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District of Nebraska.
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THE KANSAS PACIFIC RAILWAY COMPANY and ^
THE DENVER PACIFIC RAILWAY AND TEL¬
EGRAPH COMPANY,
vs.
THE UNION PACIFIC RAILROAD COMPANY. ^
> In Equity.
Brief and Argument of J. M. Woolworth,
For Complainants.
•irt ®i tb M|ipteil
DISTRICT OF NEBRASKA.
THE KANSAS PACIFIC RAILWAY COMPANY and ^
THE DENVER PACIFIC RAILWAY AND TEL¬
EGRAPH COMPANY,
vs.
THE UNION PACIFIC RAILROAD COMPANY.
ARGUMENT FOR THE PLAINTIFFS ON EXCEPTIONS TO THE DEFENDANT'S ANSWER.
This is a bill filed by the Kansas Pacific and Denver
Pacific Railway Companies to compel the defendant to op¬
erate its road as required by the acts of Congress.
On the 1st of July, 1862, Congress passed the 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." In its first section this act
incorporated the defendant, and authorized it to build and
operate a railroad from a point on the 100th meridian of
longitude, between the south margin of the valley of the Re¬
publican river and the north margin of the valley of the
Platte river, in the Territory of Nebraska, to the western
boundary of Nevada Territory.
In the eighth section it is provided that the point of de¬
parture on the meridian should be fixed by the President of
the United States.
In the third section a grant of land was made "for the
2
"purpose of aiding in the construction of said railroad and
"telegraph line, and to secure the safe and speedy transporta¬
tion of the mails, troops, munitions of war and public stores
"thereon."
In the sixth section, the company was required to keep
"the railroad and telegraph line in repair and use," and "at
"all times transmit dispatches over said telegraph line, and
"transport mails, troops, munitions of war, supplies and pub-
tic stores upon said railroad for the Government whenever
"required so to do by any department thereof," and to give
the Government a preference over all other parties.
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
"time of war) the use and benefit of the same"—railroad and
telegraph line—"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
"from the Missouri river, at the mouth of the Kansas river,
"on the south side thereof, so as to connect with the Pacific
"Railroad of Missouri, to the aforesaid point on the one-
hundredth meridian, . . . upon the same terms
" and conditions in all respects as are provided in this act for
"the railroad and telegraph line first mentioned, and to meet
"and connect with the same at the meridian of longitude
"aforesaid. . . . And said railroad through Kansas
"shall be so located between the mouth of the Kansas river
"as aforesaid, and the aforesaid point on the one-hundredth
" meridian of longitude, that the several railroads from Mis¬
souri and Iowa herein authorized to connect with the same
"can make connections within the limits prescribed in this
"act."
In the same section provision was made that the Central
Pacific Railroad Company of California should construct a
railroad, etc., from the Pacific coast, at or near San Francisco,
to the eastern boundary of California, " upon the same terms
"and conditions in all respects as are contained in this act for
3
"the construction of said railroad and telegraph line first
"mentioned, and to meet and connect with" the same "on
"the eastern boundary of California."
In the thirteenth section, the Hannibal & Saint Joseph
Railroad Company of Missouri was authorized "to extend
"its road from Saint Joseph, via Atchison, to connect and
"unite with the road through Kansas, . . . upon the
"same terms and conditions for one hundred miles in length,
"next to the Missouri river, as are provided in this act for
"the first-mentioned road," . . . or "so as to connect
"and unite with the road leading from the western boundary
"of Iowa, at any point east of the one-hundredth meridian of
"west longitude, or with the main trunk road at said point."
In the fourteenth section, the defendant was authorized to
build a single line of railroad from a point on the western
boundary of Iowa, to be fixed by the President, "so as to
"form a connection with the said company's line at some
"point on the one-hundredth meridian, upon the same terms
"and conditions in all respects as are contained in this act for
"the construction of the first-mentioned road."
In the same section provision was made for another road,
also to be built by the defendant, to run from Sioux City, in
Iowa, "so as to connect with the branch road" mentioned in
the same section; and the defendant was required to build
this reach of road whenever a railroad should be completed
through Minnesota or Iowa to Sioux City.
In the fifteenth section it is provided that any railroad
company, whether then or thereafter incorporated, should
"have the right to connect their road with the road and
"branches provided for in this act, at such places and upon
"such just and equitable terms as the President of the United
"States shall prescribe."
In the tenth section it is provided that the Kansas and
California companies, or either of them, may, after complet¬
ing their roads respectively, unite with the defendant in
building so much of its road and branches as shall then re¬
main to be constructed, upon equal terms, and on the same
terms and conditions as provided in this act in relation to the
defendant.
4
In the seventeenth section it is provided that if the several
companies do not build their roads or keep them in repair
and use, Congress may pass an act providing for their speedy
completion and repair; and "if said roads are not completed
"so as to form a continuous line of railroad, ready for use,
"from the Missouri river to the navigable waters of the Sacra-
" men to river, in California, by the first day of July, 1876,
"the whole of said railroads before mentioned and to be con¬
structed 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."
In the twelfth section, 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 the Missouri river to
"the Pacific coast. . . . The whole line of said rail-
"road and branches and telegraph shall be operated and used
"for all purposes of communication, travel and transportation,
"so far as the public and Government are concerned, as one
"connected, continuous line."
On the 2d of July, 1864, an act was passed which is en¬
titled "An act to amend" the above-entitled act.
By its seventh section it was provided that the failure of
"one company to comply" with the two acts "shall.not work
"a forfeiture of the rights, privileges or franchises of any
"other company."
In section 9 it was provided " that any company authorized
"to construct its road and telegraph line from the Missouri
"river to the initial point aforesaid may construct its road
"and telegraph line so as to connect with the Union
"Pacific Railroad at any point westwardly of such initial
"point; in case such company shall deem such westward
" connection more practicable or desirable, and in aid of so
" much of its road and telegraph line as shall be a departure
"from the route hereinbefore provided for its road, such com-
"pany shall be entitled to all the benefits and be subject to
"all the conditions and restrictions of this act."
5
In section 13 it is provided that if the defendant shall not
be proceeding in good faith to build the said road through
the Territories "when the Kansas company shall have com¬
pleted its road to the one-hundredth degree of longitude,
"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 is in these words:
"The several companies authorized to construct the afore¬
said 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 government are con¬
cerned, as one continuous line, 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 said companies, or adverse to the road or business of any
or either of the others."
