In the case of Robert C. Herd & Co., Inc., v. Krawill Machinery Corp et al, 1958, the US Supreme Court ruled on a dispute involving maritime law and insurance liability. The plaintiff, Robert C. Herd & Co., was an insurer who had paid out for damages to cargo that occurred during shipping and sought reimbursement from the defendant, Krawill Machinery Corp - a ship repair company whose negligence allegedly caused those damages. The key issue in this case was whether or not "Himalaya clauses" in bills of lading (which extend limited liability protections to agents like stevedores) could also apply to independent contractors such as Krawill. The court held that these clauses did not extend protection to negligent third parties like Krawill unless explicitly stated so in the contract language; general terms were insufficient for extending immunity from negligence suits brought by insurers subrogated to their insureds' rights against negligent damage-causers. This decision clarified how Himalaya Clauses should be interpreted under U.S law: they must clearly specify any third-party beneficiaries meant to receive limited-liability protections typically reserved for carriers themselves.

In the dissenting opinion for Robert C. Herd & Co., Inc., v. Krawill Machinery Corp et al, Justice Harlan argued that the majority's decision was inconsistent with both precedent and commercial practice. He contended that a shipowner should not be held liable for damages caused by negligence of an independent contractor who is responsible for loading or unloading cargo, as long as the shipowner has exercised due diligence in selecting a competent stevedore company to perform these tasks. According to him, this principle had been established in previous cases and reflected common understanding among those involved in shipping transactions. The majority's ruling would disrupt this understanding and could potentially lead to unfair outcomes where shipowners are held accountable for actions beyond their control.