In the proceedings taken under the Act of August 11, 1588, 25
Stat. 400, 411, c. 860, to condemn lock and dam No. 7 of the
Monongahela Navigation Company, that company is entitled under the
provisions of the Fifth Amendment to the Constitution, to recover
compensation from the United States for the taking of the franchise
to exact tolls, as well as for the value of the tangible property
taken.
The assertion by Congress of its purpose to take the property
which that company had constructed in the Monongahela River by
authority of the State of Pennsylvania did not destroy the
franchise granted to the company by the State.
Bridge Company v. United States, 105 U.
S. 470, distinguished from thin case.
By the Act of August 11, 1888, 25 Stat. 411, c. 860, Congress,
among other things, enacted:
"The Secretary of War be, and is hereby, authorized and directed
to negotiate for and purchase at a cost not to exceed $161,733.13,
lock and dam number seven, otherwise known as the 'upper lock and
dam,' and its appurtenances, of the Monongahela Navigation Company,
a corporation organized under the laws of Pennsylvania, which lock
and dam number seven and its appurtenances constitute a part of the
improvements in water communication in the Monongahela River
between Pittsburgh, in the State of Pennsylvania, and a point at or
near Morgantown, in the State of West Virginia. And the sum of
$161,733.13, or so much thereof as may be necessary, is hereby
appropriated out of any moneys in the Treasury not otherwise
appropriated for consummating said purchase, the same
Page 148 U. S. 313
to be paid on the warrant of the Secretary of War upon full and
absolute conveyance to the United States of the said lock and dam
number seven, and its appurtenances, of the said Monongahela
Navigation Company."
"In the event of the inability of the Secretary of War to make
voluntary purchase of said lock and dam number seven and its
appurtenances for said sum of $161,733.13, or a less sum, then the
Secretary of War is hereby authorized and directed to institute and
carry to completion proceedings for the condemnation of said lock
and dam number seven and its appurtenances, said condemnation
proceedings to be as prescribed and regulated by the provisions of
the general railroad law of Pennsylvania, approved February 19,
1849, and its supplements, except that the United States shall not
be required to give any bond, and except that jurisdiction of said
proceedings is hereby given to the Circuit Court of the United
States for the Western District of Pennsylvania, with right of
appeal by either party to the Supreme Court of the United States,
provided that in estimating the sum to be paid by the
United States, the franchise of said corporation to collect tolls
shall not be considered or estimated, and the sum of five thousand
dollars, or so much thereof as may be necessary, is hereby
appropriated out of any moneys in the Treasury not otherwise
appropriated to pay the necessary costs of said condemnation
proceedings, and upon final judgment being entered therein, the
Secretary of War is hereby authorized and directed to draw his
warrant on the Treasury for the amount of said judgment and costs,
and said amount for the payment thereof is hereby appropriated out
of any moneys in the Treasury not otherwise appropriated. And when
said lock and dam number seven and its appurtenances shall have
been acquired by the United States, whether by purchase or
condemnation, the Secretary of War shall take charge thereof, and
the same shall thereafter be subject to the provisions of section 4
of an act entitled 'An act making appropriations for the
construction, repair, and preservation for certain public work on
rivers
Page 148 U. S. 314
and harbors, and for other purposes,' approved July 5,
1884."
The effort at a voluntary purchase failing, on December 1, 1888,
proceedings of condemnation were commenced in the Circuit Court of
the United States for the Western District of Pennsylvania. Viewers
were appointed, who reported the value of the lock and dam number
seven to be $209,393.52. Such valuation did not take into account
the franchise of the company to collect tolls. An appeal was taken,
as provided by the statutes of Pennsylvania, which appeal gave the
right to a trial
de novo according to the course of the
common law. A jury having been waived, the matter was tried before
the court, the navigation company being the plaintiff, as to the
question of amount of compensation. These facts appeared on the
trial.
"In 1836, the State of Pennsylvania incorporated and by acts in
that and subsequent years granted to the Monongahela Navigation
Company the right"
"to enter upon the said River Monongahela and upon the lands on
either side, and to use the rocks, stone, gravel, or earth which
may be found thereon in the constructions of their works, . . . and
to form and make, erect and set up any dams, locks, or any other
device whatsoever which they shall think most fit and convenient,
to make a complete slack-water navigation between the points herein
mentioned, to-wit, the City of Pittsburgh and the Virginia state
line."
"The Monongahela River rises in the mountains of West Virginia,
flows northwardly through Pennsylvania to Pittsburgh, where it
forms a junction with the Allegheny and Ohio Rivers."
"In pursuance of its charter, the navigation company, between
1841 and the present time, has constructed in said river seven
locks and dams, which together now carry the slackwater navigation
as far as the West Virginia state line."
"Prior to the construction of said company's works -- that is to
say, prior to the year 1841 -- the navigation of the Monongahela
River was conducted altogether in small vessels, including small
steamboats of not exceeding a tonnage of fifty
Page 148 U. S. 315
tons, which could not ascend the river at all seasons, but only
during limited periods, depending on the rise of the river. The
trade or commerce on said river, prior to its improvement by said
company's works, was small, particularly in the article of coal,
for which the river in its natural condition did not furnish
sufficient harbors or places of shipment at all seasons of the
year; but by the construction and maintenance of said company's
works, there has been created an existing navigation for large
steamboats at all seasons of the year, and facilities for a large
commerce, particularly in the article of coal, of which there is
now transported in a single day as much as was before the
construction of the company's works transported in an entire
year."
"The construction of the lock and dam No. 7, the property
attempted to be appropriated in this proceeding, by the Monongahela
Navigation Company was begun in the year 1882 and completed in
1884, being the last one built, and completing the company's
improvements in the State of Pennsylvania."
"The work was commenced under the following circumstances:"
"It was provided by an act of the legislature of Pennsylvania,
constituting a supplement to the company's charter, approved April
8, 1857, that whenever the construction of sufficient locks and
dams to extend the slack water on the Monongahela River from the
Pennsylvania state line to Morgantown, in Virginia, shall have been
commenced, it shall be the duty of the Monongahela Navigation
Company to commence the construction of lock and dam No. 7 in such
manner and on such plan as will extend the navigation from its
present terminus to the Virginia state line, and complete the same
simultaneously with the completion of the work extending to
Morgantown."
On March 3, 1881, Congress passed an act, 21 Stat. 468, 471, c.
