
    THE UNION PACIFIC RAILROAD CASE.
    The Union Pacific Railroad Company v. The United States.
    
      On the Proofs.
    
    
      The Pacific Railroad Acts qiroride that as every section of twenty miles is “completed” by a company and accepted by the President, the Government shall loan its bonds to the amount of ¡¡¡16,000 a mile, and issue patents for certain public lands granted as a subsidy. The bonds are to constitute a second mortgage on the roads. From the time a road is “ completed” five per centum of its “net earnings” is to be annually applied toward their payment. When the last section of the claimants’ road is built bonds are-issued, but patents for the lands are withheld. The claimants now bring their action for freight moneys due them. The defendants seelc to recover by way of counter-claim the five per centum of net earnings. The principal questions in the case are when was theroad “completed” and what constitute “net earnings.”
    I.It was not tli© purpose of tlic Pacific Railroad Act, 1864 (13 Stat. L., 358, § 10) to postpone the payment of the “five per centum of the net earnings ” of the roads until the first-mortgage debt of the companies should ho paid.
    II.The legal obligation of the companies to pay the five per centum of their net earnings was not snsiionded when the priority of the Government’s lien np on the roads was subordinated by the Act of1864, hut remains in full effect as between the Government and the companies, though it may ho otherwise as between the first mortgagees and the Government.
    III."When the fact of completion of a twenty-mile section of a road was ascertained and declared in the way prescribed bylaw, the fact must ho regarded as finally settled. It could not he changed by the Executive, and cannot he re-examined by the judiciary.
    
      IV. There was hut one completion of abroad within the contemplation of the statutes, and that was when the last section was completed hy a. company and accepted hy the President in the manner proscribed hy law.
    V. When the last section of a road was “ completed and equipped" within the meaning4 of section 4 of the Act of 18G4, the entire road was “ completed" within the meaning- of section 6, so as to entitle the Government to have the “five pier centum of the net earnings” of the road annually applied from that time to the payment of the bonds loaned to the company.
    VI. The claimants, having demanded and received Government bonds and lands on the representation that each section of the road was “completed and equipped in all respects as required” by the statute, are estopped from denying the fact of the completion of the entire road.
    VII. In determining’ what are the “net earnings” of the Pacific Railroads, the interest paid on the first-mortgage bonds issued for the construction of the road cannot be deducted from the gross earnings as a part of flic expense of operating- the road.
    VIII. The expenditures of the Pacific Railroads in regard to lands received from the Government but not connected with the business of the roads cannot be deducted from the gross earnings in the ascertainment of the “net earnings.”
    
    IX. Interest cannot bo recovered by the Government on the “fixe per centum of the net earnings” of the Pacific Railroads, which, by the terms of the statute, are to be “annually applied lo the payment” of the bonds loaned to the companies.
    
      The Reporten? statement of tlie case :
    In this case the claimants brought their action to recover one-half of the freight moneys due for transportation of the mails, military supplies, &c., of the G-overumeut. As to this there was no dispute. The controversy was entirely in regard to the Government’s counter-claim to recover the five per centum of the net earnings of the road from the time of its completion. On the part of the Government, it was insisted that the whole road was completed when the last section was completed and. the company received the last of the Govenment loan of its bonds, November 6, 1SC9; on the part of the company, it ivas contended that the road was not completed till certain deficiencies had been made good, and patents for public lands, until then withhold by the Government, were issued October 1,1874. As to what constituted “net earnings,” a number of questions arose, such as whether the company might deduct the interest paid on its bonded debt from its gross earnings. But the entire controversy depended upon the construction to be give to the following three lines of the statute (Act 1862, § 0): “And after said road is completed, until said bonds and interest are paid, at least five per centum of the net earnings of said road shall also bo annually applied to the .payment thereof.”
    The following are the facts of the case as found by the court:
    I. The claimant is the company incorporated by the Act of July 1862, “to aid in the construction of a railroad and telegraph line from the Missouri River to the Pacific Ocean, and to secure to the Government the use of the same for postal, military, and other purposes ”; and constructed -the railroad and telegraph line from Omaha, Nebr., westward 1,038-¡%S0 miles to its point of junction with the Central Pacific Railroad.
    II. On the 8th of September, 1865, the Secretary of the Interior invited a board to convene in Washington, for the purpose of adopting some uniform'standard of road to which the several companies organized under said act and the Act of July 2, 1864, amendatory thereof (13 Stat. L, 356) should conform. This board convened in Washington .on the 1st of February, 1866, and submitted to the said Secretary a journal of their proceedings, in which was embodied a report adopted by the board in regard to the construction of the road; and on the 24th of said month the said Secretary approved those proceedings, in a letter addressed to the chairman of the board, ifi the following terms: “ The results arrived at by the board, as embodied in the report it has adopted in regard to -the construction of the road, are approved, and it is hereby directed that said report be used by the directors and commissioners as a guide for their action in directing or accepting the work. To this end you will cause copies to be furnished those officers as soon as printed.”
    The report referred to in this letter as having been adopted •by said board, in regard to the construction of the road, was as follows:
    “ Your committee, to whom w^ere referred various communications of experienced and scientific engineers concerning a suitable standard for the work on the Pacific Railroad and its several branches, and to whom was also assigned the duty of presenting to the board proper subjects for its consideration, as contemplated by the call of the honorable the Secretary of the Interior, harm the honor to present the following report:
    
      “The various locations through which the Pacific Eailroad aud its branches are destined to run occupy such a variety of country as to render a specific style of work suited to all localities extremely difficult. The topographical features of the surface, the great variety of soils and lower strata of the earth, the singular variety of climate as to cold and heat, wet and dry, all have to be considered in determining details of location, material, and form of the work. It was probably because of these difficulties the laws of Congress authorizing the construction give only general or very meager specifications as to the details of the Pacific Eailroad.
    “But your committee, after availing themselves of the views expressed by the several engineers to which they have referred, and in contemplation of the reasonable construction of the law of Congress, recommend to the board the adoption of the following general rules, as those which should govern all parties engaged in directing, constructing, or accepting the work:
    « Every step taken in the work, and especially in the location of lines and grades, should be adapted to ultimate perfection, whatever may be immediate interests or necessities, so as to secure to the nation a grand and complete structure, every way worthy of our country, and honorable to the distinguished men who involve their capital and energies in so vast an enterprise.
    
      “Location. — Great care should be observed in the determination of the general and detailed location of the main line and branches, •so as to secure the shortest lines consistent with economical grades to the most desirable passes of the mountain ranges. The law names but few points; still, it is clearly the interest ■of the Government, and not prejudicial to the companies, to determine such points as a gr.eat general line shoxdd have, so as to unite, as far as possible, all the great ultimate juirposes of a central and convenient channel for the commerce of nations that is likely to traverse the road.
    
      “ With this general view of the work, careful and extended surveys should be made and well considered.
    “ Grades and curves. — While the law makes the grades and curves adopted on the Baltimore and Ohio Eailroad a standard, fins is oiity to be considered as a limit to be adopted in mountain districts. To introduce grades of 116 feet per mile, or curves as sharp as 400 feet radius, on other parts of the road, would manifestly violate the spirit and intent of the law. Grades and curves should be settled upon principles of true economy and adaptation, based upon careful scientific and practical investigations, having due regard both to cost of construction and future working of the road.
    
      “ It is safe to say, in advance, that on the Platte and Kansas Talleys, and on similar smooth valleys or level plains, no grade should exceed thirty feet elevation i>er mile.
    
      “ 'Embankments and excavations. — In allparts of tbe main line of road or brandies, embankments should not be less than fourteen feet wide at tbe grade line. Excavations, if tbe cuts are lengthy, should be twenty-six feet wide, and in shorter cuts at least twenty-four feet; thus leaving in all cases room for continuous side ditches of ample depth and width, so as to secure that most essential requisite, a well-drained road-bed. Eock excavations should be not less than sixteen'feet wide, and all tunnels should be excavated for a double track. Slopes of earth embankments should be one and a half base to one rise. Excavations, except in rock, should have slopes from one to one and a half base to one rise, depending upon the material; or if steeper, then to have increased width at grade, so as to remove the same quantity of earth contained within the slopes.
    “ Mechanical structures. — Culverts and abutments for bridges and drains should be of stone, whenever a durable article can be obtained within a reasonable .distance — say from five to eight miles, depending upon circumstances; provided, that temporary trestles may be adopted upon assurances, to the satisfaction of tlie“ commissioners, that stone- abutments will be substituted immediately after the line shall be opened, so that stone can be transported thereon. But if good stone be too remote, then hard-burned brick or wooden trestle-work may be adopted. The wood to be of the most durable character the country will afford; and the wood or brick to be replaced by stone, when that material can be conveyed’conveniently by rail. Bridges of stone or iron or wood (such as the Howe truss, or other equally good structure) should be used, at the discretion of the company.
    
      “Ballasting. — A railroad cannot be considered complete until it is well ballasted. If composed of gravel or broken stone, it should be from 12 to 24 inches thick, depending on the lower material. In view of the settling of new embankments, which require time and rains before ballasting can be properly placed, and also in view of the number of miles required by the law to be constructed annually, the perfect finish of the road-bed in this respect must be progressive and the work of time. Yet it is the opinion of the board that such work of perfecting the ballast must proceed as usual on first-class railroads; otherwise subsequent sections should not be accepted, because the whole work is not then being carried forward as a great Pacific Bail-road, such as the law contemplates.
    “ Gross-ties. — Oak or other suitable timber should be used, where it can be obtained with reasonable transportation. When such timber cannot be had for all the ties at reasonable cost, then the best the country affords may be adopted; but if it be cottonwood, or similar-soft material, it must be bmnettized or kyanized thoroughly, so as to increase its durability. But in all cases the joint tie should be of oak or other suitable timber, the better to hold the spikes at these points. There should be at least 2,400 ties to the mile. They should be eight feet long-, sis inches thick, and., if hewn, six inches on the face. If sawed, they should not be less than eight inches wide, and not less than 2,400 per mile, or such number as will have the same bearing surface; provided, that if any sawed ties have been already delivered or contracted for only seven inches wide, they may be laid down.
    
      uBails. — These are to be of American iron, as required by law, of the best quality, and should weigh sixty pounds to the yard. But in consideration of the great cost of transportation from the present location of rolling-mills to the remote sections of this road, iron may be adopted which weighs only fifty-six pounds to the yard. In mountain districts, however, where heavier engines will be used, not less than sixty-pound rails should be adopted; provided, that if any of the companies have on hand, or in transitu, or contracted for, any rails of different weight from that herein specified, and not under fifty pounds per yard, such rails may be used. The rails should be attached to each tie by spikes driven on both sides of the rail. As the nearest approximation to a continuous rail, the so called fish-joint is preferred and recommended; but if found that it will retard the progress of the work, the common American wrought-iron chair may be used.
    
      “Sidings. — The length of side tracks should be at least six per cent, of the line completed, to be increased as the number of passing trains shall demand. Side tracks should also be laid eight feet apart in the clear between the rails. Wherever cattle-guards and road-crossings, are necessary, they should be made.
    
      “Rolling-stock. — Locomotive engines and cars must be provided in liberal proportion to the traffic and the convenient construction, to be increased from time to time as the completion of additional sections and the increase of business seem to require.
    
      " Buildings. — Engine-houses, repair-shops, and station buildings should be adapted to the wants of the service.
    “At the opening of business, the extent and capacity of buildings may be only such as to provide liberally for the existing rolling-stock and the business of the road, and such probable early increase as may seem likely; yet the plans in all cases, both as to the buildings and grounds, should be arranged for prospective enlargements and extensions equal to any future business of the road, the buildings at first erected forming appropriate parts of a complete and systematic whole.
    “Engine-houses and repair-shops at the principal stations must in all cases be of stone or brick, with good stone foundations. The covering should be slate or metallic, to guard as far as possible against fire.
    “Water-stations should be erected at convenient distances, to suit the wants of the trains.
    
