The Official "Date of Completion"
of the Transcontinental Railroad under the Provisions of the Pacific Railroad
Act of 1862, et seq., as Established by the Supreme Court of the United
States to be November 6, 1869.
(99 U.S. 402) 1879
In 1879 the Supreme Court of the United States formally established, in its opinion and order in Union Pacific Railroad vs. United States (99 U.S. 402), the official "date of completion" of the Transcontinental Railroad, as constructed under the provisions of the Pacific Railroad Act of 1862, entitled "An Act to aid in the construction of a railroad and telegraph line from the Missouri River to the Pacific Ocean, and to secure to the Government the use of the same for postal, military, and other purposes" (as amended). In the following excerpt from that opinion, as delivered for the Court by Associate Justice Joseph P Bradley, the official date of completion was established as November 6, 1869. —BCC
In one sense, a railroad is never completed. There is never, or hardly ever, a time when something more cannot be done, and is not done, to render the most perfect road more complete than it was before. This fact is well exemplified by the history of the early railroads of the country. At first, many of them were constructed with a flat rail, or iron bar, laid on wooden string-pieces, resulting in what was known, in former times, as snake-head -- the bars becoming loose, and curving up in such a manner as to be caught by the cars, and forced through the floors amongst the passengers. Then came the "T" rail; and finally the "H" rail, which itself passed through many successive improvements. Finally, steel rails in the place of iron rails have been adopted as the most perfect, durable, safe, and economical rails on extensive lines of road. Bridges were first made of wood, then of stone, then of stone and iron. Grades originally crossed and, in most cases, do still cross, highways and other roads on the same level. The most improved plan is to have them, by means of bridges, pass over, or under, intersecting roads. A single track is all that is deemed necessary to begin with; but now, no railroad of any pretensions is considered perfect until it has at least a double track. Depots and station-houses are at first mere sheds, which are deemed sufficient to answer the purpose of business. These are succeeded, as the means of the company admit, by commodious station and freight houses, of a permanent and ornamental structure. And so the process of improvement goes on so that is often a nice question to determine what is meant by a complete, first-class railroad; and – if a question of right or obligation between parties depends upon the completion of such a structure, courts are obliged to spell out, from the circumstances of the case, and the language and acts of the parties, what they mean when they use such terms.
In the present case, we have for our guidance several clauses in the Charter of the Union Pacific Railroad Company (the Act of July 1, 1862), in which the terms referred to are used, as well as the acts of the parties in reference thereto. One of these clauses is in the fourth section of the act, which contains an engagement on the part of the Government to grant certain sections of land to the company on the completion of a certain number of miles of its road. The third section having granted to the company every alternate section of the public land, designated alternate sections per mile on by odd numbers, to the amount of five alternate sections on each side of of the railroad, on the line thereof, and within the limits of ten miles, not otherwise disposed of by the United States, the fourth section proceeds as follows:
"SECT. 4. That whenever said company shall have completed forty consecutive miles of any portion of said railroad and telegraph line, ready for the service contemplated by this act, and supplied with all necessary drains, culverts, viaducts, crossings, sidings, bridges, turnouts, watering-places, depots, equipments, furniture, and all other appurtenances of a first-class railroad, the rails and all the other iron used in the construction and equipment of said road to be American manufacture of the best quality, the President of the United States shall appoint three commissioners to examine the same and report to him in relation thereto; and if it shall appear to him that forty consecutive miles of said railroad and telegraph line have been completed and equipped in all respects as required by this act, then, upon certificate of said commissioners to that effect, patents shall issue conveying the right and title to said lands to said company, on each side of the road as far as the same is completed, to the amount aforesaid; and patents shall in like manner issue as each forty miles of said railroad and telegraph line are completed, upon certificate of said commissioners. . . . Provided, however, that no such commissioners shall be appointed by the President of the United States unless there shall be presented to him a statement, verified on oath by the president of said company, that such forty miles have been completed in the manner required by this act, and setting forth with certainty the points where such forty miles begin and where the same end, which oath shall be taken before a judge of a court of record."
By the act of 1864 (13 Stat. 356), the amount and extent of the grant is doubled.
