1. The statute of Congress organizing a territory within the
jurisdiction of the United States is the fundamental law of such
territory, and as such binding upon the territorial
authorities.
2. Subject to the limitations expressly or by implication
imposed by the Constitution, Congress have full and complete
authority over a territory, and may directly legislate for the
government thereof. It may declare a valid enactment of the
territorial legislature void or a void enactment valid, although it
reserved in the organic act no such power.
3. Under the statutes of Congress, 12 Stat. 239 and 16
id. 300, the Legislative Assembly of Dakota meets
biennially, and no one session thereof can exceed forty days. That
assembly met Dec. 6, 1870, and after continuing in session every
day, Sundays excepted, until Jan. 13, 1871, adjourned without day.
The acting governor convened it April 6, 1871, when, after
organizing, it passed, among other laws, one entitled "An Act to
enable organized
Page 101 U. S. 130
counties and townships to vote aid to any railroad, and to
provide for payment of the same." In strict conformity to its
provisions, the electors of a county voted to donate a specific sum
to a certain railroad company. Congress, by an Act approved May 27,
1872, 17
id. 162, disapproved and annulled said
territorial act, but provided that the vote of aid for the
construction of the main stem of the road of the company should not
be impaired, and that the company was a valid corporation. The
company complied with the requirements of Congress by giving for
the aid so voted an equal amount of stock to the county, and the
latter issued its bonds therefor. In an action brought by a
bona fide holder of them to recover certain installments
of interest,
held that, independently of the question of
authority to convene that extra session or of the validity of the
laws enacted thereat, the bonds are binding on the county inasmuch
as the act of Congress is equivalent to a direct grant of power to
issue them.
MR. CHIEF JUSTICE WAITE delivered the opinion of the Court.
By sec. 4 of the act to provide a temporary government for the
Territory of Dakota, no one session of the legislative assembly
shall exceed forty days, 12 Stat. 239, and in 1869 Congress
declared that the sessions of all territorial legislative
assemblies should be biennial. 15
id. 300. The members of
the Legislative Assembly of Dakota met on the 5th of December,
1870, and continued in regular session on all days except Sundays
until Jan. 13, 1871, when they adjourned without day. The day of
adjournment was called on the journals the fortieth day of the
session, although there had been but thirty-five days of actual
session for the transaction of business. On the 18th of April,
1871, the members of the legislature elected the preceding fall
again assembled at the call of the acting governor of the
territory. After organizing themselves as a legislative assembly
and proceeding to legislate for the territory, they passed, among
other acts, one entitled "An Act to enable organized counties and
townships to vote aid to any railroad, and to provide for the
payment of the same." Under this act,
Page 101 U. S. 131
the voters of Yankton County, on the 2d of September, 1871,
voted to donate the Dakota Southern Railroad Company $200,000 in
the bonds of the county. All the proceedings under which this vote
was taken were conducted strictly according to the requirements of
the law.
On the twenty-seventh day of May, 1872, the following act of
Congress was approved and went into effect. 17
id.
162.
An Act in Relation to the Dakota Southern Railroad
Company
"Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled that the act passed
by the Legislative Assembly of the Territory of Dakota and approved
by the governor on the twenty-first day of April, 1871, entitled
'An Act to enable organized counties and townships to vote aid to
any railroad, and to provide for the payment of the same' be, and
the same is hereby, disapproved and annulled except insofar as
herein otherwise provided. But the passage of this act shall not
invalidate or impair the organization of the company heretofore
organized for the construction of the Dakota Southern Railroad
leading from Sioux City, Iowa, by way of Yankton, the capital of
said territory, to the west line of Bon Homme County, or any vote
that has been or may be given by the Counties of Union, Clay,
Yankton, and Bon Homme, or any township granting aid to said
railroad, or any subscription thereto, or anything authorized by
and that may have been done in pursuance of the provisions of the
aforesaid act of the legislative assembly of said territory towards
the construction and completion of said railroad, and the said
Dakota Southern Railroad Company, as organized under and in
conformity to the acts of the legislative assembly of said
territory, is hereby recognized and declared to be a legal and
valid corporation, and the provisions of the act of the legislative
assembly first aforesaid, so far as the same authorize, and for the
purpose of validating any vote of aid and subscriptions to said
company for the construction, completion, and equipment of the main
stem of said railroad, between the termini aforesaid, are hereby
declared to be and remain in full force, but no further, and for no
other purpose whatsoever."
"SEC. 2. That for the purpose of enabling the said Dakota
Southern Railroad Company to construct its said road through the
public lands between the termini aforesaid, the right of way
through said public lands is hereby granted to said company to the
extent
Page 101 U. S. 132
of one hundred feet in width on each side of said road,
provided that nothing in this act shall relieve said
Dakota Southern Railroad Company from constructing and completing
said railroad in accordance with the conditions and stipulations
under which the citizens of the counties therein named voted aid to
said railroad in accordance with the laws of said territory
approved April 21, 1871,
provided further that said Dakota
Southern Railroad Company shall issue to the respective counties
and townships voting aid to said railroad paid-up certificates of
stock in the same in amounts equal to the sums voted by the
respective counties and townships."
