In the 1896 case of Winona and St. Peter Railroad Company v. United States, the U.S Supreme Court ruled in favor of the government, asserting that it had a right to reclaim land previously granted to railroads if those lands were not used for their intended purpose within a specified period. The dispute arose when Congress passed an act granting public lands to Minnesota for railroad construction purposes. These lands were then transferred by Minnesota to Winona and St.Peter Railroad Company (W&SP). However, W&SP failed to construct any part of its line through these parcels within five years as required by law. Consequently, Congress reclaimed these unutilized sections via another Act which was challenged by W&SP on grounds that it violated their vested rights under contract clause of Constitution's Article I Section 10 Clause 1 - "No State shall...pass any...Law impairing Obligation of Contracts". The court rejected this argument stating that original grant itself contained condition precedent requiring timely construction failing which title would never vest with grantees; hence there was no impairment but rather enforcement of contractual obligations.

In the dissenting opinion for Winona and St. Peter Railroad Company v. United States, 1896, it was argued that the majority's decision to uphold a lower court ruling against the railroad company was incorrect because it misinterpreted key aspects of federal land grant law. The dissent contended that under this law, railroads were entitled to odd-numbered sections of public lands along their routes as long as they fulfilled certain conditions such as building tracks within a specified time frame. They believed that these grants were not conditional but absolute once these requirements had been met by the companies involved. Therefore, according to them, any subsequent legislation could not retroactively change or nullify these rights without violating constitutional protections against taking private property without just compensation.