United States v. Winona & St. P.R. Co., 564.

Citation67 F. 948
Decision Date06 May 1895
Docket Number564.
PartiesUNITED STATES v. WINONA & ST. P.R. CO. et al.
CourtUnited States Courts of Appeals. United States Court of Appeals (8th Circuit)

Robert G. Evans, for the United States.

Thomas Wilson (Lloyd W. Bowers, on the brief), for appellees Winona & St. P.R. Co. and Minnesota Land & Investment Co.

J. A Tawney and H. M. Lamberton, for appellee Winona & st. P. Land Co.

Before CALDWELL, SANBORN, and THAYER, Circuit Judges.

SANBORN Circuit Judge.

In this case, the appellant, the United States, brought a suit in equity in the circuit court against the Winona & St. Peter Railroad Company, a corporation, and more than 35 of its immediate and remote grantees, to set aside the certification from the United States to the state of Minnesota of about 2,380 acres of land, and to annul the conveyances thereof by the state to the railroad company. This suit was brought under the provisions of the act of congress of March 3, 1887 (24 Stat.c. 376, p. 556), to provide for the adjustment of land grants in aid of the construction of railroads. It was grounded on the fact that, at the respective times of the definite location of the railroad of the Winona Company homestead entries or pre-emption filings had been made upon the lands described in the bill, so that, according to the decision of the supreme court in Railway Co. v Dunmeyer, 113 U.S. 629, 641, 644, 5 Sup.Ct. 566, these lands were excepted from the grant to the state for the benefit of the railroad company. The existence of the homestead entries and pre-emption filings, when the line of the railroad was definitely fixed, was conceded by the appellees; and their defense was that the certification of the lands to the state, although erroneous, was not void, but conveyed the legal title; that the appellees, other than the railroad company, had become the bona fide purchasers of all but 240 acres of this land, in reliance upon this certificate, before the government made any claim to recover it; that the 240 acres which were still held by the railroad company were rightfully certified to the state for the benefit of the St. Paul & Sioux City Railroad Company, another corporation; and hence that there was no equity in the bill.

