City of Council Bluffs v. Kansas City, St. Joseph & Council Bluffs Railroad , 45 Iowa 338 ( 1876 )

Miller, Ch. J.

I. The evidence submitted to the Circuit Court establishes the fact that passenger and express cars used upon appellant’s road were, prior to the allowance of the injunction, in the westward bound trains run across the river to Omaha, without any transfer of their burdens being made at the western terminus of appellant’s road at Council Bluffs. Its eastward bound trains of passenger and express cars received their passengers and express matter at Omaha, and there was no change of cars at the western terminus of appellant’s road in Council Bluffs. The cars of defendant were drawn to and from the terminus of its road over the bridge spanning the Missouri river by the engines of the Union Pacific Railroad Company, or by the engines of a transfer company, whose business, it appears,' is to transfer passengers, freight and cars from the transfer grounds in Council Bluffs across the .bridge to the depot of the Union Pacific Railroad in Omaha. Both the petition and answer state the eastern terminus of the Union Pacific Railroad to be within the corporate limits of Council Bluffs, at a point known as the “Union Pacific Transfer Grounds,” which is also the western terminus of appellant’s railroad. From this point to the depot o'f the Union Pacific Railroad in Omaha, the cars of defendant with their burdens were transported across the bridge as above stated. It thus- appears that the passengers and express matter transported by the defendant were not transferred from and to its cars at Council Bluffs, but were carried in the cars of defendant to and from Omaha. The plaintiff insists that the acts of the defendant in permitting its cars to be thus drawn to and from Omaha as above stated are in violation of the provisions of chapter 6 of the Laws of the Fourteenth General Assembly, prescribing “ the duties of railroad companies having termini at or near Council Bluffs,” and also in violation of an alleged contract between the plaintiff and the defendant by virtue of the ordinance of the city granting the right of way for its road upon certain streets and its occupancy thereof under the ordinance. On the other hand, the defendant maintains that the statute referred to is in conflict with the Constitution of the United States, inasmuch as the State thereby attempts to regulate, interfere with and control commerce among the States, and that the city ordinance im-. poses no obligation on defendant, in the nature of a contract, to transfer passengers and freights within the city, as it possessed the right, under the laws of the State, to occupy and use such streets with its railroad, without the assent of the city and free from the restrictions and conditions imposed by the ordinance. The case is thus made to present questions involving the validity of the statute of the State above mentioned, and the effect of the city ordinance, which, it is claimed by plaintiff, is violated by the acts complained of in the petition. We will proceed-to the consideration of these questions.

The first three sections .of the statute in question prescribe the duty of the railroad corporations contemplated therein. The first section applies to-railroad companies incorporated under the laws of the State, roads which operate their lines in this State terminating at or near Council Bluffs and making connection there with any railroad extending to a point on the boundary or within the State of Iowa; the second-applies also to railroad corporations not organized under the laws of this State, which have constructed railroads terminating within the State, “ or which have authority to' bridge or ferry the Missouri river, for the. purpose of having continuous lines of their road, and for connecting with other railroads of the State of Iowa.” Those corporations contemplated in the third section are all such as have made or shall hereafter make “ any contract with any municipal corporation in this State.” The corporations contemplated in the first section are prohibited therein- “ from making any transfer of freight* passengers or express matter to .or with any other railroad company either by delivering or receiving the same, at any other place than in the State of Iowa,” at the point where the connecting railroads terminate. The second section imposes a like prohibition upon the contemplated-railroads therein, and requires them to erect and maintain, at the point of termination of their respective roads, within the limits of this State, all depots, stations and other buildings necessary for the transfer required by the statute, within the State. The third section prohibits the corporations referred-to from violating any contract.made with a municipal corporation of the State, and requires them to perform specifically the obligations imposed by such contract. ■

The statute, as plainly appears from its language and as disclosed by its history, as well as the. public history of the controversy concerning-the true point of the eastern terminus of the Union Pacific Railroad, is intended to compel the corporations whose railroads terminate at Council Bluffs to make all transfers with connecting lines inside that city.

