Union Pac. R. Co. v. Mason City & Ft. D.R. Co.

• Decision Date: 29 February 1904
• Docket Number: 1,975.
• Citation: 128 F. 230
• Parties: UNION PAC. R. CO. v. MASON CITY & FT. D.R. CO.
• Court: U.S. Court of Appeals — Eighth Circuit

128 F. 230

UNION PAC. R. CO. v. MASON CITY & FT. D.R. CO.

No. 1,975.

United States Court of Appeals, Eighth Circuit.

February 29, 1904

Syllabus by the Court

The declaration of the Supreme Court in Union Pacific Ry. Co v. Chicago, etc., Ry. Co., 16 Sup.Ct. 1173, 163 U.S 564, 586, 41 L.Ed. 265, that the provisions of the Pacific Railroad acts relating to the bridge over the Missouri river imposed upon the Pacific Company and duty of permitting the Rock Island Company to run its engines and trains over the bridge and tracks of the Pacific Company between Council Bluffs, Omaha, and South Omaha, was a controlling adjudication of the question, and not a obiter dictum.

Where a court places its decision of the ultimate legal issue before it upon its decisions of two legal questions which were pertinent to the issue, debated at the bar, considered and determined in the opinion, the decision of either one of which is sufficient to sustain the determination of the ultimate issue, the decision of each of the two questions and of every pertinent legal question decided in reaching either decision has the binding force of an adjudication, and is not a mere orbiter dictum.

The reservation of a power to add to, alter, amend, or repeal a charter authorizes the proper legislative body to make any addition, alteration or amendment which does not impair vested rights or substantially interfere with the accomplishment of the main purpose of the charter.

The reservation, in the charter of a railroad company, of the power to add to, alter, amend, or repeal, includes the reservation of power to condition the title to a bridge and to terminal facilities with the provision that the joint use of them shall be allowed to other railroad companies for reasonable compensation, provided that this use does not deprive the holder of the property of the use of it requisite to the handling of its own engines and trains, to the conduct of its own business, and to the discharge of its corporate duty to the government and to the public.

A mortgagee, or the purchaser at a foreclosure sale of the right of the mortgagee to the property of a mortgagor railroad company, which held its title under a charter that reserved the right of addition, alteration, and amendment take their interests in the property subject to the right of the proper legislative body to exercise, at any time during the possession of the mortgagor and the existence of the mortgage, its reserved power of addition and amendment, and thereby to condition the title and use of the property with the requirement that other railroad companies shall be permitted to use it to the same extent as though the mortgage had never been made. The mortgagee and the purchaser under him get nothing which the mortgagor had not, and acquire no vested rights as against the legislative body and its beneficiaries.

The power to construct or extend a railroad beyond the points designated in the articles of incorporation of the company which owns it, 'as the board of directors of said corporation may determine and designate,' includes the power to acquire and enjoy the use of a bridge, a station and the railroad tracks of another company beyond such points, and in another state, upon the determination and designation of the board of directors, and upon compliance with the laws of both states relative to the acquisition and use of property by such a corporation therein.

