Atlantic & Pacific Railroad v. Mingus

Fall, J. This is an action of ejectment, brought by the plaintiff in error to recover possession of one hundred and twenty acres of land situated in San Miguel county, New Mexico. The plaintiff claims title under act of congress of July 27, 1866, the provisions, of which necessary to be. considered in this cause are as follows: “Be it enacted,” etc.: “ Section 1. That. John Brown * * * John O. Fremont * * * and all such other persons who shall be associated with them and their successors, are hereby created and erected into a body corporate and politic in deed and in law, by the name, style, and title of the Atlantic & Pacific Railroad Company, and by that name shall have-perpetual succession, and shall be able to sue, plead, and be impleaded, defend and be defended, in all courts-of law and equity within the United States, and may make and have a company seal, and said corporation is hereby authorized and empowered to lay out, locate, construct, furnish, maintain, and enjoy a continuous railroad and telegraph line, with the appurtenances, namely: Beginning at or near the town of Springfield, in the state or Missouri; then to the western boundary of said state, and thence by the most eligible railroad route as shall be determined by said company, to a point on the Canadian river; thence to the town of' Albuquerque, on the River del Norte, and thence by the way of the Agua Frio, or other suitable pass, to the-head waters of the Colorado Chiquito, and thence along the thirty-fifth parallel of latitude, as near as may be found most suitable for a railway route, to the Colorado river at such point as may be selected by said company for crossing; thence by the most practicable- and eligible route to the Pacific. The said company shall have the right to construct a branch from the point at which the road strikes the Canadian river, eastwardly, along the most suitable route as-selected, to a point on the western boundary line of' Askansas, at or near the town of Yan Burén. And the said company is hereby vested with all the. powers, privileges, and immunities necessary to carry into effect the purposes of this act as herein set forth. The capital stock of said company shall consist of one million shares of one hundred dollars each, which shall in all respects be deemed personal property, and shall be transferable in such manner as the laws of said corporation shall provide,” etc. (Various details relating to the organization of the company.) “See. 2. And be it further enacted: That the right of way through the public lands be, and the saméis, hereby granted to the said the Atlantic & Pacific Railroad Company, its successors and assigns, for the construction of the railroad and telegraph line as proposed; and the right, power, and authority is hereby given to said corporation to take from the public lands adjacent to the line of said road, material of earth, stone, timber, etc., for the construction thereof. Said way is granted to said railroad to the extent of one hundred feet in width on each side of said railroad where it may pass through the public domain, including all necessary grounds for station buildings, workshops, depots, machine shops, switches, side tracks, turntables, and water stations; and the right of way to be exempt from taxation within the territories of the United States. The United States shall extinguish as rapidly as may be consistent with public policy, and the welfare of the Indians, and only by their voluntary cession, the Indian title to all lands falling under the operation of this act and acquired in the donation to the road named in the act. Sec. 3. And be it further enacted: That there be, and hereby is, granted to the Atlantic & Pacific Railroad Company, its successors and assigns, for the purpose of aiding in the construction of said railroad and telegraph line to the Pacific coast, and to secure the safe and speedy transportation of the mails, troops, munitions of war, and public stores over the route of said line and its branches, every alternate section of public land, not mineral, designated by odd numbers to the amount of twenty alternate sections per mile on each side of said railroad line as said company may adopt through the territories of the United States, and ten alternate sections of land per mile on each side of said railroad, whenever it passes through any state, and whenever on the line thereof, the United States have full title, not reserved, sold, granted, or otherwise appropriated, and free from preemption or other claims or rights, at the time the line of said road is designated by plat thereof, filed in the office of the commissioner of the general land office. * * * And provided further, that no money shall be drawn from the treasury of the United States to aid in the construction of the said Atlantic & Pacific Railroad.” Section 4 provides the manner in which the railroad shall be examined