Again, by the fifth section of the act of 1862 it is enacted as follows:
"SECT. 5. That, for the purposes herein mentioned, the Secretary of the Treasury shall, upon the certificate in writing of said commissioners of the completion and equipment of forty consecutive miles of said railroad and telegraph, in accordance with the provisions of this act, issue to said company bonds of the United States of $1,000 each, payable in thirty years after date, bearing six per centum per annum interest. . . . to the amount of sixteen of said bonds per mile for each section of forty miles, and to secure the repayment to the United States, as hereinafter provided, of the amount of said bonds so issued and delivered to said company, together with all interest thereon which shall have been paid by the United States, the issue of said bonds and delivery to the company shall ipso facto constitute a first mortgage on the whole line of the railroad and telegraph, together with the rolling-stock, fixtures, and property of every kind and description, and in consideration of which said bonds may be issued."
By the eleventh section the amount of bonds granted was to be $48,000 per mile for one hundred and fifty miles through the Rocky Mountains, and for the same distance including the Sierra Nevada Mountains, and $32,000 per mile between those points; and by the act of 1864 the completed sections were reduced to twenty miles instead of forty.
By the sixth section of the act it is farther enacted as follows:
"SECT. 6. That the grants aforesaid are made upon condition that said company shall pay said bonds at maturity, and shall keep said railroad and telegraph line in repair and use, and shall at all times transmit dispatches over said telegraph line, and transport mails, troops and munitions of war, supplies and public stores upon said railroad for the Government whenever required to do so by any department ave tile preference thereof, and that the Government shall at all times, in the use of the same for all the purposes aforesaid (at fair and reasonable rates of compensation, not to exceed the amounts paid by private parties for the same kind of service), and all compensation for services rendered for the Government shall be applied to the payment of said bonds and interest until the whole amount is fully paid. Said company may also pay the United States, wholly or in part, in the same or other bonds, treasury notes, or other evidences of debt against the United States, to be allowed at par, and after said road, is completed, until said bonds and interest are paid, at least five per centum of the net earnings of said road shall also be annually applied to the payment thereof."
Reading these sections together, it seems hardly possible to conceive that the word "completed," in the last clause of the sixth section, has any other or different meaning from that which it has in the fourth and fifth sections; or that the five per cent of the net earnings should not be demandable by the Government as soon as the whole line was completed in the same manner in which any forty [or twenty] miles was to be completed in order to entitle the company to bonds. This conclusion is so obvious and self-evident that it hardly needs a word of argument to maintain it.
Now, the findings of fact show that the company began to claim the subsidy of lands and bonds for completed sections of the railroad and telegraph line in June, 1866; and from that time forward made similar successive applications nearly or quite every month, tendering the affidavit of the president of the company as to the completion of the several sections, as required by the act. The first of these affidavits was made on the 25th of June, 1866, and was in the words following: —
"John A. Dix, being duly sworn, deposeth and saith, that he is president of the Union Pacific Railroad Company, and in pursuance of the requirements of Sect. 4 of the act of Congress approved July 1, 1862, entitled 'An Act to aid in the construction of the railroad and telegraph line from the Missouri River to the Pacific Ocean,' &c., he now states, under oath, that one hundred and five consecutive miles of said railroad, beginning at Omaha and ending at a point one hundred and five miles westward thereof, on the line designated by the maps of said company on file in the Department of the Interior, have been completed and equipped in all respects as required by the act referred to, as he is informed by the engineer charged with the construction of said line, and as he verily believes to be true; and he further states, under oath, that one hundred and five miles of telegraph have been completed for the said one hundred and five consecutive miles, as he is also advised by the engineer in charge,
"JOHN A. DIX,
"Sworn to, June 25, 1866."
The last affidavit, relating to the completion of the last section of the road (and indeed extending some fifty miles beyond the point of division finally agreed upon between the Union and Central Pacific Railroad Companies), was made on the 13th of May, 1869, and was in the words following:
"Oliver Ames, being duly sworn, deposeth and saith that he is president of the Union Pacific Railroad. And in pursuance of the requirements of Sect. 4 of the act of Congress approved July 1, 1862, entitled 'An Act to aid in the construction of a railroad and telegraph line from the Missouri River to the Pacific Ocean,' &c., he now states, under oath, that another section of eighty-six miles, commencing at 1,000 mile and ending at 1,086 mile post, was completed on the tenth day of May, 1869, making in all 1,086 consecutive miles of said road, beginning at the initial point on section 10, opposite western boundary of the State of Iowa, as fixed by the President of the United States, and ending at a point 1,086 miles westward therefrom on the line designated by the maps of said company on file in the Department of the Interior, that have been completed and equipped in all respects as required by the act referred to, as he is informed by the engineer charged with the construction of said line, and as he verily believes to be true. And be further states, under oath, that 1,086 miles of telegraph have been completed for the said 1,086 consecutive miles, as he is also advised by the engineer in charge.
