In the United States v. Mason & Hanger Company case of 1922, the Supreme Court ruled on a dispute involving government contracts and compensation for increased costs due to changes in law. The Mason & Hanger Company had entered into a contract with the U.S. Government to manufacture artillery shells during World War I at an agreed price per unit. However, after signing this agreement, Congress passed legislation that significantly raised corporate tax rates which affected their profits from this contract negatively. The company argued that these new laws constituted a change in circumstances beyond its control and therefore it should be compensated for additional expenses incurred as they were not factored into the original pricing agreement. The government disagreed claiming that such risks are inherent in any business venture and should have been considered when negotiating terms. The Supreme Court sided with the government stating that unless explicitly stated otherwise within contractual agreements, businesses must bear financial burdens resulting from legislative changes or other unforeseen events impacting profitability without expecting extra compensation from contracting parties.

The dissenting opinion in the case of United States v. Mason & Hanger Company argued that the majority's decision was flawed because it failed to properly interpret and apply the law regarding government contracts. The dissent contended that under existing laws, a contractor who has agreed to perform work for a fixed price cannot later demand additional compensation due to increased costs unless there is explicit provision for such an adjustment in the contract itself. In this case, no such provision existed; therefore, Mason & Hanger should not be entitled to further payment beyond what was originally stipulated in their agreement with the U.S Government. The dissent also criticized the majority's reliance on implied terms or understandings outside of those explicitly stated within written agreements as setting a dangerous precedent which could undermine certainty and stability in contractual relationships.