In the 1912 case of Van Iderstine, Trustee in Bankruptcy of Fellerman v. National Discount Company, the U.S Supreme Court dealt with a dispute over bankruptcy law. The trustee for Fellerman's bankrupt estate sued to recover payments made by Fellerman to National Discount Company prior to declaring bankruptcy as preferential transfers under section 60b of the Bankruptcy Act. The lower courts ruled in favor of National Discount Company, stating that since they had no knowledge or reason to believe that Fellerman was insolvent at the time he made those payments, they were not liable for returning them. However, upon appeal by Van Iderstine (the trustee), the Supreme Court reversed this decision and held that actual knowledge or reasonable cause on part of creditor is not necessary for a transfer to be deemed preferential under section 60b; rather it is enough if debtor was actually insolvent when making payment and such payment resulted in preference within four months before filing petition in bankruptcy.

The dissenting opinion in the case of Van Iderstine, Trustee in Bankruptcy of Fellerman v. National Discount Company argued that the majority's decision was inconsistent with previous rulings and principles established by the court. The dissent emphasized that a bankruptcy trustee should not be able to recover payments made by an insolvent debtor prior to declaring bankruptcy if those payments were made in good faith and without knowledge of insolvency. They contended that such transactions are part of normal business operations and should not be penalized or reversed after-the-fact simply because they occurred shortly before a declaration of bankruptcy. This perspective maintains respect for contractual agreements while also protecting creditors who acted honestly from unexpected losses due to another party's financial misfortune.