Section sixteen provides for the consolidation of any of the
companies, and that any company not entering into such con¬
solidation " upon the completion of its road as hereinbefore
" provided, shall be entitled to and is hereby authorized to
" continue and extend the same under the circumstances and
" in accordance with the provisions of this section, and to
" have all the benefits thereof as fully and completely as are
" herein provided, touching such consolidated company;" that
is, it may build the uncompleted road of any other company.
Section seventeen provides that the Sioux City branch may
be built by a State corporation.
The last section is as follows: " Congress may at any time
" alter, amend or .repeal this act."
On the 3d of July, 1866, an act was passed amending that
of 1864, by providing that the Kansas Company shall con¬
nect their line of railroad and telegraph with the Union
Pacific Railroad, but not at a point more than fifty miles
westwardly from the meridian of Denver in Colorado; and
also that the defendant might build its road west from Omaha
without reference to the initial point, on the one-hundredth
6
meridian of west longitude, until it should meet with the
Central Pacific Railroad Company of California.
On the 3d of March, 1869, an act was passed as follows:
"That the Union Pacific Railway Company, Eastern Divi¬
sion, be and it hereby is authorized to contract with the Den¬
ver Pacific Railway and Telegraph Company, a corporation
existing under the laws of the Territory of Colorado, for the
construction, operation and maintenance 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 Cheyenne, and to adopt the road-bed already
graded by said Denver Pacific Railway and Telegraph Com¬
pany as said line, and to grant to said Denver Pacific Rail¬
way 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 Pa¬
cific Railway and Telegraph Company, a continuous line of
railroad and telegraph from Kansas City, by way of Denver,
to Cheyenne. And all the provisions of law for the opera¬
tion of the Union Pacific Railroad, its branches and connec¬
tions, 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."
On the 20th of June, 1874, an act was passed entitled "An
act making additions to the fifteenth section of the act ap¬
proved July 2, 1864, entitled 'An act/" etc., as follows:
"That there shall be and is hereby added to the fifteenth
section of the act approved July second, eighteen hundred 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
7
and sixty-two/ the following words, namely: And any officer
or agent of the companies authorized to construct the afore¬
said 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, or which he is engaged in operat¬
ing, for all purposes of communication, travel and transporta¬
tion, so far as the public and the Government are concerned,
as one continuous line, or shall refuse in such operation and
use to afford and secure to each of said roads equal advantages
and facilities as to rates, time or transportation, without any
discrimination of any kind in favor of or adverse to the road,
or business 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 may 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 de¬
fendant 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 by the defendant, and for treble
the amount of damages sustained by the plaintiff by such
failure or refusal; 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
territory, district or circuit, process may be served upon any
agent of the defendant found in the territory, district or cir¬
cuit in which such suit may be brought; and such service 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 Company, at Cheyenne, as pro-
vived in the act of March third, eighteen hundred and sixty-
nine."
Approved June 20, 1874.
In 1869 the defendant had constructed its road from the
Missouri river at Omaha to Ogden, where it met and united
*
8
with the road of the California company. The plaintiffs
have constructed their roads so as to form a continuous line
of road from the same river at the mouth of the Kansas to
Cheyenne, where it strikes the road of the defendant—that
point being equidistant from Omaha and Ogden.
The complaint of the plaintiffs is, that the defendant re¬
fuses to afford or 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, with¬
out discrimination; but it operates its road adversely to the
road and business of the plaintiffs, and has, by discriminat¬
ing rates in favor of its own road and business and against
the road and business of the plaintiffs, excluded them from'
any participation in business passing over its road west of
Cheyenne. With this object the defendant has fixed its
rates of fare and freight from Cheyenne to Ogden in many
cases as high, and in some cases higher, than from Omaha to
Ogden, and in all cases out of all proportion to the distance
traversed; and in this manner has discriminated and does
discriminate against the plaintiff's road and the roads con¬
necting with it at Kansas City in favor of its own road east
of Cheyenne and other roads connecting with it at Omaha, so
as to force all freight and passengers coming on its road at
Ogden and destined to any point east of Cheyenne and the
roads connecting with it at Omaha, and to force all freight
and passengers destined for points west of Cheyenne to pass
over the eastern parts of its road and the roads connecting
with it at Omaha. The plaintiffs insist that the defendant
cannot lawfully charge more than one-half its rates from
Omaha to Ogden for the business coming from the plaintiff's
road upon its road at Cheyenne and destined west thereof,
or coming from its road upon their road.
Complaint is further made that the defendant, for the pur¬
pose of further discriminating against the plaintiffs, refuses
the same facilities as to time of running and connection of
trains, accommodation in passenger coaches, checking and
9
handling baggage, conveniences for loading, moving and de¬
livering freight, and in minor matters, as they give to passen¬
gers and freight between Ogden and Omaha.
The defendant in its answer insists that the plaintiffs are
not within the privileges of the provisions of the acts of
Congress providing that the roads mentioned in the acts of
1862 and 1864 shall be operated as one continuous line, and
that they shall not discriminate against one another; that it
had built its road to a connection with the road of the Cali¬
fornia company, and the same had been accepted by the Gov¬
ernment as completed 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 this act nor that of 1874.
The defendant in its answer further says, that by reason
of the diverse character of the country east and west of
Cheyenne, that the road from Omaha to that point could be
and was constructed and can be and is operated at very much
less expense than the road from that point to Ogden; so
that what is a reasonable charge for service over the one is
an insufficient charge for service over the other, and a uni¬
form rate per mile for through business would be grossly in¬
adequate to compensate it for service over the expensive and
difficult part of its road.
To these parts of the answer the plaintiffs except for im¬
pertinence.
FIRST EXCEPTION.
The acts of Congress of March, 1869, and of June, 1874,
in their terms and considered alone, bring the Denver Pacific
Company within the clauses of the acts of 1862 and 1864,
which regulate the relations of the Union Pacific and other
roads. The language is plain. In the act of 1869 it is, that
"all the provisions of law for the operation of the Union
"Pacific Railroad, its branches and connections as a continu¬
ous 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."
10
In the act of 1874, the language is, that for all the purposes
of the act of 1864, and the amendatory acts, 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."
This language is very clear. The defendant's counsel admit
that if it is to have effect, it brings the plaintiffs within the
operation of the clauses upon which they base their claim.