Union Pacific Railroad Company.
"Sworn to, May 13, 1869"
The Court of Claims finds as a matter of fact that "on the 10th of May, 1869, the last rail of the claimant's road was laid, and about a week afterwards the road was opened over the entire length to public use for the transportation of passengers and freight, and for the service of the government; and this service was from that time forward performed continuously." [Emphasis added]
It further found that on the 23d of December, 1865, the President of the United States, under the authority of Sect. 4 of the said act of July 1, 1862, appointed commissioners to examine and report upon the first section of forty miles of said road; and some time prior to April 30, 1866, he appointed other commissioners to examine and report upon the second section of twenty-five miles of said road; and after the making of each of the foregoing affidavits, he appointed other commissioners to examine the sections of the road as successively completed, and report to him in relation thereto. The reports of the commissioners so appointed were made in the first instance to the Secretary of the Interior, who transmitted them to the President, who approved the recommendations of the Secretary of the Interior by writing his approval thereon. The following is the first letter of the said secretary, with the President's indorsement thereon:
"DEPARTMENT OF THE INTERIOR,
WASHINGTON, D. C., Jan. 24, 1866.
"SIR, – I have the honor to submit herewith enclosed, for your action, the report of the commissioners appointed by you on the 23d December, 1865, to examine the first section of forty miles of the Union Pacific Railroad, extending west from the city of Omaha, Territory of Nebraska. The, company authorized to build this road having, as shown in the report of the commissioners, obligated itself to remedy, within a reasonable time, the deficiencies in the construction of said section, I respectfully recommend that the same be accepted, and proper steps be ordered for the issue of the bonds and land-grants due the company agreeably to law.
"I am, sir, with much respect, your obedient servant,
"JAS. HARLAN, Secretary.
"EXECUTIVE MANSION, Jan. 24, 1866.
"The within recommendations of the Secretary of the Interior are approved, and the Secretary of the Treasury and himself are hereby directed to carry the same into effect.
Similar reports were made by the Secretary of the Interior, as the successive sections were completed and reported on by the commissioners, down to and including the ninth day of February, 1869, and were severally approved by the President; and the company received the subsidy bonds of the Government in accordance therewith.
As it appeared by the reports of some of the commissioners that the several sections of road were not, and could not, under the circumstances be, fully completed up to the ultimate standard of a first-class railroad, though they might be, and actually were, completed, section by section, so as to admit of transportation and travel over the same, the railroad company, on the 12th of February, 1869, being thereto required by the Attorney-General of the United States, as a guaranty for the ultimate full completion and equipment of the road, executed an agreement of the last-mentioned date to deposit in the Treasury Department their own first-mortgage bonds (which by the act of July 2, 1864, they had been authorized to issue, and which were to be preferred to the lien of the United States) to the amount of $3,000,000, to be held by the Government as security for the completion of the road according to the provisions of the statutes in that behalf, and until the President, on a proper examination of the same, should be satisfied that it was so completed. At the same time, the company also agreed, by way of further security, to leave their land-grants with the government, without taking out patents to the same, until the President should be satisfied as aforesaid, – or pro tanto to such extent as he might not be satisfied.
On the 10th of April, 1869, a joint resolution was passed by Congress, by which, amongst other things, it was declared that the common terminus of the Union Pacific and the Central Pacific railroads should be at or near Ogden. And that the President was thereby authorized to appoint a board of eminent citizens, not exceeding five in number, to examine and report upon the condition of the two roads (the Union Pacific and the Central Pacific), and what sum, if any, would be required to complete each of them. And the President was further authorized and required to withhold from them an amount of subsidy bonds sufficient to secure the full completion of the roads as first-class roads, or to receive an equal amount of the first-mortgage bonds of the companies. A board of five eminent citizens was appointed under this resolution in the mouth of August following.