136, among other things appropriating $25,000 for improving the
Monongahela River in West Virginia and Pennsylvania, with this
proviso:
"But this sum shall not be expended until the Monongahela
Navigation Company shall have undertaken in good faith the
Page 148 U. S. 316
building of lock and dam number seven at Jacob's Creek, and
until said company shall, in manner satisfactory to the Secretary
of War, give assurance of their ability and purpose to complete the
same."
After the passage of this act, and on March 24, 1881, Col.
William E. Merrill, the engineer and officer in charge of the
public works of the United States on the River Monongahela,
addressed this letter to the navigation company:
"U.S. Engineer's Office, Customhouse"
Cincinnati, O., March 24, 1881
"
Hon. J. K. Moorhead, President Mon. Nav. Co., Pittsburgh,
Pennsylvania"
"Sir: The last river and harbor bill contains the following
appropriation:"
"Improving Monongahela River, West Virginia and Pennsylvania,
$25,000, but this sum shall not be expended until the Monongahela
Navigation Company shall have undertaken in good faith the building
of lock and dam number seven at Jacob's Creek, and until said
company shall, in manner satisfactory to the Secretary of War, give
assurance of their ability and purpose to complete the same."
"You will therefore see that my work on number eight is wholly
dependent on your work on number seven. I have therefore to urge on
your company that you will at the earliest date possible 'undertake
in good faith the building of lock and dam number seven,' and that
you will give the Secretary of War satisfactory assurance of your
ability and purpose to complete it. I would therefore suggest that
it might be useful for your secretary to communicate at once to the
Secretary of War such facts as to the financial resources of the
company and its intentions about number seven as will satisfy him
on the points specially left to his discretion and unlock the
appropriation so that it may be used this summer."
"Respectfully, your obedient servant"
"Wm. E. Merrill"
"
Maj. Eng'rs & B'v't Col."
Page 148 U. S. 317
Whereupon, and on April 6, 1881, the following resolutions were
passed by the navigation company, notice of which was given to the
Secretary of War:
"Whereas, Congress has made an appropriation for the
commencement of the building of lock and dam number eight in the
Monongahela River, the payment of which appropriation is made to
depend upon the Secretary of War's being satisfied of the
bona
fide intention of this company to construct lock and dam
number seven and of their financial ability to complete the same,
and whereas, Col. Merrill, of the United States Engineers, in
charge of the government improvement of the Monongahela River, has
requested this company to furnish the Secretary of War with
satisfactory assurances in relation thereto, therefore"
"
Resolved that it is the
bona fide purpose and
intention of this company to construct lock and dam number seven in
the Monongahela River in the manner and at the time required of
them by the acts of assembly of the State of Pennsylvania -- that
is to say, so to complete said lock and dam number seven that the
same shall be ready for use as soon as the requisite locks and dams
above lock and dam number seven, constructed or about to be
constructed by the federal government, shall also be finished and
ready for use, so as to complete the slack water of said river from
Pittsburgh, Pennsylvania, to Morgantown, Virginia."
"
Resolved that the secretary of this company be
directed to forward a copy of the foregoing resolution, together
with copies of the company's annual report, showing the intention
of the company and their ability to complete this work, to Col.
Merrill and also to the Secretary of War."
And on May 4, 1881, Col. Merrill addressed the following letter
to the president of the navigation company:
"Sir: I have just received official notice from the Secretary of
War, through the Chief of Engineers, that the resolution and
documents relative to the construction of lock and dam No. 7, on
the Monongahela River, forwarded to this
Page 148 U. S. 318
office by your company in April last (duplicate sent to the
honorable Secretary of War), have been considered as fully meeting
the requirements of the proviso in the last appropriation for the
improvement of the above-named river, prohibiting the expenditure
of the money appropriated"
"until the Monongahela Navigation Company shall have undertaken
in good faith the building of lock and dam No. 7 at Jacob's Creek
and until said company shall, in a manner satisfactory to the
Secretary of War, give assurance of their ability and purpose to
complete the same."
Thereafter, and in 1882, lock and dam number seven were
commenced, and completed in 1884. In the course of the trial, the
company called a witness, and offered to prove by him and other
witnesses:
"That the paid-up capital stock of the Monongahela Navigation
Company consists of thirty-two thousand six hundred and thirty-nine
shares of fifty dollars; that dividends have been declared on the
stock for a number of years at the rate of twelve percent per
annum."
"That the tolls received by the said company for the use of its
works, including lock and dam No. 7, have averaged for several
years past not less than $240,000; that the market value of the
stock was at the time of the inception of these proceedings about
$100 per share; that the money value of their entire works and
franchise is not less than $4,000,000; that the actual toll
receipts of lock and dam No. 7 for several years past have exceeded
$2,800 per annum, and that a very large increase of such toll
receipts at lock and dam No. 7 will certainly take place in a short
time by the development of coal mines naturally tributary to said
lock and dam."
"That by the construction and maintenance of the company's works
a permanent and reliable public highway has been created on which a
large and increasing carriage of coal and general merchandise takes
place, and that permanent navigation for the largest vessel and
steamboat now exists from the City of Pittsburgh, Pennsylvania, to
or near the line between the States of Pennsylvania and West
Virginia."
"That in view of the present and prospective tolls
receivable
Page 148 U. S. 319
at lock and dam No. 7, the present value of said lock and dam
No. 7 is not less than $450,000, said value being predicated upon
said present and prospective tolls; that said lock and dam No. 7
are a portion of said company's works which consist of seven dams,
each furnished with a lock or locks."
"That the navigation which is sought by these proceedings to be
made free was mainly created and made possible at all seasons by
the construction and maintenance of the company's works."
"That a large portion of the tolls received by the company is
charged upon merchandise and articles carried between points of
shipment and delivery entirely within the State of Pennsylvania,
and constituting internal commerce of said state, and that a
portion of the tolls collectible at lock and dam No. 7, for the use
of said lock and dam, is chargeable for merchandise, goods, and
passengers carried between points of shipment and delivery in the
State of Pennsylvania, the transportation being wholly within the
state as to said portion."
"To which offer of testimony counsel for the United States
objected, for the reason that the same was incompetent and
irrelevant; whereupon the court sustained the objection and
rejected the evidence."
