Rice v. Railroad Company,
66 U.S. 358 (1861)

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U.S. Supreme Court

Rice v. Railroad Company, 66 U.S. 1 Black 358 358 (1861)

Rice v. Railroad Company

66 U.S. (1 Black) 358


1. If Congress pass an act granting public lands to a territory to aid in making a railroad, and if, by the true construction of the act, the territory acquired any beneficial interest in the lands as contradistinguished from a mere naked trust or power to dispose of them for certain specified uses and purposes, the act is irrepealable and a subsequent act attempting to repeal it is void.

2. If the legislative assembly of the territory, in an act incorporating a company to make the railroad which Congress intended to aid by the grant, conferred upon the company any right, title, or interest in the lands granted by Congress, it is not competent for Congress afterwards to repeal the grant and divest the title of the company.

3. Where it appears that the territorial act of incorporation was passed before the grant was made by Congress, and that after that grant the act of incorporation was reenacted with certain modifications,

Page 66 U. S. 359

the reenactment gives to the railroad corporation such title as the territory was capable at that time of conferring.

4. But if the grant was revoked or the act making it repealed before the reenactment of the charter, the title of the company must depend on the validity of the repealing act.

5. The original act of incorporation, passed by the territorial legislature, being before the grant by Congress to the territory, did not operate as a valid grant to the company so as to vest in it a title to the lands when subsequently granted.

6. Legislative grants are not warranties, and the rule of the common law must be applied to them that no estate passes to the grantee except what was in the grantor at the time.

7. While the federal courts have no common law jurisdiction not conferred by statute, and their rules of decision are derived from the laws of the states, still, in construing acts of Congress, the rules of interpretation furnished by the common law are the true guides and have been uniformly followed.

8. In ascertaining the meaning or effect of a state statute, the rules of construction are borrowed from the common law except in cases where the courts of the state have otherwise determined.

9. An act of Congress granting land to a territory to be held for the purpose of making or aiding to make a public improvement of general interest, and restricting the use to that one purpose, does not pass to the territory a beneficial interest in praesenti.

10. If the grant be coupled with a provision that the lands shall be subject to the disposal of the territorial legislature for the public purpose specified and no other, and shall not inure to the benefit of any company heretofore constituted and organized, it is clear that future legislation of the territory alone could dispose of the lands, even for the purpose declared.

11. Where the act of Congress making the grant declares that no title shall vest in the territory, nor no patent issue for any part of the lands until twenty miles of the railroad be finished, these words cannot be rejected or disregarded or shorn of their ordinary signification unless they be so clearly repugnant to the rest of the act that the whole cannot stand together.

12. Such words are not necessarily repugnant to or inconsistent with the word "grant" used in the same and in previous sections of the act.

13. The word "grant" is not a technical word, like "enfeoff," and although, if

Page 66 U. S. 360

used broadly and without limitation, it will carry an estate in the thing granted, yet if used in a restricted sense, the grantee will take but a naked trust for the benefit of the grantor.

14. Words which, standing alone in an act of Congress, may properly be understood to pass a beneficial interest in land will not be regarded as having that effect if the context shows that they were not intended to be so used.

15. Legislative grants must be interpreted, if practicable, so as to effect the intention of the grantor, but if the words are ambiguous, the true rule is to construe them most strongly against the grantee.

16. Wherever privileges are granted to a corporation and the grant comes under revision in the courts, it is to be construed strictly against the corporation and in favor of the public, and nothing passes except what is given in clear and explicit terms.

Edmund Rice brought trespass in the County Court of Dakota, Territory of Minnesota, against the Minnesota & Northwestern Railroad Company for cutting timber on section 15 of township 114 north, of range 19 west. The defendants answered that the title to the section of land described in the plaintiff's complaint was in them, and set forth their title as follows:

The defendants were incorporated on the 4th of March, 1854, by the Legislative Assembly of Minnesota Territory for the purpose of making a railroad from the northwest shore of Lake Superior to some point to be selected on the northern line of Iowa in the direction of Dubuque. This act of incorporation provided, among other things, that

"For the purpose of aiding the said company in the construction and maintaining the said railroad, it is further enacted that any lands that may be granted to the said territory to aid in the construction of the said railroad shall be, and the same are hereby, granted in fee simple absolute, without any further act or deed, and the Governor of this Territory or future State of Minnesota is hereby authorized and directed, in the name and in behalf of said territory or state, after the said grant of land shall have been made by the United States to said territory, to execute and deliver to said

Page 66 U. S. 361

company such further deed or assurance of the transfer of the said property as said company may require to vest in them a perfect title to the same, provided however that such lands shall be taken upon such terms and conditions as may be prescribed by the act of Congress granting the same."