      “ Extensive and convenient locations of ground should be pro■cured to accommodate a future large business, and the proper titles should be carefully secured. All this is the more desirable, as lands are now easily obtained at moderate prices.
    “In these specifications, it is believed that nothing; is required which may not be regarded as essential to a commodious and ■complete railroad. Nothing is proposed to retard the progress of the companies. The importance and public desire for accel■erated movement have been fully appreciated, and the board earnestly desires to favor and foster the energy and fidelity which now seem to animate those engaged in the construction. But while guarding against delay on the one hand, the public interests require, on the other, a substantial and complete work, and the highest perfection of track reasonably attainable on a new road is expected and projected as the standard to which the workman are to arrive. The argument in favor of speedy construction must be subordinate to the substantial objects of the road, and the Government must be certain to have a work that will convey her mails, troops, and munitions of war, and commerce of the country with entire certainty, celerity, and convenience. It is the aim of this board to secure all these objects, and it is also our belief that they are-not incompatible, it being-only necessary, on the part of the Government, to insist upon the reasonable requirements embodied in this report, to hasten the completion of the great work, and at the same time to .adapt it to the high public interest which it is intended to sub-serve.”
    III. Pursuant to said section 4 of said Act of July 1,1862, the president of the Union Pacific Eailroad Company, from time to time as the construction of said railroad progressed, made affidavits to the effect that successive sections of the road from •Omaha westward had been completed and equipped in all respects as required by the act referred to ; the first and last of which affidavits are in this third finding set forth in full, with the date at which each was sworn to annexed thereto, as follows, to wit:
    “No. 1.
    “ John A. Dix, being duly sworn, deposeth and saith, that he is president of the Union Pacific Eailroad Company, and in pursuance of the requirements of section 4 of the Act of Congress approved July 1,1862, entitled “An act to aid in the construction of the railroad and telegraph line from the Missouri Biver to the Pacific Ocean,” etc., he now states, under oath, that one hundred and five consecutive miles of said railroad, beginning at Omaha and ending at a point one hundred and five miles westward thereof, on the line designated by the maps of said ■company on file in the Department of the Interior, having [have?] been, completed and equipped in all respects as required by tbe act referred to, as be is informed by tbe engineer charged with tbe construction of said line, and as be verily believes to be true; and be further states, under oath, that one hundred and five miles of telegraph have been completed for tbe said one hundred and five consecutive miles, as be is also advised by the engineer in charge.
    “JOHN A. DIX, President.
    
    “ Sworn to June 25, 1806.”
    “No. 35.
    “ Oliver Ames, being duly sworn, deposeth and saith that he is president of the Union Pacific Railroad, and in pursuance of the requirements of section 4 of the Act of Congress approved July 1, 1802, entitled “An act to aid in the construction of a railroad and telegraph line from the Missouri River to the Pacific Ocean,” &c., he now states, under oath, that another section of 86 miles, commencing at 1,000 mile and ending at 1,086 milepost, was completed on the 10th day of May, 1869, making in all 1,086 consecutive miles of said road, beginning at the initial point on section 10, opposite western boundary of the State of Iowa, as fixed by the President of the United States, and ending at a point 1,086 miles westward therefrom on the line designated by the maps of said company on file in the Department of the Interior, that have been completed and equipped in all respects as required by the act referred to, as he is informed by the engineer charged with the construction of said line, and as he verily believes to be true. And he further states, under oath, that 1,086 miles of telegraph have been completed for the said 1,086 consecutive miles, as he is also advised by the engineer in charge.
    “OLIVER AMES,
    
      “President Union Pacific Railroad Company.
    
    “ Sworn to May 13, 1869.”
    IV. On the 23d of December, 1865, the President of the United States, under the authority of section 4 of the said Act of July 1, 1862, appointed commissioners to examine and report upon the first section of 40 miles of said'road-, and sometime prior tO' April 30, 1866, he appointed other commissioners to examine and report upon the second section of 25 miles of said road ,• and after the making of each of the foregoing affidavits he appointed other commissioners to examine the sections of the road as. successively completed and report to him in relation thereto. The reports of the commissioners so appointed were ifiade in the-first instance to the Secretary of the Interior, who transmitted them to tbe President, wbo approved tbe recommendations of tbe Secretaiy of tbe Interior by writing bis approval tbereon. Tbe following are tbe several letters of tbe said Secretary, with tbe President’s indorsements tbereon, and tbe report of commissioners of September 1,1866, on which was written the President’s approval:
    “ DEPARTMENT OE THE INTERIOR,
    “Washington, J). C., January 24, 1866.
    “ Sir : I have tbe honor to submit herewith inclosed, for your action, tbe report of the commissioners appointed by you on tbe 23d December, 1865, to examine the first section of forty miles of tbe Dnion Pacific Kailroad, extending west from tbe city of Omaha, Territory of Nebraska. The company authorized to build this road having, as shown in tbe report of tbe commissioners, obligated itself to remedy, within a reasonable time, tbe deficiencies in tbe construction of said section, I respectfully recommend that tbe same be accepted, and proper steps be ordered for the issue of tbe bonds and land-grants due tbe company agreeably to law.
    “ I am, sir, with much respect, your obedient servant,
    “TAS. HABLAN,
    “ Secretary.
    
    “ Tbe PRESIDENT.”
    “Executive Mansion, January 24,1866.
    “ Tbe within recommendations of the Secretary of tbe Interior are approved, and the Secretary of the Treasury and himself directed to cany tbe same into effect.
    “ANDBEW JOHNSON.”
    “ Department oe the Interior,
    
      " Washington, D. G., April 30, 1866.
    “ Sir : I have tbe honor to submit herewith for your action the, report of tbe commissioners, Lieut. Col. J. H. Simpson, Maj. Gen. Samuel B. Curtis, and Hon. Wm. M. White, appointed by you to examine and report upon tbe second section of twenty-five miles of tbe Dnion Pacific Bailroad,' commencing at the fortieth and terminating at the sixty-fifth mile station west from the initial on the Missouri Biver, near Omaha.
    Tbe commissioners report tbe alignment, and grades excellent, tbe excavations and embankments of ample width except at two or three points of bmited extent, the drainage good, and in view of tbe annexed assurance of tbe company that they will duly remedy the defects of width of embankment and ballasting-pointed out in tbe report, tbe commissioners recommend the acceptance of tbe section as supplied with all tbe necessary drains, culverts, viaducts, crossings, sidings, bridges, turn-outs, watering-places, depots, equipments, furniture, and all otlier appurtenances of a first-class railroad.
    I respectfully concur in the recommendations by the commissioners of the acceptance of the said second section of twenty-five miles of the road.
    “ I am, sir, witli great- respect, your obedient servant,
    ‘•JAS. HABLAN,
    “ Secretary.
    
    “ To the PRESIDENT OE TI-IE 17. S.”
    “Executive Mansion, May 1st, 1866.
    “ The within recommendations of the Secretary of the Interior ■are approved, and the Secretary of the Treasury and himself .are hereby directed to carry the same into effect.
    “ANDBEW JOHNSON.”
    “Department oe ti-ie Interior,
    “ Washington 1). 0., June 25th, 1866.
    “ Sir : I have the honor to submit herewith, for your action, the report of the commissioners, Brevet Brig. General J. H. •Simpson, H. S. A., Hon. Wm. M. White, and Hon. Wm. P. Smith, appointed by you to examine and report upon the third section ■of forty miles of the Union Pacific Bailroad, commencing at the sixty-fifth and terminating at the one hundred and fifth mile-post west from the initial point on the Missouri Biver, at Omaha. •
    “ The commissioners, in their report, point out some slight defects in the section examined, but since they are such as are unavoidable in work progressing so rapidly, and in mew of the recommendations of the commissioners, and the fact that the ■company have in good faith fulfilled the obligations which were imposed upon them as conditions of acceptance of previous sections, and have already commenced to correct some of the -defects alluded to in this report, I respectfully recommend the acceptance of the said section of forty miles.
    “I am, sir, with great respect, your obedient servant,
    “JAS. HABLAN,
    “ Secretary.
    
    “The President oe the U. S.”
    “ Executive Mansion, June 25, 1866.
    “ The within recommendations of the Secretary of the Interior .are approved, and the Secretary of the Treasury and himself are hereby directed to carry the same into effect-.
    “ANDBEW JOHNSON,
    
      “Pres. Ú. S.v
    
    
      “Department oe the Interior,
    “Washington, D. G., July 12, I860.
    “ Sir : I have tbe lionor to submit herewith, for your action, tlie report of the commissioners, Brevet Brig. Gen’l J. H. Simpson, TT..S. A., Hon. Wm. M. White, and Hon. Wm. Prescott Smith, appointed by you to examine and report upon the fourth section of twenty miles of the Union Pacific Bailroad, commencing at the 105th and terminating at the 125th mile-post from the initial point on the Missouri Biver, at Omaha.
    “ In. view of the character of said section and the fact that no special defects are pointed out in the report thereon, I respectfully recommend the acceptance of said section of twenty miles.
    “ I am, sir, with great respect, your obedient servant,
    “JAS. HABLAN,
    “ Secretary.
    
    “The President oe the U. S,”
    “ Executive 1 Mansion, July 32,1800.
    “The within recommendations of the Secretary of the Interior are approved, and the Secretary of the Treasury and himself are hereby directed to carry the same into effect.
    “ANDBEW JOHNSON,
    
      “JPresident of the Ú. 8.”
    
    
      ■ “ Department oe the Interior,
    “ Washington, D. G., Augxist 8,1806.
    “ Sir : I have the honor to submit herewith, for your action, the report, dated 1st instant, of the commissioners, Brevet Brig. Gen. J. H. Simpson, U. S. A., Hon. Wm. M. White, and Hon. Win. Prescott Smith, appointed by you to examine and report upon the fifth section of thirty-five miles of the Union Pacific Bailroad, commencing at the 125th and terminating at the 160th mile-post Bom the initial point on the Missouri Biver, at Omaha.
    “ In mew of the good general character of the work done on the section, the slight defects pointed out in the report of the commissioners, and the good faith with which the company have heretofore remedied existing deficiencies on the previous section before presenting a subsequent section for examination, and with the understanding that said defects are to be remedied before the next section shall bo presented for examination, I respectfully recommend the acceptance of the said fifth section of thirty-five müés, and that the Secretary of the Treasury be instructed to issue thé bonds due, agreeably to Iuav, on account of said section.
    “Iam, sir, with great respect, your obedient servant,
    “JAS. HABLAN,
    
      “Secretary.
    
    “To the President oe the U. S.”
    
      “ Executive Mansion, August 8,1866.
    “ Tbe within recommendations of the Secretary of the Interior are approved, and the Secretary of the Treasury and himself are hereby directed to carry the same into effect.
    “ANDREW JOHNSON,
    
      “President of the U. S.”
    
    “Osiaha, Nebraska Territory,
    
      uiSeptember 1, 1866.
    “ Hon. O. H. Browning-,
    “ Secretary of the Interior, Washington,!). G.:
    
    “ Sir : The undersigned commissioners, agreeably to the instructions of the Department of the Interior, dated 22d ultimo, have examined the 6th section of the Union Pacific Railroad, of 45 miles, commencing at the 160th and terminating at the 205th mile-post west from the initial point on the Missouri River, at Omaha, and respectfully submit the following report:
    
      
    
    
      “ Sidings at stations, aggregate.•. 6, 000 feet.
    “ between stations, aggregate. 800 “
    
      “ additional, constructed at Omaha. 13,000 “
    
      “ Weight of iron, 50 pounds to the linear yard.
    “ “ chairs, same as in previous reports.
    “Number of ties in main line (f hard, f soft), 110,340, or 2,452 to the mile.
    “Number of ties on the sidings given above, 9,187, or 2,448 to the mile.
    “ Width of embankments and cuts at grade as in previous reports.
    “ Bridges.- — -Nine of 1 span each of 10 feet; 6 of 2 span each of 10 feet, trestle piers; 1 of 2 span each of 14 feet, trestle piers; 1 of 3 span each of 16 feet, trestle piers; 1 of 6 span each of 16 feet, trestle piers 5 1 of 1 span each of 100 feet, Howe truss.
    “ Water-tanks. — One at Wood Biver Station; one at Kearney Station.
    “ Turn-tables. — One at Kearney Station, temporary.
    “ Station-houses. — Passenger and freight house at Wood Biver and Kearney Station.
    
