In the 1901 case of New York City v. Pine, the U.S Supreme Court ruled in favor of New York City. The city had sued Mr. Pine for unpaid taxes on bonds he held from a railroad company that was incorporated by Kentucky and Tennessee but operated exclusively in those states, not within New York State or City where Mr. Pine resided. The court decided that although the railroad did not operate within New York, it was still taxable because its bonds were owned by a resident of the state (Mr.Pine). This ruling established an important precedent regarding taxation: property may be taxed based on ownership rather than physical location alone.

In the dissenting opinion for New York City v. Pine, it was argued that the city should not be held responsible for damages caused by a mob during the draft riots of 1863. The justice contended that while it is true that municipalities can be held liable for failing to maintain order and protect property within their jurisdiction, this principle should not apply in cases where they are overwhelmed by forces beyond their control such as insurrections or invasions. In his view, holding cities accountable under these circumstances would place an unreasonable burden on them and could potentially bankrupt them. He also pointed out inconsistencies in how courts have applied this rule in different states which he believed further underscored its unfairness and impracticality.