Houston Ry Co v. State of Texas

• Decision Date: 25 April 1898
• Docket Number: No. 406,406
• Citation: 18 S.Ct. 610,170 U.S. 243,42 L.Ed. 1023
• Parties: HOUSTON & T. C. RY. CO. et al. v. STATE OF TEXAS
• Court: U.S. Supreme Court

170 U.S. 243

18 S.Ct. 610

42 L.Ed. 1023

HOUSTON & T. C. RY. CO. et al.

v STATE OF TEXAS.

No. 406.

April 25, 1898.

This was a suit instituted by the state of Texas in the district court of Nolan county, Tex., February 3, 1890, to recover of the Houston & Texas Central Railway Company, and the purchaser under it, 16 sections of land of 640 acres each, located in that county by virtue of certificates issued by the state to the railway company. It was alleged that the certificates were issued by the commissioner of the general land office of Texas without authority of law, and that the action of the commissioner in issuing and delivering them, and permitting them to be located, and allowing the lands to be surveyed thereunder, and in receiving and filing the field notes in the general land office of the state, was without authority of law, and in violation of the constitution and laws of the state at that time; and also that the certificates were located in territory reserved by an act passed May 2, 1873, for the location of certificates issued to the Texas & Pacific Railway Company. It appeared from the state's complaint that the certificates were a part of those issued for the construction and completion of about 94 miles of main track, and about 2 1/2 miles of side track, of that part of the company's railway extending from Brenham to Austin.

The district court gave judgment in favor of the state, which was affirmed by the court of civil appeals. 36 S. W. 819. Application was made to the supreme court of the state for a writ of error, which was denied. 40 S. W. 402. This writ of error was then allowed.

The Galveston & Red River Railway Company was incorporated by a special act of the legislature of Texas approved March 11, 1848. Sp. Laws 1848, p. 370. By the second section of that act, the company was 'invested with the right of making, owning and maintaining a railway from such point on Galveston Bay, or its continguous waters, to such point upon the Red river, between the eastern boundary line of Texas and Coffee's Station, as the said company may deem most suitable, with the privilege of making, owning and maintaining such branches to the railway as they may deem expedient.'

A special act supplementary to that act was approved February 14, 1852, by section 14 of which there was granted to the company 'eight sections of land of six hundred and forty acres each, for every mile of railway actually completed by them and ready for use'; and provision was made for the inspection of the road from time to time by the state engineer, or a commissioner to be appointed by the governor, as any section of five miles thereof should be completed, on whose certificate that said section had been completed in a good and substantial manner, and ready for use, the comptroller should give information of that fact to the commissioner of the general land office, whose duty it should be to issue land certificates for the lands thus granted, which should be located upon the public domain of the state, survey be made, the field notes returned, and patents issued. Sp. Laws 1852, p. 142.

By another special act of February 7, 1853, the preliminary action of the incorporators in commencing the survey and grade of the railway at the city of Houston was confirmed; and, by section 2, the company was 'furthr authorized and empowered to extend said railway to the city of Galveston, and also to make and construct simultaneously with the main railway, described in the original acts establishing said company, a branch thereof towards the city of Austin, under the same restrictions and stipulations provided in said original acts,' etc. Sp. Laws 1853 (Ex. Sess.) pp. 36, 37.

January 30, 1854, the legislature passed a general law granting 16 sections of land to the mile for constructed railroad, which is sufficiently set forth in the preceding case, as well as the supplementary act approved the same day. It was provided that companies accepting the provisions of the act, and already entitled to eight sections per mile, should not be entitled to receive any grant for branch roads.