After the passage of this act, the bonds voted were delivered by
the county commissioners to the railroad company and stock in the
company for an equal amount was issued to the county. The First
National Bank of Brunswick, Maine, the
bona fide holder
and owner of ten of these bonds, amounting in the aggregate to
$10,000, brought this suit against the county to recover three
installments of interest. The defense was that there was no law
authorizing the issue of the bonds, and, as a consequence, that the
county was not bound for the payment of either principal or
interest. Upon the trial of the cause, the facts were found
substantially as already stated, and a judgment was rendered by the
district court of the territory in favor of the county. This
judgment was afterwards affirmed by the supreme court, and
thereupon the bank brought the case here by writ of error.
We do not consider it necessary to decide whether the Governor
of Dakota had authority to call an extra session of the legislative
assembly, nor whether a law passed at such a session or after the
limited term of forty days had expired would be valid, because, as
we think, the Act of May 27, 1872, is equivalent to a direct grant
of power by Congress to the county to issue the bonds in dispute.
It is certainly now too late to doubt the power of Congress to
govern the territories. There have been some differences of opinion
as to the particular clause of the Constitution from which the
power is derived, but that it exists has always been conceded. The
act to adapt the ordinance to provide for the government of the
territory northwest of the River Ohio to the requirements of the
Constitution,
Page 101 U. S. 133
1 Stat. 50, is chap. 8 of the first session of the first
Congress, and the ordinance itself was in force under the
Confederation when the Constitution went into effect. All territory
within the jurisdiction of the United States not included in any
state must necessarily be governed by or under the authority of
Congress. The territories are but political subdivisions of the
outlying dominion of the United States. Their relation to the
general government is much the same as that which counties bear to
the respective states, and Congress may legislate for them as a
state does for its municipal organizations. The organic law of a
territory takes the place of a constitution as the fundamental law
of the local government. It is obligatory on and binds the
territorial authorities; but Congress is supreme, and for the
purposes of this department of its governmental authority has all
the powers of the people of the United states except such as have
been expressly or by implication reserved in the prohibitions of
the Constitution.
In the organic act of Dakota, there was not an express
reservation of power in Congress to amend the acts of the
territorial legislature, nor was it necessary. Such a power is an
incident of sovereignty, and continues until granted away. Congress
may not only abrogate laws of the territorial legislatures, but it
may itself legislate directly for the local government. It may make
a void act of the territorial legislature valid, and a valid act
void. In other words, it has full and complete legislative
authority over the people of the territories and all the
departments of the territorial governments. It may do for the
territories what the people, under the Constitution of the United
states, may do for the states.
Turning, then, to the particular act of Congress now under
consideration, we find that the attention of that body was in some
way brought to the fact that the legislative assembly of Dakota
had, on the 21st of April, 1871, passed an act to enable organized
counties and townships to vote aid to railroads. In addition to
this, it was known that the Dakota Southern Railroad Company had
been organized as a corporation under certain acts of the
territorial legislative assembly, and that votes had been taken
under the aid act in some of the counties and
Page 101 U. S. 134
townships granting aid to or authorizing subscriptions of stock
in this corporation. It is clear that Congress disapproved the
policy of the aid act, and was unwilling to have it go into general
operation, but to the extent it could be made available for the
construction and completion of the main stem of the Dakota Southern
Railroad, the contrary is distinctly manifested. The act as a whole
was "disapproved and annulled," but in substance reenacted by
Congress "for the purpose of validating any vote of aid or
subscription" to that company, but "for no other purpose whatever."
A careful examination of the statute leaves no doubt in our minds
on this subject. To make it sure that the organization of the
company was complete, the "Dakota Southern Railroad Company, as
organized under and in conformity to the acts of the legislative
assembly of said territory" was "recognized and declared to be a
legal and valid corporation." It is then in terms enacted that the
provisions of the aid act,
"so far as the same authorize, and for the purpose of validating
any vote of aid and subscriptions to said company, for the
construction, completion, and equipment of the main stem of said
railroad, . . . are hereby declared to be and remain in full
force."
And again:
"That said Dakota Southern Railroad Company shall issue to the
respective counties and townships voting aid to said railroad,
paid-up certificates of stock in the same in amounts equal to the
sums voted by the respective counties and townships."
In the light of these distinct and positive declarations and
enactments of Congress, it is impossible to bring our minds to any
other conclusion than that, when the bonds now in controversy were
put out, there existed full and complete legislative authority to
bind the people of the county for their payment. No complaint is
made of any irregularity in the proceedings under the law. The
question in the case is one of power only. As we think, the vote of
the people of the county was "validated" by Congress, and express
authority given to issue the bonds for the purposes originally
intended. The only change which Congress saw fit to make was to
require the company to give stock in return for the donation as
voted.
The judgment of the supreme court of the territory will be
reversed and the cause remanded with instructions to reverse
Page 101 U. S. 135
the judgment of the district court and direct a judgment for the
plaintiff on the facts found for such amount as shall appear to be
due on the coupons sued for, and it is
So ordered.