In the meantime, two additional reports were made by the Secretary of the Interior to the President, one on the 27th of May, 1869, and the other on the 15th of July, 1869, in each case recommending the acceptance of the section referred to therein, and also recommending the issue of bonds therefor, in accordance with the agreement aforesaid, to the effect that the company should deposit its first-mortgage bonds with the Secretary of the Treasury to such amount as might be deemed necessary to secure the ultimate completion of the road.
The last of these reports, with the President's indorsement thereon, is in the words following, to wit:
"DEPARTMENT OF THE INTERIOR,
WASHINGTON, D. C., July 15, 1869.
"Sir, – I have the honor to transmit herewith, for your action, five reports, dated the 9th ultimo, of the commissioners, Messrs. Gouverneur K. Warren and James F. Wilson; also the report of Isaac N. Morris, the other commissioner, dated May 28, 1869, appointed by you to examine and report upon a section of 85 88/100 miles of the road and telegraph line, constructed by the Union Pacific Railroad Company, commencing on the road of said company at the 1,000th mile post west from Omaha, and terminating at the 1,085 88/100 mile-post.
"The majority of said commissioners, in their report, represent the said section of 85 88/100 miles ready for present service, and completed and equipped as a first-class railroad, and that the telegraph line is completed for the same distance; and as the company have paid the per diem and mileage due them under the twenty-first section of the act of Congress approved July 27, 1866, on account of their examination of said section of road and telegraph line, I therefore respectfully recommend the acceptance of the same and the issue of bonds and of patents for land due on account of said section, agreeably to the act approved July 1, 1862, entitled 'An Act to aid in the construction of a railroad and telegraph line from the Missouri River to the Pacific Ocean, and to secure to the Government the use of the same for postal, military, and other purposes,' and the acts amendatory thereof. Said bonds and patents to be issued to the Union Pacific Railroad Company on account of the work from said 1,000th mile-post to the 'common terminus of the Union Pacific and Central Pacific Railroads,' 'at or near Ogden;' and the bonds and patents on account of said work from said common terminus to Promontory Summit to be issued to such company as the proper authority, after full investigation of the respective claims of the Union Pacific Railroad Company and the Central Pacific Railroad Company of California shall determine to be thereunto lawfully entitled: Provided, however, that no bonds or patents shall in any event be issued until such security shall be deposited with the Secretary of the Treasury necessary to secure the ultimate completion of the road, agreeably to the acts mentioned in my letter to you of the 27th of May last.
I am, sir, very respectfully, your obedient servant,
"J. D. Cox, Secretary.
"EXECUTIVE MANSION, July 15, 1869.
The within recommendations of the Secretary of the Interior are approved, and the Secretary of the Treasury and himself are hereby directed to carry the same into effect.
"U. S. GRANT."
It is found by the Court of Claims that on the 22d of July, 1869, in partial performance of this last order of the President, $640,000 of subsidy bonds were issued to the company, being the subsidy for the section of twenty miles extending from the 1,000th to the 1,020th mile from Omaha, the subsidy bonds on all the previous sections having been received by the company before that time.
As before stated, in August, 1869, the President, in accordance with the joint resolution of April 10, 1869, appointed 'a board of five eminent citizens, to examine and report upon the condition of the road, and what sum would be required to complete it as a first-class railroad. This board made a detailed examination, and on the 30th of October, 1869, made an elaborate report, specifying a number of particular things at various points, such as ballasting, embankment, masonry, trestle-work, &c., which required perfecting to put the road in first class condition; estimating the aggregate expense of such improvements on the whole line from Omaha to Ogden at $1,586,100. They conclude their report as follows: "This great line, the value of which to the country is inestimable, and in which every citizen should feel a pride, has been built in about half the time allowed by Congress, and is now a good and reliable means of communication between Omaha and Sacramento, well equipped, and fully prepared to carry passengers and freight with safety and dispatch, comparing in this respect favorably with a majority of the first-class roads in the United States." [Emphasis added]
This report being made and accepted, on the 3d of November, 1869, the Secretary of the Interior issued directions to the Commissioner of the General Land-Office to commence patenting lands to the companies, and to issue patents for one half of the lands which they were to receive,-the patents for the other half to be suspended until further directions, in addition to the bonds retained, as security for the completion of the roads in the matters reported deficient or not up to the standard by the said committee.
