ARGUMENT ^
«♦
\
* #
SUBMITTED ON BEHALF OF THE
• BEFORE THE
SECRETARY OF THE INTERIOR
\
AND-THE
ATTORNEY-GENERAL OF THE U. S.
—• <♦» •-
ABTEMAS H. HOLMES, Counsel.
u
» 4
H. J. HEWITT, PRINTER, 27 ROSE STREET.
1877.
To the Honorable the Secretary of the Interior and the
Attorney-General of the United- States :
Gentlemen :
The Kansas Pacific Railway Company, whose road is one
of those mentioned in the preambles of the resolutions lately
passed by the Senate and House of Representatives respec¬
tively, offered in the Senate by the Hon. J. B. Chaffee, of
Colorado, and in the House by Hon. T. T. Crittenden, of
Missouri, desires to avail itself of the privilege of a hear¬
ing and of submitting for your consideration an argument
addressed to the subject-matter of these resolutions, re¬
questing the President to inform the respective Houses what
legal impediments, if any, exist which prevent him from
executing the laws in accordance with the obligations ac¬
cepted and the agreements made by the Union Pacific Rail¬
road Company and its branches with the United States, as
stipulated and agreed upon in the Acts of Congress re¬
ferred to in the preambles/
The acts referred to are the act approved July 1, 1862,
and the . acts approved July 2, 1864, March 3, 1869, and
June 20, 1874, amendatory thereof.
POINT I.
The information requested of the President by the reso¬
lutions is only as to " what legal impediments, if any, exist
which prevent him from executing said laws," and, strictly
speaking, the request would be complied with by a re¬
sponse by the President that the acts referred to do not
vest in him power or authority sufficient to enable him
to execute the same. But the resolution, taken in connec¬
tion with the preambles, seems to require, as within its
scope and purview, the determination of the following
grave questions:
2
I. What are the rights of the public and the Govern¬
ment, and what are the requirements of the Acts of Con¬
gress in relation to the operation and use of the Union
Pacific Railroad and its branches for all purposes of com¬
munication, travel, and transportation?
II. What are the rights and duties of the Union Pacific
Railroad and branches, as between themselves, in relation to
the operation and use of their resj^ective roads ?
III. Are the public, the Government, and the several
roads of the system of roads in the enjoyment of their re¬
spective rights, and are the several roads complying with
the requirements of said Acts of Congress in regard to the
operation and use of said roads ?
IV. What authority, if any, is vested in the President
under these Acts of Congress which enables him to enforce
their execution in this respect ?
And if upon an investigation of these questions it shall
be found that vested rights of the public, the Government,
or of any of the roads of the system as well as the require¬
ments of the Acts of Congress in relation to the operation
and use of said roads or any of them, are being violated
and evaded in a most flagrant manner (and we have not the
slightest doubt that such will be found to be the fact upon
such investigation), another and graver question presents
itself for consideration—namely,
V. Is further legislation necessary or expedient to enable
the executive to compel a compliance with the require¬
ments of these acts, and this in a summary manner ?
POINT II.
The Kansas Pacific Company will endeavor to answer
the questions above stated, and proposes to prove that the
Union Pacific Railroad Company, from the year 1870 up to
the present time, has operated its road in open and direct
contravention of the requirements of the Acts of Congress,
and in violation of vested rights of the public, the Gov¬
ernment, and the Kansas Pacific Company, to the manifest.
loss and injury of the public, the Government, and the
Kansas Company.
3
But, before proceeding further, it maybe well to recur to
the time when the act of 1862 and the amendment of 1864
was passed, following the general rules of interpretation
and construction of an Act of Congress as enunciated bv
Mr. Justice Davis, who, in delivering the opinion of the
Supreme Court of the United States in the United States
vs. The Union Pacific Railroad Company, 1 Otto 72, uses
the following language in relation to the acts we are about
to consider:
" In construing an Act of Congress we are not at liberty
to recur to the views of individual members in debate, nor
to consider the motives which influenced them to vote for
or against its passage. The act itself speaks the will of
Congress, and this is to be ascertained from the language
k used. But courts, in construing a statute, may, with
propriety, recur to the history of the times when it was
passed, and this is frequently necessary to ascertain the
reason as well as the meaning of particular provisions
of it."
HISTORICAL RESUME.
At the time the original Act of Congress to aid in the
construction of a railroad from the Missouri River to the
Pacific Ocean was passed, July 1, 1862, there was one com¬
pleted railroad across the State of Missouri (the Hannibal
and St. Joseph) and another (the Pacific Railway of Mis¬
souri) in course of construction, with the prospect of early
completion, to Kansas City. There were no other railways
reaching the Missouri River, or within two hundred miles
of it, and none under contract, the Chicago, Iowa and
Nebraska Railroad having stopped at Cedar Rapids, the
Mississippi and Missouri Railroad at Iowa City, and the
Burlington and Missouri River Railroad at or near Mount
Pleasant. The attention of Congress was accordingly fixed
upon the eastern border of Kansas as the starting point of
the proposed railway to the Pacific. Kansas had been
admitted to the Union as a State, and Nebraska was yet
under a territorial government. The Leavenworth, Pawnee,
and Western Railroad Company was an existing corpora-
4
tion chartered by the Legislature of Kansas, and empow¬
ered to build a railroad from the Missouri River to the
western boundary of that State. The Pacific Railroad bill,
as originally reported to the House of Representatives,
provided that the Union Pacific Railroad should commence
on the western boundary of Kansas, at the termination of
the Leavenworth, Pawnee, and Western Railroad, whose
initial point was fixed in the bill at the western terminus
of the Pacific Railroad of Missouri—viz., Kansas City.
The Leavenworth, Pawnee, and Western Company subse¬
quently took the name of the Union Pacific Railroad,
Eastern Division, and still later that of the Kansas Pacific.
The bill provided that there should also be built a
branch road from the western boundary of Iowa to connect
with the Union Pacific Railroad, on the western boundary*
7
of Kansas, at or near the 102d meridian of longitude. It is
a part of the history of the time that when the bill was
under discussion in the House of Representatives objection
was made to the indefiniteness of the location of the pro¬
posed starting point of the Union Pacific Railroad. This
was fixed at the western terminus of the Leavenworth,
Pawnee, and Western Railroad ; but the western terminus
of this road had not been definitely settled. An amend-
ment was accordingly offered to the bill authorizing the
Union Pacific Railroad Company to construct a branch
road from the western boundary of Iowa, to connect with
the Kansas road at some point not more than two hundred
and fifty miles from the place of commencement, and
requiring said company to do so under penalty of forfei¬
ture of all its rights and franchises, inasmuch as with¬
out this compulsory clause there was great danger that the
Iowa branch would not be built at all. The Kansas branch,
it was said, would doubtless be constructed, u because it-
was the pivotal point on which the whole system depend¬
ed." The amendment was subsequently changed so as to
require the connection of the Iowa branch to be made with
the main line on the 102d meridian of longitude, that being
the western boundary of Kansas, and in this form was
#>• /
adopted by the House.
5
When the bill came into the Senate it was determined,
as a matter of economy, to shorten the length of the Kan-
ty * —
sas and Iowa branches by tixing the eastern terminus of
the Union Pacitic Railroad at the lOOtli instead of the 102d
meridian, and as this raised a question of constitutional
right which was deemed by many Senators a serious one—
viz., the right of Congress to charter a railroad corporation
in a State—it was decided to carry the terminus northward
into the territory of Nebraska. It was accordingly fixed
"on the 100th meridian of longitude west from Greenwich,
between the south margin of the valley of the Republican
River and the north margin of the valley of the Platte
River, in the territory of Nebraska." These words were
incorporated in the law to establish the initial point of the
Union Pacific Railroad. Throughout the debates in Con¬
gress the idea is everywhere prominent that the Union
Pacific Railroad was to commence on the 100th meridian.
This idea was engrafted upon the bill in several places,
and enacted into the law of 1862, and re-enacted into the
law of 1864.
' The initial point in longitude having been thus fixed, an
attempt was made in the act of 1864 to fix the point in
latitude also. This was partially accomplished by provid¬
ing that if the Union Pacific Railroad Company should
not be actually, and in good faith, building "said rail¬
road"—to wit, the railroad commencing on the 100th
meridian—at the time the Kansas branch road should have
reached said meridian, then the Kansas Company should
be entitled to build the Union Pacific Railroad through to
the point of junction with the Central Pacific Railroad of
California. The two companies, the one building the Kansas
branch and the other building the Iowa branch, were thus
put in the attitude of competitors for the privilege of
building the trunk line commencing on the lOOtli meridian.
But in order to give both the opportunity to use the most
favorable route open to them, without prejudice to their
. rights as equal branches of the main line, whatever that
line might be, it was provided in the ninth section of the
act that either of them might join the Union Pacific Rail-
6
road at any point west of the 100th meridian, if found
more practicable or desirable. This was in fact a necessary
part of the new arrangement to fix the point in latitude
for commencing the Union Pacific Railroad; for if the
Kansas road should arrive at the 100th meridian first, the
company constructing the Iowa branch, and following the
most practicable and desirable route for its line, might,
upon reaching the 100th meridian, find itself one or two
hundred miles distant from what would then be the
Union Pacific Railroad, and be left hanging in the air. So,
if the latter company should arrive at the 100th meridian
first, the same dilemma would be presented to the former,
unless provision were made for effecting a junction west-
wardlv of the 100th meridian, the cost of the additional
«/ 7
mileage to be borne wholly by the company making it.
For various reasons, but principally by reason of the
favorable nature of the ground in the valley of Platte
River, which required very little grading to prepare the
road-bed, the company constructing the Iowa branch were
enabled to make more rapid progress in track-laying than
the Kansas Company. This fact became evident in 'the
year 1866, to the two companies and to Congress. An act
was accordingly passed in that year authorizing the Kan¬
sas Company to make its connection with the Union Pacific
Railroad at a point not more than fifty miles westwardly
from the meridian of Denver, Colorado, which was subse¬
quently done.
By the act of 1864, the company constructing any part
of its road westwardly from the 100th meridian, as author¬
ized, without a subsidy of bonds from the Government,
was entitled to aland grant of the same number of acres
per mile as on any other portion of its road. This act and
the amendatory act of 1866 gave to the Kansas Company a
land grant of ten alternate sections per mile on each side
of its pnrposed line, from the 100th meridian to a point of
junction with the Union Pacific Railroad not more than
fifty miles west of the meridian of Denver. In order, how¬
ever, to expedite the construction of railroads to Denver,
Colorado, Congress, in the year 1869, authorized the Kan-
7
sas Company to make a contract witli the Denver Pacific
Railway and Telegraph Company for the construction of
that part of its line between Denver and the point of junc¬
tion with the Union Pacific Railroad, which point was fix¬
ed at Cheyenne. This act authorized the Kansas Company
to transfer to the Denver Pacific Railway and Telegraph
Company all its rights and privileges, including its land
grant, subject to all its obligations, in pursuance of such
contract. It also required the Kansas Company to extend
its railroad to Denver, so as to form with that part of its
line authorized to be constructed by the Denver Pacific
Railway and Telegraph Company a continuous line from
Kansas City, by way of Denver, to Cheyenne, and pro¬
vided that all the provisions of law for the operation of
the Union Pacific Railroad, its branches and connections,
as a continuous line, without discrimination, should apply
the same as if the road from Denver to Cheyenne had been
constructed by the Kansas Company itself.
It appears from this historical sketch that the governing
idea of Congress throughout this legislation was a national
road commencing on the 100th meridian, and going west¬
ward to a point of junction with the Central Pacific Rail¬
road of California, with an Iowa branch and a Kansas
branch, the two branches to enjoy the same privileges, and
the whole to be constructed by the aid of Government
bonds and lands. It appears to have been the common ex¬
pectation at the time the enterprise was first projected,
that the Kansas Company, by reason of its facilities of
communication with the East, would become the Cnion Pa¬
cific Railroad Company, and it was for this reason that the
Union Pacific Company was not merely authorized to build
the Iowa branch, but was required to do so at a certain rate
of speed under heavy penalties. The requirement that the
several roads provided for in the acts should be operated
as one continuous line, without discrimination as to rates,
time and transportation, runs through all the Acts of Con¬
gress cited, and was conceived quite as much in the inte¬
rest of the Iowa branch as of any other branch, and must
8
have been originally more in tlie interest of that branch
than of the Kansas branch, since the latter was then ex¬
pected to be the main line. The authorized deflection of
the two branches from the point of junction first contem¬
plated on the 100th meridian was likewise as much in the
interest of the Iowa branch as of the Kansas branch, and
the fact that the Kansas branch alone availed itself of the
authorization, impairs its rights in no manner whatsoever.
And in this connection, Mr. Justice Davis, in the same
opinion above cited, uses the following language:
"The war of the rebellion was in progress, and, owing
to complications with England, the country had become
alarmed for the safety of our Pacific possessions. The loss
of them was feared in case those complications should
result in an open rupture ; but, even if this fear were
groundless, it was quite apparent that wTe were unable to
furnish that degree of protection to the people occupying
them which every government owes to its citizens. It was
true, the threatened danger was happily avoided, but wis¬
dom pointed out the necessity of making suitable pro¬
visions for the future. This could be done in no better
way than by the construction of a railroad across the con¬
tinent. Such a road would bind together the widely-sepa¬
rated parts of our common country, and furnish a cheap
and expeditious mode for the transportation of troops and
supplies. . . . This enterprise was viewed as a na¬
tional undertaking for national purposes, and the public
mind was directed to the end in view rather than to the
particular means of securing it. Although this road was a
military necessity, there were other reasons active at the
time in producing an opinion for its completion besides the
protection of an exposed frontier. There was a vast un¬
peopled territory lying between the Missouri and Sacra¬
mento rivers which was practically worthless without the
facilities afforded by a railroad for the transportation of
persons and property. ...
"It was in the presence of these facts that Congress
undertook to deal with the subject of this railroad. The
difficulties in the way of building it were great, and by
9
many intelligent persons considered insurmountable. . . *
The project of building the road was not conceived for
private ends, and the prevalent opinion was that it could
not be worked out by private capital alone. It was a na¬
tional work, originating in national necessities, and
requiring national assistance
The enterprise contemplated, fostered, and lavishly sub¬
sidized by Congress, was for the establishment and mainte¬
nance of a great transcontinental highway upon and over
which, the main stem and branches, the public, the
Government, and each road of the system should have
equal and inalienable rights—a great common thorough¬
fare such as that afforded by the Mississippi, with its great
tributaries, the Arkansas, Red, Ohio, Missouri, and Illinois
rivers—a national highway, common to all.
