In Sioux City & Pacific Railroad Company v. United States, the Supreme Court was asked to decide whether the United States had the right to take possession of a railroad line owned by the Sioux City & Pacific Railroad Company. The railroad had been built with the help of a loan from the United States, and the government had taken possession of the line when the company failed to make payments on the loan. The company argued that the government had no right to take possession of the line without first obtaining a court order. The Supreme Court held that the government had the right to take possession of the line without a court order. The Court reasoned that the government had a right to protect its interests in the loan, and that the taking of possession was necessary to protect those interests. The Court also noted that the government had acted in good faith in taking possession of the line, and that the company had not been harmed by the taking. The Court's decision established that the government has the right to take possession of property without a court order when it is necessary to protect its interests. This decision has been cited in numerous cases since then, and it remains an important precedent in the area of government takings.

Justice Field delivered the dissenting opinion in Sioux City & Pacific Railroad Company v. United States, arguing that the Court should have found for the plaintiff railroad company. He argued that Congress had granted a right of way to the railroad and its successors through public lands owned by the United States, which included an implied obligation on behalf of Congress to protect it from any interference or obstruction by third parties. The government's argument was based on a statute passed after this grant was made, which prohibited such grants without specific authorization from Congress; however Justice Field argued that this did not apply retroactively and could not be used as justification for interfering with rights already granted prior to its passage. Furthermore he noted that even if it were applicable, there were exceptions within it allowing for existing grants like those given here to remain valid despite their lack of explicit congressional approval. As such he concluded that since no other legal basis existed upon which to deny these rights they must stand as originally granted and thus judgment should go in favor of Sioux City & Pacific Railroad Company