Up to the 6th of November, 1869, the point at which the Union Pacific and Central Pacific roads should meet was not settled [Emphasis added] but assuming that the former would go no further west than Ogden, 1,033 68/100 miles from Omaha, the Secretary of the Treasury on that day ordered that bonds at the rate of $32,000 per mile for the distance of 13 68/100 miles from the 1,020th mile-post to Ogden should be issued, but ordered that the register of the treasury should hold $323,488 thereof as security for the over-issue of first-mortgage bonds by the company, and deliver the balance to it. The reason of withholding these bonds was, that the company, having been authorized by the act of July 2, 1864, supplementary to its charter, to issue the same amount of first mortgage bonds as it was entitled to receive from the Government, and which was accorded a priority over the lien of the Government bonds, and having actually constructed the road fifty-three miles west of Ogden, had issued a larger amount of its own bonds than the amount of subsidy to which it was entitled as the point of division between its road and that of the Central Pacific was finally settled. By a subsequent arrangement with the Central Pacific Railroad Company, the point of junction between the two roads was fixed at a point five miles west of Ogden, [Emphasis added] which entitled the Union Pacific Company to bonds for such five additional miles, amounting to $160,000, which it received in July, 1870, making the total amount of subsidy bonds which it was entitled to, and did receive, the sum of $27,235,760.
It thus appears that prior to the sixth day of November, 1869, the entire road of the company had, in separate sections, been reported by it, under the oath of its president, as being completed and furnished as a first-class railroad, in accordance with the requirements of the act, and that upon the strength of these representations, and the corresponding reports of the commissioners appointed to examine the several sections, it had been accepted by the President; [Emphasis added] and that the company, with the exception of the last $160,000 of bonds, the claim to which arose from a mutual arrangement between the two companies, had received its entire subsidy of government bonds; and had received an order for the issuing of patents for its grant of public lands to the extent of one half thereof; the patents for the other half being suspended, by virtue of the agreement made in April, 1869, as security for the more perfect completion of certain parts of the work.
It is urged that the acceptance of the road by the President up to this period was only provisional, and not final. We cannot perceive that this makes any difference. It was an acceptance by which the company was enabled to receive its subsidy of government bonds; and was sought by it in order that it might obtain them.
It seems to us unnecessary to look further, or to review the subsequent proceedings which took place between the President and the company, in reference to the fulfillment of the conditions by the latter, on which the issue of the patents for the remaining lands depended. It appears that another commission was appointed to examine the road in 1874, and that, on their report, the President was satisfied that all the imperfections, as a security for the removal of which any patents had been suspended, were removed. The company insists that this was the period which should be taken for the completion of the road in reference to the payment of five per cent of its net earnings, a period five years after it had reported the last section completed according to the act of Congress, and after the President, by virtue of the agreement aforesaid, had consented to accept it as completed for the purpose of enabling the company to draw its subsidy of government bonds, and after it had received said bonds.
Can a stronger case of estoppel than this well be presented? The plea that the Government still retained a portion of the public lands which the company was to receive, as security for the supply of certain deficiencies in the road, cannot avail to diminish the strength of the estoppel. This was done by the voluntary agreement of the company itself. And as, by making this concession, it succeeded in obtaining the formal acceptance of its road for the sake of the benefit to accrue therefrom, to wit, the procurement of the subsidy bonds, the company ought to be willing to bear the burden of such acceptance, to wit, the payment annually of five per cent of the net earnings of the road on account of the bonds. It would be an unfair construction of the acts of the parties under the law, to hold that the road was completed for one purpose and not for the other. We think, therefore, that the Court of Claims was right in deciding that the road was completed on the sixth day of November, 1869, so far as the duty of the company to account for five per cent of its net earnings is concerned. [Emphasis added] ...
Transcribed by and Courtesy of the Bruce C. Cooper
From: "ACTS AND
JOINT RESOLUTIONS OF CONGRESS, AND
DECISIONS OF THE SUPREME COURT OF THE
UNITED STATES RELATING TO THE
UNION PACIFIC, CENTRAL PACIFIC, AND
WESTERN PACIFIC RAILROADS." WASHINGTON: Government
Printing Office. 1897