The Southern Pacific Company v. Tomlinson case in 1895 revolved around a dispute between the Southern Pacific Railroad Company and an individual named Tomlinson over land rights. The railroad company claimed that they had been granted certain lands by Congress under the Act of July 27, 1866, which was intended to aid in the construction of railroads from Oregon to California. However, before this grant could be confirmed and patented by government officials, Tomlinson had already settled on part of these lands under preemption laws (laws allowing settlers on public land before it is surveyed). The Supreme Court ruled in favor of Tomlinson stating that his settlement claim took precedence because he occupied and improved upon the land prior to any official confirmation or patenting for railroad purposes. Thus, even though Congress intended for such lands to be used for railway development as per their act passed earlier; if those lands were already being legally occupied by individuals like Mr.Tomlinson then their claims would supersede any later grants made towards corporations like Southern Pacific Railroad Company.

In the dissenting opinion for Southern Pacific Company v. Tomlinson, Justice Harlan argued that the majority's decision to allow a railroad company to limit its liability through contractual agreements was fundamentally flawed. He contended that such contracts were inherently unequal due to the vast disparity in bargaining power between large corporations and individual passengers or shippers. Moreover, he believed these types of contracts could potentially undermine public safety by reducing incentives for railroads to operate safely if they knew their liability could be limited via contract terms. Furthermore, he asserted that it was not within the purview of courts but rather legislatures to decide whether companies should be allowed this kind of protection from potential damages claims.