i bailboadstutes aTransfer- - It may be well first to inquire as to what are the acts prohibited and required by the statute — what is the meaning ^ language, “ transfer of freight, passengers or exPress matter,” used in the statute to express the acts required to be done, within the city of Council Bluffs? There -is- little difficulty in answering this -question, for the language to be interpreted is of frequent use and well understood when applied to the carrying business-of-the country. It expresses the- act of removing freight, passengers' and express matter, and, in the connection in which it occurs in the statute, implies the removal of these subjects of transportation from the custody of one common carrier to that of another — from one railroad to another — for the purpose of completing their transportation to the place of destination. This may be, and is usually, done by railroad companies in the prosecution of their business in two different ways. In the one case, passengers and freight are removed from the cars of one company to those of another at the point of connection, and in the other, the cars themselves, with their burdens of passengers and freight, are transferred to and upon the connecting road and the subjects of transportation are thus carried to or toward their places of destination. In the case before us the course last indicated was pursued by the defendant, which constitutes the ground of complaint on the part of the plaintiff. It must be understood that our conclusions as to the law of the case are based upon the state of facts as established by the pleadings and evidence, namely: that the cars of the defendant with their burdens have been and are being transferred at Council Bluffs, the terminus of its road, to another railroad and upon it drawn to Omaha, where they are discharged of their contents, and after being loaded with eastern-bound passengers and freight are returned to the defendant’s road. Transfers of passengers and freight from and to the cars of the defendant, from and to other railroads in the manner of transfer first above indicated are made at Omaha instead of at Council Bluffs. "We have then the case of two transfers, one of cars and their burdens from defendant’s railroad to the Union Pacific Railroad at Council Bluffs, the other of passengers and freight, by change of cars, at Omaha. The plaintiff insists that the prosecution of the defendant’s business in this manner is in violation of the statute of the State above referred to. That the statute was intended to prohibit such transfers there is no room for doubt.

2. - — —: con-law: regulamerce. It becomes our duty now to determine whether this statute is in conflict with the Constitution of the United States. In order to do this, we must first inquire into and determine, as a matter of fact, tbe effect of tbe enforcement of tbe statute upon the business of defendant in the transportation of passengers and freight. It would necessitate the breaking of bulk of all freights and the change of all cars for passengers, transported by the defendant, at Council Bluffs, in cases where bulk is broken or change^of cars is made between the place of receipt by the carrier and the place of destination, where that was beyond the western terminus of defendant’s road. It would prohibit the running of a car-load of merchandise carried over defendant’s road across to Omaha, although consigned there. The car would have to be unloaded, the goods removed from the car in Council Bluffs, and there re-loaded on a car upon the Union Pacific Railroad in order to be carried over to Omaha. So, also, freight transported from Omaha eastward over defendant’s road could not be there received into the cars of defendant, but would have to be carried across the river to Council Bluffs and there transferred into defendant’s cars.

As we understand the record, the fact is disclosed that in the changes of cars made at Omaha, of which plaintiff complains in the petition, the destination of the passengers and freight was either west of that city or east of Council Bluffs, depending upon the direction in which the train was moving. If the statute should be enforced an additional change or transfer of cars would be required at Council Bluffs. This, would cause delay and impose expíense, thus interpiosing an obstacle to the free and speedy transpiortation of commerce among the States seeking that channel of communication.

It follows from these considerations that the statute in question is an attempt to impose regulations and restrictions which operate to embarrass and hinder the free and speedy transportation of commerce between the States.

The Constitution of the United States, Art. I, Sec. 8, confers upon Congress the power “ to regulate commerce with foreign nations, and among the several States, and with the Indian tribes.” The authority here granted extends to all matters involving subjects which pertain to or affect commerce.

Commerce is the interchange or mutual change of goods, productions, or property of ■ any hind, between nations or individuals. Transportation is the means by which commerce is carried on; without transportation there could be no commerce between nations or among the States. Any regulation of the transportation of inter-state, commerce, whether it be upon the high seas, the lakes, the rivers, or upon railroads or other artificial channels of communication, affecting commerce, operates as a regulation of commerce itself. It has been so held by the Supreme Court of the United States. Reading Railroad Co. v. Pennsylvania (State Freight Tax Cases), 15 Wallace, 232; Passenger Cases, 7 How., 283; The State of Pennsylvania v. Wheeling & Belmont Bridge Co., 18 How., 421; Gibbons v. Ogden, 9 Wheat., 1; Brown v. The State of Maryland, 12 Wheat., 419; Almy v. The State of California, 24 How., 169.

