Angelo v. Railroad Commission

Eschweirer, J.

Appellants below, riparian owners on Lime lake, challenge, as in violation of rights claimed to be secured to them under the federal and Wisconsin constitutions, the act of the Railroad Commission in granting power and authority to certain third persons to enter upon such a lake or body of water and remove marl from the bed thereof, to the commercial gain of such third persons and over the objections of plaintiff, and without compensation to them.

The main question upon which the parties stand or fall in this case is whether the legislature was inhibited by constitutional provisions from enacting a statute created by ch. 410 of the Laws of 1923, which, referring to the Railroad Commission, reads:

“31.02 (5) The commission, whenever consistent with public rights, is authorized and empowered to make contracts for the removal of any material from the bed of any navigable lake, to fix and determine the compensation to be paid to the state of Wisconsin for material so removed, and to enter into contracts, on behalf of the state of Wisconsin, for the lease or sale of such material, with such conditions as may be necessary for the protection of the public interests and the interests of the state of Wisconsin, provided that no such contract shall be made to continue for a longer period than five years.”

We shall determine this important question, involving as it does such a new and far-reaching public policy, now, even though the judgment below must be reversed and the action of the Railroad Commission set aside because of a very plain failure on its part to comply with the direct mandate and an important condition of the statute.

Assuming the validity of this law, nevertheless the legislature has plainly declared therein that its administrative body, the Railroad Commission, though authorized and empowered to make contracts in the interest of the state, shall, in making such contracts for the removal of material from the bed of any navigable lake and as a part thereof, “fix and determine the compensation to be paid to the state of Wisconsin for material so removed.” Such provision is a prerequisite in any contract that the Commission is authorized'to make.

The words used, “compensation to be paid,” should be given their primary and ordinary significance and as used on such occasions. The word “compensation” often occurs in our constitution and has been held to be synonymous with “salary” (Milwaukee County v. Halsey, 149 Wis. 82, 86, 87, 136 N. W. 139); and this would certainly mean money; and when in sec. 13, art. I, Const., it is required that “just compensation” shall be given for private property taken for public Use, it means, of course, money. The word “pay” primarily and ordinarily means the use of money (Krahn v. Goodrich, 164 Wis. 600, 610, 160 N. W. 1072), and especially so when used in connection with an obligation owing to the government, as is pointed out in Oneida County v. Tibbits, 125 Wis. 9, 12, 102 N. W. 897, 899. Clearly, therefore, this above quoted phrase connotes the idea of the use of money.

The further clause in the law providing that such contracts for lease or sale shall have conditions such as may be necessary for the protection of the public interests and “the interests of the state of Wisconsin,” in no wise lessens or detracts from the absolute condition requiring money compensation to be paid.

The possible lowering of the price for such material to the people of the state at large or to some particular class is surely not what is meant as the “compensation to be paid to the state of Wisconsin for material so removed.” The evident tenor of the statute is that the state is disposing of that which is of value and upon which a price or money value to it can be placed, for evidently such material would not be sought in commercial ventures such as here presented unless it be of value in dollars and cents; and that being so, a reasonable proportion thereof must be paid to the state, otherwise such contracts, leases, or privileges are not within the power of the Commission to grant.

The legislature evidently did not itself intend to give away, without a direct, reasonable, and substantial compensation to itself, much less to authorize such an administrative body to give away, by conferring on private persons a privilege to dispose of, for their own profit only, the natural resources and property of the state and with no return therefrom to the state. As illustrated in this case, the estimated cost to the lessees is seventy to eighty cents, and the authorized sale price to the public is up to one dollar per cubic yard.

Whether the state itself could make such gifts is not now before us; very plainly it did not here attempt so to do, and therefore there is no power of discretionary generosity vested in the Commission.

And as so construed, sec. 31.02 (5), supra, now presents questions as to the nature of title to the bed of navigable lakes; in whom is such title vested; and how far may the title holder make a matter of bargain and sale of the material therein and thereunder.

