In Kapilavastu, there was a law that woman of the Sakya tribe could not marry men from another tribe, or they would be punished. One day the husband of a beautiful young Sakya woman died, and many men from other tribes wanted to marry her. So did her husband's brother. However, this woman did not want to marry her brother-in-law, so he became very angry with her. He believed that she was having an affair with someone else. He put drugs in her drink one day, and when she fell unconscious he took advantage of her and also beat her up severely when she tried to fight him off. The woman knew she could not fight him, so she fled to Sravasti and became a nun. Her brother-in-law then reported to the court that she had had an affair with a man of another tribe.

When the court of Kapilavastu heard of her escape, they demanded that King Prasenajit of Sravasti return her to them. However, since she had become a nun, the king informed Kapilavastu that she should not be prosecuted.

Upali heard about all this and reported it to the Buddha."Upali," the Buddha said, "whether the law is reasonable or not, that is between the government and the citizens. So before she is declared innocent, the assembly of nuns should not accept her for the time being."

The Buddha was certainly compassionate, but anyone in the sangha would be expelled for breaking the precepts, so anyone who broke the law had to be punished too. The sangha could not protect those who committed crimes, so the Buddha made that decision in order to protect the sangha and not let the precepts contravene the law.

Because of his knowledge of the precepts and his fairness, Upali was often assigned by the Buddha to solve disputes among monks and nuns. However, solve disputes among monks and nuns were resentful or afraid of him because of his understanding and stern implementation of the precepts. Whenever Upali went out, some ill-behaved monks or nuns would even criticize him for making their lives difficult with the precepts. Upali simply ignored them.

One day, the Buddha heard about this, so he gathered those unruly monks and nuns who criticized Upali and admonished them. "You are all very ignorant. If you do not respect a disciple who abides by the precepts, who else will you respect? You must realize that the precepts are your instructors. With the existence of the precepts, my teachings will also stay. Your disrespect and antipathy towards Upali shows that you have bad intentions!"

Upali's principles in solving disputes were to investigate thoroughly, not to be biased toward either party involved, and not to talk about the dispute after it was settled.