In the case of Schraeder Mining and Manufacturing Company v. Packer, the Supreme Court of the United States was asked to decide whether a contract between two parties was valid and enforceable. The case involved a contract between Schraeder Mining and Manufacturing Company and Packer, a coal mining company. The contract stated that Packer would pay Schraeder a certain amount of money for the right to mine coal on Schraeder's land. Packer failed to make the payments as agreed, and Schraeder sued for breach of contract. The Supreme Court held that the contract was valid and enforceable. The Court found that the contract was supported by consideration, meaning that both parties had given something of value in exchange for the agreement. The Court also found that the contract was not unconscionable, meaning that it was not so one-sided as to be unfair. Finally, the Court found that the contract was not void for lack of mutuality, meaning that both parties had the right to enforce the contract. In the end, the Supreme Court held that the contract between Schraeder and Packer was valid and enforceable. The Court ordered Packer to pay Schraeder the money owed under the contract.

In the dissenting opinion of Schraeder Mining and Manufacturing Company v. Packer, Justice Black argued that the majority’s decision was wrongfully based on a “legal fiction” which allowed for an interpretation of the contract in favor of Packer despite its language being clear that it did not cover such circumstances. He further noted that this legal fiction had been used by courts to interpret contracts against their plain meaning before, but he believed it should be rejected as unjust and contrary to public policy. In his view, if parties wish to include certain provisions in a contract they must do so explicitly rather than relying on judicial interpretations which can lead to unfair results. As such, he would have reversed the lower court's ruling and held Schraeder liable for breach of contract due to its failure to pay royalties as agreed upon in their agreement with Packer.