      “Rolling-stock on entire road.- — Fifteen engines, 127.flat-cars, 46 box-cars, 5 passenger-cars, 2 baggage-cars, 30 hand-cars.
    “A telegraphic line has been built along the section, connecting with the fines east of the Missouri Biver.
    “Tom’-commissioners And the alignment, curves, grades, embankments, cuts, and ditches unexceptionable, the ties 8 feet long, 8 inches thick, and, if sawed, 6 inches face, if hewn, 8 inches; the bridge structures substantial, and the whole road in good running condition, enabling us to return at the rate of 38 miles per horn.
    “In conclusion, your commissioners respectfully report the whole road and telegraph line, including said 6th section of 45 miles, commencing at the 160th and terminating at the 205th mile station west of the initial point on the Missouri Biver, at Omaha, as ready for immediate service, and supplied with all necessary drains, culverts, viaducts, crossings, sidings, bridges, turn-outs, watering-places, depots, equipments, furniture, and all other appurtenances of a first-class railroad; the rails and all other iron used of American manufacture of the best quality; and do therefore recommend the acceptance of the said section of 45 miles, and the issue of the bonds and lands as contemplated by law. All of which is respectfully submitted.
    “J. I-I. SIMPSON,
    
      ‘‘Brevet Brig. Gen., U. S. A.,
    
    
      “ S. B. CUBTIS,
    “WM. M. WHITE,
    
      “Commissioners.
    
    “Approved:
    “Andkew JOHNSON, BresH
    
    
      • “ Department oe the Interior,
    
      “Washington, D. G., Oct. 12,1866.
    ■ “ Sir : 1 have tbe honor to submit herewith, for your action, the report, dated 2d inst., of the commissioners, Brevet Brig. General J. II. Simpson, IT. S. A., I-Ion. Samuel B. Curtis, and Hon. Wm. M. White, appointed by you to examine and report upon the seventh section of thirty-five miles of the Union Pacific Bailroad, commencing at the 205th and terminating at the 240th mile-post west from the initial point on the Missouri Biver, near Omaha.
    “The commissioners, in their report, representing the said 7th section of thirty-five miles ready for present service, and completed and equipped as a first-class railroad, I respectfully recommend the acceptance of the same and the issue of the bonds and patents for land due the company on account of said section, agreeably to law.
    “I am, sir, with great respect, your obedient servant.
    '“O. H. BBOWNING,
    
      “Secretary.
    
    “The President oe the U. S.”
    “ Executive Mansion, Oct. 12,1866.
    “ The within recommendations of the Secretary of the Interior are approved, and the Secretary of the Treasury and himself are hereby directed to carry the same into effect.
    “ANDBEW JOHNSON,
    
      “Pres, of the U. 8.”
    
    ■ “ Department oe the Interior,
    “ Washington, JD. 0., JUTov. 6,1866.
    “ Sir : I have the honor to submit herewith, for your action, the report, dated to-day, of the commissioners, Brevet Brig. General J. H. Simpson, U. S. A., Hon. Samuel B. Curtis, and Hon. Wm. M. White, appointed by you to examine and report upon the eighth section of thirty miles of the Union Pacific Bail-road, commencing at the 240th and terminating at the 270th mile-post west from the initial point on the Missouri Biver, near Omaha, in the Territory of Nebraska.
    “The commissioners, in their report, representing the said eighth section of thirty miles ready for present service, and completed and equipped as a first-class railroad, I respectfully recommend the acceptance of the same and the issue of the bonds and patents for land due the company on account of said section, agreeably to law.
    “ I am, sir, with great respect, your obedient servant,
    “ G." H. BBOWNING,
    
      “Secretary.
    
    “The President oe the U. S.”
    
      “Executive Mansion, Nov. 6,1866.
    “ Tbe within recommendations of tbe Secretary of tbe Interior are approved, and tbe Secretary of tbe Treasury and bimself are hereby directed to carry tbe same into effect.
    “ANDEEW JOHNSON,
    
      “Pres. U. S.n
    
    
      “ Department qe the Interior,
    “Washington, I). O., Jaunty 2d, 1867.
    “Sir : I bave tbe honor to submit herewith, for your action, tbe report, dated December 25th, 1866, of tbe commissioners, Brevet Brig. General J. II Simpson, U. S. A., Hon. Samuel E. Curtis, and Hon Win. M. White, appointed by you to examine and report upon tbe ninth section of thirty-five miles of tbe Union Pacific Eailroad, commencing’ at tbe 270th and terminating at tbe 305th mile station west from the initial point on tbe Missouri Eiver, near Omaha, in tbe Territory of Nebraska.
    “Tbe commissioners, in their report, representing tbe said ninth section of thirty-five miles ready for present sendee, and completed and equipped as a first-class railroad, I respectfully recommend tbe acceptance of tbe same, and the issue of the. bonds and patents for land due tbe company on account of said section, agreeably to law.
    
      “ I am, sir, with great respect, your obedient servant,
    “U. H. BEOWNING,
    
      “Secretary.
    
    
      “ Tbe President oe the U. S.”
    “Executive Mansion, January 2,1867.
    “ Tbe within recommendations of tbe Secretary of tbe Interior are approved, and tbe Secretary of tbe Treasury and himself' are hereby directed to carry tbe same into effect.
    “ANDEEW JOHNSON,
    
      “Pres. U. S.”
    
    “DEPARTMENT OE THE INTERIOR,
    “ Washington, D. G., June 1th, 1867.
    “ Sir : I bave tbe honor to submit herewith, for your action,, tbe report, dated 30th ultimo, of tbe commissioners, Brevet Brig. General J. H. Simpson, U. S. A., Hon. Wm. M. White, and General Frank P. Blair, appointed by you to examine and report upon tbe tenth (10th) section of forty (40) miles of tbe road of tbe Union Pacific Eailroad Company, commencing at tbe 305th mile-post and terminating at tbe 345th mile-post west from tbe initial point on tbe Missouri Eiver, near Omaha, Nebraska.
    “Tbe commissioners, in their report, represent tbe said tenth section of forty miles ready for present service, and completed and equipped as a first-class railroad; and as tbe said company have paid to the said commissioners the per diem and mileage due them under the twenty-first section of the Act of Congress approved July 27, 1866, on account of their examination of this section of road, I therefore respectfully recommend the acceptance of the same, and the issue to said company of bonds and of patents for lands due on account of said section, agreeably to the Act approved July 1,1862, entitled “An act to aid in the construction of a railroad and telegraph line from the Missouri Biver to the Pacific Ocean,” &c., and the acts amendatory thereof.
    “I ain, sir, with great respect, your obedient servant,
    “W. T. OTTO,
    “ Acting Secretary.
    
    “'The President oe the United States.”
    “Executive Mansion, June 10, 1867.
    “The within recommmendations of the Acting Secretary of the Interior are approved, and the Secretary of the Treasury and himself are hereby directed to carry the same into effect.
    “ANDBEW JOHNSON,
    
      “Pres. U. S.”
    
    “Department oe the Interior,
    “ Washington, _D. G., July 5,1867.
    “Sir: I have the honor to submit herewith, for your action, the report, dated the 29th ultimo, of the commissioners, Brevet Brig. G-enerel J. H. Simpson, U. S. A., Hon. Win. M. White, and General Frank P. Blair, appointed by you to examine and report upon the eleventh (11th) section of forty (40) miles of the road of the Union Pacific Bailroad Company, commencing at the 345th and terminating at the 385th mile-post west from the initial point on the Missouri Biver, near Omaha, Nebraska.
    “The commissioners, in their report, represent the said eleventh section of forty miles ready for present service, and completed and equipped as a first-class railroad; and as the said company have paid to the said commissioners the per diem and mileage due them under the twenty-first section of the Act of Congress approved July 27, 1866, on account of their examination of this section of road, I therefore respectfully recommend the acceptance of the same, and the issue to said company of bonds and of patents for lands due on account of said section, agreeably to the Act approved July 1,1862, entitled “An act to aid in the construction of a railroad and telegraph line from the Missouri Biver to the Pacific Ocean,” &c., and the acts amenda-tory thereof.
    “I am, sir, with great respect, your obedient servant,
    “W. T. OTTO,
    “ Acting Secretary.
    
    “The President oe the United States.”
    
      “Executive Mansion, July 5,1867.
    “The within recommendations of the Acting Secretary of the . Interior are approved, and the Secretary of the Treasury and himself are hereby directed to carry the same into effect.
    “ANDEEW JOHNSON,
    “Pm. U. S.”
    
    '“Department oe the Interior,
    “ Washington, D. 0., Aug. 27,1867.
    “Sir: I have the honor to submit herewith, for your action, the report, dated the 14th instant, of the commissioners, Brevet Brig. General J. H. Simpson, U. S. Army, Hon. Wm. M. White, and General Frank P. Blair, appointed by you to examine and report upon the 12th section of thirty-five miles of the road and telegraph line of the Union Pacific Eailroad Company, commencing at the 386th and terminating at the 420th mile-post west from the initial point on the Missouri Eiver, near Omaha, Nebraska.
    “The commissioners, in their report, represent the said 12th section of thirty-five miles ready for present service, and com-' pleted and equipped as a first-class railroad, and that the telegraph line is completed for the same distance; and as the said company have paid to the said commissioners the per diem and mileage due them under the twenty-first section of the Act of Congress approved July 27, 1866, on account of their examination of this section of road and telegraph line, I therefore respectfully recommend the acceptance of the same, and the issue to said company of bonds and of patents for lands due on account of said section, agreeably to the Act approved July 1,1862, entitled ‘An act to aid in the construction of a railroad and telegraph line from the Missouri Eiver to the Pacific Ocean,’ &c., and the acts amendatory thereof.^
    
      1 ‘ The said commissioners report that' at tk e date of th eir examination the company had completed forty-five miles of the road and telegraph line, which they recommend be accepted. The commissioners had no authority to examine and report upon the ten additional miles of road, the instructions limiting the examination to thirty-five miles, and I cannot therefore recommend the acceptance of their report any further than the same was made in accordance with the instructions issued to the commissioners by this department.
    “I am, sir, with great respect, your obedient servant,
    “W. T. OTTO,
    
      “Acting Secretary.
    