POINT III.
Your attention is now invited to a consideration of the
questions of law and of fact involved in the questions
above stated, and numbered I., II., and III. The subject-
matter of these questions has been recently presented and
elaborately argued in a case now pending in the Circuit
Court of the United States for the District of Nebraska,
before Judges Dillon and Dundy, and an examination of
the questions presented for judicial determination in that
case, and the arguments of counsel for the Union Pacific
and Kansas Pacific companies respectively, will lead as
well to the investigation of the provisions of the acts of
Congress in regard to the matters under consideration as
to a full understanding of the manner in which said roads
are now being operated and used in this regard. There
has therefore been prepared and annexed hereto a resume
of the case as presented to the court, and of the arguments
made upon it, which will now be discussed.
POINT IY.
Now, as to Question IY., careful and repeated examina¬
tions of the acts of Congress in question have not discov-
10
ered any express or specific authority'vested^in the^'Presi-
dent which enables Mm to enforce their execution, or to
compel the Union Pacific Company to desist from its un¬
lawful operation and use of its road and comply with the
requirements of the acts of Congress in this respect. There
exists, however dehors the acts, the right of the Govern¬
ment or the public to institute and maintain a proceeding
by Mandamus to compel said company to operate its road
as required by law; and the act of Congress approved
March 3, 1873, expressly confers upon the proper Circuit
Court of the United States the jurisdiction to hear and de¬
termine such cases ; or proceedings might be instituted by
the Attorney-General for a forfeiture of the charter of that
company because of the violation of its terms. But it is
submitted that in either case the relief obtained would not
be any more speedy or expedient than the relief sought in
the case above referred to, in which a mandatory injunc¬
tion is sought; and before a final determination of the case
could be reached in the Supreme Court the injury and
damage occasioned by the unlawful use of the offending
road would, in the case of many of the injured parties at
least, have become irreparable.
POINT V.
*
In response to the last question above stated it is re¬
spectfully submitted:
1. Assuming that existing laws are sufficient for all the
purposes of the Kansas Pacific Pail way Company, and that
they can be enforced after sufficient lapse of time, it should
be borne in mind that that company may consolidate itself
with the Union Pacific Company, or may execute a lease of
its road to said company, or may enter into a contract law¬
ful and binding as between the parties, whereby the public
may be as effectually shut out from the advantages intend¬
ed to be secured to them by the Pacific Pailroad Acts as
they are now. The right of travellers and freight-shippers
at Denver, for example, to the use of the Union Pacific
Railway on equal terms with all other citizens—their right
to be protected against unjust discriminations as to rates,
11
time, and transportation facilities—will remain after the
Kansas Pacific Company shall have secured its own rights,
either by litigation or by negotiation, and it would be an
«> O •/ C
extremely narrow view to take of the matter to assume
that because the Kansas Pacific Company is prosecuting a
suit, or has the right to prosecute a suit, therefore the
rights of the public will be ultimately secured and pro¬
tected. It may be said that private parties likewise have
the right to bring suits for mandamus to compel the Union
Pacific Company to operate its road as required by law. It
was decided in the Omaha bridge case that they have this
right, and in that case a peremptory mandamus was
granted requiring the company to do certain acts and to re¬
frain from doing certain other acts. Nevertheless, if I am
correctly informed, the Union Pacific Company has since
that time disregarded the mandamus, as it had previously
disregarded the law, showing that the remedies now exist¬
ing are practically valueless so far as the public are con¬
cerned.
2. Again : the ability of the Kansas Pacific Company to
repay its indebtedness to the Government depends wholly
upon its earning capacity. It lias no resources outside of
its receipts from the transportation of persons and pro¬
perty. Under existing laws it is required (1) to keep its
road up to a certain standard of efficiency and to have it
always in readiness for the use of the Government; (2) to
render service to the Government for one-half the compen¬
sation charged to private individuals, the other half being
credited to the company on account of the subsidy bonds ;
(3) to pay at least 5 per cent, of its net earnings into the
Treasury on the same account; (4) to reimburse the princi¬
pal and interest of the subsidy bonds at the maturity
thereof. The subsidy bonds issued to the company amount
to $6,303,000, having thirty years to run, with interest at
6 per cent., the whole indebtedness amounting eventually
to $17,648,400, less the amount earned and to be earned by
government transportation. But the Kansas Pacific Com¬
pany, being cut off from its rightful share of the overland
traffic by the discriminations of the Union Pacific Com-
12
pany, has been unable to pay the full interest on its first
mortgage bonds, and is at the present time in the
hands of receivers and threatened with foreclosure bv
reason of such default. The company is now in arrears of
first mortgage interest to the amount of $3,547,049, and is
threatened with still further embarrassment by the hostile
action of the Union Pacific Company, which has recently
built a branch road into Colorado for the purpose ap¬
parently of diverting traffic hitherto enjoyed by the Kansas
Pacific Company to its own treasury. It is a question of
the first moment to the Government whether it will allow
its own security as second mortgagee of the Kansas Pacific
Pail way to be impaired or lost through the refusal of the
Union Pacific Company to obey a plain requirement of its
charter. The overland and local business of the two com¬
panies is capable of yielding and does yield net earnings to
the amount of over $9,500,000 per annum, of which only
$2,715,142 is required for first mortgage interest of both
companies, leaving an annual surplus of nearly $7,000,000
for other purposes. How short-sighted would be a policy
which should allow one of these companies by persistent
infraction of law to destroy the other, and thereby render
the Government's claim upon it valueless !
3. It may well be enquired, also, whether the Government
can remain indifferent to the rights of the first mortgage
bondholders of the Kansas Pacific and Denver Pacific Pail-
ways, and indeed of any other persons who have invested
their money in those enterprises on the faith of the several
acts of Congress requiring all these roads to be operated as
one continuous line, "without any discrimination of any
kind in favor of the road or business of either of said com¬
panies, or adverse to the road or business of any or either
of the others." Most of the money which built the Kansas
Pacific and Denver Pacific roads was furnished bv citizens
of foreign countries upon the belief that these laws would be
complied with, and that since the whole system of Pacific
railways was a national undertaking, and since the Govern¬
ment itself stood between them and the companies as sec¬
ond mortgagee, they would be protected against loss, so
13
far, at least, as tlie enforcement of the charter obligations of
the companies was concerned. Perhaps erroneous infer¬
ences were drawn from the fact that the Government stood
in such near relations to them ; but it is worth enquiring, in
connection with other reasons lime advanced, whether some
consideration is not due to the people who enabled the
Government to have the use of any such thoroughfares as
the Kansas Pacific and Denver Pacific Railways.
4. The attitude of the Union Pacific Railroad Company
in the premises lias become in some sort a national scan¬
dal. Great hardship lias been inflicted upon individuals
and communities and States bv the discriminations estab-
lislied by that company (see Appendix A). The public
press has taken up the matter in many widely distant parts
of the country as a case calling for the active interference
«/ *•»
of the Government in the interests of law and order, hold¬
ing that the monopoly established by the Union Pacific
Company is both unauthorized and dangerous, and that
the time has come to put some adequate check upon its en¬
croachments. The strength of this feeling has been shown
in both houses of Congress, and the Secretary of the Inte¬
rior has alluded to it in his annual report in the following
concise terms :
"That there is such discrimination is bejmnd dispute.
That it is in direct contravention of the letter and spirit of
the Pacific Railroad Acts there can scarcely be serious
doubt. There seems to be no disposition on the part of the
Union Pacific Company voluntarily to remedy this evil,
but I am of the opinion that proper steps should be taken
to enforce compliance with the acts of Congress."
4. It may be added, and this is an important fact in the
case, that these discriminations are practised against the
Government as well as against private shippers, and as
the Government is the largest shipper over these roads it is
the greatest sufferer. A case in point is furnished by the
charge made by the Union Pacific Company for the trans¬
portation of 416 troops belonging to the Second Infantry
from St. Louis to r*an Francisco in the month of July last.
The Kansas Pacific Company offered to transport these
u
troops at five dollars less 'per man than the regular rate
on the Union Pacific ; that is to say, at $111 per man, the
regular rate from St. Louis to San Francisco, via Omaha,
being $116, divided as follows :
Cents
Miles. Fare, per mile.
St. Louis to Council Bluffs.. 438 $15.50
Omaha Bridge .50
Union Pacific * 1,033 54.00 5t2o3tt
Central Pacific 883 46.00 5TVo
$116.00
For conveying these troops from Cheyenne to Ogden, a
distance of 516 miles,- the Union Pacific Company charged
$46.50 per man, or at the rate of nine cents per mile, its
regular through rate being only 5T2o2o cents per mile—a dis¬
crimination of 3tVtt cents per man per mile against the
Government. This was equal to $19.50 per man on the
distance traversed, or $7,312 on the number carried. It is
possible for the Treasury Department, under the system
which exists for settling these accounts, to throw the loss
of this particular sum on the Kansas Pacific and Denver
Pacific companies, by allowing the Kansas Pacific only
$7.30 per man for 639 miles, or 1T10V cents per man per
mile, and the Denver Pacific $3.50 per man for 106 miles,
or $3rW per man per mile. But, assuredly, this will be
the last time, if such a rule prevails, that the Kansas Pa¬
cific will offer to carry Government troops and property
at less rates than those established by the Union Pacific.
The Government effected a saving of nearly one thousand
dollars on this particular bill by accepting the offer of the
Kansas Pacific Company, and might effect similar savings
constantly but for the discriminations of the Union Pacific
Company.
5. The Kansas Pacific Company was surprised to learn
that this discrimination repeated itself on the Central Pa¬
cific Railroad, and that, inasmuch as the troops belonging
to the Second Infantry did not traverse the whole line of the
Union Pacific Railroad, but were taken by that company
at Cheyenne, they were charged local rates on the Central
15
Pacific Railroad from Ogden to San Francisco, or $7.50
more than the regular through rate, which would have left
nothing whatever to the Kansas Pacific for transporting
the-troops 638 miles. It is the first case that has come to
my knowledge of a discrimination by the Central Pacific
Company against either the Kansas Pacific Company or the
Government, and is presumed to be an inadvertence. It
will be seen by the document (Appendix B) that it is dis¬
approved of by the Quartermaster-General.
6. Leaving out of view . the advantages of competi¬
tion in the carriage of persons and property from the Mis¬
souri River to the Pacific Ocean, which the Government, as
well as private individuals, are entitled to, it is easy to see
that these troops might have been stationed at some place
where their passage over the Kansas Pacific or the Denver
Pacific, en route to the Pacific coast, would have been
necessary. It is absurd to suppose that the Government is
obliged, for instance, to send its troops from Fort Riley or
Fort Hays east to Kansas City, and thence north to Omaha,
to start for the Pacific, in order to get the lowest rate of
fare to their destination. Yet this is what it must do if the
discriminations of the Union Pacific Company are tolerated.
This is what private shippers are obliged to do (see Ap¬
pendix A), and it is important to consider what redress
they have under existing laws. It is impossible for
each shipper to bring an action to maintain his rights, and
doubtful if he could secure them practically, even after a
successful issue of his suit; for, as the president of the
Union Pacific Company stated in a recent interview with
myself and others, where this subject was under discus¬
sion, "One man can lead a horse to water, but you know
how many it takes to make him drink." The annoyances to
which a great and powerful company can subject a private
shipper are many fold greater than any damages that
might be awarded to him in an action at law.
The conclusion upon the whole matter is that the Govern¬
ment, and the Government alone, possesses the power
adequate to compel the Union Pacific Company to operate
16
its road as required by law. Since Congress reserved the
power to alter, amend, or repeal the acts under which the
Union Pacific Railroad Company took its charter and all
its franchises and privileges, it is for Congress to say-what
further measures shall be taken to enable the Executive to
secure to the public and the Government a faithful com¬
pliance with the statutes which forbid discriminations, and
to enforce these laws in a summary manner; and further
legislation is necessary and expedient to that end.
All of which is respectfully submitted 011 behalf of the
Kansas Pacific Railway Company.
ARTEMAS H. HOLMES,
of Counsel.
17
APPENDIX A.
Discriminating Rates of Passenger Fares ;and
Freight Charges of the Union Pacific Railroad
Company to and from Cheyenne.
The Kansas Pacific Railway Company, at the time of
making its last demand upon the Union Pacific Railroad
Company for a faithful compliance with the laws of Con¬
gress herein recited, ascertained that the following among
other discriminating charges were in force at the offices of
the latter Company at Omaha and Cheyenne :
i C «,•
Through Freights to the Pacific Coast in cents per 100
pounds.
ARTICLES.
! Omaha to Cheyenne to
Ogden. Ogden,
! 1,032 miles. 516 miles.
Agricultural implements
Ale and beer (in wood)..
Bacon
Bitters
Canned goods
Candles
Coal-oil
Dried fruit
Dry-goods
Paints
Furniture
Hardware
Household goods
Iron and nails
Liquors (in wood).......
Sugar
Stoves
273
101
101
J 35
78
78
78
135
227
78
273
135
273
78
112
135
101
219
163
163
219
219
191
191
191
219
163
219
191
219
163
191
163
219
18
Local Freights.
ARTICLES.
Between
Omaha and Ogden,
1,032 miles.
'
'
Between
Cheyenne and Ogden,
516 miles.
Cents per
Per car¬
Cents per
Per car¬
100 lbs.
load.
100 lbs.
load.
Agricultural imple¬
ments
250
$219 50
219
$220 00
Bacon
165
245 00
163
290 00
Beans
122^
245 00
163
326 00
Beef (mess)
122^
245 00
163
326 00
Butter.
207
219
Candles
207%
191
Coal-oil
122 %
245 00
191
326 00
Cheese
207%
219
Coffee •
122 y2
163
Dried fruit
207^
191
Dry-goods
250
219
Drugs
250
219
Earthenware
122
168 50
• 219
220 00
Pence-wire
122^
163
Furniture
219 50
220 00
Window-glass
122^
163
Grain
122^
117 50
163
206 00
Hides
168 50
382 00
Iron and nails
122
245 00
163
220 00
Live stock
168 50
240 00
Lumber
:
<
117 50
187 50
Stoves and fixtures... .
