In the case of Yearsley et al. v. W.A Ross Construction Co., 1939, the U.S Supreme Court ruled in favor of a contractor who was sued for property damage caused during a federal project. The plaintiffs, landowners along the Missouri River, claimed that their lands were eroded due to dikes constructed by W.A Ross Construction Company under contract with the United States government as part of a river improvement project authorized by Congress. They sought damages from both the construction company and its surety bond provider. The court held that when private contractors are carrying out work on behalf of and under authority from the federal government within its constitutional powers, they cannot be held liable if any harm results from this work unless it can be shown that they exceeded their authority or committed some wrongful act beyond what was required by their contract with the government. This decision established an important precedent known as "Yearsley immunity," which provides protection for contractors performing work at direction of federal authorities against state law claims arising out of such works.

In the dissenting opinion for Yearsley et al. v. W.A Ross Construction Co., Justice Black argued that the majority's decision to grant immunity to a private contractor performing work on behalf of the federal government was misguided and could lead to abuses of power. He contended that such a ruling effectively placed these contractors above the law, allowing them to avoid liability for any harm or damage caused by their actions, even if they were negligent or reckless in carrying out their duties. Furthermore, he expressed concern that this would leave victims without recourse and undermine public trust in government contracts. Therefore, he believed it was essential for courts not only consider whether a contractor acted under governmental authority but also examine how responsibly they executed their tasks before deciding on issues of immunity.