But it is insisted that it cannot have operation against the
Union Pacific Company, because the acts in which it is found
were passed after the rights of the defendant had become
fixed by the construction of its entire road, and it has never
consented thereto. That is to say, the acts of 1862 and 1864
constitute a contract between the Government and the com¬
pany which it was not competent for Congress to impair by
subsequent legislation, and that the effect of the acts of 1869
and 1874 is to impair the contract.
The act of 1862 contained a clause reserving to Congress
the right to alter, amend, or repeal it; but as it is accompa¬
nied with terms upon which some observation may be made,
we pass it by, and invoke the last section of the act of 1864,
which is simply in these words: "Congress may at any time
"alter, amend, or repeal this act."
The act of 1864 was accepted by the defendant; it took
the rights, privileges, aid in bonds, and lands granted—all
burdened with the duties, obligations, relations and limita¬
tions expressed in the same act; and among the latter, with
the reserved power and right 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 Wallace, 190/
That case was, shortly, this: Two colleges were incorporated
and established at two places not remote from each other.
The constitution of Pennsylvania provided that the Legisla¬
ture of the State should have the power "to alter, revoke or
" annul any charter of incorporation thereafter granted, when-
11
"ever, in their opinion, it may be injurious to the citizens,
" . . . ; in such manner, however, that no injustice shall
"be done to the corporators." With that provision in force,
the colleges respectively applied to the Legislature for an
amendment of their charters, so as to consolidate them in a
certain measure, retaining one department at one place and
another department at the other. Under that legislation,
the institutions were reorganized accordingly. Afterwards,
another act was passed, still further interfering with the con¬
stitution of the colleges, so as to unite them under one organ¬
ization. The last act was objected to as within the inhibition
of the Federal Constitution against acts of the States impair¬
ing the obligation of contracts.
Mr. Justice Cliffokd, 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.
When such a provision is incorporated in the charter, it is
clear that it qualifies the grant, and that the subsequent exer¬
cise of that reserved power cannot be regarded as an act
within the prohibition of the constitution. Such a power,
also—that is, the power to alter, modify or repeal an act of
incorporation—is frequently reserved to the State by general
law applicable to all acts of incorporation, 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 charter was granted subsequent
to the passage of the general law, even though the charter
contains no such condition, nor any allusion to such a reser¬
vation. Reservations in such a charter, it is admitted, may be
made; and it is also conceded that where they exist, the ex¬
ercise of the power reserved, by a subsequent Legislature does
Hot impair the obligation of the contract created by the
original act of incorporation. Subsequent legislation alter¬
ing or modifying the provisions of such a charter where
there is no such reservation is certainly 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
12
the charter were passed with the assent of the corporation,
and they were duly accepted by a corporate vote as amend¬
ments to the original charter, they cannot be regarded as im¬
pairing the obligation of the contract created by the original
charter. Private 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 on the liabili¬
ties and duties which the corporators assume by accepting the
terms therein specified, and the grant of the franchise on that
account can no more be resumed by the Legislature, 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 incorpora¬
tion, or in some general law of the State, which was in
operation at the time the charter was granted."
The same court has applied the rule expressed above in
Tomlinson v. Jessup, 15 Wallace, 454; Holyohe Co. v. Lyman,
id., 500. See also Piek v. Chicago, &c., Co., 6 Bissell, 177;
Commonwealth v. Eastern P. P., 103 Mass., 254; Fitchburg
P. P. v. Grand Junction P. P., 4 Allen, 198; English v. New
Haven P. P., 32 Conn., 240; Albany, &c., Co. v. Brownell,
24 N. Y., 345; Attorney General v. Chicago, &c., 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 object of the incorporation without its assent.
That question is not involved here, for the amendment of the
acts of '62 and *64 by those of *69 and *74, has no such
effect. The act of *64 expressly provided that the Kansas
company might connect with the Union Pacific at any point
west of the one-hundredth meridian. It also contained the
clause requiring the companies to operate their several roads
as one continuous line without discrimination. And it con¬
tained the reserved right of amendment. When Congress by
the act of *69 provided that the Kansas company should
adopt the Denver company's road as a part of its line, and
make the connection by means of it, the object of the act of
'64 was not impaired, but rather advanced. Indeed, it seems
like "sticking in the bark" for the Union Pacific to repudiate
its duties to the public and the Government because the con-
13
nection of the Kansas company is made not directly by its
own road but by that of another company.
The cases cited arose under State statutes, and the consti¬
tutional provision urged against them has no application to
Federal statutes. Here is an act of Congress whose terms
are clear and explicit. This court will hesitate to say it is
void. It is an act by means of which the great objects of
the legislation about the Pacific roads is advanced and accom¬
plished. This court will hesitate before it puts itself in the
way of the full realization of those objects.
It is therefore respectfully submitted that the allegations
that the defendant's road was completed to a connection with
that of the California company when the acts of '69 and '74
were passed, and that the defendant has never assented thereto,
are immaterial, irrelevant, impertinent, and should be ex¬
punged from this answer, with the further matter in which
they are incorporated, denying that the plaintiffs, and partic¬
ularly the Denver company, are not in the attitude and rela¬
tion to claim the benefit of the sections—12 of the act of '62,
15 of the act of'64, and of the act of'74.
SECOND SET OF EXCEPTIONS.
The second, third, fourth and fifth exceptions of the plain¬
tiffs to the answer of the defendant raise the question, whether,
because the construction, maintenance and operation of its
reach of road west of Cheyenne was and is greater than the
construction, maintenance and operation of its reach of road
east of Cheyenne, it is justified in making a discriminating
rate so as to exact for service on the west half of its line
more, and much more, than one-half of its charges for service
over its whole line.
The defendant insists that the greater cost of construction,
maintenance and operation of a part of its road than of an¬
other part, should be taken account of in fixing and appor¬
tioning its rates over separate sections.
The plaintiff contends that those matters cannot be taken
into consideration at all; but the single element in the inquiry
is, distance traversed.
14
The plaintiffs contend that any discrimination is prohib¬
ited ; the defendant that only unequal discrimination is pro¬
hibited.
FIRST POINT.
The language of section 15 of the act of 1864, taken in its
natural and obvious signification, sustains the contention of
the plaintiffs.
I. It prohibits "discrimination of any kind." However
discrimination may be exercised; however discrimination be¬
tween other roads not bound by contract or statute such as
this, is exercised, justified and regulated; however prejudi¬
cially absolute non-discrimination may affect any one of these
roads, is immaterial: there is the command of Congress, ex¬
pressed in plain and simple terms, and it must be obeyed.