250
279 00
219
240 00
Sugar *
12214
245 00
163
326 00
Passenger Fares.
An enquiry made at the office of the Union Pacific Rail¬
road Company in New York on the 20th April last,
elicited the answer that passenger fares were the same
from Cheyenne to Ogden (516 miles) as from Omaha to
Ogden (1,032 miles). It has been customary, however, for
the Union Pacific Railroad Company to charge local rates
($46 50) on emigrant business coming to Cheyenne via the
Kansas Pacific Railway en route to Ogden, while its charge
19
for the same business from Omaha to Ogden is only $21 60
—or $29 40 more for 516 miles than for 1,032 miles.
APPENDIX B.
War Department, )
Quartermaster-General's Office, V
Washington, D. C., Dec. 1, 1877. )
To the Honor able the Secretary of War :
Sir : With reference to the report from this office of No¬
vember 3, 1877, forwarding the accounts for the transporta¬
tion of the Second Infantry from St. Louis to San Francisco
via Kansas City, it is observed that the rate of $53 50 per
mail charged for the transportation over the Central Pacific
Railroad from Ogden to San Francisco is in excess of the
proportion which enures to that company on through pas¬
senger travel from Ogden to San Francisco, viz., $46 per
man—that is to say, the through tariff rate charged the
public from Omaha to San Francisco is $100 per man, of
which the Union Pacific Railroad receives on division $54
and the Central Pacific $46.
The charge of $53 50 per man for the transportation of
these troops from Ogden to San Francisco is the local tariff
rate for transportation between these points—that is, the
rate which would be charged a person whose journey should
commence at Ogden and end at San Francisco.
I consider that this rate of $53 50 charged for the troops
is $7 50 per passenger too much.
The troops started from Atlanta, Georgia, and passed
direct through to San Francisco, and I can see no sufficient
reason for the Central Pacific Railroad charging $7 50 per
man ($3,120 in the whole) more, for the reason that the
men reached Cheyenne on tlm Union Pacific Railroad via
Denver, instead of passing over the whole of the line of the
Union Pacific from Omaha.
The cost to the company of their transportation over the
Central Pacific from Ogden, the eastern terminus of that
road, to San Francisco, was in no manner affected by their
20
having come through Denver instead of through -Omaha,
and therefore the charge seems to me unjust.
This difference, excess in charge, had not been clearly
brought to my attention when the report of 13th November
was written.
Whether it be a violation of the law, being a discrimina¬
tion against the Kansas Pacific and Denver Pacific4End¬
ways, depends upon the point at issue between the roads—
that is, whether the line from Kansas City to Denver, and
7 V
thence to Cheyenne, is entitled to protection by the law
against adverse discrimination. \
Very respectfully, your obedient servant,
(Signed) M. C. Meigs,
Quartermaster-General, Brevet Major-General U. S. Army.
Q. M. G. O., December 1, 1877.
|fn the (Circuit (Court o! the United States
FOR THE DISTRICT OF NEBRASKA.
The Kansas Pacific Railway Com¬
pany and The Denver Pacific
Railway and Telegraph Company,
Complainants,
vs.
The Union Pacific Railroad Com-
„ pany,
Defendant.
Before Hon. John F. Dillon, Circuit Judge, and Hon.
Elmer S. Dundy, District Judge.
J. P. Usher, J. M. Woolworth, and Artemas II.
Holmes, Complainants' Counsel.
George G. Wright, John N. Rogers, and Andrew J.
Poppleton, Defendant's Counsel.
STATEMENT OF CASE.
This is a bill tiled by the Kansas Pacific and Denver Pa¬
cific Railway Companies to compel the defendant to ope¬
rate and use its road as required by the several acts of
Congress relating thereto.
The first section of the act approved July 1, 1862, in¬
corporated the defendant, and authorized and empowered
it " to lay out, locate, construct, furnish, maintain, and
enjoy, a continuous railroad and telegraph from a point on
the lOOfcli meridian of longitude west from Greenwich, be¬
tween the south margin of the valley of the .Republican
River and the north margin of the vailey of the Platte
River, in the Territory of Nebraska, to the western boun¬
dary of Nevada Territory, upon the route and the terms
hereinafter provided."
In the eighth section it is provided that the point of de¬
parture on the meridian aforesaid should be fixed by the
President of the United States.
In the third section a grant of land was made "for the
purpose of aiding in the construction of said railroad and
telegraph line, and to secure the safe and speedy transpor¬
tation of the mails, troops, munitions of war, and public
stores thereon."
In the sixth section the company was required to " keep
said railroad and telegraph line in repair and use, and
(shall) at all times transmit despatches over said telegraph
line, and transport mails, troops, and munitions of war,
supplies, and public stores upon said railroad for the Gov¬
ernment, whenever required to do so by any department
thereof, and that the Government shall at all times have
the preference in the use of the same for all the purposes
aforesaid."
In the eighteenth section the object of the act is declared
to be "to promote the public interest and welfare " and
" to secure to the Government at all times (but particularly
in the time of war), the use and benefits of the same for
postal, military, and other purposes."
In the ninth section the company, which is now known
as the Kansas Pacific Railway Company, one of these
plaintiffs, was authorized "to construct a railroad and
telegraph line ... as herein provided, upon the same
terms and conditions, in all respects, as provided in this
act for the.construction of the railroad and telegraph line
.first mentioned (Union Pacific Railroad Company, main
line), and to meet and connect with the same at the meri¬
dian of longitude aforesaid."
In the fourteenth section the defendant was authorized
"to construct a single line of railroad and telegraph from a
23
point on the western boundary of the State of Iowa, to be
fixed by the President of the United States, upon the most
direct and practicable route, to be subject to his ap¬
proval, so as to form a connection with the line of said
company at some point on the 100th meridian of longitude
aforesaid, from the point of commencement on the western
boundary of the State of Iowa, upon the same terms and
conditions, in all respects, as are contained in this act for
the construction of the said railroad and telegraph first
mentioned ;" and in the same section it was provided fur¬
ther : " And whenever there shall be a line of railroad com¬
pleted through Minnesota or Iowa to Sioux City, then the
said Pacific Railroad Company is hereby authorized and
required to construct a railroad and telegraph from said
Sioux City upon the most direct and practicable route to a
point on, and so as to connect with, the branch railroad
and telegraph in this section hereinbefore mentioned, or
with the said Union Pacific Railroad, said point of junc¬
tion to be fixed by the President of the United States, not
farther west than the one hundredth meridian of longitude
aforesaid, and on the same terms and conditions as pro¬
vided in this act for the construction of the Union Pacific
Railroad as aforesaid."
In the fifteenth section it was provided: "That any
other railroad company now incorporated or hereafter to be
incorporated shall have the right to connect their road with
the road and branches provided for by this act, at such places
and upon such just and equitable terms as the President
of the United States may prescribe. Wherever the word
company is used in this act, it shall be construed to em¬
brace the words their associa tes, successors, and assigns,
the same as if the words had been properly added thereto."
In the tenth section provision was made as to the Kansas
Pacific and the Central Pacific Company of California
that, "after completing their roads, respectively, said
companies, or either of them, may unite upon equal terms
with the first-named company in constructing so much of
said railroad and telegraph line and branch railroads and
telegraph lines, in this act hereinafter mentioned, through
u
the territories from the State of California to the Missouri
River, as shall then remain to be constructed, 011 the same
terms and conditions as provided in this act in relation to
the said Union Pacific Railroad Company."
In the seventeenth section it was provided: " That in
case said company or companies shall fail to comply with
the terms and conditions of this act, by not completing
said road and telegraph and branches within a reasonable
time, or by not keeping the same in repair and use, but
shall permit the same for an unreasonable time to remain
unfinished or out of repair and unfit for use, Congress may
pass any act to insure the speedy completion of said road
and branches, or to put* the same in repair and use, and
may direct the income of said railroad and telegraph line
to be thereafter devoted to the use of the United States to
repay all such expenditures caused by the default or
neglect of such company or companies" ; and further,
" that if said roads are not completed, so as to form a con¬
tinuous line of railroad, ready for use, from the Missouri
River to the navigable waters of the Sacramento River, in
California, by the first day of July, eighteen hundred and
seventy-six, the whole of all of said railroads before men¬
tioned, and to be constructed under the provisions of this
act, together with all their furniture, fixtures, rolling stock,
machine-shops, lands, tenements, and hereditaments, and
property of every kind and character, shall be forfeited to
and be taken possession of by the United States."
The eighteenth section provided as follows: ''And the
better to accomplish the object of this act, namely, to pro¬
mote the public interest and welfare by the construction of
said railroad and telegraph line, and keeping the same in
working order, and to secure to the Government, at all times
(but particularly in time of war), the use and benefits of the
same for postal, military, and other purposes, Congress
may, at any time—having due regard for the rights of said
companies named herein—add to, alter, amend or repeal
this act." 4
In the twelfth section it was provided that "The track
upon the entire line of railroad and branches shall be of
uniform width, to be determined by the President of the
United States, so that, when completed, cars can be run
from tlie Missouri River to the Pacific coast;
the whole line of said railroad and branches and telegraph
shall be operated and used for all purposes of communica¬
tion, travel, and transportation, so far as the public and
Government are concerned, as one connected continuous
line."
In the seventh section of the act approved July 2, 1864,
amendatory of the act of 1862, it was provided as follows :
" And the failure of any one company to comply fully with
the conditions and requirements of this act, or the act to
which this is amendatory, shall not work a forfeiture of
the rights, privileges, or franchise of any other company
or companies that shall have complied with the same."
Section nine of the same act provides: "That any com¬
pany authorized by this act to construct its road and tele¬
graph line from the Missouri River to the initial point afore¬
said, may construct its road and telegraph line so as to
connect with the Union Pacific Railroad at any point west-
wardly of such initial point, in case such company shall
deem such westward connection more practicable or desira¬
ble ; and in aid of the construction of so much of its road
and telegraph line as shall be a departure from the route
hereinbefore provided for its road, such company shall be
entitled to all the benefits and be subject to all the condi¬
tions and restrictions of this act."
Section twelve of this act provides that the Kansas Com¬
pany therein described as The Leavenworth, Pawnee and
Western Railroad Company, "now known as the Union
Pacific Railroad Company, eastern division, shall build the
railroad from the mouth of Kansas River, by the way of
Leavenworth, or, if that be not deemed the best route, then
the said company shall, within two years, build a railroad
from the city of Leavenworth to unite with the main stem
at or near the city of La wrence ; but to aid in the construc¬
tion of said branch the said company shall not be entitled
to any bonds. And, if the Union Pacific Railroad Com¬
pany shall not be proceeding in good faith to build the
;
26
said railroad through the territories when the Leavenworth,
Pawnee and Western Railroad Company, now known as
the Union Pacific Railroad Company, eastern division, shall
have completed their road to the hundredth degree of longi¬
tude, then the last-named company may proceed to make
said road westward until it meets and connects with the
Central Pacific Railroad Company on the same line."
Section fifteen of this act, which .contains the pith and
marrow of the whole controversy, provides: "That the
several companies authorized to construct the aforesaid
roads are hereby required to operate and use said roads
and telegraph for all purposes of communication, travel,
and transportation, so far as the public and the Govern¬
ment are concerned, as one continuous line ; and in such
operation and use, to afford and secure to each equal ad¬
vantages and facilities as to rates, time, and transportation,
without any discrimination of any kind in favor of the
road or business of any or either of said companies, or ad¬
verse to the road or business of any or either of the others."
Section sixteen provides for the consolidation of any of
the companies and fixes the terms and conditions of any
such consolidation and its results.
The last section of this act is as follows : " That Congress
may, at any time, alter, amend, or repeal this act."
Section first of the act approved July 3, 1866, after
authorizing the Kansas company to designate the general
route of their road, and to file a map thereof, provided
further "That said company shall connect their line of
railroad and telegraph with the Union Pacific Railroad,
but not at a point more than fifty miles westward!y from
the meridian of Denver in Colorado." And the second
section provided : "That the Union Pacific Railroad Com¬
pany, with the consent and approval of the Secretary of
the Interior, are hereby authorized to locate, construct, and
continue their road from Omaha, in Nebraska territory,
westward, according to the best and most practicable route,
and without reference to the initial point on the one hun¬
dredth meridian of west longitude, as now provided by law,
in a continuous completed line, until they shall meet and
27
connect with the Central Pacific Railroad Company of Cali¬
fornia."
On the third day of March, 1869, an act was passed as
follows:
Ax Act to authorize the transfer of lands granted to the
Union Pacific Railroad Company, Eastern Division, be¬
tween Denver and the point of its junction with the
Union Pacific Railroad, to the Denver Pacific Railway
and Telegraph Company, and to expedite the comple¬
tion of railroads to Denver, in the Territory of Colo¬
rado.
Be it en acted by the Senate and House of Representat i ves
of the United States of America in Congress assembled,
That the Union Pacific Railway Company, Eastern Di¬
vision, be, and it hereby is, authorized to contract with
the Denver Pacific Railway and Telegraph Company, a
corporation existing under the laws of the Territory of
Colorado, for the construction, operation, and mainte¬
nance of that part of its line of railroad and telegraph
between Denver City and its point of connection with
the Union Pacific railroad, which point shall be at Chey¬
enne, and to adopt the road-bed already graded by the
said Denver Pacific Railway and Telegraph Company as
said line, and to grant to said Denver Pacific Railway and
Telegraph Company the perpetual use of its right-of-way
and depot-grounds, and to. transfer to it all the rights and
privileges, subject to all the obligations pertaining to said
part of its line.
Sec. 2. And be it further enacted, That the said Union
Pacific Railway Company, Eastern Division, shall extend
its railroad and telegraph to a connection at the city of
Denver, so as to form, with that part of its line herein
authorized to be constructed, operated, and maintained by
the Denver Pacific Railway and Telegraph Company, a
continuous line of railroad and telegraph from Kansas
City, by way of Denver, to Cheyenne. And all the pro¬
visions of law for the operation of the Union Pacific Rail¬
road, its branches and connections, as a continuous line,
without discrimination, shall apply the same as if the road
28
i
from Denver to Cheyenne had been constructed by the
said Union Pacific Railway Company, Eastern Division;
but nothing herein shall authorize the said Eastern Di¬
vision company to operate the road or fix the rales of
tariff for the Denver Pacific Railway and Telegraph Com¬
pany.
