In United States vs. Knight's Adm'r, the Supreme Court ruled that a federal court had jurisdiction to hear an action brought by the United States against a state officer for damages arising from his alleged breach of duty in failing to collect and pay over certain taxes due under federal law. The case arose when the administrator of William Knight’s estate refused to turn over $1,000 in taxes collected from citizens living within his district but not paid into the Treasury as required by law. The government sued him for damages resulting from this failure and sought relief in a federal court on grounds that it was suing him as an individual rather than as a representative of any particular state or its laws. After considering arguments presented by both sides, including those concerning whether such suits were permissible under Article III of the Constitution which grants Congress power “to constitute Tribunals inferior to the Supreme Court”, Chief Justice Taney concluded that since there was no dispute between two states or their citizens involved here (as would be necessary for original jurisdiction), then it fell upon Congress alone to determine whether such cases could be heard in federal courts; thus affirming their authority over matters involving individuals who are subject only to national laws regardless if they are acting on behalf of any particular state or its laws at issue.

In United States vs. Knight's Adm'r, the Supreme Court was asked to decide whether a tax imposed by Congress on distilled spirits was constitutional. The majority opinion held that it was, but Justice Daniel dissented from this ruling and argued that the tax violated Article I of the Constitution because it did not apportion taxes among states according to population as required by law. He further argued that since Congress had no power to impose such an unapportioned direct tax, any attempt to do so would be unconstitutional and void. Furthermore, he noted that if such a tax were allowed then there would be nothing preventing Congress from imposing other forms of taxation without regard for state populations or other limitations set forth in the Constitution. In conclusion, Justice Daniel believed strongly in upholding Constitutional principles and felt compelled to dissent from what he viewed as an unconstitutional action taken by Congress with respect to taxation powers granted under Article I of the Constitution