In the case of McDonald, Receiver v. Williams in 1898, the U.S Supreme Court ruled on a dispute involving railroad bonds and receivership. The plaintiff, McDonald was appointed as receiver for a railway company that had defaulted on its bond payments. He sued Williams to recover payment for services rendered by the railway company before his appointment as receiver. However, Williams argued that he should not be liable because he had already paid part of these charges to another party who claimed to be an agent of the railway company at that time. The court held in favor of McDonald stating that even though someone else may have collected money from Williams claiming they were acting on behalf of the railroad company; it did not absolve him from paying what was due directly to the official representative (receiver) appointed by law i.e., McDonald. This decision established legal precedence regarding liability and responsibility when dealing with financial transactions involving insolvent companies under receivership.

In the dissenting opinion for McDonald v. Williams, Justice Harlan argued that the Supreme Court did not have jurisdiction over this case as it involved a dispute between private parties about property rights and was therefore a matter of state law. He contended that federal courts should only intervene in such cases if there is an assertion of some right, title or privilege under national authority which has been denied by the state court's decision. In this case, he found no such denial had occurred; rather, he believed that the plaintiff’s claim to land based on preemption laws was properly rejected by lower courts because those laws were designed to protect settlers from speculators and not intended to be used against other settlers. Therefore, according to him, there was no violation of any federally protected right warranting intervention by federal judiciary.