Taxation upon freights carried by railroad companies, laws requiring the payment, by the master of vessels, of a fixed sum for each passenger brought from a foreign port, those granting the exclusive right to navigate rivers with boats propelled by steam, those imposing a stamp duty upon bills of lading, and those authorizing the building of bridges over navigable rivers, and the like, are held to be regulations of commerce. •

A State statute imposing a tax upon all persons leaving the State by railroads or stage coaches, and requiring the corporations or individuals engaged in their transportation to make, report of the number of such persons carried by them, and pay the tax imposed, was held to be in conflict with the Constitution of the United States, on the ground that it imposed an obstacle to the free and unobstructed communication and travel of the citizens of the United States in the discharge of' their duties as such, and in the prosecution of their lawful business in other States, and in foreign countries. Crandall v. The State of Nevada, 6 Wallace, 35.

It will be observed that the State statutes, which, in the cases above cited, were held to be unconstitutional, imposed burdens upon the transportation of inter-state commerce by the levying of taxes. The same'principles upon which these statutes were held invalid apply to statutes creating burdens or imposing restrictions of a different character. Commerce may suffer no more from a law requiring a direct tax to be paid thereon into the State treasury, than from a regulation under which charges will be exacted by individuals, as would be the case of transferring freight from the cars of one railroad to those of another at State lines when the connecting roads form continuous lines over which freight may be carried without change of cars. And a regulation of the State whereby the most speedy transit is prevented may ‘be a greater burden upon inter-state commerce — a greater embarrassment to it, than taxes of the character held invalid in the cases above cited. Celerity in the transportation of passengers and freight is now imperatively demanded by the business of the country; every impediment thereto is a burden upon commerce. State statutes producing such results are, under the authorities cited, clearly in conflict with the Constitution of the United States. Subjects of legislation of this character, which are in their character national, affecting the whole country, or different sections of the country, and confided by the Constitution to the general government, are exclusively within the legislative control of Congress. Reading Railroad Company v. Pennsylvania, 15 Wallace, 232; Cooley v. Port Wardens, 12 How., 299; Gilman v. Philadelphia, 3 Wallace, 713; Crandall v. The State of Nevada, 6 Wallace, 35.

The State statute under consideration affects the commerce of the whole country. The Union Pacific Railroad, with which the defendant’s railroad and others centering at Council Bluffs connect, is a great thoroughfare over which the commerce and trade of the Pacific States, and to some extent that of Asia, is carried. The defendant’s road, and other roads referred to, bear to and from the Union Pacific Railroad the commerce and trade which are national in their character, and in fact, to some extent, also pertain to foreign nations. If any regulations respecting the transfer of freight and passengers in their transit from one State to another upon railroads, or in respect to railroads engaged in the transportation of the subjects of inter-state commerce be necessary, tbe power to make such regulations is by the Constitution conferred upon Congress. It may do so by enactments establishing a uniform system, which will have regard to the general interest of the commerce of the whole country. State enactments are usually designed to meet local wants and demands; Congressional enactments are such as are required by the whole country. The people of the several States, so far at least as the interests of foreign and inter-state commerce are concerned, must be regarded as one nation, and regulations affecting these interests should be uniform throughout all the States. Inter-state commerce and the transportation necessary to its existence are not local in their nature, but affect the people of all the States. The Constitution of the United States has, therefore, wisely committed to the national legislature the duty of establishing regulations of the character of those prescribed by the statute under consideration.

In our opinion, Congress has enacted regulations upon this very subject which are in conflict with this State statute; this being so, the statute cannot be sustained.

3_._. • It has been held by the Supreme Court of the United States that upon certain subjects pertaining to commerce, the States, in the absence of Congressional enactments, may adopt regulations; but when Congress has assumed

to act upon such subjects, the State enactments conflicting, therewith cannot be enforced. Crandall v. The State of Nevada, 6 Wall., 35; Gilman v. Philadelphia, 3 Wall., 713; Cooley v. The Board of Wardens, 12 How., 299.

