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In the case of Willing, Receiver v. Binenstock et al., 1937, the Supreme Court dealt with a dispute over bankruptcy proceedings and debt repayment. The defendants were creditors who had received payments from an insolvent debtor within four months prior to its bankruptcy filing. The plaintiff was a receiver appointed by the court to manage the bankrupt estate's assets and sought recovery of these payments under Section 60b of Bankruptcy Act which allows for such recoveries if it can be proven that when receiving payment, creditors had reasonable cause to believe that preferential treatment was being given at others' expense due to impending insolvency. The District Court ruled in favor of the receiver but this decision was reversed on appeal by Circuit Court which held that mere knowledge or suspicion about financial difficulties does not constitute 'reasonable cause'. However, upon further appeal, Supreme Court overturned this ruling stating that 'reasonable cause' is present even if there isn't any direct proof showing creditor's belief in debtor's insolvency; circumstantial evidence like sudden rush for collection or unusual method used for payment could suffice as well.
The dissenting opinion in the case of Willing, Receiver v. Binenstock et al., argued that the majority's decision to allow a receiver appointed by one state court to sue in another state was inconsistent with previous rulings and principles of federalism. The dissent emphasized that receiverships are creations of local law and their powers should not extend beyond those granted by the appointing jurisdiction unless there is explicit statutory authority or recognition from other states. It also pointed out potential issues related to conflicts between different jurisdictions' laws, as well as concerns about fairness for defendants who may be subject to suits in distant forums without any connection to their dispute. Furthermore, it suggested that allowing such actions could undermine respect for state courts and create uncertainty around legal proceedings involving receivers.