In the view we take of this case, the material facts disclosed at the hearing are these: The lands in question were certified to the state under the provisions of the following acts of congress, viz.: The act of March 3, 1857 (11 Stat.c. 99, p. 195), which granted to the territory of Minnesota, for the purpose of aiding in the construction of certain railroads, including that of the Winona Company and that of the St. Paul & Sioux City Railroad Company, every alternate section of land designated by odd numbers for 6 sections in width on each side of each of said roads, and provided that in case it should appear that the United States had, when the lines or routes of said roads were definitely fixed, sold any sections or parts of sections granted, or that the right of pre-emption had attached to the same, then lands in lieu of those sold or pre-empted might be selected from alternate sections of the public domain within 15 miles of the lines of said roads; the act of congress approved March 3, 1865 (13 Stat.c. 105, p. 526, §§ 1, 2), which increased the quantity of lands granted by the act of March 3, 1857, to aid in the construction of the railroad of the Winona Company to 10 sections per mile, extended the indemnity limits of the grant to 20 miles, and provided that the lands granted by that act and by the act of March 3, 1857, should 'in all cases be indicated by the secretary of the interior'; and the act of May 12, 1864 (13 Stat. 72), which granted to the state of Minnesota, for the purpose of aiding in the construction of the railroad of the St. Paul & Sioux City Railroad Company, 4 additional sections per mile, to be selected within 20 miles of the line of said railroad, upon the same conditions, restrictions, and limitations as were contained in the act of March 3, 1857. The line of the railroad of the Winona Company was definitely fixed from its eastern terminus westerly to the west line of range 31 on July 29, 1858, to the west line of range 37 as early as August 3, 1864, and to the west line of range 38 on February 23, 1867. The line of the railroad of the Sioux City Company was definitely fixed from its eastern terminus to section 31, township 107, range 31, on February 20, 1858; and thence westerly to section 30, township 104, range 39, on August 10, 1865. Both of these railroad companies built their railroads in a time and manner that entitled them to the benefit of the acts of congress cited, so far as those acts and the timely construction of their railroads conferred upon them any right to these lands; and the railroad of the Winona Company was built past all and across some of these lands before the year 1873. All of these lands were certified to the state before June 7, 1879, and all but 680 acres of them before May 15, 1874. A part of them were certified to the state for the benefit of the Winona Company, and a part were certified to the state for the benefit of the Sioux City Company. Those certified for the benefit of the Winona Company were conveyed to that company by the state prior to 1880. The lands certified to the state for the benefit of the St. Paul & Sioux City Railroad Company were within the place limits of the Winona Company and within the indemnity limits of the Sioux City Company. When the line of the railroad of the Winona Company was definitely fixed opposite to the, they were subject to homestead entries or pre-emption filings, which were subsequently canceled by the proper officer of the land department of the United States. After these entries and filings had been canceled, the Sioux City Company selected these lands as indemnity lands under its grants, and they were thereupon certified to the state for its benefit. There was such a deficiency in the lands in place granted to Sioux City Company that all the public lands within its indemnity limits were required to fill it. In 1875, before the governor of the state had conveyed these lands to the Sioux City Company, the Winona Company brought suit against it for an injunction, forbidding that company to apply to or to receive from the governor of the state a conveyance of any of these lands, and for a decree that the Winona Company was justly entitled to them, and to a conveyance of them from the state. In 1885 the Winona Company succeeded in obtaining a final decision of the supreme court entitling it to this relief (St. Paul & S.C.R. Co. v. Winona & St. P.R. Co., 112 U.S. 720, 5 Sup.Ct. 334); and the governor of the state thereupon conveyed these lands to the Winona Company. On October 31, 1867, D. N. Barney and eight other persons owned the stock of the Winona Company. These persons had, at the request of the company, loaned to it large sums of money, and had constructed 105 miles of its railroad from Winona to Waseca, Minn. In payment of this loan and for the construction of this railroad, the corporation on that day agreed to deliver to these men certain amounts of its stock and bonds, and sold and agreed to convey to them, or to the parties to whom they directed it to convey, as many acres of land as the corporation should receive on account of the construction of that 105 miles of railroad, and to convey in satisfaction of this contract all the lands it should receive within its 20-mile limits, commencing at the eastern terminus of its railroad, and running westerly until the full quantity was conveyed, excepting, however, such portions of said lands as were necessary to the operation of its railroad. At the same time, and as a part of the same transaction, Barney and his associates sold their stock in the Winona Company to parties in control of the Chicago & Northwestern Railway Company, and the sale of and agreement to convey these lands were part of the consideration for the sale of the stock. Some of the lands covered by this contract were sold to innocent third parties before 1876. In that year, the appellee the Winona & St. Peter Land Company, a corporation, was organized with a capital stock of $500,000; and with this stock, it bought the unsold lands covered by the contract of October 31, 1867, and the obligations of the purchasers of the lands sold by Barney and his associates, for the unpaid purchase price thereof. Prior to 1878 the Winona Railroad Company conveyed to the parties designated by Barney and his associates all the lands in controversy, except 240 acres in range 38, which had been certified to the Sioux City Company, and except those which the Winona Company conveyed to the land company on November 20, 1887, in obedience to the decision of the supreme court of the United States in Railroad Co., 117 U.S. 618, 5 Sup.Ct. 606, and Barney v. Railroad Co., 117 U.S. 228, 6 Sup.Ct. 654. In court in the state of Minnesota to compel the Winona Railroad Company to convey the lands last mentioned to them, or to the parties they designated, under the contract of October 31, 1867. That suit was removed to the United States circuit court for the district of Minnesota, where a decree was rendered in April, 1881, that the Winona Company should convey these lands under the contract to the complainants in that suit, or to the parties they might designate. In 1886 this decree was affirmed on appeal by the supreme court; and on November 20, 1887, the Winona Company conveyed these lands to the Winona & St. Peter Land Company pursuant to that decree.

According to the uniform decisions of the officers of the land department of the United States, from the passage of the acts of congress under which these lands were certified to these railroad companies until the decision of the...

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