In National Bank v. Grand Lodge, the United States Supreme Court was asked to decide whether a national bank could be held liable for a debt incurred by a state grand lodge. The Grand Lodge had borrowed money from the bank and had given the bank a mortgage on its property as security. The Grand Lodge then defaulted on the loan, and the bank sought to foreclose on the mortgage. The Grand Lodge argued that the bank was not entitled to foreclose because the loan was not authorized by the state legislature, as required by the National Bank Act. The Supreme Court held that the bank was entitled to foreclose on the mortgage. The Court reasoned that the National Bank Act did not require the state legislature to authorize the loan, but only that the loan be made in accordance with the laws of the state. The Court found that the loan was made in accordance with the laws of the state, and thus the bank was entitled to foreclose on the mortgage. In conclusion, the Supreme Court held that the bank was entitled to foreclose on the mortgage, as the loan was made in accordance with the laws of the state. The Court found that the National Bank Act did not require the state legislature to authorize the loan, and thus the bank was entitled to foreclose on the mortgage.

Justice Field delivered the dissenting opinion in National Bank v. Grand Lodge, arguing that the majority's decision was contrary to both precedent and sound public policy. He argued that a bank should not be allowed to set off its debt against a deposit made by an individual who had no knowledge of or control over it; such action would allow banks to take advantage of their customers without any legal protection for them. Furthermore, he noted that this case was similar to one decided previously where the court held that a bank could not setoff debts against deposits when there were multiple depositors with different interests in those funds. In his view, allowing banks to do so would create confusion and uncertainty as well as encourage fraud on unsuspecting customers. Finally, Justice Field concluded by noting that if Congress wanted banks to have this power they should pass legislation explicitly granting it rather than relying on judicial interpretation of existing laws which did not provide such authority.