In disposing of this question we shall treat only of the subject of the bed or the soil under navigable lakes as separate, apart, and distinguishable from the same subject matter concerning navigable rivers and streams, the statute here clearly limiting its scope to the navigable lakes and therefore in no w'ise presenting any issue as to the ownership of the beds of navigable rivers and streams, title to the center of which has, from an early day and consistently since, been declared, in this state, to be in riparian owners, subject to the public rights incident to navigation. Jones v. Pettibone, 2 Wis. 308; Wisconsin River Imp. Co. v. Lyons, 30 Wis. 61; Reysen v. Roate, 92 Wis. 543, 544, 66 N. W. 599; State v. Sutherland, 166 Wis. 511, 521 (166 N. W. 14), and cases there cited at p. 522. This rule carries with it the right to separately sell title to the submerged land of the river bed, as was upheld in Bright v. Superior, 163 Wis. 1, 11, 13, 156 N. W. 600. The general doctrine in Illinois is the same, Tempel v. U. S. 248 U. S. 121, 129, 39 Sup. Ct. 56; in Michigan, Collins v. Gerhardt, 237 Mich. 38, 211 N. W. 115; and in Mississippi, where the riparian owner on the Mississippi river may enjoin the dredging of gravel therefrom, though he may not take such material without permission of the War Department. Archer v. Greenville S. & G. Co. 233 U. S. 60, 34 Sup. Ct. 567. See, also, note in 23 A. L. R. 757. In Iowa, for instance, the opposite rule prevails. Marshall Dental Mfg. Co. v. Iowa, 226 U. S. 460, 23 Sup. Ct. 168.

We shall consider it also as though such a lake, having no apparent connection with the waters of the Mississippi or the St. Lawrence, but being within the statutory definition, infra, of navigable waters of the state, is subject to the same trust as that proclaimed in sec. 1, art. IX, as quoted infra. Whether such a body of water as Lime lake appears to be in the record here should be considered differently in any application of the holding now made upon the main and broad question presented under said sec. 31.02 (5), Stats., and here argued by the parties, is a question not raised by the parties in the court below nor here, nor do we pass upon it.

That the patent from the United States in terms included the land under this body of water as though it were not submerged does not affect the situation (Mendota Club v. Anderson, 101 Wis. 479, 492, 78 N. W. 185; Illinois S. Co. v. Bilot, 109 Wis. 418, 426, 84 N. W. 855, 85 N. W. 402), because such grants are presumably subject to the rule of the state as to waters and riparian rights. Brewer-Elliott O. & G. Co. v. U. S. 260 U. S. 77, 89, 43 Sup. Ct. 60.

Our constitution declares, sec. 3, art. IX:

“The people of the state, in their right of sovereignty, are declared to possess the ultimate property in and to all lands within the jurisdiction of the state; and all lands the title to which shall fail from a defect of heirs shall revert to or escheat to the people.”

And by sec. 1 of the same article:

“The navigable waters leading into- the Mississippi and St. Lawrence . . . shall be common highways and forever free, as well to the inhabitants of the state as to the citizens of the United States, without any tax, impost or duty therefor.”

The first provision above quoted is an explicit assertion of a fundamental attribute of state sovereignty. Under such power as sovereign the state had, at the moment of its creation, the right to determine all matters concerning the title to lands covered by navigable waters, subject only to the paramount authority of the federal government, in matters concerning navigation as a part or means of interstate commerce and of its proper disposal by the United States prior to statehood. U. S. v. Holt State Bank, 270 U. S. 49, 54, 46 Sup. Ct. 197; Seattle v. Oregon & W. R. Co. 255 U. S. 56, 63, 64, 41 Sup. Ct. 237; Appleby v. New York City, 271 U. S. 364, 46 Sup. Ct. 569; Massachusetts v. New York, 271 U. S. 65, 86, 89, 46 Sup. Ct. 357; Fox River P. Co. v. Railroad Comm. 274 U. S. 651, 47 Sup. Ct. 669, affirming 189 Wis. 626, 208 N. W. 266; U. S. v. Chandler-Dunbar W. P. Co. 229 U. S. 53, 60, 63, 33 Sup. Ct. 667; Scott v. Lattig, 227 U. S. 229, 243, 33 Sup. Ct. 242; Milwaukee v. State, 193 Wis. 423, 214 N. W. 820.

The second above quoted provision, as to its navigable waters, was copied almost verbatim from the Ordinance of 1787. What power was then in the Continental Congress to so provide is now immaterial; this state solemnly assumed such trust and tied its own sovereign hands in that regard by its self-imposed constitution, and has always recognized such as an absolute duty and obligation. Diana S. Club v. Husting, 156 Wis. 261, 267, 145 N. W. 816; In re Crawford County L. & D. Dist. 182 Wis. 404, 408, 196 N. W. 874; Wis. T., L., H. & P. Co. v. Green Bay & M. C. Co. 188 Wis. 54, 65, 205 N. W. 551.

That there is the substantial difference between rivers and streams on the one hand and lakes on the other on the question of ownership to the soil covered by such waters as indicated above, has been plainly recognized by legislative action as well as by the judicial decisions supra.

