Wisconsin Central R. Co. v. United States
164 U.S. 190 (1896)

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U.S. Supreme Court

Wisconsin Central R. Co. v. United States, 164 U.S. 190 (1896)

Wisconsin Central Railroad Company v. United States

No. 21

Argued October 15-16, 1896

Decided November 16, 1896

164 U.S. 190

Syllabus

The changes made in the grants to Wisconsin in the Act of May 5, 1864, to aid in the construction of railroads from those made to that state by the Act of June 3, 1856, rendered necessary some modifications of provisos 1 and 3 of § 1, and of §§ 2, 3 and 4 of the latter act, and they were accordingly reenacted in homologous provisos and sections of the act of 1864; but as the second proviso of § 1 and § 5 of the act of 1856 required no modification, they were not reenacted, but the terms and conditions contained therein were carried forward by reference, as explained in detail in the opinion of the Court.

Statutes granting privileges or relinquishing rights of the public are to be strictly construed against the grantee.

An intention to surrender the right to demand the carriage of mails over subsidized railroads at reasonable rates, assumed in construing a statute of the United States, is opposed to the established policy of Congress.

The terms and conditions imposed on the grant under which the plaintiff in error holds embraced the condition that the mail should be carried at such rates as Congress might fix, and § 13 of the Act of July 12, 1876, was applicable.

The Postmaster General, in directing payment of compensation for mail transportation, does not act judicially.

The action of executive officers in matters of account and payment cannot be regarded as a conclusive determination when brought in question in a court of justice.

The government is not bound by the act of its officers making an unauthorized payment under misconstruction of the law.

Parties receiving moneys illegally paid by a public officer are liable ex aequo et bono to refund them, and there is nothing in this record to take the case out of the scope of that principle.

The forms of pleading in the Court of Claims do not require the right to recover back moneys so illegally paid to be set up as a counterclaim in an action brought by the party receiving them to recover further sums from the government.

An Act of Congress of March 3, 1873, 17 Stat. 556, c. 231, prescribed the rates of compensation for the transportation of the mails on the basis of the average weight, and by an Act

Page 164 U. S. 191

of July 12, 1876, 19 Stat. 78, c. 179, the compensation was directed to be readjusted by the Postmaster General as specified on and after July 1, 1876. Section 13 of this act provided

"that railroad companies whose railroad was constructed in whole or in part by a land grant made by Congress on the condition that the mails should be transported over their road at such price as Congress should by law direct shall receive only eighty percentum of the compensation authorized by this act."

By an Act approved June 3, 1856, 11 Stat. 20, c. 43, Congress granted to the State of Wisconsin lands to aid in the construction of certain railroads northward and northwestward in said state, ultimately reaching the west end of Lake Superior, the land granted being every alternate odd-numbered section for six sections in width on each side of the roads, respectively. Section 5 of this act provided:

"That the United States mail shall be transported over said roads, under the direction of the Post Office Department at such price as Congress may by law direct, provided that until such price is fixed by law, the postmaster-general shall have the power to determine the same."

Some or all of the roads contemplated in this act not having been constructed, Congress, by Act of May 5, 1864, 13 Stat. 66, c. 80, again granted lands to the State of Wisconsin for three different general lines of railroad, the line covered by section 3 of the act being the one in controversy. By this act, alternate odd-numbered sections for ten sections in width, instead of six, were granted,

"upon the same terms and conditions as are contained in the act granting lands to said state to aid in the construction of railroads in said state, approved June 3, 1856."

The two acts, the words in each and not in the other being printed in italics, are as follows:

"Act of June 3, 1856"

Page 164 U. S. 192

"SEC. 1. That there be, and is hereby, granted to the State of Wisconsin for the purpose of aiding in the construction of a railroad from Madison, or Columbus, by the way of Portage City to the Saint Croix River or Lake between townships twenty-five and thirty-one, and from thence to the west end of Lake Superior, and to Bayfield, and also from Fond du Lac on Lake Winnebago, northerly to the state line, every alternate section of land designated by odd numbers for six sections in width on each side of said roads, respectively."

