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United States v. Union Pacific Ry. Co., 160 U.S. 1 (1895)

United States v. Union Pacific Railway Company

No. 334

Argued October 18, 1894

Decided November 18, 1895

160 U.S. 1


The objects which Congress sought to accomplish by the Act of July 1, 1862, c. 120, 12 Stat. 489, granting a subsidy to aid in the construction of both a railroad and a telegraph line from the Missouri River to the Pacific Ocean, and by the Act of July 2, 1864, c. 216, 13 Stat. 356, amendatory thereof, were the construction, the maintenance, and the operation of both a railroad and a telegraph line between those two points; the governmental aid was extended for the purpose of accomplishing all these important results, and there is nothing in subsequent legislation to indicate a change of this purpose.

The provisions in those acts permitting the railroad company to arrange with certain telegraph companies for placing their lines upon and along the route of the railroad and its branches did not affect the authority of Congress, under its reserved power, to require the maintenance and operation by the railroad company itself, through its own officers and employees, of a telegraph line over and along its main line and branches.

Page 160 U. S. 2

An arrangement between the railroad company and the telegraph company, such as was permitted by the 19th section of the Act of July 1, 1862, and by the fourth section of the Act of July 2, 1864, c. 220, known as the Idaho Act, could have no other effect than to relieve the railroad company from any present duty itself to construct a telegraph line to be used under the franchises granted and for the purposes indicated by Congress. No arrangement of the character indicated by Congress could have been made except in view of the possibility of the exercise by Congress of the power reserved to add to, or amend the act that permitted such arrangement.

It was not competent for Congress under its reserved power to add to, alter, or amend these acts to impose upon the railroad company duties wholly foreign to the objects for which it was created or for which governmental aid was given, nor, by any alteration or amendment of those acts, destroy rights actually vested, nor disturb transactions fully consummated. With the policy of such legislation the courts have noting to do.

The provision in the Act of August 7, 1888, c. 772, 26 Stat. 382, requiring all railroad and telegraph companies to which the United States have granted subsidies to

"forthwith and henceforward, by and through their own respective corporate officers and employees, maintain and operate, for railroad, governmental, commercial and all other purposes, telegraph lines, and exercise by themselves alone all the telegraph franchises conferred upon them and obligations assumed by them under the acts making the grants,"

is a valid exercise of the power reserved by Congress.

Since the passage of the Act of July 24, 1866, c. 230, the provisions of which were embodied in the Revised Statutes Title LXV, Telegraphs, no railroad company operating a post road of the United States, over which interstate commerce is carried on, can bind itself, by agreement, to exclude from its roadway any telegraph company, incorporated under the laws of a state, that has accepted the provisions of that act and desires to use such roadway for its line in such manner as will not interfere with the ordinary travel thereon.

The agreement of October 1, 1866, between the Union Pacific Railway Company, Eastern Division, and the Western Union Telegraph Company gave the telegraph company the absolute control of all telegraphic business on the routes of the railway company, and consequently tended to make the Act of July 24, 1866, c. 230, 14 Stat. 221, ineffectual and was hostile to the object contemplated by Congress; and, being thus in its essential provisions invalid, it was not binding upon the railway company.

The agreements of September 1, 1869, and December 14, 1871, between the Union Pacific Railroad Company and the Atlantic and Pacific Telegraph Company were void.

The agreement of July 1, 1887, between the Union Pacific Railway Company and the Western Union Telegraph Company is illegal not only to the extent it assumes to give to the telegraph company exclusive rights and advantages in respect of the use of the way of the railroad company for

Page 160 U. S. 3

telegraph purposes, but also because, in effect, it transfers to the telegraph company the telegraphic franchise granted it by the United States, which was not permitted by the acts of Congress defining the obligations of railroad companies that had accepted the bounty of the government. While the United States might proceed by mandamus against the railway company to compel it to perform the duties imposed by its charter, it has the further right, in this suit, to ask the interposition of a court of equity to compel a cancellation of the agreements under which the telegraph company asserts rights inconsistent with the several acts of Congress, and the final decree in such a suit may require the railway company to obey the directions of Congress as given in those acts.

This suit was commenced by the United States in the Circuit Court for the District of Nebraska. A decree was there made giving the plaintiff the relief it asked for. 50 F. 28. An appeal was taken to the Circuit Court of Appeals for the Eighth Circuit, where the decree of the circuit court was reversed. 19. U.S.App. 531. From that decree the United States took this appeal. The case is stated in the opinion of the Court.

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