NORTHERN PAC. R. CO. et al. v. MUSSER SAUNTRY LAND, LOGGING & MANUF'G CO. et al., 68 F. 993

After making the foregoing statement, the opinion of the court was delivered by BAKER, District: Judge. Tin1 lands in controversy are within the place limits of the Pacific Company’s road. The title, therefore, passed to that company, if the lauds were subject to the operation of the grant made by the third

section of the act of July 2, 1804. Tlie contention is that these lands were not subject to the operation of this grant, for the reason that they wore withdrawn by the land department, in 'February, 1861», in order to satisfy the grant of indemnity lands made by the earlier acts of June 3, 1856, and May 5, 1864. These lands are within the indemnity, and not within the place, limits of the grant to the Omaha Company. The grant to the Pacific Company is of “every alternate

section of public lands, * i;‘ * 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 pre-emption or other claims or rights, at; tlie time the line of said road is definitely fixed, and a plat thereof filed in the office of the commissioner of the general land office; and whenever prior to said time any of said sections or parts of sections shall have been granted, sold, reserved, Occupied by homestead settlers. or pre-empted, or otherwise disposed of, other lands shall he selected by said company in lieu thereof.” The rule that a grant by congress does not; operate upon lands theretofore lawfully reserved, for any purpose whatever, has too often been declared to be longer open to discussion.

As was observed by the supreme court in the case of Railroad Co. v. Forsythe (decided June 3, 1895, and not yet officially reported) 15 Sup. Ct. 1020, "there can be no doubt as to this rule, or as to the fact that lands withdrawn from sale by the land department are considered as reserved within its terms.” The lands in controversy within the indemnity limits of the Omaha Company’s road were not granted by the acts of 1856 or 1804.

They were simply withdrawn from sale, pre-emption, or homestead entry by the action of the land department, in order that the beneficiary of the grant might, in case the full amount of lands granted was not found within the place limits, select therefrom enough to supply the deficiency. These lands, being within the indemnity limits of the Omaha Company, might be required to satisfy the earlier grant; but not being granted, they were still within the disposing power of congress.

It has often been held that "until selection was made, the title remained in the government, subject to its disposal at its' pleasure.” Kansas Pac. R. Co. v. Atchison, T. & S. F. R. Co., 112 U. S. 414, 421, 5 Sup. Ct. 208; U. S. v. McLaughlin, 127 U. S. 428, 450, 455, 8 Sup. Ct. 1177; Wisconsin Cent. R. Co. v. Price Co., 133 U. S. 496, 511, 10 Sup. Ct. 341; U. S. v. Missouri, K. & T. Ry. Co., 141 U. S. 358, 374, 12 Sup. Ct. 13.

It follows that, notwithstanding the grant in the acts of 1856 and 1864 to the Omaha Company, the title to the indemnity lands which might be required to supply the deficiency in its place limits remained in the government, and was subject to its disposal at its pleasure. The congress might, without any violation of the rights of the Omaha Company, have granted to the Pacific Company all the lands within the indemnity limits of the former company, if it had chosen to do so.

It is insisted that, as such grant might have been made, the act of July 2, 1864, ought to be so construed as to deny to the land department the power to withdraw any lands which, upon the definite location of the line of the Pacific Company, might be found to be within its place limits, although such withdrawal was made in order to satisfy the claims of an earlier grant to indemnity lands. The grant in the act of July 2, 1864, is a grant in praesenti. Its language is, "that there be, and is hereby granted.” The construction and effect of such words of grant have often been considered by the supreme court.

In the case of St. Paul & P. R. Co. v. Northern Pac. R. Co., 139 U. S. 1, 5, 11 Sup. Ct. 389, Mr. Justice Field, speaking for the court, said: “The language of the statute is, ‘that there be, and hereby is granted’ to the company every alternate

section of the lands designated, which implies that the property itself is passed, not any special or limited interest in it. The words also import a transfer of a present title, not a promise to transfer one» in the future. The route not being at the time determined, the grant was in the nature of a float, and the title did not attach to any sxtecific sections until they were capable of identification; but, when once identified, the title attached to them as of the daté of the grant, except as to such sec lions as were specifically reserved.

It is in this sense that the grant is termed one in prae-senti; that is to say, it is of that character as to all lands within the terms of the grant and not reserved from it at the time of the definite location of the route. This is the construction given to similar grants by this court, where the question has been often considered; indeed, it is so well settled as not to be open to discussion. Schulenberg v. Harriman, 21 Wall. 44, 60; Leavenworth Lawrence, etc., R. Co. v. U. S., 92 U. S. 733; Missouri, Kansas, etc., Ry. Co. v. Kansas Pac. Ry. Co., 97 U. S. 491; Railroad Co. v. Baldwin, 103 U.