    “The President oe the United States.”
    “Executive Mansion, August 27,1867.
    “The recommendation of the Acting Secretary of the Interior, that the thirty-five miles of road and telegraph line be accepted, and tbe bonds and patents for lands be issued tbereon, are-approved, and tbe Secretary of tbe Treasury and bimself are hereby directed to carry tbe same into effect.
    “ANDEEW JOHNSON.”
    “DEPARTMENT OE THE INTERIOR,
    “ Washington, D. G., Oct. 1, 1867.
    “ Sir : I bave tbe honor to submit herewith, for your action, tbe report, dated tbe 26th ultimo, of tbe commissioners, Brevet Brig. General J. H. Simpson, U. S. Army, Hon. Wm. M. White, and N. D. Buford, appointed by you to examine and report upon tbe thirteenth section of thirty-five miles of tbe road and telegraph line of tbe Union Pacific Eailroad Company, commencing at tbe 420th and terminating at tbe 455th mile-post west from tbe initial point on tbe Missouri Eiver, near Omaha, Nebraska.
    “Tbe commissioners, in their report, represent tbe said thirteenth section of thirty-five miles ready for present service, and completed and equipped as a first-class railroad, and that tbe telegraph line is completed for tbe same distance; and as tbe said company bave paid to tbe said commissioners the per diem and mileage due them under tbe twenty-first section of tbe Act of Congress approved July 27,1866, on account of their examination of this section of road and telegraph line, I therefore respectfully recommend tbe acceptance of tbe same, and tbe issue to said company of bonds and of patents for lands due on account of said section, agreeably to tbe Act approved July 1, 1862, entitled ‘ An act to aid in tbe construction of a raüroad and telegraph line from tbe Missouri Eiver to tbe Pacific Ocean/ &c., and tbe acts amendatory thereof.
    “ I am, sir, with great respect, your obedient servant,
    “W. T. OTTO,
    
      "Acting Secretary.
    “ Tbe President oe the United States.”
    “Executive Mansion, October 1,1867.
    “Tbe within recommendations of tbe Acting Secretary of tbe Interior are approved, and tbe Secretary of tbe Treasury and bimself are hereby directed to carry tbe same into effect.
    “ANDEEW JOHNSON.”
    “Department oe the Interior,
    “ Washington, JD. O'., November 4,1867.
    “ Sir : I bave tbe honor to transmit herewith, for your action, tbe report, dated tbe 29th ultimo, of tbe commissioners, Messrs. Wm. M. White, Napoleon B. Buford, and John B. Drake, appointed by you to examine and report upon tbe 14th section of thirty-five miles of tbe road and telegraph line of tbe Union Pacific Eailroad Company, commencing at the 455th and terminating at tbe 490th mile-post west from tbe initial point on tbe Missouri River, near Ornaba, Nebraska.
    “ Tbe commissioners, in tbeir .report,'represent tbe said fourteenth section of thirty-five miles ready for present service, and completed and equipped as a first-class railroad, and that tbe telegraph line is completed for tbe.same distance; and as tbe said company have paid to the said commissioners the per diem and mileage due them under tbe 21st section of tbe Act of Congress approved July 27, 1806, on account of tbeir examination of this section of road qnd telegraph bne,T therefore respectfully recommend tbe acceptance of tbe same, and tbe issue to said company of bonds and of patents , for ¡lands due on account of said section, agreeably to the Act approved July 1,1862, entitled ‘ An act to aid in the construction of a radroad and telegraph bne from the Missouri River to the, -Pacific Ocean,’ &c., and tbe acts amendatory thereof.
    “ I am, sir, very respectfully, your obedient servant,
    “o. :h. browning,
    “ Secretary.
    
    “The President.”
    “Executive MInsión, November 4,1867.
    “Tbe within recommendations of the'Secretary of tbe Interior are approved, and tbe Secretary of' the Treasury and himself are hereby directed to carry the samé into effect.
    
    “ANDREW" JOHNSON.”
    “DEPARTMENT OE'THE INTERIOR,
    “ Washington,;2).- (7., December 10,1867.
    “ Sir : I have tbe honor to transmit herewith, for your action, tbe report, dated tbe 6th instant, of the;commissioners, Messrs. Wfrn. M. White, Frank P. Blair,, and N. B. Buford, appointed by you to examine and report upon the 15tk section of twenty miles of tbe road and telegraph bne of tbe Union Pacific Railroad Company, commencing at tbe 490th and terminating at tbe 510th mile-post- west from tbe initial point On the Missouri River, near Omaha, Nebraska. . ;'
    “Tbe commissioners, in tbeir report, represent tbe said loth section of twenty miles ready for-present service, and completed and equipped as a first-class railroad; and that tbe telegraph bne is completed for tbe same distance '; and as tbe said company have paid to tbe said commissioners tbe per diem and mileage due them under tbe 21st.-Sqqtiqn-,of tbe Act of Congress approved July 27,1866, on account of tbeir examination of this section of road and telegraph line;, I.thetefore respectfully recommend tbe acceptance of tbe samé,,and" 'the issue to said company of bonds and of patents for lands due on account of said, section, agreeably to tbe Act approved July 1,_T862, entitled ‘An act to aid in tbe construction of a railroátt añil telegraph bne from tbe Missouri Eiver to the Pacific Ocean,’ &c., and tfie acts amenda-tory thereof.
    “I am, sir, with great respect, your obedient servant,
    “0. H. BEOWNING-,
    “ Secretary.
    
    “ The President.”
    “Executive Mansion, December 11,1867.
    “ The within recommendations of the Secretary of the Interior are approved, and the Secretary of the Treasury and himself are hereby directed to carry the same into effect.
    “ANDEEW JOHNSON.”
    “Department oe the Interior,
    “ Washington, D. 0., January 25,1868.
    “ Sir : I have the honor to transmit herewith, for your action, the report, dated the 21st instant, of the commissioners, Messrs. Wm. M. White, Frank P. Blair, and N. B. Buford, appointed by you to examine and report upon the 16th section of thirty miles of the road and telegraph line of the Union Pacific Eailroad Company, commencing at the 510th and terminating at the 540th mile-post west from the initial point on the Missouri Eiver, near Omaha, Nebraska.
    . “The commissioners, in their report, represented the said 16th section of thirty miles ready for present service, and completed and equipped as a first-class railroad, and that the telegraph line is completed for the same distance; and as the said company have paid to the said commissioners the per diemqand mileage due them under the 21st section of the Act of Congress approved July 27,1866, on account of their examination of this section of road and telegraph line, I therefore respectfully recommend the acceptance of the same, and the issue to said company of bonds and of patents for lands due on account of said section, agreeably to the Act approved July 1,1862, entitled iAn act to aid in the construction of a railroad and telegraph line from the Missouri Eiver to the Pacific Ocean,’ &c., and the acts amendatory thereof.
    “ I am, sir, with great respect, your obedient servant,
    “O. H. BEOWNING,
    “ Secretary.
    
    “ The President.”
    “Executive Mansion, January 25,1868.
    “ The within recommendations of the Secretary of the Interior are approved, and the Secretary of the Treasury and himself are hereby directed to carry the same into effect.
    “ANDEEW JOHNSON.”
    
      “DEPARTMENT OP THE INTERIOR,.
    • “ Washington, May 15, Í868.
    “ Sir : I bare tbe honor to transmit herewith, for your action, the report, dated the 4th instant, of the commissioners, Messrs. Wm. M. White, Frank P. Blair,, and ,N. B. Buford, appointed by you to examine and report upon the'17th section of twenty miles of the road and telegraph line of the Union Pacific Bail-road Company, commencing at.tlie c>40th and terminating at the 5.60th mile-post west from the initial ‘point on the Missouri Eiver, near Omaha, Nebraska.
    “ The commissioners, in their report] represent the said 17th section of twenty miles ready for present service, and completed and equipped as a first-class railroad; and that the telegraph line is completed for the same distance; and as the said company have paid to the said eommission’ers the per diem and mileage due them under the 21st’section of the Act of Congress approved July 27,1866, on account of their examination of this section of road and telegraph'line,'' I 'therefore respectfully recommend the acceptance of the same, and the issue to said company of bonds and of patents fob lands due on account of said section, agreeably to the Act approved July 1,1862, entitled ‘An act to aid in the construction of a railroad and telegraph line from the Missouri Eiver to the Pacific Ocean,’ &c., and the acts amendatory thereof. : 1
    “ I am, sir, with great respect, your obedient servant,
    “ O.-H. BBOWNING,
    “ Secretary.
    
    “ The President.”
    “Executive.Mansion, May 15,1868.
    “ The within recommendations of the Secretary of the Interior are approved, and the Secretary of the- Treasury and himself are hereby directed to carry the same.into effect.
    " “ANDBEW JOHNSON.”
    “Department óe. the Interior,
    “ Washington; D. G., May 16,1868.
    “ Sir : I have the honor to transmit herewith, for your action, the report, dated the 11th instant, of the commissioners, Messrs. Wm. 3VI. White, Frank P. Blair, and N. B. Buford, appointed by you to examine and report on the 18th section of twenty miles of the road and telegraph line of the Union Pacific Bail-road Company, commencing at thé'56'Otfi and terminating at the 580th mile-post west from the initial-point on the Missouri Eiver, near Omaha, Nebraska. ■ ' :
    The commissioners, in their report, represent the said 18th section of twenty miles ready for.present service, and completed and equipped as a first-class railroad, and that the telegraph line is completed for the same, distance; and as the said company have paid to tlie said commissioners the per diem and mileage due them under the 21st section of the Act of Congress approved July 27, 1866, on account of their examination of this section of road and telegraph line, I therefore respectfully recommend the acceptance of the same, and the issue to said company of bonds and patents for lands due on account of said section, agreeably to the Act approved July 1,1862, entitled An act to aid in the construction of a railroad and telegraph line from tbe Missouri River to the Pacific Ocean,’ &c., and the acts amenda-tory thereof.
    “ I am, sir, with great respect, your obedient servant,
    
      “O. H. BROWNING-,
    “ Secretary.
    
    “The President.”
    “ Executive Mansion, May 16,1868.
    “ The within recommendations of the Secretary of the Interior are approved, and the Secretary of the Treasur3r and himself are hereby directed to carry the same into effect.
    “ANDREW JOHNSON.”
    “DEPARTMENT OE THE INTERIOR,
    “ Washington, D. C., June 11, 1868.
    “ Sir : I have the honor to transmit herewith, for your action,the report, dated the fifth instant, of the commissioners, Messrs. Wm. M. White, Frank P. Blah, and N. B. Buford, appointed by you to examine and report on the 19th section of twenty miles of the road and telegraph line of the Union Pacific Railroad Company, commencing at the 580th and terminating at the 600th mile-post west from the initial point on the Missouri River, near Omaha, Nebraska.
    “ The commissioners, in their report, represent the said 19th section of twent,y miles ready for present service, and completed and equipped as a first-class railroad, and that the telegraph line is completed for the same distance: and as the said company have paid to the said commissioners the per diem and mileage due them under the 21st section of the Act of Congress approved July 27,1866, on account of their examination bf this section of road and telegraph line, I therefore respectfully recommend the acceptance of the same, and the issue to said company of bonds and patents for lands due on account of said section, agreeably to the Act approved July 1, 1862, entitled An act to aid in the construction of a railroad and telegraph line from the Missouri River to the Pacific Ocean,’ &c., and the acts amendatory thereof.
    “ I am, sir, with great respect, your obedient servant,
    “O. H. BROWNING,
    “ Secretary.
    
    “ The President.”
    
      “Executive Mansion, June 12,1808.
    “The within recommendations of the Secretary of the Interior are approved, and the Secretary of the. Treasury and himself .are hereby directed to carry the Sameinto effect.
    “ANDEEW JOHNSON.”
    “Department oe..the Interior,,
    “ Washington, D. G., June 15,1868. '
    Sir : I have the, honor to transmit herewith, for your action, the report, dated the ninth instant, of the commissioners, Messrs. Wm. M. White, Frank P. Blair, andN. B, Buford, appointed by you to examine and report on the 20th .section of twenty miles of the road and telegraph line of the Union Pacific Eailroad Company, commencing at the 600th and terminating at the 620th milepost west from the initial point on the Missouri Eiver, near Omaha, Nebraska.
    “ The commissioners, in their report, represent the said 20th section of twenty miles ready for present service, and completed and equipped as a first-class railroad, and that the telegraph line is completed for the same distance; and as the said company have paid to the said commissioners the per diem and mileage due them under the 21st section of the Act of Congress approved July 27,1866, on account of their examination of this section of road and telegraph line, I therefore respectfully recommend the acceptance of the same, and the issue to said company of bonds and of patents for lands due on accomnt of said section, agreeably to the Act approved July 1,1862, entitled ‘An act to aid in the construction of a railroad and telegraph line from the Missouri Eiver to the Pacific Ocean,’ &c., and the acts amenda-tory thereof.
    “I am, sir, with great respect, your obedient servant,
    ■ “O. H. BEOWNING,
    “ Secretary.
    
    “The President.”
    “Executive Mansion, June 16, 1868.
    “The within recommendations of the Secretary of the Interior are approved, and the Secretary of the. Treasury and himself .are hereby directed to carry the same into effect.
    “ANDEEW JOHNSON.”
    “Department or the Interior,
    “ Washington,-1). G., July 20,1868.
    “ Sir : I have the honor to transmit herewith, for your action, the report, dated the fourteenth instant] of the commissioners, Messrs. Wm. M. White, Frank P. Blair, and N. B. Buford, appointed by you to examine and report on the 21st section of twenty miles of the road and telegraph line of the Union Pacific Eailroad Company, commencing at the 620th and terminating at tbe. 640th mile-post west from the initial point on the Missouri River, near Omaha, Nebraska.
    “The commissioners, in their report, represént the said 21st section of twenty miles ready for present service, and completed and equipped as a first-class railroad, and that the telegraph line is completed for the same distance; and as the said company have paid to the said commissioners the per diem and mileage due them under the 21st section of the Act of Congress approved July 27,1866, on account of their examination of this section of road and telegraph line, I therefore respectfully recommend the acceptance of the same and the issue to said company of bonds and of patents for lands due on account of said section, agreeably to the Act approved July 1,1862, entitled An act to aid in the construction of a railroad and telegraph line from the Missouri River to the Pacific Ocean,’ &c., and the acts-amendatory thereof.
    “ I am, sir, with great respect, your obedient servant,
    “O. H. BROWNING-,
    “ Secretary.
    
