Pigeon River Improvement, Slide Boom Co v. Charles Cox

• Decision Date: 15 January 1934
• Docket Number: No. 126,126
• Citation: 291 U.S. 138,54 S.Ct. 361,78 L.Ed. 695
• Parties: PIGEON RIVER IMPROVEMENT, SLIDE & BOOM CO. v. CHARLES W. COX, Limited
• Court: U.S. Supreme Court

291 U.S. 138

54 S.Ct. 361

78 L.Ed. 695

PIGEON RIVER IMPROVEMENT, SLIDE & BOOM CO.

v CHARLES W. COX, Limited.

No. 126.

Argued Dec. 6, 7, 1933.

Decided Jan. 15, 1934.

Appeal from the United States Circuit Court of Appeals for the Eighth circuit.

[Syllabus from pages 138-140 intentionally omitted] Messrs. John D. Jenswold, of Duluth, Minn., and Bernard R. Goggins, of Wisconsin Rapids, Wis., for appellant.

[Argument of Counsel from pages 140-143 intentionally omitted] Mr. Edward L. Boyle, of Duluth, Minn., for appellee.

[Argument of Counsel from pages 143-147 intentionally omitted] Mr. Chief Justice HUGHES delivered the opinion of the Court.

Pigeon River Improvement, Slide & Boom Company, a Minnesota corporation, brought this action against Charles W. Cox, Limited, a Canadian corporation, to recover tolls for the use of improvements which the Minnesota corporation had made in the Pigeon river. These improvements embraced sluiceways, booms, and dams, which were used by the defendant in driving, sluicing, and floating timber products. The case was removed to the Federal court, a demurrer to the amended complaint was sustained without leave further to amend, and the judgment of dismissal was affirmed by the Circuit Court of Appeals. 63 F.(2d) 567. The case comes here on appeal.

Pigeon river is a boundary stream between the State of Minnesota and the Province of Ontario, Dominion of Canada, at the northeast corner of Minnesota. The river is a small stream which has its source in lakes on the international boundary and flows in a southeasterly direction along that boundary for about forty miles, discharging at Pigeon Bay into Lake Superior. The boundary is approximately midstream. The defense against the charge of tolls is based upon article 2 of the Treaty of August 9 1842—the Webster-Ashburton Treaty—which, after defining the international boundary, provides as follows:¹

'It being understood that all the water communications and all the usual portages along the line from Lake Superior to the Lake of the Woods, and also Grand portage, from the shore of Lake Superior to the Pigeon river, as now actually used, shall be free and open to the use of the citizens and subjects of both countries.'

When this treaty was concluded, the lower portion of the Pigeon river was impassable because of falls and rapids. On July 25, 1842, Mr. Ferguson, who had been surveyor to the commissioners under the seventh article of the Treaty of Ghent,² thus described this part of the river in response to an inquiry by Mr. Webster:³ 'At the mouth of the Pigeon River there is probably about three hundred yards in length of alluvial formation; but the river above that, as far as to near Fort Charlotte, runs between steep cut rocks of basaltic or primitive formation, and is a succession of falls and rapids for nearly its whole length—the last cataract, which is within about a mile of its mouth, being almost one hundred feet in height.' Below Fort Charlotte on the Pigeon river, communication with Lake Superior was by means of a trail about nine miles long running south of the river, and some distance from it, which was known as the Grand portage and was so described in the treaty.⁴ In Mr. Webster's com- munication to Lord Ashburton of July 27, 1842, summarizing the understanding which had been reached as to the boundary and setting forth the proposed stipulation as to water communications and portages which was incorporated in the treaty as above quoted, he said: 'The broken and difficult nature of the water communication from Lake Superior to the Lake of the Woods renders numerous portages necessary; and it is right that these water communications and these portages should make a common highway where necessary for the use of the subjects and citizens of both Governments.'⁵ At the time of the conclusion of the treaty, this was the highway of commerce, used principally by fur traders, between the Great Lakes and the country to the north and northwest.⁶ But the Pigeon river itself prior to the improvements here in question, as alleged in the complaint and admitted by the demurrer, 'was at all times incapable of use for the driving, handling and floating of logs, pulp-wood and timber.'