Sec. 3. And be it further enacted, That- said companies
are hereby authorized to mortgage their respective por¬
tions of said road, as herein defined, for an amount not
exceeding thirty-two thousand dollars per mile, to enable
them respectively to borrow money to construct the same ;
and that each of said companies shall receive patents to
the alternate sections of land along their respective lines
of road, as herein defined, in like manner and within the
same limits as is provided by law in the case of lands
granted to the Union Pacific Railway Company, Eastern
Division : Prom elect. That neither of the companies herein¬
before mentioned shall be entitled to subsidy in United
States bonds, under the provisions of this act.
And on the twentieth day of June, 1874, an act was
passed entitled "an act making additions to the fifteenth
section of the act approved July second, 1864, entitled an
act, etc., as follows:
Be it enacted by the Senate arid House of Representatives
of the United States of America in Congress assembled',
That there shall be, and is hereby, added to the fifteenth
section of the act approved July second, eighteen hun¬
dred and sixty-four, entitled " An act to amend an act
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,' approved
July first, eighteen hundred and sixty-two, " the follow¬
ing words, namely: "And any officer or agent of the
companies authorized to construct the aforesaid roads,
or of any company engaged in operating either of said
roads, who shall refuse to operate and use the road and
telegraph under his control, in which he is engaged
• 29
in operating for all purposes of communication, travel,
and transportation, so far as the public and the Govern¬
ment are concerned, as one continuous line, or shall re¬
fuse, in such operation and use, to atford and secure to
each of said roads equal advantages and facilities as to
rates, time, or transportation, without any discrimination
of any kind 111 favor of, or adverse to, the road or busi¬
ness of any or either of said companies, shall be deemed
guilty of a misdemeanor, and, upon conviction thereof,
shall be fined in any sum not exceeding one thousand
dollars, and may be imprisoned not less than six months.
In case of failure or refusal of the Union Pacific Railroad
Company, or either of said branches, to comply with the
requirements of this act'and the acts to which this act is
amendatory, the party injured, or the company aggrieved
mav bring an action in the District or Circuit Court of the
United States in the territory, district, or circuit in which
•/ /
any portion of the road of the defendant may be situated,
for damages on account of such failure or refusal; and,
upon recovery, the plaintiff shall be entitled to judgment
for treble the amount of all excess of freight and fares
collected b}7 the defendant, and for treble the amount of
damages sustained by the plaintiff by such failure or re¬
fusal ; and for each and every violation of or failure to
comply with the requirements of this act, a new cause of
action shall arise ; and in case of suit in any such terri¬
tory, district, or circuit, process may be served upon any
agent of the defendant found in the territory, district, or
circuit in which said-suit mav be brought, and such service
•j Cj i
shall be by the court held to be good and sufficient ; and
it is hereby provided that for all the purposes of said act
and of the acts amendatory thereof, the railway of the
Denver Pacific Railway and Telegraph Company shall be
deemed and taken to be a part and extension of the road
of the Kansas Pacific Railroad, to the point of junction
thereof with the road of the Union Pacific Railroad Com¬
pany at Cheyenne, as provided in the act of March third,
eighteen hundred and sixty-nine.
In 1869 the defendant had constructed its road from the
30
Missouri River at Omaha to Ogden where it met and united
with the road of the California comfiany. The plaintiffs
ha ve constructed their road so as to fofm a continuous line
of road from the same river at the mouth of the Kansas
River to Cheyenne, in obedience to the provisions of the acts
of 1862, 1864, 1866, and 1869, where it meets and strikes the
road of the defendant, Cheyenne being equidistant be¬
tween the eastern and western termini of the road of the
defendant. The complaint of the plaintiffs is that the
defendant refuses to afford and secure to them, or either of
them, equal advantages and facilities, as to rates, time,
and transportation, with the roads, and business of other
roads connecting with defendant's road, and with its own
road and business, without discrimination; but that it
operates its road adversely to the road and business of the
plaintiffs, and has, by discriminating rates in favor of its
own road and'business against the road and business of the
plaintiffs, excluded them from any participation in busi¬
ness passing over the defendant's road west of Cheyenne.
That with this object the defendant lias fixed its rate of
fare and freight from Cheyenne to Ogden in many cases as
high as, and in some cases higher than, for traffic and trans¬
portation over its entire road, and in all cases out of all
proportion to the distance travelled ; and in this manner
has discriminated and does discriminate against the road
and business of plaintiffs, and the roads connected with it
at Kansas City, and in favor of its own road east of
Cheyenne, and other roads connected with its road at
Omaha, so as to force all freight and passenger traffic
coming on its road at Ogden, and destined to any point
east of Cheyenne, and so as to- force all freight and pas¬
sengers destined for points west of Cheyenne to pass over
the eastern half of its road and the roads connected with
it at Omaha. The plaintiffs insist that it is a duty imposed
by law upon the defendant company to charge the com¬
plainant companies, the Government, and the public for
transportation of freight or passengers going to or from
the plaintiff's road between Cheyenne and Ogden (Chey¬
enne being equidistant between the eastern and western
31
termini of defendant's roads), a rate of freight and fare not
exceeding one-lialf of its rate for business and traffic of a
similar description and character for the entire length of
its line, irrespective of any special circumstances largely
enhancing the cost of constructing, maintaining, or operat¬
ing the western portion of defendant's road, and that such
rate of freight or fare should be in all cases fixed at a
mileage rate equal to a pro rate per mile of the lowest
through rates charged by defendant company for like
transportation and traffic. Complaint is further made that
the defendant, for the purposes of further discriminating
against the plaintiff's roads and business, refuses the same
facilities as to time of running and connection of trains,
accommodation of passengers, checking and handling bag¬
gage, conveniences for loading, moving, and delivering
freight, and in minor matters, as it gives^to passengers
and freight over its own road.
The defendant in its answer insists that the plain¬
tiffs are not within the privileges of the provisions of
the acts of Congress providing that the roads men¬
tioned in the acts of 1862 and 1864 shall be operated
and used as one continuous line, and that in such ope¬
ration and use equal advantages and facilities shall
be afforded and secured to each as to rates, time, and
transportation, without any discrimination of any kind in
favor of the road or business of aiiv or either of said com-
panies, or adverse to the road or business of any or either of
the others ; that the defendant had built its road to a con¬
nection witli the road of the California Company, and that
the same had been accepted by the Government as complet¬
ed, within the requirements of the acts of 1862 and 1864,
when, in 1869 the first act relating to the Denver Pacific
company was passed ; and that the defendant has never
accepted the act of 1869 nor the act of 1874. Defendant
further answers " that the eastern half of said road is built
through and along valleys with an average ascending grade
of about ten feet to the mile, and with little or no curva¬
ture, and is therefore susceptible of easy and cheap con¬
struction, maintenance, and operation; but the western
32
half, to wit, that portion between Cheyenne and Ogden,
is built over three ranges of mountains, upon a route pre¬
senting great difficulties, both in construction, mainten¬
ance, and operation, with steep and frequent grades, and
short and broken curves, through an uninhabited and an
unproductive country, without any considerable local busi¬
ness, and subject to storms and snow which call for heavy
expenditures to meet and overcome their effects ; and that
both the cost of construction and the cost of operating
and maintaining said western half of said road is not less
than double that of building, running, and maintaining the
eastern half thereof, and that a tariff which would be amply
remunerative on the eastern half of defendant's road would,
if applied to the western half thereof, inflict upon defend¬
ant serious loss, and that if compelled to transport freight
and passengers received from and delivered to the Den¬
ver Pacific Railway and Telegraph Company at Cheyenne
over the western half of its line at a mileage rate equal to
a pro rate per mile of its lowest through rate, or at one
half of the through rate it would receive for such trans¬
portation, less, and in many cases much less, than the actual
cost to the defendant of such transportation; wherefore
the defendant submits that the construction placed by the
complainant companies upon or claimed under section 12
of the act of July 1st, 1862, and section 15 of the act of
July 2d, 1864, is erroneous* and contrary to the intention
of Congress in enacting the same."
Complainants excepted to so much of defendant's answer
as is referred to above.
The exceptions of complainants are of two classes. The
first class presents the question :
Whether or not, by reason of the completion of the
railroad and telegraph line of complainant, the Kansas
Pacific Railway Company, to Denver, and the completion
of the railroad and telegraph line of the complainant, the
Denver Pacific Railway and Telegraph Company, from Den¬
ver to Cheyenne, the point of junction with defendant
company, in all respects as to each complainant company,
as required by the several acts of Congress relating thereto,
33
9
the said Denver Pacific Railway and Telegraph Company
thereby became a part and extension of the road of the
Kansas Pacific Railway Company, to the point of junction
thereof with the road of the Union Pacific Railroad Company
at Cheyenne, as provided in the acts of July 1, 1862, July
2, 1864, March 3, 1869, and June 20, 1874?
The second class of exceptions present the following
question:
Whether or not is it a duty imposed by law upon the
defendant company to charge the complainant companies,
the Government, and the public for transportation of
freight or passengers, going to or from said Denver Pacific
Railway and Telegraph Company between Cheyenne and
Ogden—Cheyenne being equidistant between Omaha, the
eastern terminus of the defendant's road and Ogden, the
western terminus thereof—a rate of freight and fare not
exceeding one-half of its rate for business and traffic of a
similar description and character for the entire length of its
line between Ogden and Omaha, irrespective of any special
circumstances largely enhancing the cost of constructing,
maintaining, or operating a particular section of defendant's
road ?
POINT I. *
Plaintiffs insist that the acts of Congress of March 3,
1869, and of June 20, 1874, in their terms, and considered
alone, bring the Denver Pacific Company within the clauses
of the acts of 1864 and 1869, which regulate the relations of
the Union Pacific and other roads, and the language of the
act of 1869 is plain'and distinct in this respect, as follows :
" And all the provisions of law for the operation of the
Union Pacific Railroad, its branches and connections, as a
continuous line, without discrimination, shall apply the
same as if the road from Denver to Cheyenne had been
constructed by the said Union Pacific Railway Company,
Eastern Division ; but nothing herein shall authorize the
said Eastern Division company to operate the road, or to
fix the rates of tariff for the Denver Pacific Railway and
€✓
Telegraph Company."
34
And in tlie act of 1874 the language is:
" And it is hereby provided that for all the purposes of
said act, and of the acts amendatory thereof, the railway of
the Denver Pacific Railway and Telegraph Company shall
be deemed and taken to be a part and extension of the
road of the Kansas Pacific Railroad, to the point of junction
thereof with the road of the Union Pacific Railroad Com¬
pany at Cheyenne, as provided in the act of March 3,
1869." -
Defendant's counsel admitted that if these two acts are
binding upon the defendant the plaintiffs are within the
operation of the clauses upon which they base their claim ;
but it is insisted that it cannot have operation against the
defendant road, because the acts in which it is found were
passed after the rights of defendant had become fixed and
determined by the completion of its entire road, and because
it has never consented or assented to the terms and pro¬
visions of those acts; that is to say, the acts of 1862
and 1864 constitute a contract between the Govern¬
ment and defendant company which it was not compe¬
tent for Congress to impair by subsequent legislation, and
that the effect of the acts of 1869 and 1874 did impair
that contract. The act of 1862 contained a clause reserving
to Congress the right to amend, alter, or repeal the same,
" having due regard for the.riglits of said companies named
herein." But as this power was accompanied by these
words, upon which some fair discussion may be had, we
pass it by and invoke the aid of the last section of the act
of 1864 in the following words : "That Congress may at
any time alter, amend, or repeal this act." The act of 1864
was accepted by the defendant. It accepted the rights and
privileges, aid in bonds and lands granted, all burdened
with the duties and obligations, relations and limitations
expressed in and covered by that act, and among the latter
was the reserved power and rights of Congress to amend
the act. •
The extent to which this power of amendment and
repeal may be carried has been decisively declared by
the Supreme Court, in the Pennsylvania College cases, 13
35
Wallace 190, and Mr. Justice Clifford, delivering the
opinion of the court and speaking for the whole court,
said : " Cases often arise where the Legislature, in granting
an act of incorporation for a private purpose, either make
the duration of the charter conditional or reserve to the
State the power to alter, modify, or repeal the same at
pleasure. Where such a provision is incorporated in the
charter it is clear that it qualifies the grant, and that the
subsequent exercise of that reserved power cannot be re¬
garded as an act within the prohibition of the Constitution.
Such a power, also—that is, a power to alter, modify, or
repeal an act of incorporation—is frequently reserved to
the State by a general law applicable to all acts of incor¬
poration, or to certain classes of the same, as the case may
be, in which case it is equally clear that the power may be
exercised whenever it appears that the act of incorporation
is one which falls within the reservation, and that the char¬
ter was granted subsequent to the general law, even though
the charter contains no such condition nor any allusion to
such a reservation. Reservations in such a charter, it is ad¬
mitted, may be made, and it is also conceded that where
they exist the exercise of the power reserved by a subse¬
quent Legislature does not impair the obligation of the
contract created by the original act of incorporation. Sub¬
sequent legislation, altering or modifying the provisions of
such a charter where there is-no such reservation, is cer¬
tainly unauthorized if it is prejudicial to the rights of the
corporators, and was passed without their assent; but the
converse of the proposition is also true, that if the new
provisions altering and modifying the charter were passed
with the assent of the corporation, and they were duly ac¬
cepted by a corporate vote as amendments to the original
charter, the}7 cannot be regarded as impairing the obliga¬
tions of the contract created by the original charter. Pri¬
vate charters, or such as are granted for the private benefit
of the corporators, are held to be contracts because they
are .based for their consideration of the liabilities and
duties which the corporators assume by accepting the
terms therein specified, and the grant of the franchise on
36
that account can 110 more be resumed bv tlie Legislature
u o
or its benefits diminished or impaired without the assent of
the corporators than any other grant of property or legal
estate, unless the right to do so is reserved in the act of in¬
corporation or in some general law of the State which was
in operation at the time the charter was granted/1
The same court has applied the rule enunciated above
in—
Tomlinson vs. Jessup, 15 Wallace, 454.
Holyoke Co. vs. Lyman, 15 1b., 500.
See also Piek. vs. Chicago, etc., 6 Bissell, 177.
Commonwealth vs. Eastern RR., 103 Mass., 254.