As early as ch. 72, Laws of 1853, repeated in ch. 41, R. S. 1858, now appearing in substance as sec. 30.01 (2), (3), Stats., it was declared that meandered rivers and streams, and rivers, streams, sloughs, bayous, and marsh outlets, navigable in fact for any purpose, are declared navigable to the extent that they cannot be obstructed without legislative consent, and that the boundaries of lands adjoining waters and the rights of the state and individuals in respect to all such lands and water shall be in conformity to the common law.

Apparently not until ch. 328, Laws of 1895, were lakes as such so dealt with, and then it was declared that all meandered lakes, navigable in fact, or so declared to be by federal survey, are navigable, and public waters, and all persons shall have the same rights thereon and thereto as in and to all other navigable or public waters within the state, and with a proviso that the act shall not interfere with any vested rights theretofore acquired upon such lakes; this act became sec. 1607a in the Statutes of 1898, the proviso was struck out by ch. 335, sec. 2, Laws of 1917, and the law is now sec. 30.01 (1), Stats.

Whether a given body of water is navigable within the meaning here attached to that word, becomes, in the absence at least of legislative declaration, a question of fact. Bixby v. Parish, 148 Wis. 421, 425, 426, 134 N. W. 838; Economy L. & P. Co. v. U. S. 256 U. S. 113, 123, 41 Sup. Ct. 409; Brewer-Elliott O. & G. Co. v. U. S. 260 U. S. 77, 86, 43 Sup. Ct. 60; U. S. v. Holt State Bank, 270 U. S. 49, 56, 46 Sup. Ct. 197.

It is evident that as to the soil under the lake, the bed thereof, as distinguished from the body of water resting thereon, the former is land within the boundaries of this state, and title to all land, submerged or not, must rest somewhere, subject only, of course, to the declared trust as to navigation, and such title must necessarily rest either in the state as sovereign or in the riparian owners. The exact nature of the ownership; the right to possession or control, that vests in the owner of land bordering on such bodies of water, has been so fully discussed in Milwaukee v. State, 193 Wis. 423, 214 N. W. 820; Doemel v. Jantz, 180 Wis. 225, 193 N. W. 393, 31 A. L. R. 969, and in U. S. v. River Rouge Imp. Co. 269 U. S. 411, 418, 46 Sup. Ct. 144, that no more need now be said as to such; nor are we concerned with questions as to whether the title to land bordering on such body goes to the high or low water mark, a problem solved differently in various jurisdictions, as is pointed out in Massachusetts v. New York, 271 U. S. 65, 92, 93, 46 Sup. Ct. 357, and discussed in Doemel v. Jantz, 180 Wis. 225, 235, 193 N. W. 393.

While it has been repeatedly held by this court that the riparian owner on navigable lakes does not, and that the state does, hold title to the bed or soil thereunder, as stated in Diedrich v. Northwestern U. R. Co. 42 Wis. 248, 262; Delaplaine v. C. & N. W. R. Co. 42 Wis. 214, 225; Boorman v. Sunnuchs, 42 Wis. 233, 242; Mendota Chib v. Anderson, 101 Wis. 479, 492, 78 N. W. 185; Illinois S. Co. v. Bilot, 109 Wis. 418, 426, 84 N. W. 855, 85 N. W. 402; C. Beck Co. v. Milwaukee, 139 Wis. 340, 351, 120 N. W. 293; Doemel v. Jantz, 180 Wis. 225, 229, 235, 193 N. W. 393, yet in none of such or other cases in this court has the question arisen as to whether the title of the state, charged as it is with an express trust, permits of the lawful disposing of substances found in, under, or as parts of such underlying soil.