The result of the trial was a finding by the court that the
value of the lock and dam No. 7 was $209,000, "not considering or
estimating in this decree the franchise of this company to collect
tolls." Such amount was the sum adjudged and decreed to be paid by
the United States to the navigation company for the property
condemned. The company has brought the case to this Court by both
writ of error and appeal.
Page 148 U. S. 324
MR. JUSTICE BREWER, after stating the facts in the foregoing
language, delivered the opinion of the Court.
It appears from the foregoing statement that the Monongahela
Company had, under express authority from the State of
Pennsylvania, expended large sums of money in improving the
Monongahela River by means of locks and dams, and that the
particular lock and dam in controversy here were built not only by
virtue of this authority from the State of Pennsylvania, but also
at the instance and suggestion of the United States. By means of
these improvements, the Monongahela River, which theretofore was
only navigable for boats of small tonnage and at certain seasons of
the year, now carries large steamboats at all seasons, and an
extensive commerce by means thereof. The question presented is not
whether the United States has the power to condemn and appropriate
this property of the Monongahela Company, for that is conceded, but
how much it must pay as compensation therefor. Obviously this
question, as all others which run along the line of the extent of
the protection the individual has under the Constitution against
the demands of the government, is of importance, for in any
society, the fullness and sufficiency of the securities which
surround the individual in the use and enjoyment of his property
constitute one of the most certain tests of the character and value
of the government. The first ten amendments to the Constitution,
adopted as they were soon after the adoption of the Constitution,
are in the nature of a bill of rights, and were adopted in order to
quiet the apprehension of many that without some such declaration
of rights the government would assume, and might be held to
possess, the power to trespass upon those rights of persons and
property which by the Declaration of Independence were affirmed to
be unalienable rights.
In the case of
Sinnickson v. Johnson, 17 N.J.L. (2
Harr.) 129, 145, cited in the case of
Pumpelly
v. Green Bay Company, 13 Wall. 166,
80 U. S. 178,
it was said that
"this power to take private property reaches back of all
constitutional provisions, and it seems to have been considered a
settled principle of universal
Page 148 U. S. 325
law that the right to compensation is an incident to the
exercise of that power; that the one is so inseparably connected
with the other that they may be said to exist not as separate and
distinct principles, but as parts of one and the same
principle."
And in
Gardner v. Newburgh, 2 Johns.Ch. 162, Chancellor
Kent affirmed substantially the same doctrine. And in this there is
a natural equity which commends it to everyone. It in no wise
detracts from the power of the public to take whatever may be
necessary for its uses, while, on the other hand, it prevents the
public from loading upon one individual more than his just share of
the burdens of government, and says that when he surrenders to the
public something more and different from that which is exacted from
other members of the public, a full and just equivalent shall be
returned to him.
But we need not have recourse to this natural equity, nor is it
necessary to look through the Constitution to the affirmations
lying behind it in the Declaration of Independence, for in this
Fifth Amendment there is stated the exact limitation on the power
of the government to take private property for public uses. And
with respect to constitutional provisions of this nature, it was
well said by Mr. Justice Bradley, speaking for the Court in
Boyd v. United States, 116 U. S. 616,
116 U. S.
635:
"Illegitimate and unconstitutional practices get their first
footing in that way, namely, by silent approaches and slight
deviations from legal modes of procedure. This can only be obviated
by adhering to the rule that constitutional provisions for the
security of person and property should be liberally construed. A
close and literal construction deprives them of half their
efficacy, and leads to gradual depreciation of the right, as if it
consisted more in sound than in substance. It is the duty of courts
to be watchful for the constitutional rights of the citizen and
against any stealthy encroachments thereon. Their motto should be
obsta principiis."
The language used in the Fifth Amendment in respect to this
matter is happily chosen. The entire amendment is a series of
negations, denials of right or power in the government; the last
(the one in point here) being: "Nor shall private
Page 148 U. S. 326
property be taken for public use without just compensation." The
noun "compensation," standing by itself, carries the idea of an
equivalent. Thus, we speak of damages by way of compensation, or
compensatory damages, as distinguished from punitive or exemplary
damages, the former being the equivalent for the injury done, and
the latter imposed by way of punishment. So that if the adjective
"just" had been omitted, and the provision was simply that property
should not be taken without compensation, the natural import of the
language would be that the compensation should be the equivalent of
the property. And this is made emphatic by the adjective "just."
There can, in view of the combination of those two words, be no
doubt that the compensation must be a full and perfect equivalent
for the property taken, and this just compensation, it will be
noticed, is for the property, and not to the owner. Every other
clause in this Fifth Amendment is personal. "No person shall be
held to answer for a capital or otherwise infamous crime," etc.
Instead of continuing that form of statement and saying that no
person shall be deprived of his property without just compensation,
the personal element is left out, and the "just compensation" is to
be a full equivalent for the property taken. This excludes the
taking into account as an element in the compensation any supposed
benefit that the owner may receive in common with all from the
public uses to which his private property is appropriated, and
leaves it to stand as a declaration that no private property shall
be appropriated to public uses unless a full and exact equivalent
for it be returned to the owner.
We do not in this refer to the case where only a portion of a
tract is taken, or express any opinion on the vexed question as to
the extent to which the benefits or injuries to the portion not
taken may be brought into consideration. This is a question which
may arise possibly in this case, if the seven locks and dams
belonging to the navigation company are so situated as to be fairly
considered one property -- a matter in respect to which the record
before us furnishes no positive evidence. It seems to be assumed
that each lock and dam by themselves constitute a separate
structure and separate property,
Page 148 U. S. 327
and the thoughts we have suggested are pertinent to such a
case.
By this legislation, Congress seems to have assumed the right to
determine what shall be the measure of compensation. But this is a
judicial, and not a legislative, question. The legislature may
determine what private property is needed for public purposes; that
is a question of a political and legislative character. But when
the taking has been ordered, then the question of compensation is
judicial. It does not rest with the public, taking the property
through Congress or the legislature, its representative, to say
what compensation shall be paid, or even what shall be the rule of
compensation. The Constitution has declared that just compensation
shall be paid, and the ascertainment of that is a judicial inquiry.
In
Charles River Bridge v. Warren
Bridge, 11 Pet. 420,
36 U. S. 571,
Mr. Justice McLean in his opinion, referring to a provision for
compensation found in the charter of the Warren Bridge, uses this
language:
"They [the legislature] provide that the new company shall pay
annually to the college, in behalf of the old one, a hundred
pounds. By this provision, it appears that the legislature has
undertaken to do what a jury of the country only could
constitutionally do -- assess the amount of compensation to which
the complainants are entitled."