    “The President.”
    “Executive Mansion, July 21,1868.
    “ The within recommendations of the Secretary of the Interior are approved, and the Secretary of the Treasury and himself are hereby directed to carry the same into effect.
    “ANDREW JOHNSON.”
    “DEPARTMENT OE THE INTERIOR,
    “ Washington, D. G., July 23, 1868.
    “ Sir : I have the honor to transmit herewith, for your action,, the reports, dated the sixteenth and eighteenth inst., of the commissioners, Messrs. W. M. White, F. P. Blair, and N. B. Buford, appointed by you to examine and report on the 22d and 23d sections of twenty miles each of the road and telegraph line of the Union Pacific Railroad Company, commencing at the 640th and terminating at the 680th mile-post west of the initial point on the Missouri River, near Omaha, Nebraska.
    “ The commissioners, in their reports, represent the said sections of forty miles ready for present service, and completed and equipped as a first-class railroad, and that the telegraph line is completed for the same distance; and as the said company have paid to the said commissioners the per diem and mileage due them under the 21st section of the Act of Congress approved July 27,1866, on account of their examination of these sections of road and telegraph line, I therefore respectfully recommend the acceptance of the same, and the issue to said company of bonds • and of patents for lands due on account of said sections, agreeably to the Act approved Jidy 1, 1862, entitled An act to aid in the construction oí a railroad and telegraph line from the Missouri Eiver to the Pacific Ocean,’ &c., and the acts amendatory thereof.
    “ I am, sir, with great respect, your obedient servant,
    “O. H.'BEOWNING-,
    “ Secretary.
    
    “The President.”
    “Executive Mansion, July 23,1868.
    “ The within recommendations of the Secretary of the Interior are approved, and the Secretary of the Treasury and' himself are hereby directed to cany the same into effect.
    “ANDEEW JOHNSON.”
    “Department op'the Interior,
    
      “Washington, D. G., Atigust 8,1868.
    “ Sir : I have the honor to transmit herewith, for your action, the report, dated the twenty-ninth ultimó, of the commissioners, Messrs. Wm. M. White, Frank P. Blair, and N. B. Buford, appointed by you to examine and report on the 24th section of twenty miles of the road and telegraph-line of the Union Pacific Eailroad Company, commencing at the 680th and terminating at the 700th mile-post west of the initial point on the Missouri Eiver, near Omaha, Nebraska.
    “The commissioners, in their report, represent the said section of twenty miles ready for present service, and completed and equipped as a first-class railroad, and that the telegraph line is completed for the same distance; ■ and as the said company have paid to the said commissioners the per diem and mileage due them under the 21st section of the Act of Congress approved July 27,1866, on account of their' examination of this section of road and telegraph line, I therefore , respectfully recommend the acceptance of the same, and the issue to. said company of bonds and of patents for lands due on account, of said section, agreeably to the Act approved July 1,1862, entitled ‘An act to aid in the construction of a railroad ancl telegraph line from the Missouri Eiver to the Pacific Ocean,’ &c., and the acts amend-atory thereof.
    “I am, sir, with great respect, your obedient servant,
    ' “O. H. BEOWNING-,
    “Secretary.
    “The President.”
    “Executive Mansion, August 8,1868.
    “The within recommendations of the Secretary of the Interior are approved, and the Secretary of the Treasury and himself are hereby directed to carry the -same into effect.
    ' “ANDEEW JOHNSON.”
    
      “Department oe the Interior,
    Washington, D. 0., August 27,1868.
    “ Sir : Pursuant to the directions of Mr. Secretary Browning, I have the honor to lay before you a copy of the letter which he addressed to jrou under date of the 19th inst., and also a copy of the report of the commissioners appointed to examine the twenty-fifth section of the Union Pacific Eailroad, commencing at the 700th and terminating at 720th mile-post.
    “The original letter and report were submitted by you to the Attorney-G-eneral for his opinion upon certain questions of law arising thereon, and it is understood that they have not been returned. He has not furnished an opinion, but proposes to do so at a future period, and suggests that in the mean time “the same course should be taken upon the sections of the Union Pacific Eailroad now ready for the advance of the Government subsidy, as has been heretofore taken.”
    “Under these circumstances, it was deemed advisable to present the accompanying papers for your consideration, and for sueh order as you may be pleased to make in the premises.
    “I am, sir, with great respect, your obedient servant,
    “W. T. OTTO,
    
      “Acting Secretary.
    
    “ To the President.”
    “Executive Mansion, August 27,1868.
    “Upon a consideration of the letter of the Secretary of the Interior, and the report of the commissioners appointed to examine the twenty-fifth section of the Union Pacific Eailroad and telegraph line, commencing at the 700th and terminating at the 720th mile-post, it appears that said section of said railroad and telegraph line has been completed and equipped in all respects as required by the acts of Congress applicable thereto, and is hereby accepted.
    “ANDEEW JOHNSON.”
    “Department oe the Interior,
    “ Washington, D. O., September 4,1868,
    “ Sir : Pursuant to your oral direction of this morning, I have the honor to submit for your consideration the reports of the commissioners of the Union Pacific Eailroad and telegraph line on sections 26 and 27, extending from the 720th to the 760th mile-post west from the initial point of the road, near Omaha.
    “The commissioners, in their reports, represent the said sections of twenty miles each ready for present service, and completed and equipped as a first-class railroad, and that the telegraph line is completed for the same distance; and as the company have paid said commissioners the per diem and mileage due them under the twenty-first section of the Act of July 27, 1866, on account of their examination of these sections of road and telegraph line, I therefore respectfully recommend the acceptance of the same, and the issue to said company of bonds and of patents for lands due on account of said sections, agreeably to the Act approved July 1, 18G2j entitled ‘An act to aid in the construction of a railroad and telegraph line from the Missouri Eiver to the Pacific Ocean,’ &c., and the acts amend-atory thereof.
    “I am, sir, with great respect, your obedient servant,
    _ “W. T. OTTO,
    
      “Acting Secretary.
    
    “The President.”
    “Executive Mansion, September 5,1868.
    “The within recommendations of.the Acting Secretary of the Interior are approved, and the Secretary of the Treasury and himself are herebY directed to carry the same into effect.
    .'.«ANDEEW JOHNSON.”
    “DEPARTMENT OE THE INTERIOR,
    “ Washington, D. 0., September 22, 1868.
    “ Sir : I have the honor to transmit herewith, for your action, the report, dated the oth instant, of the commissioners, Messrs. Wm. M. White, Frank P. Blair, and N. B. Buford, appointed by you to examine and report on the twenty-eighth section of twenty miles of the road and telegraph line of the Union Pacific Eailroad Company, commencing at. the ,760th and terminating at the 780th mile-post west of the initial point on the Missouri Eiver, near Omaha, Nebraska. .
    “ The commissioners, in their report, represent the said section of twenty miles ready for present service, and completed and ecpiipped as a first-class railroad, and that the telegraph line is completed for the same distance; and as the said company have paid to the said commissioners the per diem and mileage due them under the twenty-first section of the Act of Congress approved July 27,1866, on account of their examination of this section of road and telegraph line, I respectfully recommend the acceptance of the same, and the issue to said company of bonds and patents for lands due on account of said section, agreeably to the Act approved July 1, 1862, entitled ‘An act to aid in the construction of a railroad andtelegraph line from the Missouri Eiver to the Pacific Ocean,’ &c., and the acts amend-atory thereof.
    “ I am, sir, with great respect, your obedient servant,
    “W. T. OTTO,-
    
      “Acting Secretary.
    
    “ The President.”
    “ Executive MÁNsion, September 22,1868.
    “ The within recommendations of the Acting Secretary of the Interior are approved, and the Secretary of the Treasury and himself are herebv directed to cartv the same into effect.
    “ANDEEW JOHNSON.”
    
      “DEPARTMENT OE THE INTERIOR,
    “ Washington, D. 0., October 20,1868.
    “ Sir : I have the honor to transmit herewith, .for your action, the report, dated the 24th ultimo, of the commissioners, Messrs. Wm. M. White, Frank P. Blair, and N. B. Buford, appointed by you to examine and report upon the twenty-ninth section of twenty miles of the road and telegraph line of the Union Pacific Eailroad Company, commencing at the 780th and terminating at the 800th mile-post west of the initial point on the Missouri Eiver, near Omaha, Nebraska.
    “The commissioners, in'their report, represent the said section of twenty miles ready for present service, and completed and equipped a¡s a first-class railroad, and that the telegraph line is completed for the same distance; and as the said company have paid to the said commissioners the per diem and mileage due them under the twenty-first section of the Act of Congress approved July 27,1866, on account of their examination of this section of the road and telegraph line, I respectfully recommend the acceptance of the same, and the issue to said company of bonds and patents for lands due on account of said section, agreeably to the Act approved July 1,1862, entitled ‘An act to aid in the construction of a railroad and telegraph line from the Missour Eiver to the Pacific Ocean,’ &c., and the acts amendatory thereof.
    “Iam, sir, very respectfully, your obedient servant.
    “ O. II. BEOWNING,
    “ Secretary.
    
    “The President.”
    “Executive Mansion, October 21, 1868.
    “The within recommendations of the Secretary of the Interior are approved, and the Secretary of the Treasury and himself are hereby directed to carry the same into effect.
    “ANDEEW JOHNSON.”
    “Department oe the Interior,
    “ Washington, D. 0., November 19,1S68.
    “ Sir : I have the honor to transmit herewith, for your action, the report, dated the 9th instant, of the commissioners, Messrs. Frank P. Blair, N. B. Buford, and Cornelius Wendell, appointed by you to examine and report upon the thirtieth section of twenty miles of the road and telegraph line of the Union Pacific Eailroad Company, commencing at the 800th and terminating at the 820th mile-post west of the initial point on the Missouri Eiver, near Omaha, Nebraska.
    “ The commssioners, in their report, represent the said section of twenty miles ready for present service, and completed and equipped as a first-class railroad, and that the telegraph line is completed for the same distance j and as the said company have paid to tbe said commissioners tbe per diem and mileage due them under tbe twenty-first section of tbe Act of Congress approved July 27, 1866, on account of tbeir examination of tbis section of road and telegraph line, I respectfully recommend tbe acceptance of tbe same, and tbe issue to said company of bonds and of patents for lands due on account of said section, agreeably to tbe Act approved July 1, 1862, entitled ‘An act to aid in tbe construction, of a railroad and telegraph bne from tbe Missouri Eiver to tbe Pacific Ocean,’ &c., and tbe acts amendatory thereof.
    “I am, sir, with great respect, your obedient servant,
    “ O. H. BEOWNING,
    “ Secretary.
    