S. 426.” The foregoing statement of the law was quoted and approved in the recent case of U. S. v. Southern Pac. R. Co., 146 U. S. 570, 593, 13 Sup. Ct. 152. The lands in controversy were reserved, at the time of the definite location of the line of the Pacific Company, by an order of the land department made after the passage of the act of July 2, 1864. These lands, having been reserved, were excepted out of the grant as much as if, in a deed, they had been excluded from the conveyance by metes and bounds, provided the reservation was one which the land department had the power to make.

The true question for decision is, did the land department have lawful authority to reserve, after the passage of the act of July 2, 1864, lands which on the definite location of the road were found to be within the place limits of the Pacific Company, in order to satisfy the claims of an earlier grant to indemnity lands? The act of July 2, 1864, contains no limitation in this regard on the power of the land department. By excepting out of the grant all lands reserved for any public use, it impliedly recognizes the power of the land department to make such reservations.

There is no language in the act which denies or limits the authority of the land department to make reservations for public purposes at any time before the definite location of the line shall have been fixed. What lands ought to be resefved in order to satisfy the various acts of congress, must, in the nature of things, be left largely to the discretion of this department. It is said that it would lead to monstrous injustice if the land department were clothed with such power. We see no force in this suggestion.

No injustice will be done to the Pacific Company by holding that the land department has authority to reserve enough of the public domain to satisfy all earlier grants. In our judgment, that department is invested with such authority. A reference to some of the cases will, we think, make this apparent. The case of Wolcott v. Des Moines Co., 5 Wall. 681, is a leading case, and one of the earliest in which the effect of a reservation by the land department was considered.

On August 8, 1846, congress granted to the then territory, now state, of Iowa, for the purpose of aiding it to improve the navigation of the Des Moines river from its mouth to the Raccoon Pork, one equal moiety, in alternate sections, of the public lands, in a strip five miles in width on each side of said river.

In 1856, congress made a grant of lands to the state of Iowa, in alternate sections, to aid in the construction of certain railroads, by which act it was 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 puipose of aiding in any object whatsoever, be and the same are hereby reserved to the United States from the operation of this act.” It was,decided, in the case of Railroad Co. v. Litchfield, 23 How. 66, that the grant of August 8, 1846, did not extend above the mouth of the Raccoon Pork.

Lands above the mouth of that fork had been reserved for the improvement of the navigation of the Des Moines river, first by the secretary of the treasury, and after-wards by the secretary of the interior. The lands the title to which was in controversy were situated above the mouth of the Raccoon Pork, and were within the place limits of the grant in aid of the railroads. It was contended that these lands had not been reserved by competent authority; that they were not within the limits of the grant of August 8, 1846; and therefore that the railroad took the title to them under the latter grant.

This contention was denied, the court observing: “It has been argued that these lands had not been reserved by competent authority, and hence that the reservation was nugatory.

As we have seen, they were reserved from sale for the specific purpose of aiding in the improvement of the Des Moines river, first by the secretary of the treasury, when the land department was under his supervision and control, and again by the secretary of the interior, after the establishment of this department, to which the duties were assigned, and afterwards continued by this department, under instructions from the president and cabinet.

Besides, if this power was not com-, petent, which we think it Was ever since the establishment of the land department, and" which has been exercised down to the present time, the grant of 8th August, 1846, carried along with it, by necessary implication, not only the power, but the duty, of the land office to reserve from sale the lands embraced in the grant.

Otherwise, its obiect might be utterly defeated.” So the acts of 1856 and 1864, by necessary implication, carried not only the power, but the duty, of the land department, to reserve for the benefit of the Omaha Company the lands necessary to satisfy the grant made to it. In the case of Kansas Pac. Ry. Co. v. Dunmeyer, 113 U. S. 629, 5 Sup.

Ct. 566, it was held that, where a homestead right had attached to a tract after the grant, and before the time of definite location of a railroad company’s line, which homestead was afterwards abandoned, the tract was simply restored to the public domain, and did not pass to the railroad company under its grant; that the grant only attached to lands which were the subject of the grant at the time of definite location; and that the company had no interest in the question as to what afterwards became of a tract which was not public land at the timé the grant became fixed. On page 644, 313 U.

