Pensacola Tel. Co. v. Western Union Tel. Co.
96 U.S. 1

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U.S. Supreme Court

Pensacola Tel. Co. v. Western Union Tel. Co., 96 U.S. 1 (1877)

Pensacola Telegraph Company v. Western Union Telegraph Company

96 U.S. 1

Syllabus

1. The powers conferred upon Congress to regulate commerce with foreign nations and among the several states, and to establish post offices and post roads are not confined to the instrumentalities of commerce, or of the postal service known or in use when the Constitution was adopted, but keep pace with the progress of the country and adapt themselves to the new developments of time and circumstances.

2. They were intended for the government of the business to which they relate, at all times and under all circumstances, and it is not only the right but the duty of Congress to take care that intercourse among the states and the transmission of intelligence are not obstructed or unnecessarily encumbered by state legislation.

3. The Act of Congress approved July 24, 1866, 14 Stat. 221, Rev.Stat., sec. 6263 et seq., entitled "An Act to aid in the construction of telegraph lines, and to secure to the government the use of the same for postal, military, and other purposes," so far as it declares that the erection of telegraph links shall, as against state interference, be free to all who accept its terms and conditions, and that a telegraph company of one state shall not, after accepting them, be excluded by another state from prosecuting its business within her jurisdiction, is a legitimate regulation of commercial intercourse among the states, and is appropriate legislation to execute the powers of Congress over the postal service.

4. Nor is it limited in its operation to such military and post roads as are upon the public domain.

Page 96 U. S. 2

5. The statute of Florida approved Dec. 11, 1816, so far as it grants to the Pensacola Telegraph Company the exclusive right of establishing and maintaining lines of electric telegraph as therein specified, is in conflict with that act, and therefore inoperative against a corporation of another state entitled to the privileges which that act confers.

6. Without deciding whether, in the absence of that act, the Legislation of Florida of 1874 would have been sufficient to authorize a foreign corporation to construct and operate a telegraph line within the Counties of Escambia and Santa Rosa in that state, the Court holds that a telegraph company of another state, which has secured a right of way by private arrangement with the owner of the land, and duly accepted the restrictions and obligations required by that act, cannot be excluded by the Pensacola Telegraph Company.

In 1859, an association of persons, known as the Pensacola Telegraph Company, erected a line of electric telegraph upon the right of way of the Alabama and Florida railroad, from Pensacola, in Florida, to Pollard in Alabama, about six miles north of the Florida line. The company operated the whole line until 1862, when, upon the evacuation of Pensacola by the Confederate forces, the wire was taken down for twenty-three miles, and Cooper's Station made the southern terminus. In 1864, the whole was abandoned, as the section of the country in which it was situated had fallen into the possession of the United States troops.

On the 1st of December, 1865, the stockholders met, and it appearing that the assets of the company were insufficient to rebuild the line, a new association was formed for that purpose, with the old name, and new stock to the amount of $5,000 subscribed. A resolution was adopted by the new company to purchase the property of the old, at a valuation put upon it in a report submitted to the meeting, and a new board of directors was elected.

A meeting of the directors was held on the 2d of January, 1866, at which the president reported the completion of the line to Pensacola, and a resolution was adopted, authorizing the purchase of wire for its extension to the navy yard. The attorneys of the company were also instructed to prepare a draft of a charter, to be presented to the legislature for enactment.

Page 96 U. S. 3

On the 24th of July, 1866, Congress passed the following act:

"AN ACT to aid in the construction of telegraph lines, and to secure to the government the use of the same for postal, military, and other purposes."

"Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled that any telegraph company now organized or which may hereafter be organized under the laws of any state in this Union shall have the right to construct, maintain, and operate lines of telegraph through and over any portion of the public domain of the United States, over and along any of the military or post roads of the United States which have been or may hereafter be declared such by act of Congress, and over, under, or across the navigable streams or waters of the United States, provided that such lines of telegraph shall be so constructed and maintained as not to obstruct the navigation of such streams and waters, or interfere with the ordinary travel on such military or post roads. And any of said companies shall have the right to take and use from such public lands the necessary stone, timber, and other materials for its posts, piers, stations, and other needful uses in the construction, maintenance, and operation of said lines of telegraph, and may preempt and use such portion of the unoccupied public lands subject to preemption through which its said lines of telegraph may be located as may be necessary for its stations, not exceeding forty acres for each station; but such stations shall not be within fifteen miles of each other."