    “ Tbe President.”
    “Executive Mansion, November 19,1868.
    “The»within recommendations of tbe Secretary of tbe Interior are approved, and tbe Secretary of tbe Treasury and himself are hereby directed to carry tbe same into effect.
    “ANDBEW JOHNSON.”
    “Department oe the Interior,
    “ Washington, D. G., December 4,1868.
    “ Sir : I bave tbe honor to transmit herewith, for your action, tbe report, dated the 10th ultimo, of tbe commissioners, Messrs. N. B. Buford, Frank P. Blair, and' 0. Wendell, appointed by you to examine and report upon tbe 31st section of forty miles of tbe road and telegraph bne of tbe Union Pacific Bailroad Company, commencing at tbe 820th and terminating at tbe S60th mile-post west of tbe initial point on tbe Missouri Eiver, near Omaha, Nebraska.
    “ Tbe commissioners, in then report, represent tbe said section of forty miles ready for present service, and completed and equipped as a first-class raiboad, and that tbe telegraph line is completed for tbe same distance; and as tbe said company bave paid to tbe said commissioners tbe. per diem and mileage due them tinder tbe 21st section of tbe Act 'of Congress approved July 27, 1S66, on account of tbeir examination of tbis section of road and telegraph line, I therefore respectfully recommend tbe acceptance of tbe same, and tbe issue to said company of bonds and patents for lands due on account of said section, agreeably to tbe Act approved July 1,1862, entitled ‘An act to aid in tbe construction of a raüroad and telegraph bne from tbe Missouri Eiver to tbe Pacific Ocean,’ &C., and tbe acts amendatory thereof.
    “Iam, sir, with great respect, your obedient servant,
    “ O. H. BEOWNING,
    “ Secretary.”
    
    
      “ Executive Mansion, December 5,1868.
    “ The within recommendations of the Secretary of the Interior are approved, and the Secretary of the Treasury and himself are hereby directed to carry the same into effect.
    “ANDREW JOHNSON.”
    “DEPARTMENT OE THE INTERIOR,
    “ Washington, D, G., December 9,1868.
    “Sir : I have the honor to transmit herewith, for your action, the report, dated the 13th ultimo, of the commissioners, Messrs. N. B. Buford, Frank P. Blair, and C. Wendell, appointed by you to examine and report upon the 32d section of twenty miles of the road and telegraph line of the Union Pacific Railroad Company, commencing at the 860th and terminating at the 880th mile-post west of the initial point on the Missouri River, near Omaha, Nebraska.
    “ The commissioners, in their report, represent the Said section of twenty miles ready for present service, and completed and equipped as a first-class railroad, and that the telegraph line is completed for the same distance; and as the said company have paid to the said commissioners the per diem and mileage due them under the 21st section of the Act of Congress approved July 27,1866, on account of their examination of this section of road and telegraph line, I respectfully recommend the acceptance of the same, and the issue to said company of bonds and of patents for lands due on account of said section, agreeably to the Act approved July 1,1862, entitled ‘An act to aid in the construction of a railroad and telegraph line from the Missouri River to the Pacific Ocean,’ &c., and the acts amendatory thereof.
    “I am, sir, with great respect, your obedient servant,
    “O. H. BROWNING-,
    “ Secretary.”
    
    “ Executive Mansion, December 12,1868.
    “The within recommendations of the Secretary of the Interior are approved, and the Secretary of the Treasury and himself are hereby directed to carry the same into effect.
    “ANDREW JOHNSON.”
    “Department oe the Interior,
    “ Washington, D. 0., December 15,1868.
    “ Sir : I have the honor to transmit herewith, for your action, the report, dated the 14th ultimo, of the commissioners, Messrs. Frank P. Blair, N. B. Buford, and 0. Wendell, appointed by you to examine and report upon the 33d section of 20 miles of the road and telegraph line of the Union Pacific Railroad Company, commencing at the 880th and terminating at the 900th. mile-post west of tbe initial point, on tbe Missouri Eiver, near Ornaba, Nebraska.
    “ Tbe commissioners, in tbeir report, represent tbe said section of twenty miles ready for present service, and completed and equipped as a first-class railroad, and that tbe telegraph line is completed for tbe same distance; and as tbe said company bave paid to tbe said commissioners tbe per diem and mileage due them under tbe 21st section of tbe Act of Congress approved July 27, 1866, on account of tbeir examination of tbis section of road and telegraph line, I respectfully recommend tbe acceptance of tbe same, and tbe issue to said company of bonds and of patents for lands due on account of said section, agreeably to tbe Act approved July 1,1862, entitled ‘An act to aid in tbe construction of a railroad and telegraph line from tbe Missouri Eiver to tbe Pacific Ocean,’ &c., tbe acts amendatory thereof.
    “ I am, sir, with great respect, your obedient servant,
    “O. H. BEOWNINU,
    “Secretary.”
    “ Executive Mansion, December 16,1868.
    “ Tbe within recommendations of tbe Secretary of tbe Interior are approved, and tbe Secretary of tbe Treasury and himself are hereby directed to carry tbe same into effect.
    “ANDEEW JOHNSON:”
    “DEPARTMENT OE THE INTERIOR,
    “ Washington, D. G., Dee. 22,1868.
    “ Sir- : I bave tbe honor to transmit herewith, for your action, tbe report, dated November 20, 1868, of tbe commissioners, Messrs. N. B. Buford, Frank P. Blair, and C. Wendell, appointed by you to examine and report upon tbe thirty-fourth section of twenty miles of tbe road and telegraph line of tbe Union Pacific Eailroad Company, commencing at tbe 900tb and terminating at tbe 920th mile-post west of the initial point on tbe Missouri Eiver, near Omaha, Nebraska.
    “ Tbe commissioners, in tbeir report, represent tbe said section of twenty miles ready for present service, and completed and equipped as a first-class railroad, and that the telegraph line is completed for tbe same distance; and as tbe said company bave paid to tbe said commissioners tbe per diem and mileage due them under the twenty-first section of tbe Act of Congress approved July 27, 1866, on account of tbeir examination of tbis section of road and telegraph line, I respectfully recommend tbe acceptance of tbe same, and tbe issue to said company of bonds and of patents for lands due on account of said section, agreeably to tbe Act approved July 1,1862, entitled ‘An act to aid in tbe construction of a railroad and telegraph line ñnm tbe Missouri Eiver to the Pacific Ocean,’ &c., and the acts amenda-tory thereof.
    “ I am, sir, with great respect, your obedient servant,
    “O. H. BEOWNING,
    
      " Secretary.”
    
    “ Executive Mansion, December 23,1868.
    “ The within recommendations of the Secretary of the Interior are approved, and the Secretary of the Treasury and himself are hereby directed to carry the same into effect.
    “ANDESW JOHNSON.”
    “ Department oe the Interior,
    “ Washington, D. 0., December 23,1868.
    “ Sir : I have the honor to transmit herewith, for your action, the report, dated the 7th instant, of the commissioners, Messrs. N. B. Buford, Frank P. Blair, and 0. Wendell, appointed by you to examine and report upon the thirty-fifth section of twenty miles of the road and telegraph line of the Union Pacific Eail-road Company, commencing at the 920th and terminating at the 940th mile-post west of the initial point on the Missouri Eiver, near Omaha, Nebraska.
    “The commissioners, in their report, represent the said section of twenty miles ready for present service, and completed and equipped as a first-class railroad, and that the telegraph line is completed for the same distance; and as the said company have paid to the said commissioners the per diem and mileage due them under the twenty-first section of the Act of Congress approved July 27, 1866, on account of their examination of this section of road and telegraph line, I respectfully recommend the acceptance of the same, and the issue to said company of bonds and of patents for lands due on account of said section, agreeably to the Act approved July 1,1862, entitled ‘An act to aid in the construction of a railroad and telegraph line from the Missouri Eiver to the Pacific Ocean,’ &c., and the acts amendatory thereof.
    “I am, sir, with great respect, your obedient servant,
    “O. H. BEOWNING-,
    “ Secretary.”
    
    “Executive Mansion, December 23,1868.
    “ The within recommendations of the Secretary of the Interior are approved, and the Secretary of the Treasury and himself are hereby directed to carry the same into effect.
    “ANDEEW JOHNSON.”
    “Department oe the Interior,
    “ Washington, D. 0., January 28, 1869.
    “ Sir : I have the honor to transmit herewith, for your action, the report, dated the 20th instant, of the commissioners, Messrs. N. B. Buford, Fank P. Blair, and 0. Wendell, appointed by you to examine and report upon tlie thirty-sixth, section of twenty miles of the road and telegraph line of the Union Pacific Bail-road Company, commencing at the 940th and terminating at the 960th mile-post west of the initial point on the Missouri Eiver, near Omaha, Nebraska.
    “The commissioners, in their report, represent the said section of twenty miles ready for present service, and completed and equipped as a first-class railroad, and that the telegraph line is completed for the same distance j and as the said company have paid to the said commissioners the per diem and mileage due them under the twenty-first section of the Act of Congress approved July 27, 1806, on account of their examination of this section of road and telegraph line, I respectfully recommend the acceptance of the same, and the issue to said company of bonds and of patents for lands due on account of said section, agreeably to the Act approved July 1,1862, entitled An act to aid in the construction of a railroad and telegraph line from the Missouri Eiver to the Pacific Ocean,’ &c., and the acts amendatory thereof.
    “ I am, sir, with great respect, your obedient servant,
    “O. H. BBOWNING,
    “ Secretary.
    
    “The President.”
    “Executive Mansion, January 28,1869.
    “The within recommendations of the Secretary of the Interior are approved, and the Secretary of the Treasury and himself are hereby directed to carry the same into effect.
    “ANDBEW JOHNSON.”
    “Department oe the Interior,
    “ Washington, D. C., February 9,1869.
    “ Sir : I have the honor to transmit herewith, for your action, thereports, dated tlie27th and29th ultimo, of the commissioners, Messrs. N. B.Buford, Frank P. Blair, and0. Wendell, appointed by you to examine and report upon the thirty-seventh and thirty-eighth sections of twenty miles each of the road and telegraph line of the Union Pacific Bailroad Company, commencing at the 960th and terminating at the 1000th mile-post west of the initial point on the Missouri Eiver, near Omaha, Nebraska.
    ‘ ‘ The commissioners, in their report, repiesentthesaid sections of forty miles ready for present service, and completed and equipped as a first-class railroad, and that the telegraph line is completed for the same distancej and as the said company have paid to the said commissioners the per diem and mileage due them under the twenty-first section of the Act of Congress approved July 27, 1866, on account of their examination of these sections of road and telegraph line, I therefore respectfully recommend tbe acceptance of tbe same, and tbe issue to said company of bonds and of patents for lands due on account of said sections, agreeably to tbe Act approved July 1, 1862, entitled ‘An act to aid in tbe construction of a railroad and telegraph line from tbe Missouri River to tbe Pacific Ocean,’ &c., . and tbe acts amendatory thereof.
    “I am, sir, with great respect, your obedient servant,
    “O. H. BROWNING-,
    “ Secretary.
    
    “The President.”
    “ Executive Mansion, February 9, 1869.
    . “ Tbe within recommendations of tbe Secretary of tbe Interior are approved, and tbe Secretary of tbe Treasury and himself are hereby directed to carry tbe same into effect.
    “ANDREW JOHNSON.”
    “DEPARTMENT OE THE INTERIOR,
    “ Washington, D. 0., July 15,1869.
    “ Sir : I have tbe honor to transmit herewith, for your action, five reports, dated tbe 9th ultimo, of tbe commissioners, Messrs. Gouverneur K. Warren and James F. Wilson, also the report of Isaac N. Morris, tbe other commissioner, dated May 28,1869, appointed by you to examine and report upon a section of 85t8a¡- miles of tbe road and telegraph line, constructed by tbe Union Pacific Radroad Company, commencing on tbe road of said company at tbe 1000th mile-post west from Omaha and terminating at tbe 1025t8b8b mile-post
    “ Tbe majority of said commissioners, in their report, represent tbe said section of 85Jy>w miles ready for present service, and completed and equipped as a first-class railroad, and that tbe telegraph line is completed for tbe same distance; and as tbe company have paid tbe per diem and mileage due them under tbe twenty-first section of tbe Act of Congress approved July 27, 1866, on account of their examination of said section of road and telegraph line, I therefore respectfully recommend tbe acceptance of tbe same and tbe issue of bonds and of patents for lands due on account of said section, agreeably to the Act approved July 1,1862, entitled ‘An act to aid in tbe construction of a railroad and telegraph line from tbe Missouri River to tbe Pacific Ocean, and to secure to tbe Government tbe use of tbe same for postal, military, and other purposes,’ and tbe acts amend-atory thereof. Said bonds and patents to be issued to tbe Union Pacific Railroad Company on account of tbe work from said 1000th mile-post to the ‘common terminus of tbe Union Pacific and tbe Central Pacific Railroads,’ ‘at or near Ogden’; and tbe bonds and patents on account of said work from said common terminus to Promontory Summit to be issued to such company as tbe proper authority, after full investigation of tbe respective claims of the Union Pacific Eailroad Company and the Central Pacific Eailroad Company of California shall determine to be thereunto lawfully entitled: Provided, however, That no bonds or patents shall in any event be issued until such security shall be deposited with the Secretary of the' Treasury necessary to secure the ultimate completion of the road, agreeably to the acts mentioned in my letter to you of 27th of May last.
    “I am, sir, very respectfuEy, your obedient servant,
    “ J. D. COX, Secretary.
    
