In the case of State Bank of Hardinsburg v. Brown et ux., 1942, the U.S Supreme Court ruled in favor of the Browns, who were being sued by The State Bank of Hardinsburg for a debt that was secured by their farm property. The bank had purchased this property at a foreclosure sale during the Great Depression and sought to obtain deficiency judgment against them for an amount exceeding what they received from selling it. However, Kentucky law prohibited banks from seeking such judgments if they bought properties at their own sales unless those properties were sold again within one year to someone else for less than what was owed on them. Since more than a year had passed since its purchase and no resale occurred, the court held that under state law, any right to seek further payment from borrowers became extinguished after one year following purchase at foreclosure sale where there is no resale.

In the dissenting opinion for the case of State Bank of Hardinsburg v. Brown et ux., Justice Frank Murphy argued that the majority's decision to uphold Kentucky's law, which allowed a debtor to retain possession and use of mortgaged property during foreclosure proceedings, was unfair to creditors. He believed this ruling would discourage lenders from providing mortgages in states with similar laws due to increased risk and uncertainty. Furthermore, he contended that such laws could potentially violate the Contract Clause if they substantially impaired existing mortgage contracts by changing their terms or conditions without consent from both parties involved. Thus, while acknowledging states' rights to regulate economic affairs within their borders, Justice Murphy maintained that these powers should not be used in ways that unfairly burden one party over another or infringe upon contractual obligations established under federal law.