United States v. Union Pacific Railroad Company
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91 U.S. 72 (1875)
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U.S. Supreme Court
United States v. Union Pacific Railroad Company, 91 U.S. 72 (1875)
United States v. Union Pacific Railroad Company
91 U.S. 72
1. The solution of the question whether the Union Pacific Railroad Company is required to pay the interest before the maturity of the principal of the bonds issued by the United States to the company depends on the meaning of the fifth and sixth sections of the original act of 1862
"to aid in the construction of a railroad and telegraph line from the Missouri River to the Pacific Ocean and to secure to the government the use of the same for postal, military, and other purposes,"
and of the fifth section of the amendatory act of 1564. Held, upon consideration of said sections, of the scheme of said original act, and of the purposes contemplated by it, that it was not the intention of Congress to require the company to pay the interest before the maturity of the principal of the bonds.
2. As commonly understood, the word "maturity," in its application to bonds and other similar instruments, applies to the time fixed for their payment, which is the termination of the period they have to run.
3. A provision in the charter that the grants thereby made are upon the condition that the company "shall pay said bonds at maturity," while it implies an obligation to pay both principal and interest when the bonds shall be come due, does not imply an obligation to pay the interest as it semiannually accrues.
4. In construing an act of Congress, the court may recur to the history of the times when it was passed in order to ascertain the reason for, as well as the meaning of, particular provisions in it, but the views of individual members in debate, or the motives which induced them to vote for or against its passage, cannot be considered.
Under the authority of the second section of the Act of Congress
of March 3, 1873, * the Union Pacific Railroad Company filed its petition in the Court of Claims alleging that it had rendered services to the government in the transportation of the mails, troops, supplies, and public stores of the United States, between the dates of February, 1871, and February, 1874, both inclusive, and praying for judgment that the United States pay the company one half part of the amount due for such services, and give credit to the company on account of the bonds issued by the United States in aid of the construction of the road to the amount of the remaining half part of said amount.
The United States filed an answer and counterclaim denying their indebtedness and alleging that they had issued to the company their coupon bonds to the amount of $100,000,000, bearing interest at the rate of six percent per annum, payable semiannually, pursuant to the Acts of Congress of July 1, 1862, and July 2, 1864, and paid to the holders of said bonds, at the stated semiannual periods, the interest due thereon, and that the company, although bound by law to reimburse them for payments so made for such interest, had never paid any part thereof, and they prayed judgment against the company for $12,000,000.
The provisions of the Acts of July 1, 1862, and the Amendatory Act of July 2, 1864, which bear upon the questions at issue, are as follows:
Act of July 1, 1862, 12 Stat., p. 489.
"SEC. 5. The Secretary of the Treasury shall, upon the certificate in writing of said commissioners, . . . issue to said company bonds of the United States of
one thousand dollars each, payable in thirty years after date, bearing six percentum per annum interest, said interest payable semiannually, . . . to the amount of sixteen of said bonds per mile, . . . and to secure the repayment to the United States, as hereinafter provided, of the amount of said bonds so issued and delivered to said company, together with all interest thereon which shall have been paid by the United States, the issue of said bonds and delivery to the company shall ipso facto constitute a first mortgage on the whole line of the railroad and telegraph, together with the rolling stock, fixtures, and property of every kind and description, and in consideration of which said bonds may be issued, and on the refusal or failure of said company to redeem said bonds or any part of them when required to do so by the Secretary of the Treasury in accordance with the provisions of this act, the said road, with all the rights, functions, immunities, and appurtenances thereto belonging and also all lands granted to the said company by the United States which at the time of said default shall remain in the ownership of said company, may be taken possession of by the Secretary of the Treasury for the use and benefit of the United States."
"SEC. 6. The grants aforesaid are made upon condition that said company shall pay said bonds at maturity, . . . and all compensation for services rendered for the government shall be applied to the payment of said bonds and interest until the whole amount is fully paid. Said company may also pay the United States, wholly or in part, in the same or other bonds, Treasury notes or other evidences of debt against the United States, to be allowed at par, and after said road is completed, until said bonds and interest are paid, at least five percent of the net earnings of said road shall also be annually applied to the payment thereof."
Act of July 2, 1864, 13 Stat., p. 356.
"SEC. 5. Only one-half of the compensation for services rendered for the government shall be required to be applied to the payment of the bonds issued by the government in aid of the construction of said road."
The Court of Claims found in favor of the company and adjudged that it recover from the United States $512,632.50 and that the counterclaim of the United States be dismissed.
The United States appealed to this Court.