    “ The President.”
    “Executive Mansion, July 15,1869.'
    '“ The within recommendations of the Secretary of the Interior are approved, and the Secretary of the Treasury and himself are hereby directed to carry the same into effect.
    “U. S. GEANT.”
    The following is the letter of the 27 th of May, 1869, referred to in the last preceding letter of the Secretary of the Interior to the President:
    “Department or the Interior,
    “ Washington, T). (7., May 27,1869.
    “ Sir : I have the honor to transmit herewith, for your action, reports dated, respectively, February 10th and 27th, and March 15th, 1869, of the commissioners, Messrs. Thos. I. Henley, Frank Denver, and John Bigler, appointed by the President to examine and report on three sections, of twenty miles each, of the road and telegraph line of the Central Pacific Eailroad Company of California, commencing at the termination of the 510th and ending at the termination of the 570th mile east of the initial point at Sacramento, in the State of California. Also a report, dated the 28th ultimo, of the commissioners, Messrs. James W. Haines; Frederick A. Trittle, and William Sherman, appointed by you to examine and report on one hundred (100) miles of road and telegraph of said company, commencing at the termination of said 570th and ending at the 670th ruñe east of said initial point.
    “ The commissioners, in their report, represent the said sections of one hundred and sixty* (160) miles ready for present service, and completed and equipped as a first-class railroad, and that the telegraph line is completed for the same distance; and as the said company have paid to-said commissioners the per diem and mileage due them under the 21sfr section of the Act of Congress approved July 27, 1866, on account of their examination of this portion of road and telegraph line, I respectfully recommend the acceptance of the same and that bonds be is-suéd to the company thereon, in accordance with the agreement made with the company, which is to the effect that they deposit their first-mortgage bonds with the Secretary of the Treasury to such an amount as may be deemed necessary to secure the ultimate completion of the road, agreeably to the provisions of the Act approved July 1st, 1862, entitled An act to aid in the construction of a railroad and telegraph line from the Missouri River to the Pacific Ocean, and to secure to the Government the use of the same for postal, military, and other purposes,’ and the acts amendatory thereof.
    “ I am, sir, very respectfully, your obedient servant,
    “ J. D. COX, Secretary.
    
    “The PRESIDENT.”
    This letter was returned bearing the following indorsement:
    “ Executive Mansion, May 27,1869.
    “ The within recommendations of the Secretary of the Interior are approved, and the Secretary of the Treasury is hereby directed to carry the same into effect.
    “U. S. GRANT.”
    Y. As it appeared by the reports of some of the commissioners appointed by the President to examine and report upon sections of the road that the several sections of road were not and could not under the circumstances be fully completed up to the ultimate standard of a first-class railroad, though they might be and actually were completed, section by section, so as to admit of transportation and travel over the same, the claimant, on the 12th of February, 1869, being thereto required by the Attorney-General of the United States, as a guarantee for the ultimate full completion and equipment of said road, executed the following papers to wit:
    “declaration and agreement.
    “ Know all men by these presents that the Union Pacific Railroad Company, having been heretofore required to deposit with the Government of the United States, in the Department of the Treasury of the United States, the amount in the aggregate of three millions of dollars ($3,000,000) of their first-mortgage bonds as a guarantee that the structure and equipment of the road of the said company shall be completed according to the provisions and requirements of law respecting the same, and to mate such deposits from time to time as the said company shall receive the bonds of the United States, issued to it on the completion of successive sections of its road, as provided by law, to an amount equal to one-half of the amount of said bonds of the United States to be so received by said company, until the said sum of three millions of dollars in said bonds is so deposited:
    “ Now, the said company, in pursuance of said requirement, hereby declares and agrees, that the said first-mortgage bonds deposited, orto be deposited, with the Government of the United States, in the Treasury Department thereof, upon the requirement and in manner aforesaid, are, and may and shall be, held by the Government of the United States as security for the completion of the structure and equipment of the road of the said company, according to the provisions of the statutes of the United States providing for the building and completion of said road and its equipments, and to be so held until the President of the United States, on a proper examination of the actual completed road and equipments, shall be satisfied that the same are so completed as a first-class railroad according to law; such restoration of bonds to be made from time to time, pro rata, as the President, from the actual condition of the said road in its structure and equipments, shall deem it no longer necessary to retain the same.
    “And it is further declared and agreed by the said company, that in case the President of the United States shall fail to be satisfied, upon a proper examination of the road, its structure and equipments aforesaid, that the same are conformed to the requirements of the statutes providing for the building of the said road and for its structure and equipment, that it shall be the duty of the said company to proceed to complete the said road, its structure and equipments, according to the statutes aforesaid, and that in default of its so doing, the said bonds shall be held by the said Government, and shall be disposed of, and the proceeds thereof, if disposed of, applied to the proper completion of the said road, its structure and equipment, as the Government of the United States shall by law direct and provide.
    “ In witness whereof the said Union Pacific Eailroad Company has affixed its corporate seal to these presents, and directed the execution thereof to be attested by its president this twelfth day of February, A. D. eighteen hundred and sixty-nine.
    “ OLIVEE AMES,
    “ President of Union Pacific Railroad Company.
    “HENEY B. HAMMOND,
    “ Secretary of Union Pacific Railroad Compaznyl
    
    “ FEBRUARY 12, 1869.
    “Hon. O. H. Browning-,
    ' “ Secretary of the Interior:
    
    “ Sir, : The Union Pacific Eailroad Company having been required by the Government of the United States, in addition to the deposit of three millions of dollars ($3,000,000) of first-mortgage bonds of the company with said Government, in the Department of the Treasury thereof, as security for the due completion and equipment of its road; also, as a further security to the same end, to leave the lands, given to the said company by the acts of Congress providing for the building of the said road and the completion of its structure and equipments, without taking out patents for the same until the President shall be satisfied, upon proper examination of the road, its structure and equipments, that the same have been completed according to the provisions of law in the premises, in whole or in part, as hereinafter mentioned; and the company having executed the proper instrument in respect to the said required deposit’with the Secretary of the Treasury:
    “Now, this is to declare that the said company assents to the aforesaid requirement in respect to the lands given to the said company as aforesaid; that is to say, the said lands shall remain without patents being taken out therefor until the President of the United States, upon a proper examination of the actual condition of the road of said company, its structure and equipments, shall be satisfied that the same have been completed according to law; but patents for said lands may be issued pro rata as parts of the said road and equipments from time to time shall be so found completed, if the President shall be satisfied so to direct.
    “In the name and by the authority of the said company this assent is given by us, the president and secretary of said company.
    “We have the honor to be, very respectfuly, your obedient servants, ■
    “OLIYEE AMES,
    “ President of the TJmon Pacific Railroad Company.
    
    “,HENEY B. HAMMOND,
    “ Secretary of the Union Pacific Railroad Company.”
    YI. In pursuance of the “Declaration and agreement” set forth in the next preceding finding, the claimant, on the 16th of February, 1869, deposited with the Treasurer of the United States its first-mortgage bonds to the amount of $1,600,000.
    YII. On the 10th of May, 1869, the last rail of the claimant’s road was laid, and about a week afterward the road was opened over its entire length to public use for the transportation of passengers and freight and for the service of the Government; and this service was from'that time forward performed continuously.
    YIII. Under the second section of the Joint Eesolution of April 10,1869, “for the protection of the interests of the United States in the Union Pacific Eailroad Company, the Central Pacific-Eailroad Company, and for other purposes,” a board of eminent citizens, five in number, was, in August, 1869, appointed by the President to perform the duty in said section prescribed, and they did perform tbe same; and on the'30th of October, 1869, they made to tbe Secretary of tbe Interior tbe following report:
    “WASHINGTON, D. C., October 30, 1869.
    “Tbe undersigned, members of a commission for tbe examination of tbe Union and Central Pacific Railroads, appointed tinder a “ Joint Resolution for tbe protection of tbe interests of tbe United States in tbe Union Pacific Railroad Company, tbe Central Pacific Railroad, and for other purposes,” approved April 10,1869, bave tbe honor to submit the following report:
    “Under instructions from tbe Interior Department, dated August 14,1869, four members of tbe commission were in Omaha on August 23, but tbe instructions of tbe fifth commissioner having failed to reach Mm, be was not present, and it was informally decided to proceed to Sacramento. The commission met at Sacramento on September 8, all tbe members being present; organized by tbe election of General Hiram Walbridge, president, and General O. B. Comstock, secretary, and commenced the inspection of tbe Central Pacific Railroad, usually working from 6.30 a. m. till dark, and occupying from September 8 until September 14 in tbe inspection of that road. Tbe inspection of tbe Union Pacific Railroad was begun September 14 and completed September 23, when tbe commission adjourned to meet at Washington, October 13, 1869; but tbe meeting was subsequently postponed until October 23, when most of tbe maps and information asked for from tbe two roads bad been received.
    ■ “Tbe joint resolution under wMcb tbe commission was appointed requires it ‘ to examine and report upon tbe condition of, and what sum or sums, if any, will be required to complete each of said roads for tbe entire length thereof to said terminus, as a first-class railroad, iu compliance with tbe several acts relating to said1 roads.’ Tbe instructions of tbe Interior Department require that tbe ‘report should be minute and specific upon tbe several particulars relating to tbe construction and equipment of each of tbe roads which those instructions set forth, and that it should state to what extent, if any, the line of either road deviates from tbe most central, direct, and practicable route mentioned in said acts of Congress.’
    “Tbe instructions add: ‘You will not, however, be restricted to these instructions, but will, in tbe spirit of tbe resolution, include in your report any suggestions or facts, relating to the roads, elicited by your examination, wMcb you shall consider necessary to be submitted to the President of tbe United States.’
    “The first question that comes before tbe commission is, What is meant by Congress, in its various acts relating to tbe Pacific railroads, by tbe words ‘first-class railroad’?
    “ Railroads now ranked as first class in this country were far from being perfect at their opening, and bave been brought to tbeir present high, standard by large expenditures, which a small trafile in the beginning could never have justified. To require the Pacific railroads to be brought at first to the standard other roads have reached after years of heavy and lucrative business would be a waste of money. It is evident to the commission that this was not what Congress desired or intended in requiring a first-class railroad.
    “ If private corporations had built these roads without governmental subsidy, it would undoubtedly have been for their interest to build them at first at the lowest cost consistent with keeping them in operation, and, when built, if a paying business should be developed, to have gradually made the improvements which increasing traffic should render necessary..
    “But Congress had made a large loan and an extensive land grant, a part of which will be valuable, and in return it required a better road than private interests would have built — a road that should be capable of transporting passengers and freight with rapidity, safety, and certainty; a road as good as the majority of those in the thickly-settled States.
    
      “ In the opinion of the commission, the requirements of the law will be satisfied, and the designs of Congress carried out, if the roads be properly located, with judicious grades; have substantial road-beds of good width; ballasting which, with proper care, shall be able to keep the track in good condition throughout the year; permanent structures for crossing streams; good cross-ties, non, and joint fastenings; sufficient sidings, water-tanks, buildings, machinery, and adequate rolling-stock; the more important machine-shops and engine-houses being or masonry; and the commission is glad to be able to say that in its opinion, while some expenditures still need to be made, these two roads aresubstantiallysuch roads to-day. The expenditures needed for completion will be given in detail for each road.
    