by commissioners and accepted, and patents for lands issue as the road is constructed. Section 5 provides how the road shall be built. Section 6 provides for surveying of the land grant by order of the president, and withdraws from sale, entry, or preemption the said lands. “Sec. 8. And be it further enacted: That each and every grant, right, and privilege herein, are so made and given to, and accepted by, said Atlantic and Pacific Railroad Company upon, and subject to, the following conditions, namely: That said company shall commence the work on said road within two years from the approval of this act by the president, and shall complete not less than fifty miles per year after the second year, and shall construct, equip, furnish, and complete the main line of the whole road by the fourth day of July, A. D. 1878. Sec. 9. And be it further enacted: That the United States make the several conditional grants herein, and that the said Atlantic & Pacific Railroad Company accept the same upon the further condition that if the said railroad make any breach in the conditions hereof, and allow the same to continue for upwards of one year, then and in such case at any time hereafter, the United States may do any and all acts and things which may be needful and necessary to insure a speedy completion of the said road.” “Sec. 11. And be it further enacted: That the said Atlantic & Pacific Bailroad, or any part' thereof, shall be a post route and military road, subject to the use of the United States for postal, military, naval, and all other government service, and also subject to such regulations as congress may impose restricting the charges for such government transportation.” “Sec. 19. And be it further enacted: That unless the said Atlantic & Pacific Bailroad Company shall obtain bona fide subscriptions to the stock of said company to the amount of one million dollars, with ten per centum paid, within two years after the passage of, and approval of, this act, it shall be null and void. Sec. 20. And be it further enacted: That the better to accomplish the object of this act, namely, 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 benefits of the same for postal, military, and other purposes, congress may at any time, having due regard for the rights of the said Atlantic & Pacific Bailroad Company, add to, alter, amend, or repeal this act.” The defendant in error relied upon a United States patent issued December 10, 1891. There is no conflict of testimony as to the facts upon which the rights of the parties depend. The cause was tried by a jury, and a verdict of not guilty returned. Judgment accordingly entered, from which plaintiff sues out writ of error to this court. Errors assigned are: The rulings of the district court admitting in evidence defendant’s patent, refusing to direct the jury to find for the plaintiff, refusing the instructions requested by plaintiff, and directing the jury to find for the defendant. There is no question here as to the proper organization of the company, including the subscription to the stock within the time fixed. The company surveyed and located its route, and filed its plats from time to time, and the alternate, sections of land within the forty mile limit on each side of the located line were withdrawn by order of the president, in accordance with the provisions of section 6 of the act. By the eighth section of the act the company was required to commence construction within two years from the date of the approval of the same, and to build not less than fifty miles of railroad, each year thereafter, and to complete the “whole road” by July 4, 1878. On April 20, 1871, up to which date the company had not complied with its contract in reference to the annual construction required, an act of congress was approved, which is as follows, viz.: “An act to enable the Atlantic & Pacific Railroad Company to mortgage its road. Be it enacted,” etc.: “That the Atlantic & Pacific Railroad Company, organized under act of congress of July twenty-seventh, eighteen hundred and sixty-six, is hereby authorized to make and issue its bonds in such form and manner, for such sums, payable at such times, and bearing such rate of interest, and to dispose of them on such terms as its directors may deem advisable; and to secure said bonds, the said company may mortgage its road, equipment, lands, franchises, privileges, and other rights and property, subject to such terms, conditions, and limitations, as its directors may prescribe. As proof and notice of the legal execution and effectual delivery of any mortgage hereafter made by said company, it shall be filed and recorded in the office of the secretary of the interior: provided, that if the company shall hereafter suffer any breach of the conditions of the act above referred to, under which it is organized, the rights of those claiming under any mortgage made by the company to the lands granted to it by said