"But in case it shall appear that the United States have, when the line[s] or route[s] of said roads [are] definitely fixed, sold any sections or parts thereof granted as aforesaid, or that the right of preemption has attached to the same, then it shall be lawful for any agent or agents, to be appointed by the governor of said state, to select, subject to the approval of the Secretary of the Interior, from the lands of the United States nearest to the tier of sections above specified, so much land in alternate sections, or parts of sections, as shall be equal to such lands as the United States have sold or otherwise appropriated, or to which the right of preemption has attached, as aforesaid, which lands (thus selected in lieu of those sold and to which preemption has attached as aforesaid, together with the sections and parts of sections designated by odd numbers as aforesaid, and appropriated as aforesaid) shall be held by the State of Wisconsin for the use and purpose aforesaid:"

"Provided that the lands to be so located shall in no case be further than fifteen miles from the line of the roads in each case, and selected for and on account of said roads:"

"Provided further that the lands hereby granted shall be exclusively applied in the construction of than road for which it was granted and selected, and shall be disposed of only as the work progresses, and the same shall be applied to no other purpose whatsoever:"

"And provided further that any and all lands reserved to the United States by any act of Congress for the purpose of aiding in any object of internal improvement, or in any manner for any purpose whatsoever, be, and the same are hereby, reserved to the United States from the operation of this act, except so far as it may be found necessary to locate the route of said railroads through such reserved lands, in which case the right of way only shall be granted, subject to the approval of the President of the United States."

"SEC. 2. And be it further enacted that the sections and parts of sections of land which, by such grant, shall remain to the United States, within six miles on each side of said roads shall not be sold or less than double the minimum price of the public lands when sold; nor shall any of said lands become subject to private entry until the same have been first offered at public sale at the increased price."

"SEC. 3. And be it further enacted, that the said lands hereby granted to said state shall be subject to the disposal of the legislature thereof, for the purposes aforesaid, and no other, and the said railroads shall be and remain public highways for the use of the government of the United States free from toll or other charge upon the transportation of property or troops of the United States."

"SEC. 4. And be it further enacted, that the lands hereby granted to said state shall be disposed of by said state only in manner following, that is to say that a quantity of land not exceeding one hundred and twenty sections, and included within a continuous length of twenty miles of roads, respectively, may be sold, and when the governor of said state shall certify to the Secretary of the Interior that any twenty continuous miles of either of said roads are completed, then another like quantity of land hereby granted may be sold, and so from time to time until said roads are completed, and if said roads are not completed within ten years, no further sales shall be made, and the land unsold shall revert to the United States."

"SEC. 5. And be it further enacted that the United States mail shall be transported over said roads, under the direction of the Post Office Department at made, and the land unsold may, by law, direct, provided that, until such price is fixed by law, the Postmaster General shall have the power to determine the same."

"Act of May 5, 1864"

"SEC. 1. [This section grants land to aid in the construction of a railroad from Saint Croix River or Lake or Lake to Lake Superior.]"

"SEC. 2. [This section grants land to aid in the construction of a railroad from Tomah to Saint Croix River or Lake.]"

"SEC. 3. And be it further enacted that there be, and is hereby, granted to the State of Wisconsin, for the purpose of aiding in the construction of a railroad from Portage City, Berlin, Doty's Island, or Fond du Lac, as said state may determine, in a northwestern direction, to Bayfield, and thence to Superior, on Lake Superior, every alternate section of public land, designated by odd numbers, for ten sections in width on each side of said road, upon the same terms and conditions as are contained in the act granting lands to said state to aid in the construction of railroads in said state, approved June three, eighteen hundred and fifty-six. But in case it shall appear that the United States have, when the line or route of said road is definitely fixed, sold, reserved, or otherwise disposed of any sections or parts thereof, granted as aforesaid, or that the right of preemption or homestead has attached to the same, that it shall be lawful for any agent or agents of said state, appointed by the governor thereof, to select, subject to the approval of the Secretary of the Interior, from the lands of the United States nearest to the tier of sections above specified, as much public land in alternate sections, or parts of sections, as shall be equal to such lands as the United States have sold or otherwise appropriated, or to which the right of preemption or homestead has attached as aforesaid, which lands (thus selected in lieu of those sold and to which the right of preemption or homestead has attached as aforesaid, together with sections and parts of sections designated by odd numbers as aforesaid, and appropriated as aforesaid) shall be held by said state, or by the company to which she may transfer the same, for the use and purpose aforesaid, provided that the lands to be so located shall in no case be further than twenty miles from the line of said road."

"SEC. 6. And be it further enacted that any and all lands reserved to the United States by any act of Congress for the purpose of aiding in any object of internal improvement, or in any manner for any purpose whatsoever, and all mineral lands be and the same are hereby reserved and excluded from the operation of this act, except so far as it may be found necessary to locate the route of such railroads through such reserved lands, in which case the right of way only shall be granted, subject to the approval of the President of the United States."

"SEC. 4. And be it further enacted that the sections and parts of sections of lands which shall remain to the United States within ten miles on each side of said roads shall not be sold for less than double the minimum price of the public lands when sold; nor shall any of the said reserved lands become subject to private entry until the same have been first offered at public sale at the increased price."

