Homestead Company v. Valley Railroad
APPEAL from the Circuit Court for the District of Iowa; the case being thus:
On the 8th of August, 1846, Congress granted  to the then Territory, and now State, of Iowa— 'For the purpose of aiding said Territory to improve the navigation of the Des Moines River, from its mouth to the Raccoon Fork, so called, in said Territory, one equal moiety, in alternate sections, of the public lands, in a strip five miles in width, on each side of said river.'
The second section of this act provided that the lands so granted should not be sold or conveyed by the Territory, nor by any State to be formed out of it, except as the improvements progressed; that is, that sales might be made so as to produce the sum of $30,000, and then cease until the governor of the Territory, or State, as the case might be, should certify to the President of the United States the fact that one-half of this sum had been expended on said improvements, when sales again might be made of the remaining lands sufficient to replace this amount. The sales were thus to progress as the proceeds were expended, and the expenditure so certified to the President.
After this grant to the State of Iowa, sometimes called 'the river grant,' the legislature incorporated the Des Moines Navigation and Railroad Company, for the purpose of carrying out the improvement for which the lands had been granted; and the lands, with some exceptions, stated infra, page 157, were conveyed to that company.
Somewhere near the middle of the State, at Des Moines City, the Des Moines River receives as a tributary a stream called the Raccoon Fork. It thus happens that about one-half the river is above the point where this fork enters and one-half below. Each half traverses, of course, a region of great extent and value.
From the phraseology of the above-quoted grant of Congress, it is obvious that a controversy was susceptible of being raised; the point open to question being, whether Congress meant to grant to the State land on the Des Moines River above the point where the Raccoon Fork enters, as well as the land below this point, or whether it meant to grant only land below. On the one hand, the grant was for the purpose of improving the navigation of the river 'from its mouth to the Raccoon Fork.' On the other, the grant itself was of one equal moiety, &c., 'on each side of the said river.'
As early as February, 1848, a controversy assumed form: and what was the true meaning of the grant was a question which came before a succession of officers of the United States, commissioners of the land office, secretaries of the treasury, secretaries of the interior, and attorneys-general. Some of these thought that the grant did not extend above the fork. Others, including Mr. A. H. Stuart, Secretary of the Interior (the department to which the subject primarily belonged), was of the opinion that it did, and certified the lands above as though that were the true construction of the grant.
The agents of the State, who had been appointed by the governor to select the sections designated by odd numbers, selected them from the mouth of the river towards the northern boundary of the State as far as surveyed; in other words, above the fork as well as below.
On the 15th of May, 1856, Congress, by act of that date,  granted to the State of Iowa, for the purpose of aiding in the construction of certain railroads specified (including the Dubuque and Pacific Railroad), every alternate section of land for six sections in width on each side of said roads. Standing without any restriction, this grant, as the road named was laid out, would have embraced certain tracts which, if the act of the 8th of August, 1846, rightly construed did include tracts above the fork, had been granted under that act for the improvement of the navigation of the Des Moines River. But the grant did not stand without restriction. On the contrary, it contained a reservation, thus:
'Provided, that any and all lands heretofore reserved to the United States by any act of Congress, or in any other manner by competent authority, for the purpose of aiding in any object of internal improvement, or for any other purpose whatsoever, be, and the same are hereby, reserved to the United States from the operation of this act, except so far as it may be found necessary to locate the routes of said railroads through such reserved lands, in which case the right of way only shall be granted, subject to the approval of the President of the United States.'
If, therefore, Mr. Stuart and the Department of the Interior, and the officers of the Federal government, who had acted on the idea that the grant included lands above the fork, and reserved them to the United States for the purpose of aiding the improvement of the Des Moines River, were 'competent authority,' within the meaning of this act, then to whomsoever else they passed or did not pass, those lands did not pass to the State under this act of May 15th, 1856, for the benefit of its railroads. But herein, again, it is obvious was a field for controversy.
Whatever the reservation or proviso to the act might mean, the State of Iowa, by act of July 14th, 1856, accepted the act and, without describing any lands particularly, enacted that the lands granted by the act 'are hereby disposed of, granted, and conferred to and upon the Dubuque and Pacific Railroad Company.' After this the lands were treated by the railway company as belonging to it, and on the 7th of April, 1863, the Commissioner of the General Land Office and Secretary of the Interior approved these specific lands to the railroad grant, and they were certified to the State on that day, as part of the railway grant. The railway company now paid the taxes.