act shall extend only to so much thereof as shall be coterminous with, or appertain to, that part of the said road which shall have been constructed at the time of the foreclosure of said mortgage.” After the passage of this act the company executed' mortgages to secure bonds due at various times from 1901 to 1922, the greater number of those bonds being guarantied by the St. Louis & San Francisco, and Atchison, Topeka & Santa Fe Railroad Companies. The interest on the bonds has been paid, ■and no breach, apparently, made in the conditions of the mortgage, except failure to construct the road with due diligence. Up to July 4, 1878, the date fixed for the completion of the road by the act of 1866, the company had completed less than one hundred and twenty-five miles of road, all told; but prior to July 6, 1886, it ■completed five hundred and sixty miles from Albuquerque west, and about fifty miles, as claimed, in the Indian territory. The line from Sepulpa, about one hundred and twenty-five miles from the initial point, Springfield, to Albuquerque, and from Mojave, five hundred and sixty miles west of Albuquerque, remains to the present time uncompleted. On July 6, 1886, congress passed the following act, viz.: “Be it enacted by the senate and house of representatives of the United States of America, in congress assembled, that all the lands, excepting the right of way and the right, power, and authority given to said corporation to take from the public lands adjacent to the line of said road material of earth, stone, timber, and so forth, for the construction thereof, including all necessary grounds for station buildings, workshops, depots, machine shops, switches, side tracks, turntables, and water stations, heretofore granted to the Atlantic & Pacific Railroad Company, by an act entitled, ‘An act granting lands to aid in the construction of a railroad and telegraph line from the states of Missouri and Arkansas to the Pacific coast,’ approved July twenty-seventh, eighteen hundred and sixty-six, and subsequent acts and joint resolutions of congress, which are adjacent to, and coterminous with, the uncompleted portions of the main line of said road, embraced within both the granted and indemnity limits, as contemplated to be constructed under and by the provisions of the said act of July twenty-seventh, eighteen hundred and sixty-six, and acts and joint resolutions- subsequent thereto and relating to the construction of said road and telegraph, be and the same are hereby declared forfeited and restored to the public domain. Approved July 6, 1886.” After the passage of this act, all the lands which had been prior to that time set aside and withdrawn under the act of 1866 were restored to the public domain, except those opposite and coterminous with the road actually constructed. Among the lands so restored was the tract now in question. VftítnrJAct”^0/' July ’1 ' The question upon which we now have to pass is solely that of the validity or constitutionality of the act of 1886, known as the “Forfeiture Act.” If the act is invalid or unconstitutional, the plaintiff should recover, for the grant was undoubtedly a grant in praesenti; floating, it is true, but becoming fixed upon the performance by the grantee of the conditions prescribed, and, when so fixed, taking effect as of the date of the granting act. Schulenberg v. Harriman, 21 Wall. 44, 60; Leavenworth, etc., R’y Co. v. U. S., 92 U. S. 733, 741. The title of the grantee under such an act is superior to a United States patent issued for lands within the grant limits, acquired subsequent to the date of the act. Wright v. Roseberry, 121 U. S. 488, 7 Sup. Ct. Rep. 985; U. S. v. Southern Pac. R’y Co., 146 U. S. 593, 13 Sup. Ct. Rep. 163, and authorities supra. Defendant in error contends that the forfeiture act of 1886 is constitutional and legal; that under section 9 of the act of 1866 power is expressly reserved to congress to forfeit, and that such power exists even if no such reservation was intended to be made; that the mortgage act of 1871 is only declarative of the right to mortgage, and its purpose was to remove all doubt of that right, and thus aid the company in obtaining funds with which to construct the road; that the mortgagees took only the title vested in the company by the terms of the granting act, subject to the right of the United States to forfeit, and that the rights or equities of the mortgagees are not now for the consideration of this court. Plaintiff admits that if no right to forfeit had been reserved, and no consequences of a breach declared in the granting act, the right to forfeit would exist; but contends that, with the consequences of the breach expressly declared, these alone can ensue from a breach and exclude the right to forfeit. Plaintiff also insists that the government failed to comply with its part of the contract, as expressed in the grant, in reference to Indian titles, and that this