In Merchants' Insurance Company v. Allen, the Supreme Court of the United States was asked to decide whether a contract of insurance was valid and enforceable. The case involved a policy of insurance issued by Merchants' Insurance Company to the respondent, Allen. The policy provided coverage for any loss or damage to Allen's property caused by fire. The dispute arose when Allen's property was damaged by fire and he sought to recover the amount of the loss from Merchants' Insurance Company. The company refused to pay, arguing that the policy was void because it had been issued without the payment of the premium. The Supreme Court held that the policy was valid and enforceable. The Court reasoned that the policy was binding on the parties even though the premium had not been paid, because the policy had been accepted by Allen and the company had not objected to the non-payment of the premium. The Court also held that the company was liable for the loss, as the policy was in full force and effect at the time of the fire. In conclusion, the Supreme Court held that the policy of insurance was valid and enforceable, and that the company was liable for the loss.

In the case of Merchants' Insurance Company v. Allen, Justice Field delivered a dissenting opinion in which he argued that the majority's interpretation of the contract between Merchants' Insurance and Allen was incorrect. He argued that under New York law, an insurance company could not be held liable for damages caused by fire if it had been extinguished before their policy took effect. Furthermore, he noted that even if there were some ambiguity in the language of the contract itself, any such ambiguity should have been resolved against Merchants' Insurance since they drafted it and thus must bear responsibility for its meaning. Finally, Justice Field concluded his dissent by noting that while courts should strive to interpret contracts as written whenever possible, they must also consider all relevant facts when making decisions so as to ensure justice is done in each individual case.