In the case of Townsend v. St. Louis and Sandoval Coal and Mining Company, 1894, the U.S Supreme Court ruled in favor of the mining company. The dispute arose when a miner named Townsend was injured while working for the company due to an alleged failure on part of his employer to provide safe working conditions as required by Illinois state law at that time. However, it was found that he had been employed under a contract which stipulated Missouri law would govern any disputes between him and his employer - where no such safety provisions existed. The court held that this contractual agreement did not violate public policy nor was it unconscionable or oppressive towards Mr.Townsend because both parties were free agents who voluntarily entered into their employment contract with full knowledge of its terms.

In the dissenting opinion for Townsend v. St. Louis and Sandoval Coal and Mining Company, Justice Brewer argued that the majority's decision was inconsistent with previous rulings of the court regarding land grants by Congress to railroads. He contended that such grants were not absolute gifts but rather contracts in which both parties had obligations; in this case, he believed that the railroad company failed to fulfill its obligation when it did not construct a line within a reasonable time frame as required by law. Therefore, according to Justice Brewer, any lands granted under these conditions should revert back to public domain if they are not used for their intended purpose within an appropriate period of time.