See also the following authorities:
Commonwealth v.
Pittsburgh & Connellsville Railroad Co., 58 Penn.St. 26,
50;
Penn. Railroad v. Balt. & Ohio Railroad, 60 Md.
263;
Isom v. Mississippi Central Railroad, 36 Miss.
300.
In the last of these cases, and on page 315, will be found these
observations of the court:
"The right of the legislature of the state by law to apply the
property of the citizen to the public use, and then to constitute
itself the judge of its own case, to determine what is the 'just
compensation' it ought to pay therefor, or how much benefit it has
conferred upon the citizen by thus taking his property without his
consent, or to extinguish any part of such 'compensation' by
prospective conjectural advantage, or
in any manner to
interfere with the just powers and province of courts and juries in
administrating right and justice, cannot for a moment be
admitted
Page 148 U. S. 328
or tolerated under our Constitution. If anything can be clear
and undeniable upon principles of natural justice or constitutional
law, it seems that this must be so."
We are not, therefore, concluded by the declaration in the act
that the franchise to collect tolls is not to be considered in
estimating the sum to be paid for the property.
How shall just compensation for this lock and dam be determined?
What does the full equivalent therefor demand? The value of
property, generally speaking, is determined by its productiveness
-- the profits which its use brings to the owner. Various elements
enter into this matter of value. Among them we may notice these:
natural richness of the soil as between two neighboring tracts. One
may be fertile, the other barren; the one so situated as to be
susceptible of easy use, the other requiring much labor and large
expense to make its fertility available. Neighborhood to the
centers of business and population largely affects values, for that
property which is near the center of a large city may command high
rent, while property of the same character, remote therefrom, is
wanted by but few, and commands but a small rental. Demand for the
use is another factor. The commerce on the Monongahela River, as
appears from the testimony offered, is great, the demand for the
use of this lock and dam constant. A precisely similar property in
a stream where commerce is light would naturally be of less value,
for the demand for the use would be less. The value, therefore, is
not determined by the mere cost of construction, but more by what
the completed structure brings in the way of earnings to its owner.
For each separate use of one's property by others the owner is
entitled to a reasonable compensation, and the number and amount of
such uses determines the productiveness and the earnings of the
property, and therefore largely its value. So that if this
property, belonging to the Monongahela Company, is rightfully where
it is, the company may justly demand from every one making use of
it a compensation, and to take that property from it deprives it of
the aggregate amount of such compensation, which otherwise it would
continue to receive. What amount of compensation for
Page 148 U. S. 329
each separate use of any particular property may be charged is
sometimes fixed by the statute which gives authority for the
creation of the property, sometimes determined by what it is
reasonably worth and sometimes, if it is purely private property,
devoted only to private uses, the matter rests arbitrarily with the
will of the owner. In this case, it being property devoted to a
public use, the amount of compensation was subject to the
determination of the State of Pennsylvania, the state which
authorized the creation of the property. The prices which may be
exacted under this legislative grant of authority are the tolls,
and these tolls, in the nature of the case, must enter into and
largely determine the matter of value. In the case of
Montgomery County v. Bridge Company, 110 Penn.St. 54, 58,
in which the condemnation of a bridge belonging to the bridge
company was sought, the court said:
"The bridge structure, the stone, iron, and wood, was but a
portion of the property owned by the bridge company and taken by
the county. There were the franchises of the company, including the
right to take toll, and these were as effectually taken as was the
bridge itself. Hence to measure the damages by the mere cost of
building the bridge would be to deprive the company of any
compensation for the destruction of its franchises. The latter can
no more be taken without compensation than can its tangible
corporeal property. Their value necessarily depends upon their
productiveness. If they yield no money in return over expenditures,
they would possess little, if any, present value. If, however, they
yield a revenue over and above expenses, they possess a present
value, the amount of which depends, in a measure, upon the excess
of revenue. Hence it is manifest that the income from the bridge
was a necessary and proper subject of inquiry before the jury."
So, before this property can be taken away from its owners, the
whole value must be paid, and that value depends largely upon the
productiveness of the property -- the franchise to take tolls.
That, in the absence of congressional action, the State of
Pennsylvania had the power, either acting itself or through a
corporation which it chartered, to improve the navigation of the
river by means of locks and dams, and also to authorize
Page 148 U. S. 330
the exaction of tolls for the use of such improvements, are
matters upon which there can be no dispute in view of the many
decisions of this Court. Those very closely in point are
Willson v. Blackbird Creek
Marsh Co., 2 Pet. 245;
Pound v. Turck,
95 U. S. 459;
Huse v. Glover, 119 U. S. 543;
Sands v. Manistee River Improvement Co., 123 U.
S. 288.
In the first of these cases, it appeared that the Marsh Company
was incorporated by an act of the General Assembly of Delaware, and
authorized to construct a dam across Blackbird Creek, a navigable
stream within the territorial limits of the state; that, in
pursuance of such authority, it did construct such dam, by which
the navigation of the stream was obstructed; Willson, with others,
were the owners of a sloop, regularly licensed according to the
laws of the United States, which sloop broke and injured the dam.
On being sued for this injury, the owners pleaded that the dam was
wrongfully erected, obstructing the navigation of the stream, and
that the sloop could not, without breaking through the dam, pass
over and along the stream, and that, in order to remove the said
obstructions, it did the injury complained of. A demurrer to this
plea was sustained, and in due course the case came to this Court.
The opinion was delivered by Chief Justice Marshall, sustaining the
ruling and holding that the dam, in the absence of legislation by
Congress, was rightfully there, having been authorized by the
legislature of the state in which the stream was situated. In it,
the Chief Justice said (p.
27 U. S. 252):
"If Congress had passed any act which bore upon the case, any
act in execution of the power to regulate commerce the object of
which was to control state legislation over those small navigable
creeks into which the tide flows and which abound throughout the
lower country of the middle and southern states, we should not feel
much difficulty in saying that a state law coming in conflict with
such act would be void. But Congress has passed no such act. The
repugnancy of the law of Delaware to the Constitution is placed
entirely on its repugnancy to the power to regulate commerce with
foreign nations and among the several states -- a power which has
not been so exercised as to affect the question. We do
Page 148 U. S. 331
not think that the act empowering the Blackbird Creek Marsh
Company to place a dam across the creek can, under all the
circumstances of the case, be considered as repugnant to the power
to regulate commerce in its dormant state, or as being in conflict
with any law passed on the subject."