Fitchburgh RR. vs. Grand June. RR., 4 Allen, 198.
English vs. New Haven RR., 32 Conn., 240.
Albany, etc , Co. vs. Brownell, 24 INT. Ar., 345.
Attorney-General vs. Chicago, etc., Co.,35 Wis., 425.
But it is insisted that the power of amendment, even
when reserved in the charter, cannot be carried so far as to
impair the original obligation of the incorporation without
its assent. That question is not involved here, for the
amendment of the acts of 1862 and 1864 by those of 1869
*/
and 1874 have no such effect. The act of 1864 expressly
provided that the Kansas company might connect with the
Union Pacific company at any point west of the 100th meri¬
dian. It also contained a clause requiring the companies
to operate their several roads as one continuous line with¬
out discrimination, etc., and contained the reserved light
of amendment without qualification. W^hen Congress by
the act of 1869 provided that the Kansas company might
adopt the Denver company's line as a part and exten¬
sion of its line, and make the connection by means of it
with the defendant's road at Cheyenne, the object of the
act of 1864 was not impaired but advanced, and the right
asserted by the Union Pacific company to repudiate its
duties and obligations to the public, the Government, and
one of the system of roads, because the connection of the
Kansas company is not made directly by its own road but
by means of that of another company, is manifestly absurd
37
and cannot be sustained. The act of 1874 would be ab¬
solutely a nullity.
It is to be further observed in this connection that the de-
fendant company accepted the provisions of the act of 1864
and acted upon the privileges thereby accorded to it, and
built its road from Omaha, in Nebraska, westward, "with¬
out reference to the initial point on the 100th meridian of
longitude, as now provided by law, in a continuous, com¬
pleted line"; and it was by the first section of the same act-
that the Kansas company was authorized to connect their
road with the road of the defendant company at a point,
not the 100th meridian, but which should not be " more
than fifty miles westwardly from the meridian of Denver,
in Colorado."
The cases cited above under this point arose under State
statutes, and the United States constitutional provision
urged against them has no application to Federal statutes.
In this case there is an act of Congress, the terms of which
are clear and explicit, and this Court will hesitate to say
that it is void or unconstitutional. It is an act by means
of which the great objects of the legislation in relation to
the Pacilic roads was advanced and accomplished.
It is therefore respectfully submitted that the allegations
that the defendant's road was completed to a connection
with that of the California company before the acts of 1869
and 1874 were passed, and that the defendant has never
assented to or accepted those acts, are immaterial, irrele¬
vant, impertinent, and should be expunged from the an¬
swer, with the further matter in which they are incorpo¬
rated, denying that the road of the Denver company, in
connection with, and as a part and extension of, the Kan¬
sas company, is not one of the* branch roads provided
for by the acts of 1862 and 1864.
And it is futher submitted that all the requirements and
provisions of the acts of 1862,1864, 1866, and 1869 have been
complied with by the Kansas Pacific company, and that
said company, by reason of the completion of the road to
Denver, and the completion of the road of the Denver
company to Cheyenne, in all respects, as to each of said
38
companies, as required by tlie acts of Congress relating
thereto, is entitled to all the rights and privileges conferred
upon it by the acts of 1862, 1864, 1869, and 1874, as one
of the branches of the Union Pacific Railroad.
POINT IT.
The language of section 15 of the act of 1864, taken in
its natural and obvious meaning, sustains the claim and
construction insisted on by the plaintiffs. But before pro¬
ceeding to analyze and discuss that section, it will be well
to determine what is meant by, and what, in fact, is, the
road of the Union Pacific company. It has been judicial¬
ly determined by the Supreme Court to begin at the Iowa
shore of the Missouri river, and its western terminus is un¬
questionably at Ogden, in the Territory of Utah. But it
will appear later on in this argument that the Union Paci¬
fic comj>any contends that its road is composed of two
parts—viz., the main stem, from the 100th meridian to Og¬
den, and the Iowa branch, from the 100th meridian to its
eastern terminus. By the act of 1862 the defendant was
required to build the Iowa branch before proceeding to
build the main line, the 100th meridian being the point at
which the Iowa branch and the road of the Kansas com¬
pany were required to join and connect with the mainline.
The ninth section of the act of 1864 authorized the Kansas
company, or any other of the branch roads, " to construct
its road and telegraph line so as to connect with the Union
Pacific Railroad at any point westwardly of such initial
point"—the 100th meridian ; and this initial point, so far
as related to all of the roads of the system, except the
Union Pacific (which was still required by both these acts
to complete the Iowa branch to the 100th meridian before
it was authorized to build the main line), vanished from
the acts. By the act of 1866 the Union Pacific company was
authorized to construct and continue their road from Oma¬
ha westwardly, "without reference to the initial point on
100th meridian," and by this act this initial point entirely
disappears from the acts, and need no longer be considered
39
as playing any part in the scheme of the acts, as far as re¬
lated to the operation and nse of any of the system of
roads. The section under consideration (15) uses the words
"the several companies authorized to construct the afore¬
said roads are hereby required to operate and use said
roads." Now it will be observed that the Union Pacific
company was authorized to construct, and did construct,
under and by virtue of the acts of 1864 and 1866, amenda¬
tory of the act of 1862, its road from the eastern terminus
to Ogden, and, whether its road is considered by it as com¬
posed of one or two sections, whether it is a road or roads,
it was constructed by the Union Pacific company, and is
within the provision of Section 15, and is covered by the
words of that section.
POINT III.
Now as to the question raised by the second class of ex¬
ceptions. The defendant by its answer raises the question
whether if the cost of construction, maintenance, and
operation of that half of its road west of Cheyenne was
and is greater than the cost of construction, maintenance,
and operation of the half east of Cheyenne, it is justified
in charging a discriminating rate, so as to exact for ser¬
vices on the west half of its road much more than one-half
of its charges for like services over its entire road ?
The defendant insists that greater cost of construction,
maintenance, and operation of a part of its road, as com¬
pared with the cost of another part thereof, should be
taken account of in fixing and apportioning its rates over
the separate sections. Plaintiffs contend that these mat¬
ters cannot be taken into consideration at all; that the
only element in the inquiry is distance travelled ; that
any discrimination whatever is prohibited ; the defendant
claiming that only inequitable or unequal discrimination is
prohibited.
1. The language of section fifteen prohibits discrimination
of any kind, however the discrimination may be exer¬
cised. However discrimination as between other roads
40
not bound by contract or statute is exercised, justified,
and regulated, however prejudicial, absolute non-discri-
nation may affect any one of these roads, is entirely imma¬
terial. There is the command of Congress expressed in
plain and simple terms and it must be obeyed. Each road
is to be so operated and used as to afford to every other
road and the business of every other road equal advantages
and facilities as to rates, time, and transportation, without
any discrimination whatever. That is the unvarying and
all-sufficient rule, and like terms of a contract, however in¬
considerately it may have been entered into by the parties,
its words must be observed and obeyed. It does not
change the rule to characterize it as arbitrary, or unjust, or
inequitable in its operation and effect. Its reach and
compass and force are to be measured by the terms in
which it is expressed.
2. But the counsel for the defendant, construing these
words, insist that the prohibition is levelled at the action of
one company towards the others, so that it cannot favor
one of them more than another, and that each may so
operate and use its own road as to favor it to the prejudice
and even ruin of any or either of the others. To this seve¬
ral decisive answers may be made. The prohibition is not
against discrimination for or against any road merely, but it
is against the business of any road as well. The Union
Pacific is not only not to operate and use its road, whether
considered as a unit or as composed of two roads, so as to
discriminate for or against any road, but it is also not to
operate and use its road so as to discriminate in favor of its
business and against the business of any other road. And
this is the more apparent when the language is observed.
The discrimination forbidden to be indulged in by one com¬
pany is not that which is in favor of any or either of the
other companies, but simply that which is "in favor of the
road or business of any or either of said companies."
In the terms u said companies," is included the company
which seeks to discriminate, so that discrimination in its
own favor is prohibited, just as much as against the other
companies; and this language is the more noticeable, for
41
it is not the same as that used when prohibiting adverse
discrimination. There the word kt other "is inserted, the
reason being that it was not necessary to prohibit a com¬
pany from discriminating against itself and its own business.
3. The contention of tlie other side destroys the force of
•/
the clause. In the act of 1864, in which the clause first ap¬
peared, the Kansas company is authorized to meet and
connect with the Union Pacific at any point it pleased west
of 100th meridian ; it having done so at Cheyenne, at which
point no other companies could or did connect with the
Union Pacific, there could be no possible opportunity or
occasion for discrimination between two companies other
than the Union Pacific company and the Kansas com¬
pany, connecting with the Union Pacific at that point.
The discrimination referred to must be that which concerns
the business of those two companies or none at all. It is
needless to say that it is inadmissible to put such a con¬
struction upon a clause as renders it inopera tive, nugatory,
and absurd.
4. It is said that the mischief aimed at was a combina¬
tion of the main line and one of the branches ; but when
one company strikes the main line at a point remote from
that at which the other strikes it, the mischief is just as
great. Indeed, it is precisely the same as if two parts
of the main line are used and operated so as to shut off
the connecting company from business with the main line.
It will be admitted that if all the branches had connected
with the main line at the 100th meridian the Union Pacific
could not have operated its main line and branch together,
prejudicially to the others. It is admitted that that was
prohibited. When the Kansas company connected with
the Union Pacific at Cheyenne, if the road east and the
ty /
road west of that point may be operated together to the
prejudice of the Kansas company, the mischief as to it is
precisely the same as if the connection had been made at
the 100th meridian.
5. And further, to enforce this view, it is said that de¬
fendant has the right to fix its own rates without reference
to any claims or demands of the plaintiffs, except as re-
42
strained or interfered with by these statutes, and that it is
upon us to point out the clear and precise language which
does thus interfere with and restrain this right. That we
submit we have done. We have shown that discrimina¬
tion of any kind is forbidden, discrimination in favor of
the defendant's road and business as well as in favor of
any other road and its business. Some large words were
used about freedom in trade, freedom in charges ; that
freedom in all kinds of wrong-doing is the rule in human
affairs, and no construction is permissible which limits the
freedom so long as another construction which preserves
this freedom meets the mischief aimed at. But so long as
the mischief aimed at is not merely a combination of two
to crush a third road, but a use and operation of one to
crush another, these swelling words have little meaning.
6. Just as the individual surrenders a part of his free¬
dom when he enters society, so each of these companies,
when they entered upon the association and community
•established by these acts, surrendered a part of their free¬
dom—namely, so much as in the opinion of Congress was
needed to be surrendered in order to their common good,
and the good of the public and the Government.
POINT IV.
But counsel for defendant also insist that it does not
discriminate against us by charging for our business the
same rate it charges for business of all others originating
at or destined to Cheyenne. This position ignores the
clause under consideration entirely. That clause requires
the defendant1 s road, west of Cheyenne, and the plaintiffs'
roads to be operated and used as one continuous line, and
yet the defendant insists upon charging for our business
the local rates which it has fixed for business destined to
or for Cheyenne. That is one complete answer. The
clause refers to the roads and business of these companies
as interchanged between them. It has no reference to that
of one of them alone. To apply to the former rates
charged for the latter may be the grossest discrimination.
43
Higher rates are always charged by railroad companies at
points remote from the junction of two or more lines than
at points where competition is active. If the plaintiffs'
business must pay the higher rates, even at the junction of
our road with others and all competition be stifled, the
statute is a nullity.
Passing, now, from the consideration of the particular
clause, and the terms of it, we extend our inquiry for its
meaning to the general scope of the legislation.
POINT y.
The place of the section forbidding discrimination, in the
several acts of Congress, shows that an absolute unvarying
and arbitrary rule was intended thereby to be established,
which must be unaffected by the circumstances of the rela¬
tive cost of construction, maintenance, and operation of the
several sections of the defendant's road.
1. The prohibition of discrimination is not found in the
act of 1862, and yet under the provisions of that act un¬
just, unequal, and inequitable discrimination could not be
exercised by one of the companies in favor of itself or
either of the others, or against either of the others. The
several sections of that act providing for the branches re¬
quired each one to be built so as " to meet and unite," or
meet and connect, with the main line.
Section twelve provides for a uniform gauge for the en¬
tire line of railroad and branches, so that cars can be run
from the Missouri River to the Pacific coast. These sec¬
tions provide for the mechanical construction of the tracks,
and this is done with such care, and with respect to all the
roads without exception, as to indicate design.
By the tenth section the other companies may under
certain circumstances build the defendant's road and
branches, or so much thereof as it may not have built.
By section seventeen, if the said roads are not completed
so as to form a continuous line ready for use from the Mis¬
souri River to the Sacramento by a day fixed, all the pro¬
perty and all the rights of all the companies are forfeited.
44
each thus being liable for the wrong of the other; and in
the same section provision is made for the maintenance of
all the roads in repair, and these provisions indicate the
purpose of closely uniting and binding up into one.society
all these companies and all their properties.
2. But the matter is not left to inference, however ob¬
viously drawn, from the clause providing for uniform
width and mechanical connection of tracks, and for one
company building the road of another, and all being liable
for the default or wrong of the other. It is expressed in
clear and distinct terms in section twelve : u The whole line
of said railroad and branches and telegraphs shall be ope¬
rated and used for all purposes of communication, travel,
and transportation, so far as the public and Government
is concerned, as one connected continuous line." By
this clause the most intimate relations are established be¬
tween these companies, their roads having been built with
the same gauge and connected with one another, so that
cars can be run from one to the other company, each re¬
sponsible for its fellow, and all kept in repair. A common
duty is superimposed upon all of operating and using its
road as one connected, continuous line.
3. These several roads, thus united into a svstem and
7 €/
bound together into a community, could not justly discri¬
minate for or against one another. The relation of the
companies as iixed by the act precludes any unjust discri¬
minations, and, besides this and apart from the terms of the
act, such is the rule of the common law. Had no such
bond of society united these companies together, their
duty in this respect would have been governed by the rules
of common law as to common carriers. This is admitted
bv the learned counsel for the defendant, Jud«e Wright,
who says in his argument: "We claim no more right to
make unreasonable or excessive charges than belongs to a
natural person acting as a common carrier : both are alike,
it may be conceded, in the proper forum and by proper pro¬
ceedings, aside from statutory regulations or contract
rights, subject to restrictions." This was expressly decid¬
ed in the great case of the Chicago and Alton Railroad Co.
