In the case of Small Business Administration v. McClellan, Trustee (1960), the U.S. Supreme Court was asked to determine whether a loan made by the Small Business Administration (SBA) could be classified as an administrative expense in bankruptcy proceedings and thus given priority over other claims. The SBA had lent money to a bankrupt company under Section 5(b) of the Small Business Act, which allows for loans to small businesses that are unable to obtain financing on reasonable terms through normal lending channels. When the company went bankrupt, its trustee argued that this loan should not be considered an administrative expense because it did not benefit creditors or aid in preserving assets during bankruptcy proceedings. The Supreme Court ruled against SBA's claim for priority payment status based on their argument that their financial assistance constituted 'administrative expenses' within meaning of Bankruptcy Act provision governing order of payments from debtor's estate; instead they were deemed general unsecured creditors.

In the dissenting opinion for Small Business Administration v. McClellan, Trustee, Justice Whittaker disagreed with the majority's interpretation of Section 191 of Title 31 U.S.C., arguing that it does not apply to this case as it pertains only to "money" and not "property." He contended that Congress did not intend for this section to cover all types of property but rather specifically money owed by a debtor in bankruptcy proceedings. Therefore, he believed that the Small Business Administration (SBA) should be treated like any other creditor and receive its share from the bankrupt estate according to standard bankruptcy laws. The SBA had loaned money under specific statutory authority which required them to take security interests in assets; thus they were entitled just like any secured creditor would be under normal circumstances. In his view, allowing government agencies special privileges over private creditors was unfair and contrary to established principles governing distribution in bankruptcy cases.