In the case of
Pound v. Turck, it appeared that a dam
and boom had been placed in the Chippewa River under authority of
the Legislature of Wisconsin. The fact that the plaintiff suffered
injury therefrom was established, and the defense was that they
were rightfully there. Mr. Justice Miller, speaking for the Court,
on page
95 U. S. 464,
uses this language:
"There are within the State of Wisconsin, and perhaps other
states, many small streams navigable for a short distance from
their mouths in one of the great rivers of the country by
steamboats, but whose greatest value in water carriage is as
outlets to saw logs, sawed lumber, coal, salt, etc. In order to
develop their greatest utility in that regard, it is often
essential that such structures as dams, booms, piers, etc., should
be used which are substantial obstructions to general navigation,
and more or less so to rafts and barges. But to the legislature of
the state may be most appropriately confided the authority to
authorize these structures where their use will do more good than
harm, and to impose such regulations and limitations in their
construction and use as will best reconcile and accommodate the
interest of all concerned in the matter. And since the doctrine we
have deduced from the cases recognizes the right of Congress to
interfere and control the matter whenever it may deem it necessary
to do so, the exercise of this limited power may all the more
safely be confided to the local legislature."
Huse v. Glover comes even nearer to this case. The
State of Illinois, at an expense of several hundred thousand
dollars, constructed locks and dams on the Illinois River for the
purpose of improving its navigation, and prescribed rates of toll
to be paid by those using the improvements. A bill was filed to
enjoin the exaction of toll on vessels of complainant passing
through the improved waters of the river. After referring to the
clause in the ordinance for the government of the Northwest
Territory which provided that the navigable waters
Page 148 U. S. 332
should be common highways, forever free, without any tax or
duty, MR. JUSTICE FIELD, for the Court, on page
119 U. S. 548,
said:
"The exaction of tolls for passage through the locks is as
compensation for the use of artificial facilities constructed, not
as an impost upon the navigation of the stream. The provision of
the clause that the navigable streams should be highways without
any tax, impost, or duty has reference to their navigation in their
natural state. It did not contemplate that such navigation might
not be improved by artificial means, by the removal of
obstructions, or by the making of dams for deepening the waters, or
by turning into the rivers waters from other streams to increase
their depth. For outlays caused by such works the state may exact
reasonable tolls. They are like charges for the use of wharves and
docks constructed to facilitate the landing of persons and freight
and the taking them on board or for the repair of vessels. The
state is interested in the domestic as well as in the interstate
and foreign commerce conducted on the Illinois River, and to
increase its facilities, and thus augment its growth, it has full
power. It is only when, in the judgment of Congress, its action is
deemed to encroach upon the navigation of the river as a means of
interstate and foreign commerce that that body may interfere and
control or supersede it. If in the opinion of the state greater
benefit would result to her commerce by the improvements made than
by leaving the river in its natural state -- and on that point the
state must necessarily determine for itself -- it may authorize
them, although increased inconvenience and expense may thereby
result to the business of individuals. . . . How the highways of a
state, whether on land or by water, shall be best improved for the
public good is a matter for state determination, subject always to
the right of Congress to interpose in the cases mentioned."
And in the last of these cases, where the Manistee River was
improved under authority of the Legislature of the State of
Michigan, and tolls exacted for the use of the improved waterway,
we find this in the opinion, on page
123 U. S.
295:
"The internal commerce of the state -- that is, the commerce
which is wholly confined within its limits -- is as much under its
control
Page 148 U. S. 333
as foreign or interstate commerce is under the control of the
general government, and to encourage the growth of this commerce
and render it safe, the states may provide for the removal of
obstructions from their rivers and harbors, and deepen their
channels, and improve them in other ways if, as is said in
County of Mobile v. Kimball, the free navigation of those
waters, as permitted under the laws of the United States, is not
impaired, or any system for the improvement of their navigation
provided by the general government is not defeated.
102 U. S.
102 U.S. 691,
102 U. S. 699. And to meet
the cost of such improvements, the states may levy a general tax or
lay a toll upon all who use the rivers and harbors as improved. The
improvements are in that respect like wharves and docks constructed
to facilitate commerce in loading and unloading vessels.
Huse
v. Glover, 119 U. S. 543,
119 U. S.
548. Regulations of tolls or charges in such cases are
mere matters of administration, under the entire control of the
state."
Kindred to these are the cases of
Gilman v.
Philadelphia, 3 Wall. 713;
Transportation
Company v. Chicago, 99 U. S. 635;
Escanaba Company v. Chicago, 107 U.
S. 678;
Cardwell v. American Bridge Co.,
113 U. S. 205, and
Willamette Bridge Company v. Hatch, 125 U.
S. 12, in which the power of a state, in the absence of
congressional action, to obstruct navigation by the construction of
bridges across navigable streams was sustained. And also the cases
of
Packet Co. v. Keokuk, 95 U. S. 80, and
Transportation Co. v. Parkersburg, 107 U.
S. 691, in which the power of a state under like
circumstances to improve the border of streams by wharves and exact
wharfage therefor was affirmed.
While in a matter of this kind it is needless to look for
authorities beyond the decisions of this Court, yet the cases of
Kellogg v. Union Company, 12 Conn. 6, and
Thames Bank
v. Lovell, 18 Conn. 500, may be referred to as containing very
satisfactory discussions of this question. We quote from the
opinion in the latter case, page 511:
"These acts, improving rivers, constructing roads, etc., will
never be complained of as interfering with the rights and powers of
Congress. The tolls alone are the subject of complaint.
Page 148 U. S. 334
But these are only the fair equivalent for privileges which the
state had a right to create, and without which these privileges
could never have existed. Commerce therefore has not been crippled
by the tolls, as the defendant claims, but has been extended by
them. The legislature of the state creating this corporation, with
its duties and its privileges, has come in aid of the powers of
Congress."
"It seems to be admitted that states may construct canals,
turnpikes, bridges, etc., and impose tolls upon passengers and
freight as a remuneration for the improvements, and that this may
be done without interfering with the power of Congress to regulate
commerce among the states or its power to establish post offices
and post roads. We have not been able to discover a sound
distinction between these cases and the one we are considering.