Each road is to be so operated and so used as to afford to
every other road in the system and the business of every other
such road equal advantages and facilities as to rates; and it
must do this "without discrimination of any kind." That is
the unvarying and sufficient rule; and, like the terms of a con¬
tract, however inconsiderately it may have been entered into by
the parties, these words must be observed, and the rule obeyed.
It does not change the rule, to characterize it as arbitrary or
unjust or unequal in its operation and effect. Its reach and
compass and force are to be measured by the terms in which
it is expressed.
II. But the counsel for the defendant, construing these
words, insist that the prohibition is leveled 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 itself to the prejudice and
even ruin of any or either of the others. To this, several
decisive answers may be made.
1. The prohibition is not of 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 (which may mean its whole line considered as a unit)
15
so as to discriminate for or against any other road considered
with the defendant's road as a unit, 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 ob¬
served. The discrimination forbidden to be indulged by one
company is not that which is in favor of any or either of the
other companies; but simply that which is in favor of any
or either of said companies. In the terms "said companies"
is included the company which seeks to discriminate, so that
discrimination in its own favor is prohibited just as much as
that between the other companies. And this language is the
more noticeable, for it is not the same as that used prohibit¬
ing adverse discrimination. There, the word "other" is in¬
serted ; the reason being that it was unnecessary to prohibit
a company from discriminating against itself and its own
business.
2. The contention of the other side destroys the force of
the clause. In the act of 1864, in which the clause first ap¬
pears, the Kansas company is authorized to meet and con¬
nect with the Union Pacific at any point it pleased west of
the 100th meridian. It having done so at Cheyenne, at which
point no other of the companies could by the acts connect with
the Union Pacific, there can be no possible opportunity or
occasion for a discrimination between two companies, other
than the Union Pacific. The Kansas company connecting
with the Union Pacific at that point, the discrimination re¬
ferred to must be that which concerns the business of these
two companies or none at all. It is needless to say that it is
inadmissible to put such a construction upon the clause as
renders it inoperative, nugatory, and absurd.
3. It is said that the. mischief aimed at was a combination
of the main line with one of the branches. But when one
company strikes the main line at a point remote from that at
which all the others strike it, the mischief is just as great,
indeed it is precisely the same if the 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 ad-
16
mitted that had all the branches connected with the trunk at
the 100th meridian, or at any other common point, the
Union Pacific could not have operated its trunk and branch
together prejudicially to the others. It is admitted that that
was prohibited. The Kansas company having connected with
the Union Pacific at Cheyenne, if the road east and the road
west of that point may be operated together to the prejudice
of the Kansas company, the mischief is as to it precisely the
same as if the connection had been at the 100th meridian.
4. And further to enforce their view, it is said that the
defendant has the right to fix its own rates without reference
to any claims or demands of ours, except as restrained or in¬
terfered with by these statutes, and that it is upon us to
point out the clear and precise language which does thus in¬
terfere with and restrain this right. That we submit we
have done. We have shown that "discrimination of any
kind" is forbidden—discrimination in favor of the defend¬
ant's road and business as well as any other road and business.
And some large words are used about freedom in trade,
freedom in charges. Freedom in all kinds of wrong-doing
is the rule in human affairs, and no construction is permissi¬
ble which limits this 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 combina¬
tion of two to crush a third road, but a use and operation of
one to crush another, those swelling words have little mean¬
ing. Just as the individual surrenders a part of his freedom
when he enters society, so each of these companies, when en¬
tering the association and community established by these
acts, surrendered a part of its freedom, 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.
III. But the counsel for the defendant also insists that it
does not discriminate against us by charging for our business
the same rates that it charges for business of all others origin¬
ating at or destined to Cheyenne.
17
1. This contention ignores the whole clause under consid¬
eration. That clause requires the defendant's road west of
Cheyenne and our roads to be operated and used as one con¬
tinuous line, and yet it applies to our common business the
local rates which it has fixed for Cheyenne business. That
is one complete answer.
2. The clause refers to the roads and business of these
companies as interchanged between them. It has no refer¬
ence to that of one of them alone. To apply to the former
rates charged for the latter may be the grossest discrimina¬
tion. Higher rates are always charged by railroad compa¬
nies at points remote from the junction of two or more lines
than at points where competition is active. If our business
must pay the higher rates, even at the junction of our road
with theirs, and all competition be stifled, the statute is a
nullity.
Passing now from a consideration of the particular clause
and the terms of it, we extend our inquiry for its meaning to
the general scope of the legislation.
SECOND POINT.
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 relative
cost of construction and maintaining the several sections of
the defendant's road.
I. The prohibition of discrimination is not found in the
act of 1862, and yet under the provisions of that act unjust,
unequal, inequitable discrimination could not be exercised by
one of these companies in favor of itself or either of the oth¬
ers or against either of the others.
1. The several sections of that act providing for the
branches, required each one to be built so as "to meet and
"unite," or "meet and connect" with the main trunk.
2. Section twelve provides for a uniform gauge for the en¬
tire line of said road and branches so that cars can be run
2
\
18
from the Missouri river to the Pacific coast. These sections
provide for the mechanical connection of the tracks, and this
is done with respect of all the roads with such care as to in¬
dicate design.
3. 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 build.
4. By section seventeen, if the said roads are not completed
so as to form a continuous line ready for use from the Mis¬
souri to the Sacramento by a day limited, all the property
and all the rights of all the companies are forfeited—each
being liable for every other. And in the same section pro¬
vision is made for the maintenance of all the roads in repair.
These provisions indicate the purpose of closely uniting and
binding up into one society all these companies and all their
properties.
5. But the matter is not left to inference, drawn from these
clauses providing for uniform width and mechanical connec¬
tion of tracks, and for one company building the road of
another, and all being liable for the default of each. It is
expressed in clear and distinct terms in section twelve: "The
"whole line of said railroad and branches and telegraph shall
" be operated and used for all purposes of communication,
" travel and transportation, so far as the public and Govern-
" ment are concerned, as one connected, continuous line. » By
this clause the most intimate relations are established between
these companies. Their roads having been built with the
same gauge and connected so that cars can run from one to
the other—one company responsible for its fellows—and all
kept in repair, a common duty is superimposed upon them
all of operating and using these roads as one connected, con¬
tinuous line.