This is an appeal from a decree of the Circuit Court for the District of Nebraska to the effect that the Union Pacific Railroad Company shall admit the Mason City & Ft. Dodge Railroad Company to the equal and joint use of its bridge across the Missouri river between Council Bluffs, Iowa, and Omaha, Neb., to its passenger station at Omaha, and to its main and passing railroad tracks between Council Bluffs, Omaha, and South Omaha, upon the terms and conditions specified in the contract between the Union Pacific Railway Company and the Chicago, Rock Island & Pacific Railway Company which was sustained by the Supreme Court in Union Pac. Ry. Co. v. Chicago, etc., Ry. Co., 163 U.S. 564, 16 Sup.Ct. 1173, 41 L.Ed. 265. The controversy which resulted in this decree involves the same property between Council Bluffs, Omaha, and South Omaha that is described in the statement and opinion, and that was the subject of the litigation which was closed by that decision. The appellant in this case is the purchaser of this property at a sale of it made in 1897 under the foreclosure of the first mortgage upon it which was made by the old Union Pacific Railroad Company on March 1, 1865. The Mason City & Ft. Dodge Railroad Company owns a railroad which extends from Council Bluffs, Iowa, to Manley Junction and to Hampton, in the state of Iowa, where it connects with the railroads of the Chicago Great Western Railway Company, and forms with these railways through lines of railroad from Council Bluffs to Chicago, Ill., to St. Paul and Minneapolis, Minn., and to Kansas City, in the state of Missouri. The Mason City Company sought by this suit to secure, and the decree below granted to it, access with its engines and trains to Omaha and South Omaha, and to the railroads entering those cities from the west and south, by means of the joint use of the bridge and railroads of the appellant, on the ground that the duty was imposed upon the latter company to grant to the Mason City Company this right, upon the payment by the appellee of reasonable compensation for the use of the bridge, station, and track, by the acts of Congress of July 1, 1862, c. 120, 12 Stat. 489; July 2, 1864, c. 216, 13 Stat. 356, 362; July 25, 1866, c. 246, 14 Stat. 244; and February 24, 1871, c. 67, 16 Stat. 430. These acts of Congress, and especially those provisions in them that are pertinent to the questions presented in this case, were recited, discussed, and analyzed in the Rock Island Case both in the Supreme Court and in the inferior courts, and it is believed that a reference to the opinions in that case will indicate their purpose and effect as well as an extended recital of them here. (C.C.) 47 F. 15; 51 F. 309, 321, 322, 2 C.C.A. 174; 163 U.S. 564, 585-589, 16 Sup.Ct. 1173, 41 L.Ed. 265. The decree of the Circuit Court is assailed on many grounds, which are considered in the opinion.

John N. Baldwin (W. R. Kelly, on the brief), for appellant.

Frank B. Kellogg and James M. Woolworth (William D. McHugh and Cordenio A. Severance, on the brief), for appellee.

Before SANBORN, VAN DEVANTER, and HOOK, Circuit Judges.

SANBORN Circuit Judge, after stating the case as above.

The chief contention of counsel for the Pacific Company is that the decree below is erroneous (1) because the acts of Congress never imposed upon the Union Pacific Railroad Company, the mortgagor under whose first mortgage of March 1, 1865, the appellant holds the property in question, nor upon its successor, the duty to grant the joint use of its bridge at Omaha, its passenger station in that city, or its railroad between Council Bluffs and Omaha to the appellee, or to any other railroad company; and (2) because, if such a duty was imposed upon it, it did not extend so far as to require that company, or any of its successors in interest, to grant to the appellee, or to any other railroad company, the use of its tracks or the use of its other transportation facilities between Omaha and South Omaha, or at any point west of Twentieth street in the former city.

The arguments and authorities in support of the position here taken by counsel for the appellant admonish us that the questions which it presents are grave, difficult, and of doubtful solution. We are, however, met at the threshhold of our investigation by the insistent claim of counsel for the appellee that each of the questions presented by this contention has been conclusively answered by the Supreme Court in Union Pacific Ry. Co. v. Chicago, etc., Ry. Co., 163 U.S. 564, 16 Sup.Ct. 1173, 41 L.Ed. 265. The opinion in that case was rendered by the Supreme Court of the United States, a court whose decisions command and always cheerfully receive the acquiescence of this and all inferior courts, and, if it has decided the legal issues pressed upon our consideration, it is neither the province nor the duty of this court to discuss or consider them. So the first question which presents itself for our determination involves a consideration of the nature and effect of the decision in the Rock Island Case.

In that case the Union Pacific Railway Company, the successor in interest of the Union Pacific Railroad Company, which made the mortgage of March 1, 1865, had made a contract with the Rock Island Company to grant to it the joint and equal use of its bridge and passenger station at Omaha, and of its railroads from Council Bluffs to Omaha and South Omaha, upon the same terms upon which this decree requires the appellant to grant the use of these facilities to the Mason City Company. The Pacific Railway Company refused to perform this agreement, and the Rock Island Company brought a suit in equity to compel its performance. The chief defense which the Pacific Company presented was that the making of the contract was beyond its corporate w powers. The counsel for the Rock Island Company answered that the powers of the Pacific Company were ample to permit it to enter upon and to execute the agreement between them (1) because the authority so to do was one of those incidental powers necessary to the full and convenient exercise of the authority to construct and operate a railroad, which had been expressly granted to it by its charter, and (2) because the act of July 25, 1866, c. 246, 14 Stat. 244, and the act of February 24, 1871, c. 67, 16 Stat 430, relating to the Omaha Bridge,...