Use common sense – Google is a search engine – it is looking for pages to give searchers results, 90% of its users are looking for information. Google itself WANTS the organic results full of information. Almost all websites will link to relevant information content so content-rich websites get a lot of links – especially quality links. Google ranks websites with a lot of links (especially quality links) at the top of its search engines so the obvious thing you need to do is ADD A LOT of INFORMATIVE CONTENT TO YOUR WEBSITE.
When would this be useful? If your site has a blog with public commenting turned on, links within those comments could pass your reputation to pages that you may not be comfortable vouching for. Blog comment areas on pages are highly susceptible to comment spam. Nofollowing these user-added links ensures that you're not giving your page's hard-earned reputation to a spammy site.