What is a continuous line of railroad? Obviously some¬
thing more than a connected line. Roads are said to be run
in connection when their respective trains have a common
point of arrival and departure, and run so that one leaves
upon the arrival of the other. Thus, the Rock Island and
the Lake Shore are connected lines, because they have, in
19
Chicago, one depot, and on the arrival of the train from the
west over the former, the train of the latter departs for the
east, the necessary time being allowed for transfer from one
to the other, and vice versa. But a continuous line means
something more than this. It is several roads with connected
tracks, and trains running continuously over all of them.
Accordingly, the Rock Island and Lake Shore are not con¬
tinuous—that is, in the sense in which the term "continu¬
ous line" is used in statutes and the adjudged cases. The
Eastern Union v. Eastern Counties, 2 Ellis & B., 520; Boston
& Lowell Co. v. Salem & Lowell Cos., 2 Gray, 1; The Railway
Canal Traffic Acccunt, 17 and 18, Vict. C., 31.
6. But however this may be—and it is not material to
this inquiry—it is certain that companies united in a system
and bound together in a community, a society, as were these,
cannot, under the act of 1862, unjustly discriminate for or
against one another. The relation of the companies as fixed
by the act precludes unjust discrimination.
7. And, besides all this, such is the rule of the common
law. Had no such bond of society united these companies,
their duty in this behalf would have been the same. This
is admitted by Judge Wright. He says in his argument,
at page 15:
"We claim no more right to make unreasonable or excess¬
ive 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 proceedings, aside from statutory
regulations or contract rights, subject to restrictions."
This was declared in the great case of the Chicago & Alton
Railroad Co. v. The People, 67 111., 11, which the counsel
for the defendants have cited. The question in that case be¬
ing the constitutional validity of an act of the Legislature
prohibiting all discrimination, passed in pursuance of a clause
in the constitution authorizing the passage of an act prohibit¬
ing unjust discrimination only, the court pursued this course
of reasoning: Railroad companies are common carriers, and
as such, subject to the same duties as natural persons exercis¬
ing that employment. The duty of common carriers at the-
\
20
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 they shall not be
unjust. It was to establish this proposition that the court
used this language in its judgment:
"This question of unjust discrimination is not before this
court for the first time. In the case of Vincent against this
same company, 49 111., 33, we held that railway companies
can make no injurious discrimination between individuals,
and therefore could not charge one rate for delivering grain
at a certain elevator in Chicago, and a higher rate for deliv¬
ering at another elevator in the same city, and equally access¬
ible upon its line. The same rule was recognized in The
People v. C. & A. R. R. Co., 55 111., Ill, though the facts
of that case were found not to require its application. The
rule was again declared in C. & N. W. R. R. Co. v. The
People, ex rel. Hempstead, et al., 56 111., 365. The opinion
in that case cites several English and American cases, in
which it was held that railway companies could not be per¬
mitted to practice an injurious and arbitrary discrimination
between different persons; and we now refer to them without
further citation."
This is elementary. We have cited the case from 67 111.
because it has been brought to our hand by our learned ad¬
versaries.
Under the act of 1862, these companies when entering the
society therein formed gave up a part of their freedom, and
submitted to the law of non-discrimination, save so far as the
circumstances justified discrimination. Without any terms
in the act expressly forbidding it, still the rule imposed by
the relationship and community and by general law was, that
they should operate and use their roads without any discrim¬
ination that was undue, unreasonable, unjust, unequal or in¬
equitable. That was the rule under the act of 1862.
II. Then came the fifteenth section of the act of 1864. It
ran in the same words as the twelfth section of the act of
1862 ; but to those words these were added, "and in such oper-
" ation and use to afford and secure to each equal advantages
"and facilities as to rates, time and transportation, without any
21
"discrimination of any kind in favor of the road or business
"of any or either of said companies, or against the road or
"business of either of the others."
1. That clause, most carefully framed — most precise, com¬
prehensive, circumstantial, and sufficient for every exigency
—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. Under that act, undue and un¬
reasonable, unjust and inequitable discrimination was forbid¬
den. Under the act of 1864 something more was forbidden;
and that was, "discrimination of any kind." It means that,
or nothing at all.
2. And this appears from another clause of the act of 1862.
In the fifteenth section of that act it is provided "that any
"railroad company now incorporated, or hereafter to be in¬
corporated, 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 equal terms as the President
"of the United States may prescribe." Those companies are
not included within the fifteenth section of the act of 1864.
Its language is, "the aforesaid companies authorized to con¬
struct the aforesaid roads." The terms are particular, so as
to exclude the companies mentioned in the fifteenth section
of the act of 1862. Had they been simply "the aforesaid
"companies," all the companies might possibly be included;
but the words "authorized to construct the aforesaid roads"
are added, and added for the purpose of excluding all but the
companies named. Thus the two classes of roads are placed
in contrast. The companies not specially named are author¬
ized to connect with the trunk and the branches—not on the
same terms as those named, but on such terms as the Presi¬
dent may prescribe; and he shall prescribe terms which are
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 rela¬
tions and rights are absolutely and irrevocably fixed by the
22
terms of the act, and the rule of their relation is invariable,
arbitrary and imperative.
The reason for the distinction is obvious. Companies
which embarked in what at the time was deemed a most haz¬
ardous venture, each contributing its due part to an im¬
mense system, had need of an absolute assurance of its due
share in the trans-continental traffic. Companies which
awaited the success of the venture should be content with
such participation in the business as justice and equity would
give them.
3. Our learned adversaries contend that we take nothing
new or additional by the clause in the act of 1864, and that
we are in the same attitude and relation as outside companies.
The contention is that we as 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 relations of the
companies named and the general rules of law. Their whole
effort, aside from the construction of the clause already ex¬
amined, is to show how prejudicial to the defendants the rule
Congress has prescribed would be. They have brought in
profiles of their road; they 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 absolute non¬
discrimination may hurt them and help us. All that might,
under certain circumstances, show the hardship of the rule,
but it does not change the rule.
The rule forbidding "discrimination of any kind," was
framed, and declared and accepted by these parties before ex¬
perience had developed the matters insisted upon, or at least
before they had become appreciated. As Mr. Justice Davis
says, in United States versus this defendant, 1 Otto, 70:
"Counsel have dwelt with special emphasis upon the con¬
sequences which would result from a decision adverse to the
appellant. We cannot consider them in disposing of the
questions arising upon this record. The rights of the parties
rest upon a statute of the United States. Its words, as well
as its reason, spirit and intention, leave in our opinion no
23
room for doubt as to its true meaning. We cannot sit in
judgment upon its wisdom or policy. When we have inter¬
preted its provisions, if Congress had power to enact it, our
duty in connection with it is ended."