Pigeon River Improvement, Slide & Boom Company, which for convenience we may call the Pigeon River Company, was incorporated in 1898 under the general laws of Minnesota.⁷ These laws purported to empower the Pigeon River Company to improve streams by erecting sluiceways, booms, dams, and other works; to acquire structures already erected together with necessary rights of way, shore rights, land and lands under water; to operate its works so as to render the driving of logs practicable; and to collect 'reasonable and uniform tolls upon all logs, lumber and timber driven, sluiced or floated' on the streams so improved. The company was also authorized, in the case of a boundary stream, to purchase stock in a corporation created in an adjoining state or country for similar purposes upon the same stream, or to unite with such a corporation, upon conditions stated. Acting under this authority, the Pigeon River Company took possession of the portion of Pigeon river within the State of Minnesota and improved it by erecting sluiceways, booms, and dams on the Minnesota side of the international boundary.

At the same time, the complaint alleges, the Arrow River & Tributaries, Boom & Slide Company, was organized under the laws of the Dominion of Canada and Province of Ontario with powers and purposes similar to those of the Pigeon River Company, but limited to the portion of the Pigeon river and its tributaries within the Dominion of Canada. This Canadian corporation, under an agreement with the Pigeon River Company, similarly improved the portion of the Pigeon river on the Dominion side of the boundary so that the improvements made by each company 'constituted complements the one of the other, and the whole of said improvements rendered the driving of logs thereon reasonably practicable and certain.' These improvements. which have since been maintained, were all located below Fort Charlotte on the Pigeon river, with the sole exception of a reservoir dam at the south end of South Fowl Lake.

Adjacent to the lower part of the Pigeon river on the Minnesota side lies the Grand Portage Indian Reservation, extending for a considerable distance along the stream.⁸ By the Act of Congress of March 3, 1901,⁹ the Pigeon River Company was authorized, under such regulations and conditions as the Secretary of the Interior might prescribe, to 'improve the Pigeon River at what is known as the cascades of said river, for the purpose of making said river at said point navigable for floating logs.' For that purpose the company was empowered to enter upon unallotted lands and, with the consent of the allottees, upon allotted lands, adjacent to the cascades, of the Grand Portgage Indian Reservation and to construct such dams, bulkheads and other works as should be necessary. It was further provided that the river 'after being so improved shall be open at all times to the free passage of all timber cut from said Grand Portage Indian Reservation, and to the passage of all other timber for a reasonable charge therefor.'¹⁰ It does not appear that the Secretary of the Interior prescribed any regulations or conditions in relation to the improvements made by the Pigeon River Company.

Recovery is now, sought for the use by the defendant, a Canadian corporation, of these improvements in the years 1928, 1929, and 1930, in driving, sluicing, and floating upon the Pigeon river its pulp wood and railway ties. This timber, the defendant says in its argument, was cut from Canadian lands and put into the Arrow river, a tributary in Canada of the Pigeon river, and was floated into the Pigeon river on its way to Lake Superior and Canadian mills. The tolls charged the defendant are alleged in the complaint, and thus admitted, to be the 'reasonable and uniform tolls' which the Pigeon River Company had established. No question is raised as to reasonableness or discrimination, the only question being whether in the light of the provision of the treaty any tolls whatever could be charged. The contentions of the defendant are that the Pigeon river is a boundary stream and, as one of the 'water communications' described in the treaty, must be kept 'free and open' to the use of the citizens and subjects of both countries; that the imposition of tolls is inconsistent with this stipulated immunity and is not justified by the legislation which the Pigeon River Company invokes.

The Circuit Court of Appeals in the instant case followed its earlier decision in Clark v. Pigeon River Improvement, Slide & Boom Company, 52 F.(2d) 550, 556, where the court reached the conclusion that the charge of tolls was forbidden by the treaty. The court disagreed with the view advanced by the Pigeon River Company that the words of the treaty 'as now actually used' limited the provision as to 'free and open' use, expressing the opinion that these qualifying words referred only to the Grand Portage. Id., 52 F.(2d) 550, 555, 556. In support of its conclusion, the Circuit Court of Appeals cited the decision of the Appellate Division of the Supreme Court of Ontario in the case of Arrow River & Tributaries, Slide & Boom Company, Ltd., 66 Ont. L.R. 577; where the court held that the Canadian company did not have 'the right to build upon the bed of the Pigeon River anything which may interfere with the enjoyment of free and open use of it by the citizens of the United States.' After the Circuit Court of Ap- peals had decided the Clark Case, the judgment in the case of the Arrow River Company was reversed by the Supreme Court of Canada. 1932 Canadian Supreme Court Reports, 495. The latter decision was brought to the attention of the Circuit Court of Appeals in the instant case, but the court adhered to its former opinion. 63 F.(2d) 567,...