"SEC. 2. And be it further enacted, that telegraphic communications between the several departments of the government of the United States and their officers and agents shall, in their transmission over the lines of any of said companies, have priority over all other business, and shall be sent at rates to be annually fixed by the Postmaster General."

"SEC. 3. And be it further enacted that the rights and privileges hereby granted shall not be transferred by any company acting under this act to any other corporation, association, or person, provided, however, that the United States may at any time after the expiration of five years from the date of the passage of this act, for postal, military, or other purposes, purchase all the telegraph lines, property, and effects of any or all of said companies at an appraised value, to be ascertained by five competent disinterested persons, two of whom shall be selected by the Postmaster General

Page 96 U. S. 4

of the United States, two by the company interested, and one by the four so previously selected."

"SEC. 4. And be it further enacted, that before any telegraph company shall exercise any of the powers or privileges conferred by this act, such company shall file their written acceptance with the Postmaster General, of the restrictions and obligations required by this act."

14 Stat. 221; Rev.Stat., sec. 5263 et seq.

All railroads in the United States are by law post roads. Rev.Stat., sec. 3964; 17 Stat. 308, sec. 201.

On the 11th of December, 1866, the Legislature of Florida passed an act incorporating the Pensacola Telegraph Company, and granting it

"the sole and exclusive privilege and right of establishing and maintaining lines of electric telegraph in the counties of Escambia and Santa Rosa, either from different points within said counties, or connecting with lines coming into said counties, or either of them, from any point in this [Florida] or any other state."

The capital stock was fixed at $5,000, with the privilege of increasing it to such an amount as might be considered necessary. The company was authorized to locate and construct its lines within the counties named,

"along and upon any public road or highway, or across any water, or upon any railroad or private property for which permission shall first have been obtained from the proprietors thereof."

In this act all the stockholders of the new association which had rebuilt the line were named as corporators. No meeting of the directors was held until Jan. 2, 1868, when the secretary was instructed to notify the stockholders "that the charter drawn up by Messrs. Campbell & Perry, attorneys, as per order of board, Jan. 2, 1866," had been passed.

On the 5th of June, 1867, the directors of the defendant, the Western Union Telegraph Company, a New York corporation, passed the following resolution, which was duly filed with the Postmaster General:

"Resolved, that this company does hereby accept the provisions of the act of Congress, entitled 'An Act to aid in the construction of telegraph lines, and to secure to the government the use of the same for postal, military, and other purposes,' approved July 24, 1866, with all the powers, privileges, restrictions, and obligations conferred and required thereby, and that the secretary be, and he

Page 96 U. S. 5

is hereby, authorized and directed to file this resolution with the Postmaster General of the United States, duly attested by the signature of the acting president of the company and the seal of the corporation, in compliance with the fourth section of said act of Congress."

In 1872, the property of the Alabama and Florida Railroad Company, including its right of way and railroad, was transferred to the Pensacola and Louisville Railroad Company, and on the 14th of February, 1873, the Legislature of Florida passed an act, which, as amended Feb. 18, 1874, authorized the last named company

"to construct, maintain, and operate a telegraph line from the Bay of Pensacola along the line of the said (its) road as now located, or as it may hereafter be located, and along connecting roads in said county to the boundary lines of the state of Alabama, and the said lines may connect and be consolidated with other telegraph companies within or without the state, and said company may pledge, mortgage, lease, sell, assign, and convey the property appertaining to the said telegraph lines, and the rights, privileges, and franchises conferred by this act, with full power in such assignees to construct, own, and operate such telegraph lines, and enjoy all the privileges, rights, and franchises conferred by this act; but in such case, the said railroad company shall be responsible for the proper performance of the duties and obligations imposed by this act."

This was within the territory embraced by the exclusive grant to the Pensacola Telegraph Company.

On the 24th of June, 1874, the Pensacola and Louisville Railroad Company granted to the Western Union Telegraph Company the right to erect a telegraph line upon its right of way, and also the rights and privileges conferred by the acts of February, 1873 and 1874. The Western Union Company immediately commenced the erection of the line; but before its completion, to-wit, July 27, 1874, the bill in this case was filed by the Pensacola Telegraph Company to enjoin the work and the use of the line, on account of the alleged exclusive right of that company under its charter. Upon the hearing, a decree was passed dismissing the bill, and this appeal was taken.

Page 96 U. S. 8

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