Judge Sawyer expressed the same idea in United States v.
The Central Pacific, 4 Sawyer. He says:
" The question here is, not as to the comparative advantages
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 considerations of this character may
be urged elsewhere, when the 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 questions here
need no illustration.
And the cases cited afford no assistance in the inquiry. In
the Chicago & Alton Railroad Co. v. The People, 67 111., 11,
the validity of an afct forbidding all discrimination was drawn
in question because the constitution empowered the Legislature
only to pass an act forbidding unjust discrimination. The
English cases arose in the administration of a statute forbid¬
ding "undue or unreasonable preferences or advantage," and
"undue and unreasonable prejudice or disadvantage." Hersh
v. The Northern Central Railroad Co., 74 Pa. St., 181, simply
held that a statute providing that all the rates for all traffic
over the whole road should not aggregate more than four
cents a mile on the average, did not prohibit a higher rate
for transporting coal a short distance. Cases arising under a
statute forbidding undue or unreasonable or unjust discrimi¬
nation, do not aid in construing an act forbidding discrimina¬
tion of any kind. The case from Pennsylvania is even
further removed from the question here.
Considering the place which the clause in question has in
the Congressional legislation, and the distinction which is
drawn between the companies mentioned in it and other com-
24
panies, and the diverse rules prescribed for these two classes,
it is respectfully submitted that the necessary conclusion is
that the matter alleged in these answers has no place in this
dispute.
THIRD POINT.
The object of the whole scheme of Congress in this legis¬
lation will be defeated by the inquiries to which we are in¬
vited by the matter in the answer, to which we except.
I. The primary object which Congress had in view in the
Pacific Railroad acts, concerned the Government.
1. This appears from the title of the act of 1862, which
was not an act to incorporate the Union Pacific Railroad
Company, but "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." This was reiter¬
ated in section 3, which runs thus: " That there be and is
" hereby granted to said company, for the purpose of aiding
"in the construction of said railroad and telegraph line, and
"to secure the safe and speedy transportation of the mails,
" troops, munitions of war, and public stores thereon, every
" alternate section of public land." Again, in section 4, it is
provided that when a section of forty miles is completed,
"ready for the service contemplated in this act," it shall be
examined by commissioners to be appointed for the purpose.
In section 6 the grants made in the acts are upon the condi¬
tion that the road be kept in repair and use, and that the
company "shall at all times transmit dispatches over said
" telegraph line, and transmit mails, troops, munitions of war,
" supplies and public stores upon said railroad for the Gov-
" ernment whenever required so to do," it having preference
over all others for such service. And in section 18 the object
is again declared to be " 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
25
" war) the use and benefit of the same for postal, military
" and other purposes."
2. 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
trunk. The aid granted, the duties imposed and the service
exacted were the same in the case of one as in the case of the
other, and hence the object was the same. By these branches
widely-separated parts of the country were reached, and the
object was to enable the Government to command transpor¬
tation from either of these widely-separated sections of the
country by that road or branch which was most accessible.
And in order to this it was provided that the main road
and branches should be operated and used as a continuous
line and without discrimination. This may be illustrated
by an actual occurrence of recent date. During the Indian
war of last summer, the Government had a regiment at Fort
Leavenworth which it needed to transport to the field of
operations at the earliest possible moment. The most con¬
venient road by which to send it was the plaintiff's. The
object of the legislation was to secure to the Government the
use of their road, with that part of the defendant's west of
Cheyenne, as a continuous line, and to put the companies in
such relations that this could be promptly done. But what
happened? By the discrimination, of which we here com¬
plain, the defendant compelled the Government to send these
troops by other roads to Council Bluffs, and thence over its
whole line. By the matter in this answer, to which we ex¬
cept, discrimination having that effect is justified. The ob¬
jects of this legislation are transcendent: they can be realized
only under a rule that is unvarying, absolute, and arbitrary;
they can be and they will be defeated under any rule which
is variable, indefinite, and involving many considerations.
For instance, admit that the cost of maintenance and opera¬
tion are to be considered in fixing the rates and the appor¬
tionment of rates between different sections of the road.
26
These elements in the calculation change every year and
every season. Accidents of storms and floods, accidents to
bridges, track and other structures, accidents of increased or
diminished traffic, a thousand such-like matters constantly
occurring and recurring affect the result; consequently the"
measure and basis of apportionment this year will not be
that of next year, nor that of to-day that of to-morrow. A
rule based on these complex and variable conditions is no
rule, and to enforce any principle of non-discrimination is
impossible. How easy, under the pretense and color of new
exigencies, to avoid the statute. How futile any remedy
whieh even this court can award or administer. And yet all
the purposes of Congress in all this stupendous system of
works is to be utterly defeated. If consequences are to be
regarded in fixing the duties, relations and measure of mu¬
tual service among these companies, these are the legitimate
ones to be taken account of and anticipated and prevented.
II. The objects secondly in view in this legislation were the
public service and convenience. This appears in the clause
already quoted from section 18, where the objects of the act
are declared:—"to promote the public interest and welfare."
And this, as well as the first object, was to be subserved, not
by building a trunk or a single line, but by building a trunk
with several branches. As has been said so many times, the
scheme was a trunk or main line and four branches—one
starting from the mouth of the Kansas, another from St. Jo¬
seph, another from Council Bluffs, and another from Sioux
City; the St. Joseph branch striking the Kansas branch or the
Iowa branch, instead of the main line. Excluding that
branch, the other three reached widely-separated sections;
and this was by design, as appears from the act itself.
In section 9 of the act of 1862, the company now known
as the Kansas Pacific was "authorized to construct a railroad
" . . so as to connect with the Pacific Railroad of
"Missouri." That provision was inserted so as to give to
Missouri, St. Louis and the Southern country connection with
this trans-continental road. The next branch was from St.
27
Joseph, to which place the Hannibal & St. Joseph Railroad
was already constructed. The next was to begin on the
western boundary of Iowa, at a point not named in the
act, doubtless because no road had yet been built across the
State to the Missouri, and the fixing of it was accordingly
left to the President. But this branch was designed to give
connection between the main line and the Iowa roads; and
the Sioux City branch was to be built when a road 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 trunk with the
eastern connection, it shall be fixed at the most practicable
point for the construction of the Iowa and Missouri branches.