45
vs. The People (67 111. 11), which the counsel for the de¬
fendant cited in their argument. The question in that case
being the constitutional validity of an act of the Legisla¬
ture prohibiting all discrimination, passed in pursuance of
a clause in the constitution authorizing the passing of an
act prohibiting unjust discrimination only, the court pur¬
sued this course of reasoning. Railroad compa nies are com¬
mon carriers, and as such are subject to the same duties as
natural persons exercising that employment. The duty of
common carriers in common law is not to impose unjust
discrimination upon any of the parties employing them,
but they may impose some discrimination, the limitation
being that it shall not be unjust. And it was to establish
this proposition that the court used the language in its
judgment.
This is elementary. We cited the case from 67 111. be-
cause it has been brought to our hands by our learned ad¬
versaries.
Under the act of 1862 these companies, when entering
the society thereby formed, gave up a part of their free¬
dom and submitted to the law of non-discrimination, save so
far as circumstances justified discrimination. Without
any terms in the act expressly forbidding it, still the rule
imposed by the relationship of the community and by the
common law was that they should operate and use their
several roads without any discrimination that was undue,
unreasonable, unjust, unequal, or inequitable. That was
the rule under the act of 1862.
4. Then came the 15th section of the act of 1864. It ran in
almost the same words as the 12th section of the act of 1862 ;
and these words were added, "and in such operation and
use to afford and secure to each equal advantages and
facilities as to rates, time, and transportation, without any
discrimination of any kind in favor of the road or business
of any or either of the said companies, or adverse to the road
or business of any or either of the others.'" That clause,
•> j
most carefully worded, most precise, comprehensive, cir¬
cumstantial, sufficient for every exigency, and which
seems to have exhausted the fertility of the draughtsman
46
to accomplish this end, must have its full meaning and
operation, and in order to do so it must be taken as adding
something to the duty imposed in the act of 1862, and to
the duties of the roads as they existed under that act and
by the common law in relation to common carriers.
Undei* that act undue and unreasonable, unjust and in¬
equitable discrimination was forbidden. Under the act of
1864 something more was forbidden, and that was discrind-
nation of any hind, or nothing at all was added or intend¬
ed to be added by the 15tli section of the act of 1864. That
this is so appears from another clause of the act of 1862.
In the 15th section of that act it is provided " that any
other railroad company now incorporated, or hereafter to
be incorporated, shall have the right to connect their road
with the road and branches provided for by this act, at
such places and upon such just and equitable terms as the
President of the United States may prescribe."
These companies are not included within the 15th sec¬
tion of the act of 1864, the language of which is the sev-
ral companies authorized to construct the aforesaid roads."
The terms are particular, so as to exclude the companies
mentioned in the 15th section of the act of 1862. Had
the words been simply "the aforesaid companies," all
companies might possibly be included, but the words "au¬
thorized to construct the aforesaid roads" are added, and
added for the purpose of excluding all but the companies
named. There the two classes of roads are placed in con¬
trast. The companies not specially named are authorized
to connect with the main line and branches, not on
the same terms as those named, but on such terms
as the President may prescribe, and he shall pre¬
scribe terms which shall be just and equitable. As to
them, the discrimination which may be exercised must not
be undue or unreasonable ; in fixing their relations and
rights what is fair and equal and just and equitable must
be considered. As to the companies named, their relations
and rights are absolutely and irrevocably fixed by the terms
of the act, and the rule of their relations is invariable, ar¬
bitrary and imperative,
41
5. The occasion for the distinction is obvious. The com4
panies which embarked in what at the time was deemed as
a most hazardous venture, each contributing its due part
to an immense system, had need of an absolute assurance
of its due share in the transcontinental traffic. The com¬
panies which awaited the success of the venture should be
content with such participation in the business as justice
and equity would give them. By the construction of the
15th section of the act of 1864 contended for by our ad¬
versaries we would take nothing new or additional by the
15th section of the act of 1864, or the act of 1874. We
would be in the same position and relation to the defen¬
dant as mere outside companies.
6. The defendant contends that they are bound by terms
which under varying circumstances appear from time to
time just and equal ; that discrimination of any kind as
forbidden in the act means only what flows from the rela¬
tions of the companies and the general rules of law. The
whole argument of the defendant's counsel, aside from the
construction of the clause already examined, is to show
how prejudicial to the defendant the rule Congress lias
prescribed would be. They have brought in profiles of the
road which have told us what an engine can do here and
what it can do there. They have exhausted all our school¬
boy arithmetic in adding and subtracting and multiplying
and dividing, in order to show that an absolute non-discri¬
mination may hurt them and help us. All that might
under some circumstances tend to show the hardship of
the rule, but does not change the rule.
7. The rule forbidding discrimination of any kind was
framed and declared and accepted by these companies be¬
fore experience had developed the matters insisted upon,
or at least before they had become appreciated. As Mr.
Justice Davis says in The United States against the Union
Pacific Railroad, 1 Otto 70: "Counsel have dwelt with
special emphasis upon the consequences which would re¬
sult from a decision adverse to appellant. We cannot
consider them in disposing of the questions arising upon
this record. The rights of the parties rest upon a statute
48
♦
of the United States. Its words as well as its reason,
spirit, and intention leave, in our opinion, 110 room for
doubt as to tlieir meaning. We cannot sit in judgment
upon its wisdom or policy; when we have interpreted its
provisions, if Congress had power to enact it, our duty in
connection with it is ended/1
Judge Sawyer expressed the same idea in United States
against the Central Pacific, 4 Sawyer. He says :
" But the question here is not as to the comparative ad¬
vantages derived by the parties from the building and use
of this road ; or whether the Government did not make a
more liberal grant than was necessary ; or whether it might
not have made a better bargain in other respects; or
whether the defendant has not obtained a more profitable
contract than it ought to have had. Whatever considera¬
tion of this character may be urged elsewhere, when the
<u O /
parties come into a court of justice to seek an adjudication
of their rights, they stand upon their contract as it is, and
the simple dry question is, What is the contract in law,
and, in fact, what are the rights of the parties under it%■'
The appositeness of these expressions to the question
here needs no illustration, and the cases cited by the defend¬
ant afford no assistance in this enquiry. I11 Chicago and
Alton Railroad Company against The People, 67 Illinois
11, the validity of an act forbidding all discrimination was
drawn in question, because the constitution empowered
the legislature only to pass an act forbidding unjust dis¬
crimination. The English cases a*ose in the administra¬
tion of a statute forbidding "undue or unreasonable pre¬
ferences 'or advantage," and "undue and unreasonable pre¬
judice or disadvantage." Heath against The Northern
Central Railroad Co., 7 Pa., 181, simply held that the
statute providing that all rates for all traffic over the \yhole
road should not aggregate over four cents a mile on the
average, did not prevent a higher rate for transporting coal
a short distrance. Cases arising under the statute forbid¬
ding undue or unreasonable or unjust discrimination do
not aid in construing an act forbidding discrimination of
any kind. The case from Pennsylvania is even further
49
removed from the question. When we consider the place
which the clause in question lias in the Congressional leg¬
islation, and the distinction which is drawn between the
companies mentioned in it and other conqianies, and the
divers rules prescribed for the two classes, it is respectful¬
ly submitted that the necessary conclusion is that the
matter alleged in these answers has no place in this dis¬
pute.
\
POINT VI.
The object of the whole'scheme of Congress in this legis¬
lation will be defeated by the inquiries to which we are
invited by the matter in the answer to which we except.
1. The primary object which Congress had in view in
the Pacific Railroad acts concerned the Government. This
appears from the title of the act of 1862. This was re¬
iterated in section 8, and in section 18 the object is again
declared to be u to promote the public interest and welfare
by the construction of said railroad and telegraph line, and
keeping the same in working order, and to secure to the
Government at all times (but particularly in time of war)
the use and benefit of the same for postal, military, and
other purposes.1' These purposes were to be subserved
not only by the construction of the road of the defendant,
but also and equally by the construction of the other
branches. They were all to be constructed, maintained,
and operated upon the same terms and conditions in all
respects as the main stem. The aid granted, the duties
imposed, and the services exacted were the same in the
case of one as in the case of the other, and hence the ob¬
ject was the same.
2. The objects of this legislation are transcendent. They
can be realized only under a rule that is unvarying, abso¬
lute, and arbitrary. They can be, and they will be, defeat¬
ed under any rule which is variable, indefinite, and involv¬
ing many considerations. For instance, admit the cost of
maintenance and operation are to be considered in fixing
the rates and apportionment of rates between different sec-
50
tions of a road or roads. These elements in the calcula¬
tion change every year and every season. Accidents of
storm and flood, accidents to bridges, tracks, and other
structures, accidents of increased or diminished traffic, a
thousand such like matters, constantly occurring and re¬
curring, would affect the result. Consequently the mea¬
sure and basis of the apportionment one year will not be
that of the next, nor that of to-day the same as that of to¬
morrow. A ride based on these complex and variable
conditions is no rule, and to enforce any principle of non¬
discrimination would be impossible. And yet it is to such
an investigation that the defendant company invites us,
the public, and the Government in the apportionment of
the rates for transportation of freight or passengers over
the western half of its road. How easy, under the pre¬
tence and color of new exigencies, to avoid the statute ;
how futile any remedy which even this Court can award
or administer would be ! And yet all the purposes of Con¬
gress in this stupendous system of work are to be utterly
defeated. If consequences are to be regarded in fixing the
duties, relations, and measure of mutual service among
these companies, these are the legitimate ones to be taken
account of, anticipated, and prevented.
3. The secondary object in view in this legislation was
the public service and convenience. This appears in the
clause already quoted from section 18, where the objects of
the acts are described to be to promote the public interest and
welfare ; and this, as well as the first object, was to be sub¬
served not by building a main line or a single line, but by
building a main line with several branches. It has been
said so many times the scheme was a main line and four
branches, one starting from the mouth of the Kansas,
and another from Atchison, another from Council Bluffs,
another from Sioux City. Excluding the Atchison branch,
the other three branches reach widely separated sections,
and this was by design, as appears by the act itself. In
section 9 of the act of 1862, the company known as the
Kansas Company was authorized to construct a railroad so
as to meet with the Pacific Railroad of Missouri. That
51
provision was inserted to give Missouri, St. Lonis, and
the southern country connection with its transcontinental
road. The next branch was to begin on the western boun¬
dary of Iowa, at a point not named in the act, doubtless
because no road had been built across the State of Iowa to
the Missouri, and the fixing of it was accordingly left to
the President; but this branch was designed to give con¬
nection between the main line and the Iowa branch ; the
Sioux City branch was to be built when a route through
northern Iowa or Minnesota should be built to that place,
in order to give those sections like connections. In further¬
ance of this purpose it was provided in section 7 that in
fixing the point of connection of the main line with the
eastern connections, it shall be fixed at the most practicable
point for the connection of the Iowa and Missouri branches.
Another provision is to be noted in this connection. As
already explained, the Kansas Company was, in a contin¬
gency, to build the main line ; should it do so, it was neces¬
sary to provide for the convenient connection of the Iowa
branch and the Atchison branches, so that sections of the
'country to be served thereby would not be left unprovided
for. This was assured by the clause of section 9, "and
said railroad through Kansas shall be so located between
the mouth of the Kansas River as aforesaid, and the afore¬
said point on the 100th meridian of longitude, that the
several railroads from Missouri and Iowa herein authorized
to connect with the same can make connection within the
limitation prescribed in this act." This great object, thus
disclosed bv a consideration of the circumstances of the
eastern termini and the branches, was advanced and as¬
sured by the several provisions that they should all re¬
spectively meet, unite, and connect with the main line by
means of a uniform gauge, and form with it a continuous
line of road, which should be operated and used without
discrimination of any kind. To each section of country
reached by a branch road and the roads connected on the
east, perfect equality with all the others was thus assured..
No construction can be placed on the 15tli section of the
act of 1864 which would operate to defeat this purpose.
52
4. We insist tliat the construction contended for by de--.
fendant has that vicious effect. Under the shelter of its con¬
struction a practice and course of dealing has been pur¬
sued which does defeat that object, and we therefore say
that it is wrong. In order to bring the aspect of the case
to full view, attention needs to be paid to the initial point
as fixed by the act of 1862, and as dealt with in the subse¬
quent acts relating to companies as affected by it.
5. It lias been said and repeated that the original scheme
in the act of 1862 was a main line, with its initial point on
the 100th meridian, and the branches. The original
authority was to the defendant to build the trunk line, but
in a contingency deemed most likely to occur this autho¬
rity was to vest in the Kansas Company. Each of the
branches was to be operated as a continuous line with the
main line. . Whether the main line was to be built by the
company owning and operating one or the other of the
branches or not, each and every one of them was to be the
equal of each and every of the others ; there might be com¬
petition to the initial point, but from that point west there
would be of necessity a tariff absolutely the same for all
branches. Thus far we have no clause forbidding discrimi¬
nation of any kind. That flowed from the circumstances,
and the general rule of law, and did not need distinct ex¬
pression The act of 1864 authorized the Kansas and Han¬
nibal and St. Joe and Sioux City Companies to connect at
any point they pleased west of the 100th meridian, each
having its separate point of connection. The Kansas Com¬
pany retained the right under this act to build the main
line under certain circumstances. If it connected with the
main line west of the meridian and continued the construc¬
tion west, it would happen that the Iowa branch might, for
a time at least, be separated from the main line. It was,
therefore, provided in the act of 1866 that the Iowa branch
might be built without regard to the initial point. The
initial point lost all its importance under these changed
circumstances, and became not only practically but abso¬
lutely obsolete. This is distinctly conceded bv Mr. Rogers,
who says, "that as between plaintiffs and defendant Chey-
53
enne is now to be treated and considered as the initial
point." Mr. Rogers uses the expression " the complainants'
road," which constitutes one of these branches connecting
at Cheyenne. As to it, the road west of that point consti¬
tutes the main line. It was when a common point of con¬
nection of branches was abandoned, and because it was
abandoned, that the stringent provisions against discrimi¬
nation of any kind was inserted in the legislation and be-
t/ OJ
came necessary, in order to secure and conserve the interests
of the different sections of the country. The single fact
that it was at the same time and in the same act in which
the plaintiff was authorized to connect west of the 100th
meridian at any point it chose, that the clause against
any discrimination was enacted, proves that that clause
was to be operative upon the new relations of the com¬
panies created by the act; unless that was so the clause
would be utterly worthless.
