al., 1916, was a case that revolved around the issue of liability for an unpaid debt. In this case, the John Davis Co. had contracted with Peoria to construct a sewer system and obtained a bond from Illinois Surety as security for performance. However, when subcontractor Kehoe-Berge Co wasn't paid by Davis for their work on the project, they sued both companies to recover their losses. The Supreme Court ruled in favor of Kehoe-Berge Co., stating that under the terms of its contract with Davis and Peoria, Illinois Surety was liable not only to Peoria but also directly to any unpaid subcontractors like Kehoe-Berge who were involved in fulfilling contractual obligations.

In the dissenting opinion for Illinois Surety Company v. The John Davis Company et al., Justice Holmes disagreed with the majority's interpretation of the bond contract and its implications on liability. He argued that, according to the terms of the bond, Illinois Surety was only liable for any default by Pease Brothers during their contractual period which ended in 1911. Any subsequent defaults or liabilities incurred after this date were not covered under this suretyship agreement as it had already expired. Therefore, he believed that Illinois Surety should not be held responsible for payments made by John Davis Co to workers post-1911 since these debts arose outside of Pease Brothers' contractual period with them.