Another provision is to be noted in this connection. As al¬
ready explained, the Kansas company was, in a contingency,
to build the main line. Should it do so, it was necessary to
provide for the convenient connection of the Iowa branch
and the St. Joseph branch, so that the sections of country to
be served thereby would not be left unprovided for. This
was assured by this clause of section 9: "And said railroad
"through Kansas shall be so located between the mouth of
" the Kansas river as aforesaid and the aforesaid point on the
"one-hundredth meridian of longitude, that the several rail-
" roads from Missouri and Iowa herein authorized to connect
"with the same can make connection within the limits pre¬
scribed in this act."
*
In the Union Pacific Railroad Co. v. Hall, 1 Otto, 343,
Mr. Justice Strong, after a survey of the several sections of
the act, says:
"The scheme of the act of Congress, then, is very apparent.
It was to secure the connection of the main line by at least
three branches with the Missouri and Iowa railroads, and
with a railroad running eastwardly in Iowa either through
that State of through Minnesota. An observance of this
scheme, we think, will aid in considering the inquiry, at what
place the act of Congress, and the orders made in pursuance
thereof, established the eastern terminus of the Iowa branch.
From it may reasonably be inferred that the purpose of Con-
28
gress was to provide for connections of the branches of the
main line of the Union Pacific road with railroads running
through States on the east of the Territory, and to provide
for those connections within those States at points at or near
their western boundaries."
This great object thus disclosed by a consideration of the
circumstances of the eastern termini of the branches was ad¬
vanced and assured by the several provisions that they should
all respectively meet, unite and connect with the trunk by
means of a uniform gauge, and form with it a continuous
line, and that they and the trunk be operated and used with¬
out discrimination of any kind. To each section of country
reached by a branch and the roads connecting on the east,
perfect equality with all the others was thus assured. What¬
ever other construction be placed on the fifteenth section of the
act of 1864 must operate to defeat this purpose. We insist
that the construction contended for by our adversaries has
that vicious effect. Under the shelter of that construction a
practice and course of dealing has been pursued which does
defeat that object. We say, therefore, that it is wrong.
III. In order to bring this aspect of the case into full
view, attention needs to be paid to the initial point, as fixed
by the act of 1862, and as dealt with in the subsequent acts,
and the relations of the companies as affected by it.
1. It has been said and repeated that the original scheme
in the act of 1862 was a trunk road, with its initial point on
the 100th meridian, and three branches. The original au¬
thority was to the defendant to build the trunk, but in a con¬
tingency deemed most likely to occur this authority was to
vest in the Kansas company. Each of these branches were
to be operated as a continuous line with the trunk. Whether
the trunk was to be built by the company owning and oper¬
ating one or the other of the branches, each and every of
them was to be the equal of each and every of the others.
There could be competition to the initial point, but from that
point west there would of necessity be a tariff absolutely the
same for all branches. Thus far we have no clause forbid¬
ding discrimination, the act of 1862 only considered; that
29
flowed from the circumstances and the general rules of law,
and did not need distinct expression.
2. The act of 1864 authorized the Kansas, Hannibal & St.
Joseph and Sioux City companies to connect at any point
they pleased west of the one-hundredth meridian, each hav¬
ing its separate point of connection. The Kansas company
retained the right under this act to build the trunk under
certain circumstances. If it connected with the main line
west of the meridian and continued the construction westerly,
it would happen that the Iowa branch might, for a time at
least, be separated from the trunk. It was therefore provided
in the act of 1866 that the Iowa branch might be built with¬
out regard to the initial point. The initial point lost all its
importance under the changed circumstances, and became not
only practically but absolutely obsolete. This is distinctly
conceded by Mr. Rogers, who says that as between the plain¬
tiffs and defendant, Cheyenne is now to be treated and con¬
sidered as the initial point. At page 7 of his argument he
says:
"The complainant's road constitutes one of these branches
connecting at Cheyenne, as to it the road west of that point
constitutes the main line."
3. It was when a common point of connection of the
branches was abandoned, and because it was abandoned, that
the stringent provision against discrimination was inserted in
the legislation, and became 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 that we were authorized to connect west of the me¬
ridian at any point we chose and that the clause against dis¬
crimination was enacted, proves that that clause was to be
operative upon the new relations of the companies created
by the act: unless that were so the clause would be utterly
worthless.
The case is then reduced simply to this: The roads at
Cheyenne, namely, our roads, "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."
30
4. But it is said that under this legislation it is permissi¬
ble for the defendant to break up its road into sections,
apportioning the through rates between them at its own dis¬
cretion. Undoubtedly the defendant may direct its own
business as it pleases, subject however to the limitations im¬
posed upon its powers by law. Those limits of course it
cannot exceed, and'if it attempts to do so by any evasive de¬
vice, the court will lay its hand all the heavier upon it
because its action is disingenuous. It is also said that the
Circuit Court for Iowa held that, as respects rates, the com¬
pany might break up its road into sections with discriminat¬
ing rates. That was a mandamus to compel it to operate its
bridge over the Missouri river as an integral part of its
road. The court held that it was required to do so by the
mandate of the statute that the companies operate and
use their roads, as far as the public and Government were
concerned, as one continuous line in respect of rates, 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 discover any ground of distinction between
the duty as to rates and the duty as to time and transporta¬
tion. The reach of the road across the bridge and the re¬
mainder of the line, being sections of the whole line, were
required to be operated together as a continuous line. The
distinction between "rates" and "time" was not based on
the clause under consideration, but on the distinct and sepa¬
rate provision in the bridge act giving special tolls for the
bridge.
But it is again objected that our view excludes all compe¬
tition between the branches. We submit that it does not do
so, but rather stimulates that competition. This brings
clearly to view the true object of this legislation, namely, to
advance the interests and conserve the equality of the dif¬
ferent sections of the country reached by the branches.
Our road and the road west of Cheyenne are one line for the
purposes of this provision of law. The defendant's road
east and its road west of Cheyenne are one line for the same
purposes. The law says that no discrimination shall be ex-
31
ercised by the defendant in respect of its western reach of
road; all devices under the name of apportionment of rates,
which have such effect, are forbidden. All considerations of
cost, expense, inconvenience, under cover and excuse of which
discrimination, openly,or covertly, is produced, must be ex¬
cluded. Competition up to that point is permissible, beyond
that point it is forbidden.