6. The case is then reduced, up>on defendant's theory,
simply to this : The road at Cheyenne—namely, the plain¬
tiffs' road—the main line west and the defendant's branch
east of there, are required to be operated and used as one
continuous line, without discrimination of any kind.. But
it is said that under this view it is permissible for defend¬
ant to apportion the through-rates between the two sec¬
tions of its road at its own discretion, giving the lion's
share to the main line. Undoubtedly, the defendant
may direct its own business as it pleases—subject,
however, to the limitation imposed upon its powers
by law. Those limitations, of course, it cannot exceed,
and if it does attempt to do so by any evasive device the
Court will lay its hand all the heavier upon it, because its
action is disingenuous.
7. It is also said that the Circuit Court for Iowa held
that, as respects rates, the defendant company might
break up its road into two sections, with discriminating
rates on the two sections. The case referred to was a man¬
damus case to compel it to operate its bridge over the Mis¬
souri River as an integral part of its road. The Court held
that it was required, by the mandate of the statute, that
54
the companies use and operate tlieir roads, as far as the
Government and public were concerned, as one con¬
tinuous line in respect of time and transportation, and
enforced the duty as respects time and transportation.
Had that been the whole of the case, it is not possible to
discuss any ground of distinction between the duty as to
rates and the duty as to time and transportation. The
piece of road across the bridge and the remainder of the
line, being sections of the whole line, were required to be
operated together as a continuous line, and as to time
and transportation, as required by section 15 of the act of
1864. The distinction between rates, and time, and trans¬
portation was not based on the clause under consideration,
but on the distinct and separate provision in the Bridge Act
gi ving special tolls to the bridge.
8. But it is again objected that our view excludes all
competition between the branches. We submit that it
does not do so, but rather stimulates that competition.
And this brings clearly to view the true object of this legis¬
lation—viz., to advance the interests and conserve the
equality of the different- sections of the country reached
by the branches. The plaintiffs' road and the roads west
of Cheyenne are all one line for the purposes of this pro¬
vision of law. The defendant's road east and west
of Cheyenne are one line for the same purposes. The law
says that no discrimination shall be exercised by the west¬
ern half of the road, and all devices, under the name of ap¬
portionment of rates, which have such effect are forbidden ;
all considerations of cost and inconvenience, under cover
and excuse of which discrimination is openly or covertly
produced, must be excluded. Competition up to that
point is permissible ; beyond that point it is forbidden.
The great object of service to the Government and the pub¬
lic by means of these branches, operated in perfect equality,
is destroyed by the practices of which we complain, and
these practices are apologized for by our adversaries in
their argument here, beca use otherwise the material inte¬
rests of the defendant and the State of Iowa would be in¬
jured. Under the practices which they apologized for,
55
Iowa is to have all this business ; Missouri, and the States
east and south of it, are to be shut out of it. The North is
to thrive on a.monopoly ; the South and East are to be
starved bv absolute exclusion. That the laws forbid.
9/
Now, to what vast reach and proportions these questions
expand when thus reviewed. It is no longer the case of
the parties to this record, their convenience or inconveni¬
ence, profit or loss ; but that of all States and groups of
States claiming equal rights and participation in this na¬
tional system of work and this transcontinental traffic.
POINT VII.
The position assumed by the defendant, that the rates
which it is entitled to charge over the west half of its road
is to be fixed by an equitable pro-rate of its through rate,
based upon the proportionate expense of the construction,
maintenance, and operation of that half of the road as
compared with its whole road, invites us to an inquiry,
by the very nature of it improper, in determining the
duties of these parties under the act.
1. It is said that the road of the defendant west of Chey¬
enne cost much more per mile than it did east of Cheyenne,
and that its grades and curvatures are such that the cost
of maintenance and operation of it is also much greater
than the portion east of Cheyenne. Now, it is a matter of
common knowledge, which has entered into the history of
the times, that the building of defendant's road was ac¬
companied by enormous frauds on the part of its directors
against the company and the Government. In Wardell's
case, lately decided by Mr. Justice Miller in this court, he
took judicial notice of the scandals of the Credit Mobilier,
and the strange devices by which parties were enabled to
build a great and expensive railroad, and make for them¬
selves immense fortunes. Generally, railroad building re¬
quires an expenditure of money by those engaged in it.
In this instance it gave large sums of money to those en¬
gaged in it. The rule of law, that courts will take judicial
notice of what is generally known within the limits of their
Ol>
jurisdiction, is declared in Brown against Piper, 91 V. S.
117, and cases cited. Now, it is proposed by defendant to
take an account of all sums expended by tbe company, as
well those justly applied to the building of the road as
those unjustly returned to the directors, and calculate
from these figures what is the equitable pro-rate per mile
based upon the expense of construction of its road. The
construction account of the company, as it stands on their
books, is to be taken without regard to the extraordinary
dividends, as they were called, among the members of the
company. Thus the enormous wrongs in the building of
the road are to be made the basis in fixing its rates, and
the more enormous those wrongs the higher are the rates
which it is to fix ; and this is to be to the prejudice, not
of the plaintiff's road only, but of the people of Missouri,
the States east and south of it, the public, and the Govern¬
ment.
A full and complete answer to this position of defend¬
ant would be to say that with the proceeds of the subsidy
of lands and bonds received by the defendant from the
Government and the people they might have built its road,
so that it would have compared favorably as to grades,
curvatures, and permanence with the renowned Appian
Way of the Romans.
Suppose, on the other hand, the company make ex-
piation for its former sins, and proposes to make the
rates upon the basis of what its road actually cost,
excluding what was fraudulently diverted by means
of the Credit Mobilier to these members. In that case the
actual cost would be ascertained, but by what process %
By going through its whole construction account 1 That
would involve a long time, and necessarily result in
nothing decisive or satisfactory. Shall it be by bring¬
ing a cloud of experts to the witness-stand to testify what
the road could honestly be built for 1 Time would be con¬
sumed with equally undecisive and unsatisfactory results,
and meantime all the great rights of the public and the
Government and the plaintiffs are to be kept in abeyance.
2. It is said, in the second place, that the cost of mainte-
67
nance .and operation must be considered. What is said
before about the cost of construction is equally applicable
to the cost of maintenance and operation. Had the road
been honestly built with the proceeds of the subsidies, 110
grade would have been so heavy as to necessitate an ex¬
pensive maintenance and operation. Every structure
would have been so built as to require repairs and renew¬
als at but very long intervals. The equipment supplies
would have been so nearly perfect and so extensive as to
reduce the current expenses to an inconsiderable sum ; but
the vice of the construction is communicated to the main¬
tenance and operation, and is made a virtue in order to
justify the discriminations of which we complain. If it be
said that these matters are not in the case, and that the
question here is the abstract one, whether cost of construc¬
tion, maintenance, and operation can be considered in
fixing rates, we answer, first, that as a matter of public
and common knowledge the Court must be taken to know
them ; and, secondly, that let these notorious facts be
taken as suppositions, and they illustrate the case aptly,
and demonstrate the impropriety of admitting the inquiry
to which the defendant invites us.
3. The protracted nature of the enquiry proposed by the
defendant, and the delay in securing public rights which
it would necessitate, have been already incidentally sug¬
gested. But we present them as substantive reasons for
the construction which we place on section 15 of the act
of 1864. If we are to take as a basis of the calculation,
and estimate what the defendant's road actually cost, the
inquiry in that behalf, as already remarked, must be very
protracted. If we dispense with that, and take whatever
sum the construction account shows, most iniquitous as
that would be, then ve have to inquire into the cost of
maintenance year by year. Consider the elements of this
more limited inquiry : if new rails are to be laid, how
many and to what extent ? shall they be steel or iron % are
tliev necessary and proper \ if a bridge is to be replaced,
is it necessary that it should be all wood or iron, heavy or
light, expensive or inexpensive % shall station houses be built
■}
58
at this place or not at all ? shall they be brick or wood, one
or two stories, large or small, good or bad % Every item in
the account of maintenance must be considered, and when
the proof on all these matters has been taken, on one sub¬
ject and the other, the assistance of experts must be se¬
cured. The Court cannot pass on such questions, but re¬
quires the assistance and the opinion of railroad men, and
where will that lead to, and in what will it end \ Pass
from these inquiries to that about the cost of operation,
and equally difficult questions present themselves : the
number of officers and employees, and the salary of each ;
the competency, usefulness, measures of service; strikes
of workmen, and their treatment; the number and the
price and value of cars, engines, and trains ; the propriety
of contracts with freight companies and palace-car com¬
panies ; of maintaining shops for manufacture, or buying
articles from others ; accidents resulting in damages to
third parties, law expenses in defending Credit Mobilier
suits and Government live per cent, suits—a thousand such
matters would be involved in the inquiry, and all of them
would pass through the crucible of experts.
What may be done in this matter of ascertaining ope¬
rating expenses is well illustrated by the achievements of
the accomplished operators of this defendant's bridge at
Omaha. These expenses were reported by them last year
as equal to all the tolls over the bridge, less interest on the
bonds. Upon the honesty or dishonesty, truth or false¬
hood of that report, we do not remark. We instance it to
show what may be done when to ability motive is added.
4. Another circumstance is to be considered. These cal¬
culations to which we are invited would have to be made
yearly. What may be done and ought to be done one
year may not be done and ought not to be done another
year, either in the maintenance or operation of the road.
No certain rule can be laid down. While the inquiry for
one year is being conducted, that year is passing away, and
in the new year new conditions appear, of which new evi¬
dence must be taken and upon which other decisions must
be made; and while the inquiry as to that is being carried
59
oil other changes are taking place, which in their turn rej
suit in a subject of inquiiy, and the conclusion at this
rate, it is manifest, would never be reached, and the case
at bar without end.
- 5. While this inquiry to which we are invited is being
carried on, the rights of the Government and the public, as
well as those of the plaintiffs, are disregarded and set at
naught. The business of Missouri, the States and groups
of States east and south of Missouri, must be diverted to
Chicago or reach Council Bluffs by a circuitous route not
provided for in this legislation, and then pay the ransom
extorted by a great monopoly, or it must be suspended.
The troops and military supplies at the great military
depot of Fort Leavenworth must, with all other Government
business, be subjected to like inconvenience. Pending the
inquiry, the law must be considered as suspended ; and as
the inquiry can never end, the law is most effectually re¬
pealed.
6. We submit that a construction which involves such
consequences must be erroneous. Congress authorized the
construction of these great works, and aided them in an
unexampled measure, for great public purposes. It bound
them together in one system of society, and imposed upon
them their duties and relations in furtherance of the same
purpose. It laid down a rule enforcing those duties, and
regulated those relations in order to fortify against all acci¬
dents and circumstances, for the same great object. Our
construction of the act advances and assures that purpose.
It is, therefore, the right construction. The construction
contended for on the part of the defendant annihilates that
purpose. It is, therefore, the wrong construction. The
arguments advanced by the defendant against the con¬
struction contended for by the plaintiffs are not pertinent
to the subject matter of this controversy. They would one
and all of them be applicable to the construction of an act
which prohibited undue, unjust, unfair, inequitable, or
some other kind of discrimination, and all of them would •
be forcible and exhaustive upon an argument addressed to
Congress to repeal the clause over which this controversy
60
arises ; but so long as *tlie lotli section of the act of 1864
and the whole of the act of 1874 stands upon the Statute
Book of the United States the only construction which will
be of any service whatsoever, and will in any way serve to
carry out the great purposes of the acts for the present and
for all time, is that it is a legal duty imposed upon the de¬
fendant to charge for transportation of freight or passen¬
gers, going to or coming from its road at Cheyenne, a rate
of freight or fare which shall be in all cases fixed at a mile¬
age rate equal to a pro-rate per mile of the lowest through
rates charged by the defendant company for similar trans¬
portation or traffic over its whole road.
The motion to expunge from defendant's answer to the
bill of complainants so much of the answer as has been
excepted to by plaintiffs as impertinent should be granted.
All of which was respectfully submitted by counsel on
behalf of the complainant companies.
In the Matter of the Resolutions of both Houses of
Congress touching the operation of the Union
- Pacific Railroad and Branches.
LETTER TO THE PRESIDENT
BY
J. P. USHER.
v«
#
TO THE PRESIDENT:
In the Matter of the Resolutions of both Houses of
Congress touching the operation of the Union
Pacific Railroad and Branches.
Because of my intimate knowledge of the way
and manner in which the roads in the Union Pacific
railroad system have been operated since their comple¬
tion, it was thought by the parties interested in the
Kansas Pacific branch that if present at the hearing
before the Secretary of the Interior and the Attorney
General, I would be of very much service to them.
They have expressed their disappointment that I was.
not there ; other pressing duties prevented. I think I
can briefly present to you for your consideration in this
way all I could have said or done if I had been before
the Secretary and the Attorney General.
The question is, is any further action by Congress
necessary to compel the operation of the Union Pacific
Railroad and branches, as already required, by the
several acts of Congress f
It is apparent that the Central Pacific of California,
owing to its peculiar location in the Union Pacific Rail¬
road system, is in a great measure quite indifferent how
the Union Pacific, and branches connecting with it, are
managed, because all the overland traffic of the Union
Pacific Railroad and branches necessarily passes over
2
4
its line of road. But the Union Pacific is not, in the
opinion of its managers, indifferent, and by their man¬
agement and policy they have usurped the control of
all the trans-continental traffic appertaining to it, and of
all the branch roads leading into it. The through con¬
nection by the Kansas Pacific branch at Cheyenne was
made in September, 1870, and yet from that day to this,
now more than seven years, the Kansas Pacific and
Denver Pacific, together a branch of the Union Pacific,
have at no time been operated with it as a continuous
line. Between the Union Pacific and these branch
companies the most implacable hostility has existed
from the day of their completion, never surpassed by
rival railroad companies east of the Mississippi river,
in the operation of their roads. It is a matter of public
notoriety that the Union Pacific has with its means
(which would have been better employed in paying its
debts to the Government), lately constructed a rival
road to the Denver Pacific, with the avowed object and
purpose of controlling the carrying trade of Colorado,
to the impoverishment and ruin of the Kansas Pacific
and Denver Pacific roads.