Congress has the same power to regulate commerce upon the land as
upon the water. A river, to be sure, is a natural channel; but if
it is not a navigable one, it can no more be used for the purposes
of commerce than the land, and therefore to convert it from the
mere natural channel into a public highway for commercial purposes
and to levy a toll to reimburse the expense no more conflicts with
the powers of Congress over the commerce of the country than the
construction of a canal or a turnpike for the same purposes, with
the same tolls. And this, we think, is equally true of rivers,
which are only navigable to a partial and limited extent, and by
artificial and expensive means are rendered navigable to a greater
extent, with a reasonable toll levied upon those only who receive
the benefit of the extended navigation. The principle is the same
in both the cases stated."
But in this case, there was not only the full authority of the
State of Pennsylvania, but also, so far as respects this particular
lock and dam, they were constructed at the instance and implied
invitation of Congress. The Act of March 3, 1881, making an
appropriation for the improvement of the river, in terms provided
that no such improvement should be made until the navigation
company had in good faith started upon the building of this lock
and dam. This lock and dam connected the lower improvements already
made by the navigation
Page 148 U. S. 335
company with the upper improvements proposed to be made by
Congress, and the appropriation by the latter was conditioned on
the company's undertaking their construction. This is something
more than the mere recognition of an existing fact; it is an
invitation to the company to do the work, and when, in pursuance of
that invitation and under authority given by the State of
Pennsylvania, the company has constructed the lock and dam, it does
not lie in the power of the state or the United States to say that
such lock and dam are an obstruction, and wrongfully there, or that
the right to compensation for the use of this improvement by the
public does not belong to its owner, the navigation company.
Upon what does the right of Congress to interfere in the matter
rest? Simply upon the power to regulate commerce. This is one of
the great powers of the national government, one whose existence
and far-reaching extent have been affirmed again and again by this
Court in its leading opinions, and the power of Congress over such
natural highways as navigable streams is confessedly supreme.
See, among the various cases in which this supremacy has
been affirmed:
Gilman v.
Philadelphia, 3 Wall. 725;
County of Mobile v.
Kimball, 102 U. S. 691,
102 U. S. 696;
Bridge Co. v. United States, 105
U. S. 482;
Miller v. New York, 109
U. S. 392;
Wisconsin v. Duluth, 96 U. S.
379;
Willamette Iron Bridge Company v. Hatch,
125 U. S. 1. In
Wisconsin v. Duluth, page
96 U. S. 383,
it was said:
"It is to be observed, as preliminary to an examination of the
acts of the general government in the special matter before us,
that the whole system of river and lake and harbor improvements,
whether on the seacoast or on the lakes or the great navigable
rivers of the interior, has for years been mainly under the control
of that government, and that whenever it has taken charge of the
matter, its right to an exclusive control has not been denied. . .
. And while this Court has maintained in many cases the right of
the states to authorize structures in and over the navigable waters
of the state which may either impede or improve their navigation,
in the absence of any action of the general government in the same
matter, the doctrine has been laid down with unvarying
Page 148 U. S. 336
uniformity that when Congress has, by any expression of its
will, occupied the field, that action was conclusive of any right
to the contrary asserted under state authority. The adjudged cases
in this Court on this point are numerous."
And in
Willamette Bridge Co. v. Hatch, 125 U.
S. 12, the proposition was thus stated:
"And although, until Congress acts, the states have the plenary
power supposed, yet when Congress chooses to act, it is not
concluded by anything that the states, or that individuals by its
authority or acquiescence, have done, from assuming entire control
of the matter, and abating any erections that may have been made,
and preventing any others from being made, except in conformity
with such regulations as it may impose."
It cannot be doubted, in view of the long list of authorities --
for many more might be cited -- that Congress has the power, in its
discretion, to compel the removal of this lock and dam as
obstructions to the navigation of the river or to condemn and take
them for the purpose of promoting its navigability. In other words,
it is within the competency of Congress to make such provision
respecting the improvement of the Monongahela River as in its
judgment the public interests demand. Its dominion is supreme.
But, like the other powers granted to Congress by the
Constitution, the power to regulate commerce is subject to all the
limitations imposed by such instrument, and among them is that of
the Fifth Amendment we have heretofore quoted. Congress has supreme
control over the regulation of commerce, but if, in exercising that
supreme control, it deems it necessary to take private property,
then it must proceed subject to the limitations imposed by this
Fifth Amendment, and can take only on payment of just compensation.
The power to regulate commerce is not given in any broader terms
than that to establish post offices and post roads; but if Congress
wishes to take private property upon which to build a post office,
it must either agree upon the price with the owner or in
condemnation pay just compensation therefor. And if that property
be improved under authority of a charter granted by the state, with
a franchise to take tolls for the use of the
Page 148 U. S. 337
improvement, in order to determine the just compensation, such
franchise must be taken into account. Because Congress has power to
take the property it does not follow that it may destroy the
franchise without compensation. Whatever be the true value of that
which it takes from the individual owner must be paid to him before
it can be said that just compensation for the property has been
made. And that which is true in respect to a condemnation of
property for a post office is equally true when condemnation is
sought for the purpose of improving a natural highway. Suppose, in
the improvement of a navigable stream, it was deemed essential to
construct a canal with locks, in order to pass around rapids or
falls. Of the power of Congress to condemn whatever land may be
necessary for such canal there can be no question, and of the equal
necessity of paying full compensation for all private property
taken there can be as little doubt. If a man's house must be taken,
that must be paid for, and if the property is held and improved
under a franchise from the state, with power to take tolls, that
franchise must be paid for, because it is a substantial element in
the value of the property taken. So, coming to the case before us,
while the power of Congress to take this property is
unquestionable, yet the power to take is subject to the
constitutional limitation of just compensation. It should be
noticed that here there is unquestionably a taking of the property,
and not a mere destruction. It is not a case in which the
government requires the removal of an obstruction. What differences
would exist between the two cases, if any, it is unnecessary here
to inquire. All that we need consider is the measure of
compensation when the government, in the exercise of its sovereign
power, takes the property.
And here it may be noticed that after taking this property, the
government will have the right to exact the same tolls the
navigation company has been receiving. It would seem strange that
if, by asserting its right to take the property, the government
could strip it largely of its value, destroying all that value
which comes from the receipt of tolls, and having taken the
property at this reduced valuation, immediately possess and enjoy
all the profits from the collection of the same tolls.
