In North Pennsylvania Railroad Company v. Commercial Bank of Chicago, the Supreme Court was asked to decide whether a railroad company could be held liable for a debt incurred by a third party. The Commercial Bank of Chicago had loaned money to a third party, and the North Pennsylvania Railroad Company had agreed to guarantee the loan. The bank sued the railroad company for the debt, but the railroad company argued that it was not liable because the loan had been made to a third party. The Supreme Court held that the railroad company was liable for the debt. The Court reasoned that the railroad company had agreed to guarantee the loan, and that the bank had relied on the guarantee when it made the loan. The Court also noted that the railroad company had received a benefit from the loan, as the third party had used the money to purchase railroad stock. Therefore, the Court held that the railroad company was liable for the debt.

In the case of North Pennsylvania Railroad Company v. Commercial Bank of Chicago, Justice Field delivered a dissenting opinion arguing that the majority's decision was wrongfully decided and should be reversed. He argued that under Illinois law, which governed this case, a railroad company could not pledge its property to secure payment on bonds issued by it without first obtaining approval from two-thirds of its stockholders in accordance with state statute. The majority had held that such an approval was unnecessary because the bondholders were third parties who did not need to consent to any action taken by the railroad company; however, Justice Field disagreed and argued that since these bonds were secured by pledges made against specific properties owned by the railroad company, they constituted "special contracts" requiring special consideration from all involved parties including both bondholders and stockholders alike. Furthermore he noted how allowing companies like railroads to issue bonds without proper authorization would create great uncertainty for creditors as well as potential investors who may be interested in purchasing said securities but are unable to do so due lack of legal protection or assurance regarding their validity or enforceability.