The great objects of service to the Government and the
public by means of three branches, operated in perfect equal¬
ity, are destroyed by the practices of which we complain, and
these practices are apologized for by our adversaries in their
arguments here. Under those practices they apologized for,
Iowa is to have all this business; Missouri is to be shut out
of it. The north is to thrive on a monopoly; the south is to
be starved by absolute exclusion. That the law forbids.
Into what vast reach and proportions these questions ex¬
pand when thus viewed! It is no longer the case of the
parties to this record—their convenience or inconvenience,
profits or loss; but of States and groups of States claiming
equal rights and participation in this national system of
works and this trans-continental traffic.
FOURTH POINT.
The inquiry to which we are invited by the matter of this
answer is, by the very nature of it, improper in determining
the duties of these parties.
I. It is said, in the first place, that the road of the defend¬
ant west of Cheyenne cost much more per mile than it did
east of Cheyenne. It is matter of common knowledge, which
has entered into the history of the times, that the building
of the defendant's road was accompanied by enormous frauds
on the part of its directors against the company and the Gov¬
ernment. In Wardell's case, lately decided by Mr. Justice-
Miller, in this court, he took judicial notice of the scan¬
dals of the Credit Mobilier, and the strange devices by which
parties were enabled to build a great and expensive railroad
and make for themselves immense fortunes. Generally, rail¬
road building requires an expenditure of money by those en-
32
gaged in it—in this instance it gave large sums of money
to those engaged in it. It is so declared in Brown v. Piper,
91 U. S., 31, and cases cited.
1. Now it is proposed to take all the sums expended by
the company, as well as those justly applied to the work, as
also those unjustly converted to their own use by the direc¬
tors, and calculate what are just rates upon them. TJhe con¬
struction 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 made
the basis of rights 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 our roads only, but
of the people of Missouri and the States east and south of
it, and of the Government.
2. Suppose, on the other hand, the company make expia¬
tion 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 its
members. In that case the actual cost must be ascertained.
By what process? By going through its whole set of con¬
struction accounts? That would involve a long time, and
necessarily result in nothing decisive or satisfactory. Shall
it be by putting experts on the witness stand to testify what
the road could honestly be built for? Equal time would be
consumed, with equally indecisive and unsatisfactory results,
and meanwhile all the great rights of the plaintiffs, the com¬
munities interested, the public and the Government are to be
kept in abeyance.
II. It is said, in the second place, that the cost of main¬
tenance and operation must be considered. What is said
above about the cost of construction is equally applicable to
the cost of maintenance and operation. Had the road been
honestly built, not a grade would have been made so heavy
as to require an expensive maintenance and operation; every
structure would have been so built as to require repairs and
33
renewals but very slight and at distant intervals; the equip¬
ment and supplies would have been so nearly perfect and so
extensive as to reduce the current expenses to an inconsider¬
able sum. But the vice of the construction is communicated
to the maintenance 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 matters of public and common
knowledge, the court must be taken to know them; and sec¬
ondly, let these notorious facts be taken as suppositions and
they illustrate the case aptly, and demonstrate the impropriety
of admitting the inquiry which the defendant seeks to raise.
III. The protracted nature of the inquiry proposed by the
answer, and the delay in securing public rights which it
would necessitate, have been already incidentally suggested,
but we present them as substantive reasons for the construc¬
tion we place on section fifteen of the act of 1864.
1. If we are to take as a basis of the calculation and esti¬
mate what the defendant's road actually cost, the inquiry in
that behalf, as already remarked, must be very protracted.
2. If we dispense with that and take whatever sum the
construction account shows — most iniquitous as that would
be—then we 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 much? Shall
they be steel or iron ? Are they necessary and proper ? If
a bridge is to be replaced, is it necessary ? Shall it be wood
or iron, heavy or light, expensive or inexpensive? Shall
station-houses be built at this place or that, or at all sta¬
tions ? Shall they be brick or wood, one or two stories, large
or small, good or bad ? Every item in the account for main¬
tenance must be considered. And when the proof on all these
matters has been taken on one side and the other, the assist¬
ance of experts must be secured. The court cannot pass on
3
34
such questions, but require the assistance of the opinion of
railroad men. Where will that lead to, and where is the end?
3. Pass from these inquiries to that about the cost of opera¬
tion, and equally difficult questions present themselves: the
number of officers and employes, and the salary of each; com¬
petency, usefulness, measures of service and diligence; strikes
of workmen, and their treatment; the number, kind, price
and value of cars, engines and trains; the propriety of con¬
tracts with Pullman about sleepers, and with companies of
which officers are members for purchase of supplies, and of
maintaining shops for manufacture or buying articles of
others; accidents resulting in damages to third parties; law
expenses in defending Credit Mobilier suits and Government
five-per-cent. suits;—a thousand such matters would be in¬
volved in the inquiry, and all of them would pass through
the crucible of the experts. What may be done in this mat¬
ter of ascertaining operating expenses is well illustrated by
the achievements of the accomplished operators of this de¬
fendant's bridge at Omaha. Those 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 falsehood of that report, we do not remark. We in¬
stance it to show what may be done when to ability motive
is added.
4. Another circumstance is to be considered. These calcu¬
lations are 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. JSTo certain rule can be laid down. While the in¬
quiry is being conducted for one year, that year is passing away,
and in the new year new conditions appear, of which new
evidence must be taken, and upon which other decisions must
be made. And while the inquiry as to them is being carried
on, other changes are taking place, which in their turn must
be the subject of inquiry. And thus the case will go on
without end.
And while this inquiry is being carried on, the rights of
35
the Government and the public, as well as of these plaintiffs,
are disregarded and set at naught. The business of Mis¬
souri, and the States east and south of her, must be diverted
to Chicago, or reach Council Bluffs by a circuitous route not
provided in this legislation, or it must be suspended. The
troops and military supplies collected at the great military
depot at Fort Leavenworth must, with all other Government
business, be subjected to the like inconvenience.
Pending the inquiry the law must be considered as sus¬
pended. And as the inquiry can never end, the law is re¬
pealed.
We submit that a construction which involves such con¬
sequences must be erroneous. Congress authorized the
construction of these great works, and aided them in an un¬
exampled measure for great public purposes. It bound them
together into one system and society, and imposed upon them
their duties and relations in furtherance of the same purpose.
It laid down a rule enforcing those duties and regulating
those relations in order to fortify against all accident and cir¬
cumstance the same great object. Our construction of that
rule 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 therefore
is the wrong construction.
J. M. WOOLWORTH,
Of Counsel for Complainants.