The books of subscription were opened at St. Paul and New York. Stock was subscribed to a large amount, the requisite proportion of it was paid in, and the company was organized agreeably to the terms of the charter. On the 29th of June, 1854, an act was passed by Congress granting to the Territory of Minnesota, for the purpose of aiding in the construction of a railroad along the route mentioned in the charter, every alternate section of land, designated by odd numbers, for six sections in width on each side of said road within the territory. The act of Congress making the grant was as follows:

"1. Be it enacted &c., that there is hereby granted to the Territory of Minnesota for the purpose of aiding in the construction of a railroad from the southern line of said territory commencing at a point between township ranges 9 and 17, thence by the way of St. Paul by the most practicable route, to the eastern line of said territory, in the direction of Lake Superior, every alternate section of land, designated by odd numbers, for six sections in width on each side of said road within said territory, but in case it shall appear that the United States have, when the line of said road is definitely fixed by the authority aforesaid, sold any section or any part 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 territory, subject to the approval of the Secretary of the Interior, to select 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 to which the right of preemption has attached as aforesaid, which land thus selected in lieu of those sold and to which preemption has attached as aforesaid, together with the sections or parts of sections designated by odd numbers as aforesaid and appropriated as aforesaid shall be held by the Territory

Page 66 U. S. 362

of Minnesota 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 road in each case, and selected for and on account of said road; provided further that the lands hereby granted shall be exclusively applied in the construction of that 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 whatever; and provided further that any and all lands heretofore reserved to the United States by an act of Congress or in any other manner by competent authority for the purpose of aiding in any object of internal improvement or for any other purpose whatever 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 railroad 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."

"SECTION 2. And be it further enacted that the sections and parts of sections of land which by such grants shall remain to the United States within six miles on each side of said road shall not be sold for less than double the minimum price."

"SECTION 3. And be it further enacted that the said lands hereby granted to the said territory shall be subject to the disposal of any legislature thereof for the purpose aforesaid, and no other; nor shall they inure to the benefit of any company heretofore constituted and organized; and the said railroad shall be and remain a public highway for the use of the United States, free from toll or other charge upon the transportation of any property or troops of the United States; nor shall any of the said lands become subject to private entry until the same shall have been first offered at public sale at the increased price."

"SECTION 4. And be it further enacted that the lands hereby granted to said territory shall be disposed of by said territory only in the manner following -- that is to say, no title shall vest in the said Territory of Minnesota, nor shall any patent issue for any part of the lands hereinbefore mentioned, until a continuous line of twenty miles of said road shall be completed

Page 66 U. S. 363

through the lands hereby granted; and when the Secretary of the Interior shall be satisfied that any twenty miles of said road are completed, then a patent shall issue for a quantity of land not exceeding one hundred and twenty sections, and included within a continuous length of twenty miles of said road, until it shall be completed, and if said road is not completed within ten years, no further sale shall be made, and the land unsold shall revert to the United States."

"SECTION 5. And be it further enacted that the United States mail shall be transported at all times on said railroad, 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."

It was before the passage of this act that the books of subscription were opened -- namely on the 1st of May, 1854. On the 20th of the same month, subscriptions were made upon the books at St. Paul. On the 30th of June, 1854, the day after the act of Congress making the grant was approved by the President, one million of dollars were subscribed to the stock on the books opened at New York, and ten percent thereupon duly paid to the commissioners. Directors were then elected and the company completely organized. Afterwards, on the 16th of February, 1855, the territorial legislature made some modifications and additions to the charter and reenacted it. The defendants further averred that on the 20th of October, 1855, they caused a survey to be made of their route for the railroad and located it agreeably to the act of incorporation and the act of Congress; that the route as located runs through the land claimed by the plaintiff and described in his complaint; that it was not until after this location -- to-wit, on the 1st of January, 1856 -- that the plaintiff purchased the land from the United States, and that the trespass complained of consisted in going on that part of the land where the track of the railroad was lawfully located and cutting such timber as was necessary to be removed for the purpose of constructing the work.

To this answer of the defendants the plaintiff replied that

Page 66 U. S. 364

after the officers and directors of the company were chosen by the stockholders and entered upon the discharge of their duties, and before the trespasses complained of were committed, to-wit on the 24th day of August, 1854, Congress passed the following act repealing that by which the grant was made on the preceding 29th of June:

"Be it enacted that the bill entitled 'An act to aid the Territory of Minnesota in the construction of a railroad therein,' which passed the House of Representatives on the twentieth day of June, eighteen hundred and fifty-four and which was approved by the President of the United States on the twenty-ninth day of June, eighteen hundred and fifty-four, be, and the same is hereby repealed."

The defendants demurred to the replication, and for cause of demurrer set forth that the repealing act of 24 August, 1854, was void and of no effect.

The court of original jurisdiction gave judgment on the demurrer in favor of the plaintiff. The defendants appealed to the supreme court of the territory, where the judgment was reversed, but judgment was not entered for the defendants. By the law admitting Minnesota into the Union as a state, the records of the supreme court of the territory were transferred to the district court of the United States. There, an application was made to amend the record by entering a proper judgment, which was done, and this writ of error sued out by the defendants from the Supreme Court of the United States was directed to the judge of the district court.

Page 66 U. S. 369

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