Chapters on the History of the Southern PacificDaggett, Stuart
History
Chapters on the History of the Southern Pacific
Daggett, Stuart
Pacific railroads -- History; Railroads -- California -- History; Southern Pacific Company
We may say with some confidence that the nature of the lien of the
second mortgage subsidy bonds of the United States depended, under the
Thurman Act, upon the power of Congress to alter, amend, and repeal the
terms of the Acts of 1862 and 1864 in respect to the security provided
for the government loan.
Court Decisions
Now on the question of the meaning of the “saving clause” in the Act of
1864, the courts had not in 1897, and still have not, satisfactorily
passed. That the clause did not authorize unlimited changes in the
provisions of existing legislation was evident. The majority of the
Supreme Court expressed the view in the sinking fund cases that the
reserved power could not be used to undo what had already been done
or to unmake contracts which had already been made, but that Congress
could provide for what should be done in the future, and might even
direct what preparation should be made for the due performance of
contracts already entered into.[573] Under this interpretation the
Supreme Court upheld the clauses in the Thurman law which required the
Pacific railroads to pay certain moneys into a sinking fund.
The same court in 1895 decided that a federal act which required
bond-aided railroads to operate their own telegraph lines was a
legitimate amendment of the clause of the Act of 1862 which authorized
these companies to enter into agreements with specified private
corporations for the rendering of telegraph service.[574]
Again, in Menotti v. Dillon (1897), the court approved an amendment
to the land-grant provisions of the Act of 1862 designed to quiet
litigation in land cases in California;[575] and in Union Pacific v.
Mason City and Fort Dodge, it sustained a law of 1871 which authorized
the Union Pacific to issue bonds for the construction of a bridge
across the Missouri River at Omaha, but required the company to permit
the trains of all railroads terminating at the Missouri River at Omaha
to use the new bridge up to a fair limit of its capacity and on payment
of a reasonable compensation.[576]
Public-domain text, read in full here on John Shaqi.
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