failure of the grantor is largely responsible for the delay of construction by the grantee, and that the forfeiture act should not have been passed. Plaintiff further contends that the provisions of the mortgage act of 1871 show clearly that it was not the intention of congress to reserve the power. to forfeit in the act of 1866, and, further, that the mortgage act created a new contract, extending expressly the term within which the grantee was to complete construction, and that under its provisions contracts have been made which are violated by the forfeiture act of 1886. This court in the case of Railroad Co. v. Esquibel, 5 N. M. 123, cited and relied on by counsel for the defendant in error, held that ‘ ‘time was of the essence of the contract,” and in construing a clause in the Texas Pacific' act, similar to section 9 of the grant act of 1866, declared that the clause was for the benefit of the government, and not of the company. The purpose for which this grant was made is repeatedly declared in the different sections of the act; that is, “to aid in the construction of a road, to secure the safe and speedy transportation of the mails, troops, munitions of war, and public stores to the Pacific coast.” Section 20 of the act provides that to “better accomplish” the objects thereof, namely, “to promote the public interest and- welfare,” etc., and to “secure to the government at all times * * * the use and benefit of the same [railroad and telegraph lines] for postal, military and other purposes, congress may at anytime, having due regard to the rights of said Atlantic & Pacific Railroad Company, add to, alter, amend, or repeal this act.” "What stronger reservation could be desired? Are we to say, in the face of the provisions of sections 9 and 20, that the legislature and the courts are to have “due regard for the rights of the grantee,” and no regard whatsoever for the rights of the United States or of the public, and shall not consider the public welfare, which is expressly declared to be the object for which this enormous grant was made? Are we to say that the congress of the United States intended to create a corporation, give it the breath of everlasting life, grant to it sovereign powers of eminent domain, endow it with a princely estate vaster than a kingdom of the old world, and set it above the laws, above the courts, above the people, above the government, making the “thing” greater than its creator? It is true that “a corporation created by the legislature, and endowed with' certain powers ánd functions' and property, the legislature reserving no interest in that which is given them, and no control over the succession of persons who form the corporation, or over the exercise of their functions, such a corporation is a private corporation, to whom a franchise has been given by a grant which is an executed contract, and that any ■deprivation of their property, or any disturbance or denial of their rights and functions, impairs the obligations of contracts.” 3 Pars. Cont. 531; College v. Woodward, 4 Wheat. 519. It is also “a settled rule of construction that public grants are to be construed strictly,” and, where the public interest is concerned, “any ambiguity in the terms of the contract must ■operate against the company and in favor of the public.” Richmond R’y Co. v. Louisa R’y Co., 13 How. 81. Chief Justice Taney said: “The continued existence of a government would be of no great value if, by implications and presumptions, it was disarmed of the powers necessary- to accomplish the ends of its creation, and the functions it was designed to perform transferred to the hands of privileged corporations.” Charles River Bridge v. Warren Bridge, 11 Pet. 584; also 2 Inst. 496; Canal Co. v. Wheeley, 2 Barn. & Adol. 792. In the case of Northern Pac. R’y Co. v. Traill Co., 115 U. S. 601, 6 Sup. Ct. Rep. 201, section 20 of the act creating the Northern Pacific Railroad Company, exactly similar to section 20 of the act under which the plaintiff company received its grant, was held to reserve to the United States the power to pass an act declaring that no land granted to the company should be conveyed, although earned, until the expense of survey of such lands had been paid by the company. It was urged that this last act was unconstitutional, upon the same ground as taken in the case at bar, and, indeed, it was so held by the supreme court of Minnesota; but the supreme court, by Justice Millek, held that section 20 “conferred this power on congress,” by which not only was the grantee divested of its lands, but the taxing power of a municipal government denied. grant of authon$te? bi-eSfhl! condition. Did congress, by the'mortgage act of 1871, extend the time during which the road might be completed? It is strongly contended that this was the intend, and is the effect, of the act in question. There is some ambiguity in the proviso of the act, and, there being necessity for