In view of these facts the question is, are all the acts
of Congress relating to the Union Pacific Railroad and
branches, from July 1, 1862, to June 20, 1874, mere
" sounding brass," or are they vital laws and capable
of being enforced ? That they have not been enforced
or observed in the slightest degree is certain. Abun¬
dant pretexts and devices have always been at hand to
justify the companies, which by the law have been left
without any common head to control them, to act pre¬
cisely as their separate selfish interests prompted them.
It is true there are Government Directors, having a
voice in the management of the Union Pacific Railroad
3
Company, but in no instance have they endeavored to
bring about an operation of all the roads as a unit. They
have doubtless considered that their duty was per¬
formed in the advancement of the interests of the Union
Pacific, though such advancement should result in the
ruin of the branches, and it may be that in so acting
they have discharged their whole duty. However that
may be, the indisputed fact remains that the Union
Pacific and branches leading into it east of the moun¬
tains have not been operated as one continuous line,
nor have these lines of road been open to the public,
the government, and to each other without discrimina¬
tion, until now, after seven years, a universal complaint
exists because of the breach and defiance of law by
these companies, and it ought not to be expected that
such complaint will be silenced until the law is squarely
*
enforced.
The Kansas Pacific and the Denver Pacific Compa¬
nies have appealed to the Circuit Court of the United
States against the Union Pacific Company, demanding
a decree for the enforcement of the law, claiming that
they are entitled to have their road operated in connec¬
tion with the Union Pacific as one continuous line, and
that the rates upon the Union Pacific shall be uniform
to their branch road, whether freight and passenger
shall be transported upon the Union Pacific east or west
of Cheyenne; that Cheyenne being in the middle of the
Union Pacific road, the rates of that company are
bound to be uniform over its whole line of road, and
that for transportation from the branch upon any part
of its line of road, the rate to be charged shall be a
pro rate upon its whole line.
The Union Pacific has answered the bill and has set
up in its answer that it ought not to be compelled to
4
I
submit to the terms demanded, because, it says, it cost
more to construct and costs more to operate its road
west of Cheyenne than its road east of that point, and
that the laws ought to be so read as to justify it in
establishing differential rates upon such portions of its
road, as, in the judgment of its managers, shall seem
just and expedient for the interests of that company.
To the parts of the answer setting up this defense
the Kansas Pacific and Denver Pacific companies ex¬
cepted. Their exceptions were argued at the last term
of the Circuit Court at Omaha, and are now under
advisement. With this I have the honor to submit to
you the briefs and arguments of Mr. Wool worth and
myself, wherein we have endeavored to present the
claims of the Kansas Pacific and Denver Pacific Com¬
panies, as well as to refute the pretensions of the Union
Pacific Company. I do not know that I can add any¬
thing further in the way of argument.
It must be apparent to you that if the claim of the
Union Pacific interposed in that cause is valid, the acts
of Congress afford no restraint to the exercise, by the
companies in the Union Pacific Railroad system, of all
the powers that belong to railroad companies without
the system, in the way of rivalry or combination with
other roads, to the destruction of roads obnoxious to
them. This is constantly done without any excuse
or justification being offered to the injured party or the
public. Such conduct is what is called business. If
the acts of Congress do not absolutely restrain and
control the companies embraced in the Union Pacific
Railroad system, it was only courtesy on the part of the
Union Pacific company to deign an answer or excuse for
its conduct. If it be conceded that any of the companies
in the Union Pacific Railroad system have the right to
5
disregard the acts of Congress and conduct themselves
as their interests shall seem to be best served, then the
acts become mere "leather and prunella,'' fit only to be
trodden under foot.
One of the questions argued by Mr. Wool worth and
myself, proper for the consideration of the Court, will
not embarrass the Executive in enforcing the law,
namelv, that the Kansas Pacific and Denver Pacific
roads are a branch of the Union Pacific. Congress
having declared in the acts of March 3, 1869, and of
June 20, 1874, that these roads are a branch, has con¬
cluded the Executive upon that subject. It will be
quite too much for either of the companies to ask the
Executive to pass upon the constitutionality of those
laws.
Another vital question is equally well settled by the
Supreme Court of the United States in Hall's case, 1
Otto, 353, (extract of the decision in my brief, page 12),
namely, that section twelve in the act of 1862, and
section fifteen in the act of 1864, requiring the branch,
with the main line, to be operated as one continuous
line, mean that such connected and continuous line is
to be operated in through cars for freight and pas¬
sengers, without stoppage; that if the road is operated
so that there shall be a change of cars at the point of
connection, the one continuous line will be broken into
two lines, and plainly inconsistent with continuous
operation of it as a whole. By this decision it is set¬
tled beyond dispute what one continuous line means,
and the acts of Congress requiring the roads thus to be
operated have never yet been questioned; and yet
these plain provisions of law, intended for the benefit
and welfare of the Government, the public and the
companies, have been for seven years wholly ignored
6
by the companies. Whether the fault may be laid to
one company, or all, is wholly immaterial. So much of
the law has not been kept. That it ought to have
been, all but those interested in violating it, will affirm.
If it be said that the provisions of section fifteen, act
of 1864, denouncing discrimination, remain to be con¬
strued by the Courts, I answer that that is not so as to
the executive. In this connection, I beg your attention
to an expression of the Supreme Court, by Mr. Justice
Strong, in HalVs case, 1 Otto, 350 (extract page 23 of
my brief). I submit that the Court decided in that case
that the Union Pacific Company cannot charge a greater
rate of toll over any portion of its road because of its
increased cost than it charges upon other portions of its
line. It is true that the decision of the Court was made
in reference to the Omaha bridge, but the decision is of
general application to the whole line, and we have no
right to assume that the Court will qualify or modify
this decision, if the question shall ever come before it,
as to the right of these companies to make different
rates upon any portion of their lines of road. It must
be apparent to every intelligent mind that it was the
intention of Congress to provide for a system of rail¬
roads which should be operated upon principles entirely
different from those that were in vogue in the operation
of railroads generally. In their management they were
not to be left to the capricious and selfish conduct of
their respective managers, for if that was done the
entire object of Congress was certain to be frustrated.
To an ordinary observer it must appear to be certain
that the only construction that can fairly be placed
upon section fifteen of the act of 1864 is that differential
rates by any of the companies in the Union Pacific
Railroad system, the effect of which shall or may be to
7
advance the interests of any or either of said compa¬
nies to the disadvantage of another, is discrimination ;
absolutely forbidden by the law; and a grievous offense
against the government, the public and the proscribed
company.
The first difficulty standing in the way of the opera¬
tion of the several roads as required by law, and abso¬
lutely necessary to be overcome, is the neglect or
refusal of the companies to operate their roads as one
continuous line. When that is done (as declared
by the Supreme Court it shall be, in through cars)*, the
companies will necessarily be compelled to cease their
hauteur toward each other, and this for many reasons
that will readily occur to experienced minds. Obvi¬
ously the operation of the road as a continuous line is
the first thing to be done. Its value to the government
and the public and the several roads is so great that
Congress has over and again declared that they shall
be so operated.
In the recent presentation of the subject before
the Attorney General and Secretary of the Interior,
it was claimed by counsel for the Union Pacific
Company, that the increased expense for transporting
the 2d Infantry, lately passing over the Kansas Pacific
and the Denver Pacific roads to Cheyenne, thence by
the Union Pacific and California Central to San Fran¬
cisco, was caused by the fault of the Kansas Pacific and
Denver Pacific companies, in undertaking to transport
the regiment at all; whereby they made it necessary
for the Union Pacific Company to send cars empty from
Omaha to Cheyenne, there to take the regiment and bear
it along. That is one version of the affair; the other is
that the Kansas Pacific and Denver Pacific companies
notified the Union Pacific Company that their cars, bear-
8
ing the troops, could go through, and so avoid a change.
However this may be (and of course it will be denied)
is quite immaterial; it is enough that one or all of the
companies was in fault. The troops were not trans¬
ported over the entire road, viz : from Kansas City to
San Francisco " as one continuous line." They were
compelled to change cars with all their baggage, fami¬
lies and servants at least ♦twice: and now the Quarter¬
master General and accounting officers are perplexed
and confounded to know whether the Kansas Pacific
and Denver Pacific companies are entitled to any com¬
pensation whatever for their part in the affair. In the
mean time all the companies are criminating, recrimin¬
ating and grimacing at each other about it,—a most
scandalous and revolting spectacle.
If the companies can with impunity conduct them¬
selves in this manner with the government, what op¬
pression may they not impose upon each other and the
public? The transporting of the 2d Infantry is a fortu¬
nate occurrence in the controversy, because all the facts
connected with it are accessible to the President, and
afford a perfect illustration of the way and manner in
which the Union Pacific road and branches are operated
by the companies, and of their total disregard of the
duties imposed on them by the law of their existence.
The law to these companies is a dead letter, it has
never been kept; not the slightest regard has ever been
paid to it, and never will be, if it be left to the compa¬
nies, of their own volition, to keep and observe it.
The question then is,
Has the Executive the power, under existing laws, to
compel these companies to perform their duties to the
government, to the public, and to each other, as provided
by law f
9
It has been urged that the statute authorizing pro-,
feedings by mandamus is adequate. Manifestly that
is not so, as is exemplified in the case of Hall, where
repeated judgments have been rendered that the road
should be operated over the Omaha bridge as a contin¬
uous line, and yet it is not done, and it may never be,
because of any means the law has provided to compel
it. Excuses are ample and abundant against the ple¬
nary enforcement of the judgment of the courts.
The statute authorizing proceedings by mandamus
against the companies seems to provide an adequate
remedy to correct a single nonfeasance, e. g., the failure
to operate the roads " as one continuous line." Yet in
practice it has proved insufficient notably in compelling
the Union Pacific Company to run its through cars over
the Omaha bridge.
The proceedings in mandamus being according to the
rules of the common law, the writ not being allowed
until the offending party has refused to perform some
positive duty, it will be seen at a glance that proceed¬
ings in mandamus will be wholly inadequate to meet
this case. The first writ in this matter would be to
compel the companies to operate their roads as one
continuous line. When judgment is had that it be
done, questions will arise of which the following are
but a part: the time and times when the through
cars shall be run; what shall be the rate of speed
and who shall conduct the through trains; shall the
passengers be compelled at every connection of the
roads to attend by day or by night and% see their
baggage pass through the hands of the baggage-smash¬
ers, weighed and pay extra, if by them found too heavy,
on pain of being thrust off the train ? Then, the through
tickets, will they be honored by the several companies*
10
Then, the billing and handling of freight, a thousand
times more complicated. To direct all these things is
quite beyond the scope and province of the writ of
mandamus. It must be conceded that that writ cannot
be availed of as affording a practicable and sufficient
reihedy.
Then we have the highly penal act of June 20, 1874.
Its value is to be considered. The greatest number of
the public passing over these roads prefer to submit to
the abridgment of their rights and to the extortion of
the companies, and will and do submit rather than en¬
gage in litigation with them. Why this is so, is appa¬
rent. A lajge majority reside at great distances from
the courts in wThich their suits would have to be brought,
beside people generally are reluctant to engage in law
suits.
But it may be supposed that the reasons which deter
individuals from engaging in prosecutions under this
penal statute, do not apply to the complaining com¬
panies. There are reasons, however, which have caused
the injured companies to look to the invoking of
that statute only as a last resort. For the very
first thing to be done under the law is to operate all the
roads as one continuous line. When that shall be done,
the rolling stock of the companies will be interchange¬
ably used over all the continuous line. By the decis¬
ion of the Supreme Court, in HalVs case, construing
the acts of Congress, the companies are bound to trans¬
port freight and passengers without change of cars ; of
course none of these companies would care to place
their rolling stock under the control of a set of men,
some of whom they had prosecuted and caused to be
fined and imprisoned, for no other fault than that of
obeying their master.
>
11
Again, suppose the prosecutions are confined to the
offending company and its principal officers: that will
"be war. There will be suits without number, new suits
every day, the hand of each party will be raised against
the other. Whereas, they ought to be at peace, each
striving to promote the welfare of the others, while
observing their duties to the public. Generally, it is
true that lawsuits are bad expedients to settle difficul¬
ties existing between parties who are bound to live
together. So I think you will conclude that prosecu¬
tions under the penal law of 1874, ought to be avoided,
if a better way can be devised. That the President
will be able to devise and suggest a better way, one
that will for all time be sufficient, ought to be the
earnest wish of all concerned. ^
The trouble has been occasioned by the fact that the
roads are by the acts of Congress left under the exclu¬
sive control of the companies severally owning them ;
and so long as that continues the companies will from
sheer refractoriness, stimulated by interest and ambi¬
tion, evade a fair execution of the law. This being so
beyond doubt or question, to remedy the evil Congress
should provide by law
For the Appointment of a Commissioner
By the Executive, whose duty shall be in accordance with
the obligations imposed by section 15 of the act of 1864,
to devise and promulgate, under the direction of the Sec¬
retary of the Interior, rules and regulations for the oper¬
ation of all the roads in the Union Pacific Railroad sys¬
tem. The law should invest the Commissioner with
power to compel the observance of his rules and regula¬
tions, and if the companies rebel, to take absolute con¬
trol of the roads. There will be an end of all difficulty
12
if that is done ; and while this subject is in hand, to end
the law suits of the government with the companies, and
to avoid others, I suggest that it will be well to provide
by law that the Commissioner shall have access to the
books and accounts of the companies, and that they
shall, under rules and regulations to be prescribed by
the Secretary of the Treasury, be compelled to come to
an account with him of and concerning their earnings,
to the end that the government may get its just propor¬
tion thereof, as provided by law, and so avoid the multi¬
tude of suits pending and to be brought for the five per 7
cent, net earnings.
The foregoing is respectfully submitted, in the hope
that it may tend to influence the Executive to recommend
a law providing for the appointment of a commissioner
with powers and duties as above suggested; for, after an
experience of now more than ten years with these com¬
panies, with an intimate knowledge of their manage¬
ment, and the numberless possibilities open to them to
evade their obligations imposed by law, I am certain
that the only sure way to compel them to do their duty
and keep their statute contracts, is to meet them face to
face with ample power. When that is done they will
cease warring with each other, will peacefully devote
themselves to the discharge of the duties for which they
were created, and in doing that each will earn enough
to pay their honest debts.
J. P. USHER.