In the case of Lazarus, Michel & Lazarus v. Prentice in 1913, the Supreme Court dealt with a dispute over bankruptcy proceedings and property rights. The firm of Lazarus, Michel & Lazarus had sold goods to Musica on credit but before payment could be made, Musica was declared bankrupt and a receiver was appointed. The firm sought to reclaim their goods or their value from the receiver arguing that they retained title under a reservation clause in their contract until full payment was received by them. However, this claim conflicted with provisions of the Bankruptcy Act which protected assets for distribution among all creditors. The Supreme Court ruled against Lazarus, Michel & Lazarus stating that while such reservation clauses might be valid between parties involved directly in transactions under state law; they were not enforceable after bankruptcy as federal law took precedence over state laws regarding insolvency matters. Therefore it held that once goods have been delivered to a buyer who later becomes insolvent before paying for them fully; those goods become part of his estate available for distribution among all his creditors rather than being recoverable solely by seller.

In the dissenting opinion for Lazarus, Michel & Lazarus v. Prentice, Receiver of Musica (1913), it was argued that the majority's decision to uphold a lower court ruling against the plaintiffs was incorrect. The dissenting justices believed that there were significant errors in how the lower courts had interpreted and applied bankruptcy law in this case. They contended that under proper interpretation of existing laws, creditors should not be allowed to seize assets from a debtor who has declared bankruptcy until all legal proceedings related to their bankruptcy have been completed. In this particular case, they felt that allowing such seizures would unfairly harm other potential claimants by reducing available funds for debt repayment and potentially leaving some with no recourse at all.