In the case of Salinger v. United States in 1926, the Supreme Court ruled on an issue related to tax law and bankruptcy. The appellant, Jacob Salinger, was a bankrupt who had paid income taxes for years prior to his declaration of bankruptcy. After declaring bankruptcy, he sought to recover these payments as preferential transfers under section 60b of the Bankruptcy Act from the appellee - United States government. However, both lower courts denied this claim leading him to appeal at Supreme Court level. The main question before court was whether or not payment of income taxes could be considered a 'preferential transfer' that could be recovered by a bankrupt individual under section 60b of Bankruptcy Act which allows recovery if it can prove that such transfer enabled one creditor (in this case US Government) receive more than what they would have received during debtor's liquidation process. However, Justice Oliver Wendell Holmes Jr., writing for majority held that payment made towards income tax is not a ‘transfer’ within meaning given by Bankruptcy act and hence cannot be reclaimed after filing for bankruptcy even though it might have been done within four months preceding filing period as per Section 60b requirement.

In the dissenting opinion for Salinger v. United States, Justice Oliver Wendell Holmes Jr. argued that the majority's decision to uphold a conviction based on an ambiguous statute was unjust and contrary to principles of fairness and due process. He contended that it is fundamentally unfair to punish someone for violating a law when it is not clear what conduct the law prohibits or requires. In this case, he believed that there was reasonable doubt about whether Mr. Salinger's actions were illegal under the applicable federal banking laws because those laws did not clearly define what constituted "misapplication" of bank funds - which was central in his charges. Therefore, according to Justice Holmes, Mr.Salinger should have been acquitted rather than convicted as per these unclear standards.