judicial construction, it is our duty, as we conceive; it, to consider the proviso in question together with the entire act, as well as the granting act to which it refers. It is urged that the company possessed the power to mortgage its franchises, property, lands, etc., before this declaration by congress. This may be true, but there was evidently' some doubt upon the subject. Power was granted them expressly to sue and be sued, etc., and they were “vested with all the powers, privileges, and immunities necessary to carry into effect the purposes of this act as herein set forth.” As shown from the record, the company had incurred a debt in 1871, were compelled to secure funds, and the act was passed. It is reasonable to presume that it was passed at the request of the company. Now, if it was the intention of congress to do something more than affirm the right to mortgage; if it was conscience stricken at the failure of the government to comply with its contract*, as is urged — why was not a plain, direct declaration to this effect made? Why was the only intimation to this effect contained in the act the following: “Provided," that if the company shall hereafter suffer any breach of the conditions of the act above referred to, under which it is organized, the rights of those claiming under any mortgage,” etc., “shall extend only to so much thereof [lands] as shall be coterminous with, or appertain to, that part of the said road which shall have been constructed at the time of the .foreclosure of said mortgage?” When this act was passed the company was in default. It had “suffered a breach” in having constructed in five years only thirty-four miles of road; and, from the terms of the act, it is apparent that congress intended to assure capitalists that no advantage would be taken then of this breach, hence the use of the word “hereafter.” If.it was intended to grant ■further and indefinite time to the company in which to ■construct the road, why was the expression used, “hereafter suffer any breach of the conditions of the act •above referred to under which it is organized?” Was this not clearly and distinctly a recognition and reaffirmance of the conditions under which the company •acquired its grant, with an assurance that no advantage would be taken of the breach already suffered? Did mot congress suppose, as a matter of course, that any mortgage would contain a condition of foreclosure upon breach of condition of the grant as well as upon failure to pay interest? Was this not done in the mortgages by the terms of which the party of the first part binds itself to construct the road with due diligence, and the second party reserves power to take possession and foreclose for any breach of the conditions of the mort.gage? Would not any court construe “due diligence” in this case to mean within the time limited in the .granting act? It has been strongly urged that up to the present time the mortgages could not have been foreclosed. This contention is not sustained by the facts as shown in the record. To sustain the contention of plaintiff, we must not consider any portion of the mortgage act except the last four words of the proviso. We must not consider at all the granting act. We must not look to the evident intention of the mortgagor and mortgagee, and their construction of the act. We must give the four words, standing alone, referred to, a strained construction, which would result in divesting the United States of forty-odd millions of acres of land forever, or at least during the pleasure of the mortgagees, without promoting in any .sense the object for which the grant was made; and we must declare unconstitutional an act of congress, passed after mature deliberation, careful investigation, and with a thorough knowledge of every phase of the case, as-shown by the report accompanying the forfeiture bill. The grant would remain suspended in mid air, as it-were, until the Atchison, Topeka & Santa Pe Railroad Company, bondholder, graciously saw fit to foreclose its mortgage, or to construct the road at its own pleasure; and in the meantime no settler could obtain a homestead thereon, and no county or state revenue could be derived therefrom by taxation. The contention of plaintiff is equivalent to the proposition that this mortgage act is a license coupled with a grant. We think it a license, and, if correct, as Lord Chief Justice Vaughan said in Thomas v. Sorrell, Vaughan, 330, “a dispensation or license properly passeth no-interest nor alters or transfers any property in anything.” We construe this proviso by the rule laid down by an eminent English chancellor: “If you find, the first words have a clear meaning, but those that follow are inconsistent with them, to reject the latter.” It is true that we must- consider not only the contract-of the United States with the corporation, but also the-rights of parties contracting with the corporation. 