Here then the two companies-the navigation company on the one hand and the railroad company on the other were put in antagonism. A question to be decided was this, 'Did the grant of the 8th August, 1846, which was now represented by the navigation company, pass lands above the fork?'
[To preserve, however, in a chronological order, the chain of certain event hereinafter referred to, we will here, at the apparent expense of unity of subject, mention that on the 22d of March, 1858, the legislature of Iowa, having sold a portion of the lands granted by the act of August 8th, 1846, and being about to convey certain other portions to the Des Moines Navigation Company, granted, by an act, all the residue of them, and 'all lands and compensation which may be given in extension, or in lieu of any portion thereof, by the General Government, to the Keokuk, Fort Des Moines, and Minnesota Railroad Company (whose name was subsequently changed to the Des Moines Valley Railroad Company);' the grant to become operative so soon as Congress shall assent to or permit a diversion, or the title thereto shall become tested in the State so as to be subject to a grant. ]
To come back, however, now, to the question about the extent of the grant.
That question got before this court A. D. 1860, in The Dubeque and Pacific Railroad v. Litchfield,  where it was finally decided that the grant carried nothing above the fork. This question, therefore, was at an end. But it did not follow from this that any of the lands above had passed to the railroad company under the act of the 15th May, 1856. That was another question, and whether or not they had so passed would depend on the effect of the proviso or reservation in that act; a matter then an yet judicially unsettled.
As soon as the decision in The Dubuque and Pacific Railroad v. Litchfield, deciding that the navigation company, under the grant of the 8th of August, 1846, took no lands above the fork, was announced (which it was in 1860), Congress passed first a joint resolution,  and then an act,  to counteract its effects.
The joint resolution, which bore date March 2d, 1861, was thus:
'Resolved, &c., That all the title which the United States still retain in the tracts of land along the Des Moines River and above the mouth of the Raccoon Fork thereof, which have been certified to said State improperly by the Department of the Interior as part of the grant by act of Congress, approved August 8th, 1846, and which is now held by bon a fide purchasers under the State of Iowa, be, and the same is hereby relinquished to the State of Iowa.'
The act of Congress, which was approved 12th of July, 1862, was thus:
'Be it enacted, That the grant of lands to the then Territory of Iowa for the improvement of the Des Moines River, made by the act of August 8th, 1846, is hereby extended so as to include the alternate sections (designated by odd numbers) lying within five miles of said river, between the Raccoon Fork and the northern boundary of said State. Such lands are to be held and applied in accordance with the provisions of the original grant, except that the consent of Congress is hereby given to the application of a portion thereof to aid in the construction of the Keokuk, Fort Des Moines, and Minnesota Railroad [subsequently called the Des Moines Valley Road], in accordance with the provisions of the act of the General Assembly of the State of Iowa, approved March 22d, 1858.' 
The act then went on further to say:
'And if any of said lands shall have been sold or otherwise disposed of by the United States, before the passage of this act, excepting those released by the United States to the grantees of the State of Iowa under the joint resolution of March 2d, 1861, the Secretary of the Interior is hereby directed to set apart an equal amount of lands within said State, to be certified in lieu thereof. Provided that if the said State shall have sold and conveyed any portion of the lands lying within the limits of this grant, the title of which has proved invalid, any lands which shall be certified to said State, in lieu thereof, by virtue of the provisions of this act, shall inure to and be held as a trust fund for the benefit of the person or persons respectively, whose title shall have failed as aforesaid.'
This act having been passed, an agent of the State of Iowa and the Commissioner of the General Land Office met, and on an assumption that the lands above the fork meant to be given by the act of Congress, July 12th, 1862, for the improvement of the Des Moines River, had been granted to the Dubuque and Pacific Railroad Company by the act of May 15th, 1856, agreed 'that the United States had sold and otherwise disposed of a certain quantity of land prior to the passage of the said act [of July 12th, 1862], for which the State was entitled to indemnity under the act aforesaid;' and, entering into negotiations, finally made an adjustment of things by which a large quantity of lands were certified to the State as indemnity for the lands which, upon the representations of the agent of Iowa, the United States admitted had been disposed of by it under the grant of May 15th, 1856, for railroad purposes. And this action of the commissioner, made May 21st, 1866, was approved by the Secretary of the Interior on the next day.
