In Smith et al. v. Universal Insurance Company, the Supreme Court of the United States was asked to decide whether a policy issued by an insurance company could be voided due to a breach of warranty in the contract. The plaintiffs had taken out an insurance policy on their ship and cargo with Universal Insurance Company but failed to disclose that they had previously been denied coverage from another insurer for similar goods. When their ship and cargo were lost at sea, Universal refused to pay out on the claim citing this omission as grounds for voiding the contract. The court found in favor of Smith et al., ruling that although it was true that they had not disclosed all relevant information when taking out their policy, there was no evidence presented which showed any intention or attempt by them to deceive or defraud Universal Insurance Company; therefore, they were entitled to receive payment under terms of their original agreement with said company.

In Smith et al. v. Universal Insurance Company, the Supreme Court was asked to decide whether a contract of insurance between two parties could be enforced when it had been made without consideration and in violation of an existing state law prohibiting such contracts. The majority opinion held that the contract was void because it violated public policy as expressed by the state statute, but Justice Story dissented from this decision on several grounds. He argued that although there may have been some technical violations of the law, these were not sufficient to render a valid agreement void; rather, he believed that courts should look at all relevant facts and circumstances surrounding each case before deciding whether or not to enforce a particular contract. Furthermore, he argued that if one party had already performed their part of the bargain then they should be allowed to recover damages for breach even if there were legal issues with how the agreement came about in the first place. In conclusion, Justice Story's dissent maintained that while certain contracts may violate public policy or statutes enacted by states legislatures they can still be enforced provided both parties are willing participants who have received something valuable in exchange for their performance under said agreements