2 Mor. Priv. Corp., sec. 1047; Black, Const. Prohib. 16. But here the mortgagee was by the very terms of the mortgage act put upon notice of the condition of the-granting act, and further notified, as we construe it, to this effe'ct: “At the time of the foreclosure of your mortgage, if a breach has been committed, your rights will only pertain to lands actually earned at the time we take advantage of such breach.” This construction is not so much strained as that contended for by plaintiff, is in conformity with the best interests of public policy, agrees with the conditions of the granting act, and is in accord with the intent of congress as expressed, by the act of 1866 and the forfeiture act of 1886. Where there are two statutes, the one granting-certain powers or privileges, and the latter extending-the power to different subjects, even without mentioning the limitations of the former act to the subject of its grants, these limitations may by construction be held to attach to the new subjects, when such construction is in consonance with the manifest intention of the legislature. Chamberlain v. Chamberlain, 43 N. Y. 424. Mr. Justice Field said: “Instances without number exist when the meaning of words in a statute has been enlarged or restricted and qualified to carry out the intention of the legislature.” Eureka Con. Min. Co. v. Richmond Min. Co., 4 Sawy. 302; Reiche v. Smythe, 13 Wall. 162. Where the scope of a general provision is the subject of consideration, there is always a leaning, not only to prevent obscurity, but injustice,, for neither can be presumed to be intended. Board v. Spackman, 13 Q. B. Div. 878; Murray v. Gibson, 15 How. 421. The intention of the act is what should be sought for, and the intent will always prevail over the literal sense of its terms. Cearfoss v. State, 42 Md. 406; Reynolds v. Holland, 35 Ark. 56. When two portions of an act of legislative grant are repugnant or in conflict, the established rule is that the former prevails over the latter. Fore v. Williams, 35 Miss. 522; In re Second Ave. Church, 66 N. Y. —. It seems consonant with reason and good sense that a proviso, being properly intended to limit the language of the legislature, will not be construed to intend by doubtful words to enlarge or extend the act or portion of an act to which it is attached and this appears to be the settled rule. Suth. St. Const. 297; In re Webb, 24 How. Pr. 247; U. S. v. Dickson, 15 Pet. 141; State v. Kelly, 34 N. J. Law, 75. It being settled beyond contravention that a legislative grant is to be construed strictly in favor of the state and against the grantee, it necessarily follows that nothing will pass against the state by implication. Charles River Bridge v. Warren Bridge, 11 Pet. 420; Rice v. Railroad Co., 1 Black, 358; Ruggles v. Illinois, 108 U. S. 536, 2 Sup. Ct. Rep. 832; Gaines v. Coates, 51 Miss. 335; State v. Southern Pac. R. Co., 24 Tex. 80. It is presumed always that the lawmakers have a definite purpose in every act. We must presume here that the mortgage act of 1871 was passed with a full understanding of the provisions and legal effect of the act of 1866; and that when congress proceeded to pass the act of 1886, forfeiting the unearned lands, but “having due regard for the rights of the grantee,” it was familiar with both the prior acts and legislated knowingly. A part of ■one of these acts must be construed with reference to the others upon the same subject. If inconsistent, we must attempt to harmonize; if the wording is unambiguous, and the meaning clear, we would not be at liberty to put a construction upon it evidently foreign to the intent of the lawmakers, no matter wh.at we thought of the justice of it; but, if there is ambiguity and uncertainty, to arrive at the intent we must construe the whole act and that to which it refers together, and are at liberty, certainly, to take into consideration all other acts upon the same subject. It has been well said that the general intent of the statute is the key to the meaning of the parts, and it is the established rule that the intention of the whole act will control the construction of the parts. 1 Kent, Com. 461; Ogden v. Strong, 2 Paine, 584; Green v. State, 59 Md. 123; Railroad Co. v. Alexandria, 17 Gratt. 176; Burke v. Monroe Co., 77 Ill. 610; Stone v. Mayor, etc., 1 C. P. Div. 691; Jennings v. Love, 24 Miss. 249; Garby v. Harris, 7 Exch. 591; Reiche v. Smythe, 13 Wall. 162; Williams v. McDonald, 3 Pin. 331. Power was reserved to congress by sections 9 and 20 of the Act of 1866 to forfeit the grant, or the unearned portion of the same, upon breach. The mortgage act of 1871 was declarative of the right to mortgage the property of the company, including the lands, and also, apparently, in the nature of an assurance that no advantage would be taken of the breach already suffered. The act of 1886, forfeiting the unearned grant, was valid and constitutional. Judgment below affirmed. Freeman, J., concurs.