January 23, 1856, the legislature passed a special act, entitled 'An act for the relief of the Galveston and Red River Railway Company and supplementary to the several acts incorporating said company,' by which, after providing that the company should have six months after January 30, 1856, to complete the first 25 miles of its road, commencing at the city of Houston, it was declared that 'said company shall be entitled to the rights, benefits, and privileges, granted by an act approved Jaunary thirtieth, eighteen hundred and fifty-four, entitled 'An act to encourage the construction of railroads in Texas by donations of land,' upon the completion of said twenty-five miles within said six months,' etc., upon certain conditions, to wit: That the company should construct 25 miles of its road each year after the expiration of said time; that it should maintain its principal office and keep its records on the line of its road; that a majority of its directors should reside in the state; that it should build its main line to a certain point before commencing any branch road; that the act of February 7, 1853, to regulate railroads should apply to the charter; and that it should 'yield all general branching privileges, except such as are expressly granted by the provisions of its charter to certain points, and shall be required to expend only so much of its capital stock upon any branch as shall be expressly subscribed to such branch, and shall not spend upon its trunk any moneys subscribed for any branch, and shall be required to complete its main trunk to the point on Red River contemplated in its charter, or to such point of intersection between said road and some other road running from the northern or eastern boundary of Texas towards El Paso, as shall be agreed upon between the directors of said company.' It was provided that the company might assign certificates for lands granted it; that it might borrow money for the construction of the railway, and secure the same by mortgage and the issue of bonds; and that it should have the right, after location and survey of the lands granted it, or any part thereof, to mortgage or sell any part of the same. The sixth section road: 'That nothing in this act shall be so construed as to affect the right of the state to repeal or modify the act of January 30, 1854, entitled 'An act to encourage the construction of railroads in Texas by donations of land': provided, that the right to lands acquired before said repeal or modification shall in all cases be protected.' Sp. Laws 1856, pp. 28, 30.

By another special act approved September 1, 1856, the Galveston & Red River Railway Company was authorized to change its name to 'The Houston and Texas Central Railway Company,' and it was also provided that the failure of the company to build the second section of its road within one year after the completion of the first section should not work a discontinuance as to said company of the benefits of the general act of January 30, 1854, or of any other general or special laws relative to railroads, 'if said company shall have completed their second and third sections, amounting to at least fifty miles, at the expiration of two years after the constructo n of said first section.' Sp. Laws 1856, pp. 259, 260.

By another special act passed February 4, 1858, it was, among other things, provided that the failure of the company to complete the third section of its road by July 30, 1858. should not work a discontinuance as to the company of the benefits of the act of January 30, 1854, or any other general laws in reference to railroads, if the company should complete the third section by July 30, 1859; and that, on the completion of subsequent sections of 25 miles annually after July 30, 1859, or 50 miles every two years, 'said company shall be entitled to sixteen sections of land per mile, as contemplated in said last-mentioned act, for each section so completed'; and 'that the benefits of the provisions in the general law shall only inure to the said company while said laws shall remain in force.' Sp. Laws 1858, pp. 94, 95.

By still another special act, approved February 8, 1861, any failure to complete the fourth and fifth sections was condoned, and the company given until January 30, 1863, in which to complete those sections. Sp. Laws 1861, pp. 11, 12.

When the Civil War began, in 1861, the company had completed and had in operation its main line for about 80 miles from the terminus at Houston. January 11, 1862, the legislature passed two general acts continuing in force all laws granting lands to railway companies, and extending the time in which they were required to construct certain parts of their lines until two years after the close of the war. These acts provided that the president and directors of this railway company should, before the provisions of the acts might extend to the benefit of the company, pass a resolution restoring the original bona fide stockholders of the company to the rights, privileges, and immunities to which they were entitled previous to the sale of the road as mentioned in the acts: provided, the stockholders should pay into the treasury of the company 10 per cent. upon their stock on or before the expiration of the extension of time provided, or otherwise should forfeit their rights, privileges, and property interests as stockholders. Laws 1862, pp. 43, 44, 46, 47. The resolution required by these acts was duly passed by the company.

On September 21, 1866, a special act was passed, entitled 'An act granting lands to the Houston and Texas Central Railway Company,' by which a specific grant was made to that company 'of sixteen sections of land, of six hundred and forty acres each, for every mile of road it has constructed, or may construct, and put in running order, 'in accordance with the provisions...