Soon after this adjustment, that is to say, in the spring of 1867, this court, in the case of Wolcott v. Des Moines Company,  decided that the lands which had been reserved by the action of so many principal officers of the United States, including Mr. Stuart, Secretary of the Interior, had been reserved by 'competent authority,' within the meaning of the proviso in the act of May 15th, 1856, and decided again the same thing in Des Moines Navigation Company v. Burr,  and yet again in Harriet Riley v. W. B. Wells, a case which the reporter did not, in view of two previous decisions, think it necessary to report.
As under each one of these decisions the court decided that the United States had not, by its act of the 15th of May, 1856, given anything away to the State for the benefit of its railroads which, even assuming that the act of the 8th of August, 1846, carried lands above the fork, would have belonged to the navigation company-or, as, in other words, it decided that there was, so far as the act of May 15th, 1856, was concerned, no ground for indemnity to the State of Iowa for a loss to the navigation company, the State was now naturally prompt to ratify the action of its own agent and of the Federal officers, who had acted on a different supposition of the effect of the proviso or reservation; and on the 31st of March, 1868, the State, accordingly, by act of legislature, did ratify and confirm their action.
Congress equally, on the 3d of March, 1871, notwithstanding the decisions above mentioned, by act of the date just mentioned  enacted:
'That the title to the land certified to the State of Iowa by the Commissioner of the General Land Office, under the act of July 12th, 1862, in accordance with the adjustment made by the authorized agent of the State of Iowa and the Commissioner of the General Land Office, May 21st, 1866, and approved by the Secretary of the Interior May 22d, 1866, and which adjustment was ratified and confirmed by the State of Iowa March 31st, 1868, be, and the same is ratified and confirmed to the State of Iowa and its grantees, in accordance with said adjustment and said act of the General Assembly of the State of Iowa.'
Thus, as the reader will perceive, the summing up of everything, including all the legislation, and all the decisions, ended with these results:The navigation company got its alternate sections above the fork:
The Des Moines Valley Railroad (succeeding to the Keokuk, Fort Des Moines, and Minnesota Railroad) got the body of the 'indemnity lands,' which had been granted to the State for the improvement of the river, on the assumption that the navigation company (owing to the Congressional grant of May 15th, 1856) had not got them:
While the Dubuque and Pacific Railroad Company, for whose erroneously supposed taking away, under the grant just mentioned, from the navigation company of lands above the fork, the indemnity lands had been granted to the said navigation company, got-nothing at all.
The Homestead Company (to which it ought to have been earlier said that the Dubuque and Pacific Railroad Company had granted its rights, and who, with it, had paid $80,000 taxes on the lands) now accordingly filed its bill in the court below, against the navigation company, the Valley Railroad Company, and others, setting up—
1st. (And in the face of what was decided in Wolcott v. Des Moines Company and the two other cases) that the act of May 15th, 1856, did carry to it the lands above the fork.
2d. That if this was not so, then that they were holders of titles under the State, which had failed within the meaning of the proviso in the act of July 12th, 1862, and so cestui que trusts for a portion of the indemnity lands granted by it.
3d. That if they were not such holders, and not so entitled, they were nevertheless entitled to a portion of those lands, because the said lands had been certified to the navigation company or its grantees upon the assumption that the river lands had been granted by the act of May 15th, 1856, to the railroad company; a matter now decided not to have been true in fact or law.
The court below dismissed the bill and the Homestead Company took this appeal.
Mr. James Grant, for the appellants; Messrs. J. F. Withrow, C. C. Nourse, and E. C. Litchfield, contra.
Mr. Justice DAVIS delivered the opinion of the court.
^1 9 Stat. at Large, 77.
^2 11 Stat. at Large, 9.
^3 This assent was given by the act of Congress of July 12th, 1862. See infra, p. 158.
^4 23 Howard, 66.
^5 12 Stat. at Large, 251.
^6 Id. 543.
^7 See mention of this act, supra, p. 157.
^8 5 Wallace, 681.
^9 5 Wallace, 681.
^10 16 Stat. at Large, 582.