Language is found in several of our decisions tending to indicate that it was the opinion of the court that the state’s title carried with it no power to grant anything thereof to others, and that such title was so impressed with the public trust that there was nothing left which resembles any of the incidents of private ownership in property so far as the right to sell and dispose in whole or in part is concerned, as is illustrated in- the following references to some of them: In McLennan v. Prentice, 85 Wis. 427, 55 N. W. 764, in an action concerning the title to lands on a water front in Ashland, and in discussion of the title of the state to submerged lands there, but which the state had not granted (p. 445), it was said (p. 444) that “The state has no proprietary interest in them; . . . while it may make a grant of them for public purposes, it may not make an irrepealable one; and any attempted grant of the kind would be held . . . subject to revocation.” In Illinois S. Co. v. Bilot, 109 Wis. 418, 84 N. W. 855, 85 N. W. 402, in speaking of lands submerged by Lake Michigan and the state s title to lands under all public waters of the state, the court said (p. 426) : “It cannot transfer such title by grant or otherwise,” etc. And in Rossmiller v. State, 114 Wis. 169, 89 N. W. 839, much relied upon by plaintiffs in this case, some of the language there used does lend strong support to such contention. It involved the constitutionality of an act prohibiting the cutting of ice from any meandered lake for shipment out of the state except upon license from the secretary of state and the payment of ten cents per ton, with very drastic penal provisions for its enforcement. Its attempted justification was stated to be that such ice is state property which it can deal with as a private person deals with his own property rights. Page 179. It was there held (p. 180) that every person has constitutional rights to enjoy its public waters for every legitimate purpose, including the cutting and appropriation of ice, subject, of course, to proper police regulation; that it had not been supposed that the state could deal with public waters or anything else held upon a like trust and use such for purposes of revenue; and (p. 181), “Obviously, there can be no difference between public water in a liquid condition and in the form of ice.” Had the sentence then ended it would have been all-sufficient to meet the question there presented; it continued, however, as follows: “or between water and the land covered thereby, or the fish or fowls which inhabit the same, or any of the animals fence natures, in respect to sovereign authority over the same. If one may be dealt with as the absolute property of the state, the others may be.”

The reference, therefore, to any precise similarity, so far as title in the state is concerned, between water and the land covered thereby, was obiter and must be so now considered. There is a substantial difference between the submerged land and the navigable water thereupon; and while it is manifestly impossible to have a navigable bed of water without a bed of land upon which it may rest, yet it is to the bed of water as a means of navigation and as a public highway that the state has assumed the trust, and not to the land under the same as land, for as time goes on the course of the stream may be changed or the body of water disappear, but the land formerly so covered and the title thereto remains. This is strikingly illustrated in U. S. v. Holt State Bank, 270 U. S. 49, 46 Sup. Ct. 197, supra, concerning the drainage of a large lake in Minnesota.

The right to take ice, therefore, as decided in this Rossmiller Case, was not based upon the idea of a right incident to the soil under the same, but because such was a public right incident to navigation upon the water highway in the broad sense of the term, and because such a right was not only to be free to the citizens of this state and of the United States as common highways forever, but, as should now be noted, it was to be such without any tax, impost, or duty therefor (sec. 1, art. IX, Const., supra), and this tax was to that extent in the nature of an embargo.

In the same case (p. 187) reference is made to the two cases of Priewe v. Wis. S. L. & I. Co. 93 Wis. 534, 67 N. W. 918, 103 Wis. 537, 548, 79 N. W. 780, as holding that the state has no such interest in the beds of navigable lakes that it can treat the same as a subject for bargain and sale or grant the same away to private owners under the guise of police power. These two cases, however, presented very substantially different situations than here, and there it was very properly held that the state cannot arbitrarily take away or destroy the rights of a riparian owner on a navigable lake without his consent and without compensation or due process of law and for any mere private purpose; and the facts in those cases show that what was attempted amounted to a virtual destruction of the entire body of water upon which the riparian owners had clearly established rights, and that it would have the effect of creating a nuisance, and was^ of no benefit financially or otherwise to the state but solely to private individuals. These prior decisions of this court, or any expressions therein, do not control in this case under the rule of stare decisis.

Neither does the fact that such title in the lands submerged by such public waters may by accretion or reliction slowly pass from the state to the riparian owner, change the rule here, for this is an independent rule as to property, arising only when physical changes have been made by natural causes. Such other rule was recognized without question in Hathaway v. Milwaukee, 132 Wis. 249, 111 N. W. 570, 112 N. W. 455, to which suit, however, the state was not a party, involving apportionment to riparian owners of the large accretions caused by the breakwater in Lake Michigan at the north end of Milwaukee harbor.

Apparently in England the Crown claims the right to mines and minerals under the sea in channels and rivers subject to tidal flow and out the three miles of general international delimiting of the high seas, but there seem to be serious questions even to the present time on just what the rule is, although an act of Parliament granted rights under the sea for mining off the shores of .Cornwall. 28 Halsbury, Laws of England, p. 360, par. 653. Many disputes have there arisen as to respective rights by grants, prescription, etc., for the taking of stones, sand, gravel, sea.weed, etc., from the shores.