By an Act of-Congress approved July 1st, 1862, 12 U. S. Statutes at Large, 496, U. S. Revised Statutes, p. 1022, § 5257, other railroad companies are authorized to connect their roads with the Union Pacific Railroad or any of its branches. The Act of June 15,1866,14 U. S. Stat. at Large, 66, U. S. Revised Stat., p. 1022, § 5258, provides that “ every railroad company in the United States * * * * is hereby authorized to carry upon and over its road, boats, bridges and ferries, all passengers, troops, government supplies, mails, freight and property , on their way from any state to another state, and to receive compensation therefor, and to connect with roads of other states so as to form continuous lines for the transportation of the same to the place of destination.” Under these statutes the defendant is authorized to connect its railroad with the Union Pacific Railroad so as to form a continuous line for the transportation of passengers and freight to the places of their destination. The connection indicated by the language of these acts of Congress is that whereby the cars of one road may be transported over the other, so that passengers and freight may be carried as upon a continuous line of railway without change of cars. The provision last quoted expresses this thought by direct and plain language, and the first implies the same, for it is hardly probable that Congress meant no more by the word “connect” used in the provision than that freight and passengers may be transferred from the cars of one railroad to those of another. On the contrary, it was intended that the cars themselves, with their burdens, should be transferred from one road to another, so that passengers and freights might be transported from ocean to ocean without change of ears or breaking bulk, as upon one continuous line of road. The purpose of the statutes is evidently in the interest of commerce, intended to promote speedy and unobstructed transportation, and to relieve the products and merchandise of the country of the indirect tax of breaking bulk and re-shipping at the various railroad termini when being transported by rail. Nothing tends more effectually to produce these results than continuous lines for the carriage of commerce. The delay, expense and loss attending the breaking of bulk and reshipment is a serious embarrassment and impediment to commerce. These Congressional enactments, under the interpretation given them, tend to remedy these evils; any other interpretation would destroy their force and defeat their evident purpose.

Under these laws the defendant is authorized to make connection at.Council Bluffs, whereby its cars may be transported with their burdens upon the Union Pacific Railroad, or any other railroad, so as to form a continuous line, and to receive and transport over defendant’s road the cars of other connecting roads. This is just what the plaintiff complains of and alleges to be in conflict with the statute of the State. But as that statute is in conflict with the Constitution and laws of the United States, it cannot be supported as a valid law, and confers no right entitling the plaintiff to the relief it has demanded.

It is insisted by appellee that the State statute simply provides the place of transfer, when transfers are made by the defendant; that, as shown by the evidence in the case, transfers are made upon the Union Pacific Railroad at Omaha, where freight and passengers are removed from and to defendant’s cars, to and from those of other railroad companies. It is insisted that this transfer should be made at the terminus of defendant’s road, and that the State may rightfully compel it. We have seen that defendant has the right to connect with the Union Pacific Railroad, to transfer to and receive from it cars with their burdens. "When the cars of the defendant are lawfully received by the Union Pacific Railroad Company, there is no authority possessed by the State to prescribe that after such cars have been transported out of the State upon that road the freight and passengers contained therein shall not be transferred to other cars at any point before reaching their destination. Neither does the State possess authority to prohibit the ■ defendant from receiving cars from the Union Pacific Railroad, wherever their burdens may have been put into them.

If Iowa may, by law, require that bulk of cargoes transported upon the railroads of the State shall be broken; that passengers and freight shall be transferred from and to the cars of such roads at their termini, to and from the cars of other connecting roads, and that cars with their contents shall not be hauled or transported over the said roads in Iowa, -which are transported from the roads of other States, laws of the same character may be made by each of the States of the Union. If such powers were possessed by the States, and exercised by them, we would in vain hope for continuous lines of transportation, a thing of the highest importance to all the people of the Union, and of the utmost importance to the jieople of Iowa, whose agricultural productions, the great source of our wealth, find a market through channels of transportation wholly within the borders of sister States. The commodities of trade which are brought here from other States are carried upon the same railroads and rivers that bear our productions to market. The principle upon which the statute in question is attempted to be sustained would afford support for legislation by other States which would embarrass the commerce of this State by imposing upon it unlimited burdens. These thoughts commend the wisdom of the constitutional restriction upon the exercise of such powers by the individual States of the Union.

