In the 1908 case of Missouri Pacific Railway Company v. Larabee Flour Mills Company, the U.S Supreme Court dealt with a dispute over freight charges. The Larabee Flour Mills Company had shipped goods via the Missouri Pacific Railway and later disputed the amount they were charged for this service. They argued that they should have been given a lower rate based on an agreement between their company and another railway line which was absorbed by Missouri Pacific Railway. However, no written contract existed to support this claim. The court ruled in favor of the railway company stating that rates for transportation are subject to regulation by public authority; therefore, any private agreements made regarding these rates would not be legally binding unless approved by such regulatory bodies. Furthermore, it held that even if there had been an existing contract between Larabee and the previous rail line (which there wasn't), it wouldn't necessarily bind its successor (Missouri Pacific) without explicit terms indicating so.

In the dissenting opinion for Missouri Pacific Railway Company v. Larabee Flour Mills Company, it was argued that the majority's decision to hold a railway company liable for damages caused by sparks from its locomotives was unjustified and inconsistent with previous rulings. The dissenting justices contended that railroads should not be held responsible unless negligence could be proven, as they were simply performing their function of transporting goods and people across vast distances. They also pointed out that there are inherent risks associated with operating trains, including the potential for sparks to ignite nearby flammable materials. Therefore, according to this viewpoint, businesses located near railroad tracks should bear some responsibility for protecting themselves against such hazards rather than expecting railways to completely eliminate these risks or pay damages when accidents occur.