In Manhattan Life Insurance Co. v. Broughton, Trustee, the Supreme Court of the United States was asked to decide whether a life insurance policy was validly assigned to a third party. The policyholder had assigned the policy to a trustee, who then assigned it to a third party. The insurance company argued that the assignment was invalid because the policyholder had not obtained the company's consent prior to the assignment. The Supreme Court held that the assignment was valid. The Court reasoned that the policyholder had the right to assign the policy to the trustee, and the trustee had the right to assign it to the third party. The Court further held that the insurance company's consent was not required for the assignment to be valid. The Court noted that the policyholder had the right to assign the policy to the trustee, and the trustee had the right to assign it to the third party. The Court concluded that the assignment was valid and the insurance company was obligated to pay the proceeds of the policy to the third party.

Justice Field delivered the dissenting opinion in Manhattan Life Insurance Co. v. Broughton, Trustee, arguing that the Court should not have reversed the decision of the Circuit Court of Appeals and instead should have affirmed it. He argued that under California law at the time, a trust was created when an individual transferred property to another with instructions to use it for certain purposes or for someone else's benefit; this had been done in this case by transferring funds from one bank account into another with instructions to pay out dividends on shares held by others. Furthermore, he noted that even if there were no express trust agreement between parties involved in such transactions as occurred here, equity would imply one based upon their conduct and intentions. Thus Justice Field concluded that since a valid trust had been established according to both state law and equitable principles applicable at common law courts, then its terms must be enforced accordingly regardless of any other considerations raised by either party during litigation proceedings before lower courts or now before Supreme Court justices hearing appeals from those decisions.