Page 148 U. S. 338
In other words, by the contention, this element of value exists
before and after the taking, and disappears only during the very
moment and process of taking. Surely reasoning which leads to such
a result must have some vice -- at least the vice of injustice.
Much reliance is placed upon the case of
Bridge Company v.
United States, 105 U. S. 470. But
that was a case not of the taking, but of the destruction, of
property. It is true, Mr. Chief Justice Waite, in delivering the
opinion of the Court, uses this language in reference to the power
of Congress:
"But the power of Congress in respect to legislation for the
preservation of interstate commerce is just as free from state
interference as any other subject within the sphere of its
legislative authority. The action of Congress is supreme, and
overrides all that states may do. When, therefore, Congress in a
proper way declares a bridge across a navigable river of the United
States to be an unlawful structure, no legislation of a state can
make it lawful. Those who act on state authority alone necessarily
assume all the risks of legitimate congressional interference."
But such affirmation of power was not made with reference to a
question like this. The facts in that case were these: the bridge
company was a creature of the legislation of the States of Ohio and
Kentucky, and incorporated to build a bridge across the Ohio River
between Newport and Cincinnati. The state charters authorized the
construction of a bridge in accordance with the provisions of an
Act of Congress of July 14, 1862, or any act that Congress might
pass on the subject. On March 3, 1869, Congress passed a resolution
giving its assent to the construction of this bridge. This
resolution contained this reservation:
"But Congress reserves the right to withdraw the assent hereby
given in case the free navigation of said river shall at any time
be substantially and materially obstructed by any bridge to be
erected under the authority of this resolution, or to direct the
necessary modifications and alterations of said bridge."
15 Stat. 347. After the passage of this resolution, the company
commenced the erection of a drawbridge and expended a large amount
of money in the undertaking.
Page 148 U. S. 339
Before, however, the bridge was finished, Congress passed an act
-- the Act of March 3, 1871, 16 Stat. 572, 573, c. 121 -- requiring
a high bridge. The act provided that upon the bridge company's
making the changes required by the act, it might file its bill in
the Circuit Court of the United States for the Southern District of
Ohio to have determined whether the bridge had been constructed
theretofore, so far as the work had progressed, in accordance with
the provisions of law then in existence, and second, the liability
of the United States, if any there was, by reason of the changes.
The suit was brought, and on appeal to this Court, by four to
three, Mr. Justice Matthews taking no part in the decision, the
Court held that the government was not liable for any damages. The
case turned, in the judgment of the majority, mainly upon the
resolution of March 3, 1869, heretofore quoted. In the early part
of the opinion (page
105 U. S. 475)
the Chief Justice says:
"No question can arise in this case upon what the states have
done, for both Ohio and Kentucky required the company to comply
with the regulations of Congress. Neither are we called on to
determine what would have been the rights of the company if, in the
original license, no power of future control by Congress had been
reserved."
He then proceeds to consider at some length the peculiar
language of that reservation. Under it, as he says, Congress had
the right to withdraw assent, which was equivalent to a positive
enactment that a further maintenance of the bridge, as at first
planned and partially constructed, was unlawful, and the mere
exercise of its power under this reservation to declare the
proposed structure unlawful did not expose the government to any
liability for damages. We quote fully the expression of views on
this subject:
"It is next insisted that if, in the judgment of Congress, the
public good required the bridge to be removed or alterations to be
made in its structure, just compensation must be made the company
for the loss incurred by what was directed. It is true that one
cannot be deprived of his property without due process of law, and
that private property cannot be taken for public use without just
compensation."
"In the present case, the bridge company asked of Congress
Page 148 U. S. 340
permission to erect its bridge. In response to this request,
permission was given, but only on condition that it might be
revoked at any time if the bridge is found to be detrimental to
navigation. This condition was an essential element of the grant,
and the company, in accepting the privileges conferred by the
grant, assumed all risks of loss arising from any exercise of the
power which Congress saw fit to reserve. What the company got from
Congress was the grant of a franchise, expressly made defeasible at
will, to maintain a bridge across one of the great highways of
commerce. This franchise was a species of property, but from the
moment of its origin, its continued existence was dependent on the
will of Congress, and this was declared in express terms on the
face of the grant by which it was created. In the use of the
franchise thus granted, the company might, and, it was expected,
would, acquire property. The property thus acquired Congress could
not appropriate to itself by a withdrawal of its assent to the
maintenance of the bridge that was to be built, but the franchise,
by express agreement, was revocable whenever, in the judgment of
Congress, it could not be used without substantial and material
detriment to the interests of navigation. A withdrawal of the
franchise might render property acquired on the faith of it, and to
be used in connection with it, less valuable, but that was a risk
which the company voluntarily assumed when it expended its money
under the limited license which alone Congress was willing to give.
It was optional with the company to accept or not what was granted,
but, having accepted, it must submit to the control which Congress,
in the legitimate exercise of the power that was reserved, may deem
it necessary for the common good to insist upon."
It is evident, therefore, that the point decided was that
Congress had reserved the right to withdraw its assent to the
construction of a bridge on the plan proposed whenever in its
judgment such bridge should become an obstruction to the
navigation, that the bridge company entered upon the construction
of the bridge in the light of this express reservation, and with
the knowledge that Congress might at any time declare that the
bridge constructed as proposed was an
Page 148 U. S. 341
obstruction to navigation, and that Congress, exercising this
reserved power, did not thereby subject the government to any
liability for damages. There was no taking of private property for
public uses, and while the company may have been deprived of
property, it was deprived by due process of law, because deprived
under authority of an express reservation of power. Even this
conclusion was reached with strong dissent, Mr. Justice Miller, MR.
JUSTICE FIELD, and Mr. Justice Bradley dissenting and each writing
a separate opinion. And these opinions only make more clear the
fact that the case was rested in the judgment of the majority on
the effect of the reservation.
In the case at bar, there is no such reservation; there is no
attempt to destroy property; there is simply a case of the taking
by the government, for public uses, of the private property of the
navigation company. Such an appropriation cannot be had without
just compensation, and that, as we have seen, demands payment of
the value of the property as it stands at the time of taking.
