In the case of Missouri & Kansas Interurban Railway Company v. City of Olathe, Kansas (1911), the U.S Supreme Court ruled in favor of the railway company. The city had attempted to impose a tax on the company's property within its jurisdiction, but this was challenged by the railway as unconstitutional under both state and federal law. The court found that while cities have broad powers to levy taxes for public purposes, they cannot do so in a way that infringes upon interstate commerce or violates due process rights protected by Fourteenth Amendment. In this instance, it was determined that taxing an interurban electric railroad operating between states constituted such an infringement and violation because it interfered with interstate commerce and violated equal protection laws since other similar properties were not taxed similarly.

The dissenting opinion in the case of Missouri & Kansas Interurban Railway Company v. City of Olathe, Kansas argued that the majority's decision was a departure from established principles regarding municipal corporations and their powers. The dissent contended that municipalities should not be able to impose conditions on franchises granted by state legislatures without express legislative authority. They believed this power could lead to abuse and potentially infringe upon private rights or property interests without due process of law. Furthermore, they disagreed with the majority's interpretation of "reasonable" regulations, arguing it was too broad and subjective, which could result in arbitrary decisions by local governments. In essence, they feared this ruling would give cities unchecked power over businesses operating within their jurisdictions.