"SEC. 8. And be it further enacted that the said lands hereby granted shall, when patented as provided in section seven of this act, be subject to the disposal of the companies respectively entitled thereto for the purposes aforesaid, and no other, and the said railroads be, and shall remain public highways for the use of the government of the United States, free from all toll or other charge, for the transportation of any property or troops of the United States."

"SEC. 7. And be it further enacted that whenever the companies to which this grant is made, or to which the same may be transferred, shall have completed twenty consecutive miles of any portion of said railroads, supplied with all necessary drains, culverts, viaducts, crossings, sidings, bridges, turnouts, watering places, depots, equipments, furniture, and all other appurtenances of a first-class railroad, patents shall issue conveying the right and title to said lands to the said company entitled thereto, on each side of the road, so far as the same is completed, and coterminous with said completed section, not exceeding the amount aforesaid, and patents shall in like manner issue as each twenty miles of said road is completed, provided, however, that no patents shall issue for any of said lands unless there shall be presented to the Secretary of the Interior a statement, verified on oath or affirmation by the President of said company and certified by the Governor of the State of Wisconsin, that such twenty miles have been completed in the manner required by this act, and setting forth with certainty the points where such twenty miles begin and where the same end; which oath shall be taken before a judge of a court of record of the United States."

"SEC. 9. And be it further enacted that, if said road mentioned in the third section aforesaid is not completed within ten years from the time of the passage of this act, as provided herein, no further patents shall be issued to said company for said lands, and no further sale shall be made, and the land[s] unsold shall revert to the United States."

"SEC. 5. And be it further enacted that the time fixed and limited for the completion of said roads in the act aforesaid of June three, eighteen hundred and fifty-six, be, and the same is hereby extended to a period of five years from and after the passage of this act."

The road constructed upon the line indicated in section 3 of the act of 1864 was originally that of two companies, which were afterwards consolidated and became the Wisconsin Central Railroad Company. These roads were constructed by the Phillips & Colby Construction Company, who apparently were to have control and operation of the road until fully equipped and delivered to the railroad company. The time for completion having been extended, portions of said roads were completed, equipped, and operated in 1875, and carried mail under the management of the construction company up to some time prior to December 27, 1877, when notice was given of the turning over of the roads to the Wisconsin Central Railroad Company, and from that time the mails have been carried by that company. Commencing in 1875, and

Page 164 U. S. 198

continuing until July, 1879, the Postmaster General allowed and paid for the carriage of the mails the customary rates paid to non land grant companies. Upon the informal opinion of the assistant Attorney General for the Post Office Department, the Postmaster General issued an order, June 2, 1880, directing that from July 1, 1879, the pay should only be at the rate provided by Congress for land-grant roads, namely eighty percent of the full amount. January 26, 1881, upon a reconsideration, orders were issued recalling the order of June 2, 1880, whereupon the department returned to the earlier practice and paid full rates for the carriage of the mails until January 8, 1884, when Postmaster General Gresham again adopted the construction of June 2, 1880, and applied the same to the compensation of these roads from and after July 1, 1883, and that construction has been applied from thence hitherto, and payment made at the rate of eighty percent of the amount paid non land grant roads.

In addition to reducing the pay for carrying the mails for the current and subsequent years, namely, from July 1, 1883, the Postmaster General restated the account for the carriage of the mails prior to July 1, 1883, both during the period when they were carried by the construction company and during the period from about December, 1877, to July 1, 1883, in which they were carried by the Wisconsin Central Railroad Company, and deducted out of moneys which had been earned since July 1, 1883, the excess over the eighty percent rate which had been paid during the previous years.

Suit was brought in the Court of Claims May 26, 1887, by the Wisconsin Central Railroad Company against the United States, to recover an alleged balance due as compensation for carrying the mails. The Court of Claims allowed the railroad company $6,448.80, as being the amount deducted from the claimant's earnings in 1886 and 1887 for payments in excess of the eighty percent rate made to the construction company while that company was operating the roads, but the Court of Claims held that Postmaster General Gresham's construction was correct, and that the claimant was restricted to the eighty percent rate, and therefore disallowed the

Page 164 U. S. 199

claim for the money withheld against the excess, and also the amount of the claim for the period subsequent to July 1, 1883. The sums which had been paid to claimant in excess of the eighty percent rate, and which were deducted from subsequently earned pay, amounted to $12,532.43. The twenty percent subsequent to July 1, 1883, was $16,343.58.

The Court of Claims gave judgment in favor of the Wisconsin Central Railroad Company for $6,448.80, and the railroad company appealed. The United States did not appeal.

Page 164 U. S. 201

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