S., and page 566, 5 Sup. Ct., Mr. Justice Miller, in delivering the opinion of the court observed: “The right of the homestead having attached to the land, it was excepted out of the grant as much as if, in a deed, it had been excluded from the conveyance by metes and bounds.” This doctrine was affirmed in Railroad Co. v. Whitney, 132 U. S. 357, 10 Sup. Ct. 112; Land Co. v. Griffey, 143 U. S. 32, 12 Sup. Ct. 362; Bardon v. Railroad Co., 145 U. S. 535, 12 Sup. Ct. 856.

The supreme court has decided, in many cases, that the withdrawal by the land department operated to exclude from sale, purchase, or pre-emption all lands embraced in such withdrawal or reservation, and that it also operated to exclude from the grant to a railroad company all lands so withdrawn or reserved, for any public purpose or use, at the time of the definite location of its line. Bullard v. Railroad Co., 122 U. S. 167, 7 Sup. Ct. 1149; U. S. v. Des Moines Nav. & Ry. Co., 142 U. S. 510, 12 Sup. Ct. 308.

In the case last cited it is said: “The validity of this reservation was sustained in the case of Wolcott v. Des Moines Co., 5 Wall. 681. In that case it was held that, even in the absence of a command to that effect in the statute, it was the duty of the officers of the land department, immediately upon a grant being made by congress, to reserve from settlement and sale lands within the grant; and that, if there was dispute as to its extent, it was the duty to reserve all lands which, upon cither construction. might become necessary to make good the ptirposcs of the grant.

This ruling as to the power and duty of the officers of the land department has been followed in many cases.” In the case of Hamblin v. Land Co., 147 U. S. 531, 536, 13 Sup. Ct. 353, it is said: “A reservation by the interior department, it is well settled, operates to withdraw the land from entry under the pre-emption or homestead laws;” citing Wolcott v. Des Moines Co., 5 Wall. 681; Wolsey v. Chapman, 101 U. S. 755: Bullard v. Railroad Co., 122 U. S. 167, 7 Sup. Ct. 1149; U. S. v. Des Moines Nav. & Ry. Co., 142 U. S. 510, 12 Sup. Ct. 308.

These cases, and others to the-same effect, establish the principle that the land department is invested with authority to withdraw or reserve public lands from sale, entry, or grant for the purpose of devoting them to some public purpose or use, in pursuance of

an act of congress; and that the withdrawal of such, lands at any time before the title to the lands attach, under a. grant, by the definite location of a railroad line, excludes them from tlie mass of public lands upon which a legislative grant will operate. The reason is obvious. Otherwise a later grant might operate to defeat or impair the effect of a prior grant.

Whenever congress makes a grant of public land in aid of a public improvement, it is not to be supposed that it was within the legislative intent to defeat or impair the full effect of the prior grant, unless such purpose is manifested in plain and unambiguous terms. When public lands have been segrega led from the common mass by

an act oí congress, or by an order of the land department withdrawing them from entry or sale, for the accomplishment of some specific public purpose, it has never been held that such lands were embraced within the operation of a grant in aid of the construction of a railroad, should the order of withdrawal afterwards from any cause be revoked. Lands so reserved or withdrawn at the time ot the definite location of a railroad line are not embraced witliin the terms of the grant.

The grant, though made prior to the reservation, does not attach to lands withdrawn to satisfy an earlier grant, for the reason that they are excluded therefrom by the clear and explicit language of the act of congress. It is argued that the fundamental error in the decision of the court below is in overlooking the fact that the earlier grant to the Omaha Company xiassed no title to, and made no grant of, the indemnity lands.

It is true that no title to the indemnity lands could vest in the Omaha Company until such lands were located and selected, and such location and selection had been approved by the land department. But the earlier grant, while conveying no title to the indemnity lands, operated as a covenant or promise by the government to convey those lands, which bound it in good faith to do no act which would defeat or impair such covenant or promise.

So far as the Pacific Company is concerned, it has no just ground of complaint; for, in reserving these lands for the benefit of the earlier grant, the land department has simply done what the plighted faith of the government required it to do. While the right to these indemnity lands rested in covenant or contract, it imposed on the government a strong moral obligation to cause such acts to be done as would protect the just expectations of the Omaha Company from disappointment.

And although the grant to the Pacific Company was one operating in praesenti, still its title did not, and by the express terms of the statute could not, attach to any specific lands, until the line of its definite location was fixed,— and then only to public lands, not reserved or otherwise appropriated. The lands in controversy, at the time of the definite location .of its line, were reserved by competent authority, for the benefit of an earlier grant, and hence were not embraced within the operation of the grant to the Pacific Company.

We have carefully examined all the authorities cited by counsel for the appellants, and find nothing in conflict with the views here expressed. The conclusion reached makes it unnecessary to consider the other-questions presented. There is no error in the decree, and it will be affirmed, at the cost of the appellants.