The theory of the government seems to be that the right of the
navigation company to have its property in the river, and the
franchises given by the state to take tolls for the use thereof,
are conditional only, and that whenever the government, in the
exercise of its supreme power, assumes control of the river, it
destroys both the right of the company to have its property there
and the franchise to take tolls. But this is a misconception. The
franchise is a vested right. The state has power to grant it. It
may retake it, as it may take other private property, for public
uses, upon the payment of just compensation. A like, though a
superior, power exists in the national government. It may take it
for public purposes, and take it even against the will of the
state, but it can no more take the franchise which the state has
given than it can any private property belonging to an
individual.
Notice to what the opposite view would lead: a railroad between
Columbus, Ohio, and Harrisburg, Pennsylvania, is an interstate
highway, created under franchises granted by the two states of Ohio
and Pennsylvania, franchises not
Page 148 U. S. 342
merely to construct, but to take tolls for the carrying of
passengers and freight. In its exercise of supreme power to
regulate commerce, Congress may condemn and take that interstate
highway, but in the exercise of that power, and in the taking of
such property, may it ignore the franchises to take tolls, granted
by the states, or must it not rather pay for them, as it pays for
the rails, the bridges, and the tracks? The question seems to carry
its own answer. It may be suggested that the cases are not
parallel, in that in the present there is a natural highway, while
in that suggested it is wholly artificial. But the power of
Congress is not determined by the character of the highway. Nowhere
in the Constitution is there given power in terms over highways,
unless it be in that clause to establish post offices and post
roads. The power which Congress possesses in respect to this taking
of property springs from the grant of power to regulate commerce,
and the regulation of commerce implies as much control, as
far-reaching power, over an artificial as over a natural highway.
They are simply the means and instrumentalities of commerce, and
the power of Congress to regulate commerce carries with it power
over all the means and instrumentalities by which commerce is
carried on. There may be differences in the modes and manner of
using these different highways, but such differences do not affect
or limit that supreme power of Congress to regulate commerce, and
in such regulation to control its means and instrumentalities. We
are so much accustomed to see artificial highways, such as common
roads, turnpike roads, and railroads, constructed under the
authority of the states, and the improvement of natural highways
carried on by the general government, that at the first it might
seem that there was some inherent difference in the power of the
national government over them. But the grant of power is the same.
There are not two clauses of the Constitution, each severally
applicable to a different kind of highway. The fee of the soil in
neither case is in the general government, but in the state or
private individuals. The differences between the two are in their
origin; nature provides the one, man establishes the other.
Page 148 U. S. 343
Mr. Justice Bradley, delivering the opinion of the Court in
Railroad Company v.
Maryland, 21 Wall. 456,
88 U. S. 470,
referred to this matter in these words:
"Commerce on land between the different states is so strikingly
dissimilar in many respects from commerce on water that it is often
difficult to regard them in the same aspect in reference to the
respective constitutional powers and duties of the state and
federal governments. No doubt commerce by water was principally in
the minds of those who framed and adopted the Constitution,
although both its language and spirit embrace commerce by land as
well."
It is also suggested that the government does not take this
franchise; that it does not need any authority from the state for
the exaction of tolls, if it desires to exact them; that it only
appropriates the tangible property, and then either makes the use
of it free to all or exacts such tolls as it sees fit or transfers
the property to a new corporation of its own creation, with such a
franchise of take tolls as it chooses to give. But this franchise
goes with the property, and the navigation company, which owned it,
is deprived of it. The government takes it away from the company,
whatever use it may make of it, and the question of just
compensation is not determined by the value to the government which
takes, but the value to the individual from whom the property is
taken, and when by the taking of the tangible property the owner is
actually deprived of the franchise to collect tolls, just
compensation requires payment not merely of the value of the
tangible property itself, but also of that of the franchise of
which he is deprived.
Another contention is this: first, that the grant of right to
the navigation company was a mere revocable license; secondly, that
if it was not, there was a right in the state to alter, amend, or
annul the charter; and thirdly that there was by the eighteenth
section thereof reserved the right at any time after twenty-five
years from the completion of the improvement to purchase the entire
improvement and franchise by paying the original cost, together
with six percent interest thereon, deducting dividends theretofore
declared and paid --
Page 148 U. S. 344
a provision changed by section 8 of the Act of June 24, 1839, so
as to require a payment of the expenses incurred in constructing
and making repairs, with eight percent per annum interest. But
little need be said in reference to this line of argument. We do
not understand that the Supreme Court of Pennsylvania has ever
ruled that a grant like this is a mere revocable license. The cases
referred to by counsel are those in which there was simply a
permit; but here there was a chartered right created -- the right
not merely to improve the river, but to exact tolls for the use of
the improvement -- and such right, created by an act of
incorporation, as long ago settled in this Court in
Dartmouth College Trustees v.
Woodward, 4 Wheat. 518, is a contract which cannot
be set aside by either party to it.
Again, the state has never assumed to exercise any rights
reserved in the charter, or by any supplements thereto. So far as
the state is concerned, all its grants and franchises remain
unchallenged and undisturbed in the possession of the navigation
company. The state has never transferred, even if it were possible
for it to do so, its reserved rights to the United States
government, and the latter is proceeding not as the assignee,
successor in interest, or otherwise, of the state, but by virtue of
its own inherent supreme power. What the state might or might not
do is not there a matter of question, though doubtless the
existence of this reserved right to take the property upon certain
specified terms may often, and perhaps in the present case,
materially affect the question of value. And finally, there is no
suggestion on the part of Congress, and no proffer in these
proceedings, of payment under the terms of the charter and
supplementary act of 1839, and no attempt to ascertain the amount
which would be due to the company in accordance therewith.
These are all the questions presented in this case. Our
conclusions are that the navigation company rightfully placed this
lock and dam in the Monongahela River, that with the ownership of
the tangible property, legally held in that place, it has a vested
franchise to receive tolls for its use, that such franchise was as
much a vested right of property as the ownership
Page 148 U. S. 345
of the tangible property, that the right of the national
government, under its grant of power to regulate commerce, to
condemn and appropriate this lock and dam belonging to the
navigation company, is subject to the limitations imposed by the
Fifth Amendment that private property shall not be taken for public
uses without just compensation, that just compensation requires
payment for the franchise to take tolls, as well as for the value
of the tangible property, and that the assertion by Congress of its
purpose to take the property does not destroy the state
franchise.
The judgment therefore will be
Reversed, and the case remanded, with instructions to grant
a new trial.
MR. JUSTICE SHIRAS having been of counsel, and MR. JUSTICE
JACKSON not having been a member of this Court at the time of the
argument, took no part in the consideration and decision of this
case.