4, —:-: state°llty ° We fully recognize the well settled doctrine that the State, by virtue of its police power, may enact all such laws as may be necessary or proper to protect its citizens in their persons, health and property, to guard

them against frauds, impositions and oppressions, even where such laws may in some respects affect persons or corporations engaged in the transportation of foreign or inter-state commerce, such as quarantine and health laws, all laws to prevent the commission of felonies, misdemeanors, or other breaches of the peace, etc. The Mayor etc. of New York v. Miln, 11 Pet., 102; Gibbons v. Ogdon, 9 Wheat., 1; License Cases, 5 How., 504; Brown v. Maryland, 12 Wheat., 419; Passenger Cases, 7 Flow., 283; Fuller v. The C. & N. W. Ry. Co., 31 Iowa, 187. The views we have expressed in respect to the validity of the statute under consideration are in no respect inconsistent with the doctrine above referred to. The act is not in the nature of a police regulation, nor confined within the exercise of the police power of the State.

We do not hold that the General Assembly would not have the power to pass laws regulating the time or manner of making transfers of the subjects of commerce transported by railroad carriage from and to points wholly within the State. But this is not the character of the act under consideration. As we’ have already seen, it would, if given effect, operate directly upon inter-state commerce, creating burdens upon it of a character which have frequently been held to be beyond the power of the States to impose.

The act also, by its terms, claims to regulate commerce both within and without the State by requiring transfers to be made in Iowa and prohibiting the same being done in Nebraska.

Whether or not we would be required to hold the act to be invalid also under section 30, article 3 of the Constitution of Iowa, which prohibits, the passage of special laws where a general law can be made applicable, we do not determine, since counsel have not argued that question.

5__. 0CC11_ street1: eon-tract. II. We will now consider the effect of the ordinance of the city granting the right to defendant to construct its road upon the streets of the city. It declares that it shall be lawful for defendants to occupy the streets named with its railroad upon the condition, among others, that defendants shall transfer freight and passengers, carried by it, within the city limits. It is claimed that the occupancy of the streets for the purposes of the railroad, operates as an acceptance of the conditions, and raises a contract whereby defendant is bound to their performance.

Without inquiring whether a contract may exist, under municipal legislation, of this character, binding the grantee of the rights conferred to the performance of the conditions imposed, we are of the opinion that, in this case, no such obligation is created, for the following reasons: 'The defendants, under the law of the State as it then stood, had the right to occupy the street upon which its railroad is constructed, without the consent of the city. The City of Clinton v. The C. R. & M. R. R. Co., 24 Iowa, 455; Chicago, Newton & Southwestern R. Co. v. The Mayor of Newton, 36 Iowa, 299.

It is very plain that if the city, by direct legislation, could not have prevented the occupancy of its streets by defendant’s railroad, it could not, by affixing a condition to its assent to such occupancy, defeat defendant’s rights under the laws of the State. As the ordinance of the city conferred no right upon defendant that it did not before possess under the statutes of the State, there is no consideration upon which to base a contract, even if it be admitted (but which we do not decide) that the ordinance and occupancy,of the streets by defendants wouldj under other circumstances, raise a contract binding the defendant to the performance of the conditions imposed upon it.

It is urged by appellee that the right of way act (Revision, Art. 3 of Chap. 55, p. 218), upon which the decisions above cited are based, will not repeal the provisions of the charter of the city of Council Bluffs, a prior enactment, which confers the control of its streets and alleys upon the city council. But counsel are mistaken in assuming that the city charter took effect prior to the right of way act. That act became a law February 9, 1853. The city charter was approved January 24, 1853, and the last section provided that the act should take effect from and after its publication in' certain newspapers named therein. It was never so published, and it took effect under the general provisions of chapter 3, Code of 1851. Under these provisions the city charter went into operation-after the right of way act took effect.

Finding the State statute, under consideration, to be in plain conflict with the Constitution of the United States and with acts of Congress passed in pursuance thereof, it becomes our duty to declare the statute of the State invalid and without force as a law. Stewart v. The Board of Supervisors of Polk Co., 30 Iowa, 9, and cases cited.

The order of the Circuit Court allowing the injunction must be

Reversed.