In the few cases cited or found in this country where any one of our sister states, asserting title as owner of the bed of, or soil under, navigable water, has undertaken to sell or dispose of such submerged land or valuable products thereon or thereunder, it has been held a proper exercise of such so-called private state ownership to the bed, as distinguishable from the title held in trust for the people at large in the navigable waters themselves; among such are phosphate deposits in South Carolina, Coosaw M. Co. v. South Carolina, 144 U. S. 550, 12 Sup. Ct. 689; sand and gravel, in Union S. & M. Co. v. State, 127 Ark. 456, 192 S. W. 380, and prior Arkansas cases there cited; phosphate, in State v. Black River P. Co. 32 Fla. 82, 13 South. 640; sand, in Wear v. Kansas, 245 U. S. 154, 38 Sup. Ct. 55, affirming State ex rel. Dawson v. Akers, 92 Kan. 169, 140 Pac. 637.

In 1913 Michigan provided that all unpatented overflowed lands and lake bottom lands belonging to the state should be leased and controlled by their state board of control. Several thousand acres of the bed of Lake St. Clair, by reason of the reliction of the waters, became suitable for cottages and small homes; the state made a park of a portion thereof and divided the balance into lots, which were leased and occupied by many persons for summer cottages. It was held in Nedtweg v. Wallace, 237 Mich. 14, 208 N. W. 51, 211 N. W. 647, that such could be done, although Michigan seems committed to the doctrine that there are the same riparian rights to the center in the lakes, except the Great Lakes, as there is to the thread of the rivers. Sewers v. Hacklander, 219 Mich. 143, 188 N. W. 547; Collins v. Gerhardt, 237 Mich. 38, 211 N. W. 115. In U. S. v. Holt State Bank, 270 U. S. 49, 52, 46 Sup. Ct. 197, supra, Minnesota authorized the drainage of a lake and thereafter sold the lands so uncovered, and such action was upheld.

The control over the oyster beds in tide waters has always been recognized’ as in the state bordering the tide waters rather than in the federal government or any private riparian owners. Martin v. Waddell, 16 Pet. (41 U. S.) 367; Louisiana v. Mississippi, 202 U. S. 1, 26 Sup. Ct. 408, which was a contest because of legislation, evidently conceded to be within the power of the respective states, concerning'the fishing of oysters in the Gulf of Mexico, and where threatened resort to bloodshed to settle the dispute by armed bands in each state was averted by that resort to the court. McCready v. Virginia, 94 U. S. 391, 396, upheld the right of Virginia to exclude all but her citizens from the privilege of oyster fishing; and Lewis B. P. O. C. Co. v. Briggs, 229 U. S. 82, 86, 33 Sup. Ct. 679, is in point. The same doctrine was declared as to sponges found in tide waters and that Congress had no power to legislate thereon, in The Abby Dodge, 223 U. S. 166, 175, 32 Sup. Ct. 310.

Although New York apparently declines to follow the doctrine that the state as sovereign takes the jus privatum of the sovereign at common law as distinct from the jus publicum, Appleby v. New York City, 235 N. Y. 351, 363, 139 N. E. 474 (affirmed, 271 U. S. 364, 46 Sup. Ct. 569), yet grants to towns by charters in colonial days of submerged tide-water lands have been sustained as against the state itself and others. Tiffany v. Oyster Bay, 209 N. Y. 1, 102 N. E. 585; Same v. Same, 234 N. Y. 15, 136 N. E. 224, 24 A. L. R. 1267.

We are of the opinion, and so hold, that ch. 410, Laws of 1923, creating sec. 31.02 (5), Stats., was within the power of the legislature to enact, and that no rights of the plaintiffs under the federal or state constitutions are invaded by such an act, when carried out as we declared in the beginning of this opinion.

Although no mention is made in this statute of the rights of riparian owners, as such, to such navigable waters, yet of course the presumption is that the legislature did not intend to give thereby, leave or license to persons acting thereunder to invade or injure the rights and privileges of riparian owners on such navigable waters, or to take away from such owners or others injured in the carrying on of such work the usual remedies for wrongs. Neither do we now determine whether any arrangement made with the Commission under this law would relieve a party thereto from the necessity of obtaining the consent of local authority or from being subject to the penalties prescribed in sec. 348.42, Stats., prohibiting, to other than riparian owners, the taking of sand, gravel, clay, or other substances from navigable waters in this state without prior consent of the local authorities.

Neither is there here presented the question as to the rights of riparian owners on rivers to so remove material from such navigable waters.

By the Court. — Judgment reversed.

Case Details

Case Name: Angelo v. Railroad Commission

Court Name: Wisconsin Supreme Court

Date Published: Jan 10, 1928

Citation: 217 N.W. 570

Court Abbreviation: Wis.