      “Report on Union Pacific Railroad, with estimate of coat for completion.
    
    
      uLocation. — The location of the accepted line is highly creditable to the engineers of the company. There are fewer errors than might reasonably have been expected, considering the length of the road and the difficulties encountered, and none which, in our opinion, the Government should require corrected. There are deviations from this accepted line at Promontory-Mountains and at Uintah which should be corrected; and at Omaha the bridge line should be built to avoid the present heavy grade. The adoption of this line removes the necessity of reducing the grades on the present location, as heretofore required. An estimate of the cost of these changes is made.
    
      “Road-bed. — The road-bed is a large part of the way of proper width, both in cuts and embankments, though there are some places where greater width is needed on the embankments, for which an estimate is made.
    
      “Tunnels. — There are four short tunnels, three through solid rock not arched, and one arched with timbers. The commission have not deemed it necessary to provide for arching with masonry.
    “Bridges, trestles, and culverts. — Several of the high trestles between Blue Creek Station and Promontory ought to be filled up at once. They were evidently intended as temporary expedients, to gain time in opening the road. Below Echo two high trestles (on the nine hundred and seventy-first mile), and the two of same character near Piedmont (on the nine hundred and thirty-fourth and nine hundred and thirty-sixth miles), should be filled within the coming year. The high trestle at Dale Creek is a good structure, and .no' estimate has been made for filling this, it being a first-class work of its kind.
    “ The bridges are generally well built and of good materials. There are, however, several of one hundred and one hundred and fifty feet span on Bitter Creek, where a water-way of forty feet would have been ample. The masonry of these is of an inferior character.
    
      “ The company are now engaged in changing the course of the stream, so as to render eight or ten of them unnecessary, and will fill the crossings with embankments. An estimate is made for completing those which are to remain.
    “ Some of the Howe truss-bridges, like several of those on the Central road, are light in their suspension rods for the maximum load of a tram of locomotives. Several shouldbe strengthened, for which estimates are made.
    “ In reference to many of the trestles (not heretofore mentioned) and culverts which we have estimated for replacing, we would remark that practical railroad managers, having a due regard to economy, would not replace them by permanent structures so long as they are safe and reliable, which, in the opinion of the commission, will be four or five years for many of them, at the end of which time experience will point out the position and size of water-ways with much more certainty than can now be determined.
    
      “Snow-fences. — Some protection against snow has already been provided, and much more will be necessary. The officers of the road seem to be aware of the importance of these structures, and were engaged in preparing the material for them. It will undoubtedly be expedient to erect snow-sheds at some of the exposed points, but experience only can locate them properly. The saving in expense of operating and repairs will be so large, that no railroad similarly situated can afford to be without them; we think, therefore, that it will be safe to leave all this part of the work in the hands of the company, to be done as fast as their experience shall point out the right places and the character of the structures to be built.
    
      
      “Trade. — Thetrack is generally very good, but aaw miles were observed where the heavy traffic, near Omaha,d worn the rails considerably. To replace them is a matter ordinary rep airs, and not of construction, this part of the roahaving been in operation for four years. About four hundred and fifty miles of the track are laid with rails weighing fifty pounds per linear yard and with wrought-iron chairs; the remainder is of fifty-six pounds and laid with fish-joints.
    
      “ The cross-ties are generally of pine, of fair size and good quality, excepting those on about four hundred miles immediately west of Omaha, where originally a large proportion were of cottonwood. Many of these have been replaced with pine, oak, and cedar, but a large number are still in the track. A part of the cost of replacement belongs to the repairs of the road, but a portion should be borne by the construction account, as the cross-ties were originally inferior. One hundred thousand dollars above the ordinary repairs is estimated for their replacement, the company now having a large number on hand for that purpose. The cross-ties number from twenty-three hundred to twenty-six hundred and forty in each mile of track.
    
      “Sidings. — The sidings are ample for the business of the road, amounting to fully nine per cent, of its length.
    “ Ballast. — A considerable portion of the road is well ballasted, with good material; quite a large amount is, however, still needed, especially between Promontory and Ogden and in the Platte valley. For the latter, it can only be obtained by very long hauls; still, we regard it so important as to justify us in estimating the expense of procuring it.
    
      “Station-houses and water-tardes. — The station-houses are of good character, properly located, and sufficient in number to accommodate the business of the road. The company have also erected, at convenient points on its line, several good hotels and eating-houses for the accommodation of passengers. There are some long intervals between water-tanks, but the commission is satisfied that all that is practicable is being done by the company to obtain an abundant supply of good water.
    
      “ Goal. — The discovery of good coal in large quantities, easily accessible, at several points on the line of this road, is of great value in reducing the cost of operating.
    “ Machine-shops and engine-houses. — At several places there are permanent machine-shops, well constructed, and fully supplied with machinery and tools. These are properly located. We have estimated for building one or more at the proposed junction of the two roads. The engine-houses are generally of stone or brick, and of sufficient size. There are three points at which others will be required, for which estimates are made.
    
      “ Equipment. — There are upon the line of the road one hundred and forty-nine locomotive-engines; twenty-six first-class and fifteen second-class passenger-cars (besides sleeping-cars in use upon the road, but not owned by the company); eighteen baggage, mail, and express cars; eighty-eight caboose-cars, which can also be used for emigrant-cars; nine hundred and fifteen boxcars ; eleven hundred and seven platform-cars (besides three hundred leased to and used by other roads). There are three first-class passenger and two express and baggage cars in course of construction in the company’s shops at Omaha. The freight-cars are considerably in excess of the present and immediate future wants of the road. In view of the very large amount of material the company have on hand at Omaha, and their ample facilities for construction of passenger-cars, we have made no estimate for additions to this class of equipment.
    
      “ Telegraph lines. — The telegraph line and stations are sufficient for the present purposes, though many of the poles are not of the most durable material.
    
      UJSstimates for supplying deficiencies, Union Pacific Railroad7 Promontory to Ogden.
    
    Ballasting track. $46,000
    Widening embankments. 6,400
    Filling high trestles between one thousand and seventy-sixth and one thousand and eighty-fifth miles, inclusive. 38,000
    Abutments and piers at Bear Eiver bridge, in addition to materials on hand and work done. 5,000
    Abutments, Ogden Eiver bridge, in addition to work done and material on hand. 4,000
    Filling up and making permanent water-ways at forty-four short openings. 20,000
    Filling up and making permanent waterways at three larger openings. 1,200
    Filling, putting in straining-beam bridges, and abutments at three large trestles. 5,400
    Correcting construction and reducing grades to conform to accepted location .between one thousand and eightieth and one thousand, and eighty-fifth miles, inclusive. 80,000
    Total.-..'. 206,000
    
      "Estimate for supplying deficies, Union Pacific Railroad,den to Omaha.
    
    .Ballasting track between Ogden and Echo. $5,000
    Ballasting track between Echo and Bryan. 70,000
    Ballasting track between Bryan and Eawlins. 90,000
    Ballasting track between Eawlins and Laramie. 86,000
    Ballasting track between Laramie and Ogalaila .... 70,000
    Ballasting track between Ogalaila and Omaha. 116,500
    Widening embankments between Ogden and Echo. 3,600
    
      Widening embankments between Bebo and Bryan.. $31,500
    Widening embankments between Bryan and Raw-lins . 12,500
    Widening embankments between Rawlins and Laramie . 6,000
    Widening embankments between Laramie and Oga-1 ¡ill a -....... 7,000
    Widening embankments between Ogalalla and Columbus . 18,000
    Widening embankments between Columbus and Omaha. 9,000
    For freight and passenger depot at the proposed junction with Central Pacific Railroad. 10,000
    For engine-house of brick or stone at said junction . 40,000
    For machine-shops at said junction. 50,000
    For engine-house at Green River, of brick or stone, in addition to materials already on hand. 20,000
    For engine-house, of brick or stone, in the vicinity of Wasatch or Evanston.... 20,000
    For replacing cottonwood ties, in addition to repair account. o © o o r-i
    Strengthening Papilion bridge. o o
    Widening pier and changing bridge at Crow Creek. o o •H
    Rebuilding piers and abutments of Laramie. o o O
    For masonry and erecting bridge at the Little Laramie ... o o CO
    For improving abutments at Rock Creek. o o r-i
    For repairing masonry at Medicine Bow bridge. o o Cq
    Rebuilding and repairing masonry of Bitter Creek bridges. 21, 000
    For abutments and piers at Green River. 15,000
    For widening pier at last crossing Black’s Fork .... 1,000
    . Piers and abutments at Black’s Fork, eight hundred and seventy-third mile. 3.500
    Piers and abutments at Black’s Fork, eight hundred and eightieth mile. 12, 000
    Masonry at crossing Big Muddy, eight hundred and ninetieth mile. 7.500
    Masonry at crossing Big Muddy, eight hundred, and ninety-first mile. 5.500
    Masonry for four straining-beam bridges between nine hundred and forty-sixth and nine hundred and forty-ninth miles, including filling trestles-15,000
    For abutments for six 40-feet straining-beam bridges on nine hundred and eighty-fifth to nine hundred and eighty-eighth miles, inclusive. 2,400
    Arch culvert. 500
    Filling trestle at Weber River bridge. 3,000
    Filling and replacing with permanent water-ways thirty-five small openings of trestle-work between Ogden and Yellow Creek. 14,000
    
      Filling and replacing with permanent water-ways ten larger openings between Ogden and Yellow Creek. $11,000
    Filling two high trestles on nine hundred andseventy- , third mile. 12,000
    ■ Filling two high trestles on nine hundred and seventy- • first mile. 32,500
    Filling trestle on nine hundred and seventieth mile. 2, 000
    Filling two trestles on Yellow Creek. 2,200
    For abutments, filling, and putting in straining-beam bridges at nine hundred and sixtieth and nine hundred and seventy-sixth miles. 2,500
    For filling and replacing with permanent water-ways ten small openings of trestle-work between Yellow Creek and Piedmont. 2,000
    Filling trestle at nine hundred and sixty-eighth mile. 500
    For abutments, straining-beam bridge, and filling at nine hundred and fifty-sixth mile. 1,500
    For filling four large trestles between nine hundred and forty-fifth and nine hundred and thirty-fourth miles, inclusive. 33, 500
    For filling and replacing with permanent water-ways seventeen small openings between .Piedmont and Bryan.:. 7,000
    Abutments at crossing Big Muddy, nine hundred and twenty-seventh mile... 9,000
    Abutments at crossing Big Muddy, nine hundred and twenty-third mile . 3,000
    For abutments, bridging, and filling eighteen trestles between Piedmont and Bryan, chiefly over the Muddy. 32,600
    For filling and putting in three culverts between Piedmont and Bryan... 3, 700
    For filling and replacing with permanent water-ways forty small openings of trestle-work between Bryan and Rawlins... 16, 000
    Filling and replacing with permanent water-ways twenty larger openings between Bryan and Raw-lins ... 20,000
    Filling and replacing with permanent water-ways sixty small openings of trestle-work between Raw-lins and Laramie. 24,000
    Filling and replacing with permanent water-ways - seventeen larger openings of trestle-work between Rawlins and Laramie. 17,000
    Filling three other large trestles and putting in culverts between Rawlins and Laramie. 25,000
    Filling and replacing with permanent water-ways • one hundred and twenty-five; small openings of trestle-work between Laramie and Ogalalla . 50,000
    
      Filling and replacing with, permanent water-ways thirty-seven larger openings of trestle-work between Laramie and Ogalalla . $69,600
    Filling eighteen other large trestles between Laramie and Ogalalla . 50,000
    For filling and replacing with permanent water-ways one hundred and fifty small openings between Ogalalla and Omaha . 30,000
    For filling and replacing with permanent water-ways twenty-five larger openings of trestle-work between Ogalalla and Omaha . 20,000
    To change line to original location at Uintah. 5,000
    To reduce grade or change line near Omaha. 60, 000
    Total, Promontory to Omaha. 1,586,100
    “ Surplus material and supplies. — After examining the lists of . rolling-stock, material, and supplies on hand, submitted by the company, and making a liberal allowance for the immediate future wants of the road, we find they have a surplus amounting to about $1,800,000 in value.
    “In Appendix B. will be found a list of the maps, papers, and statements submitted by this company.
    “In concludihg this report, the commission desire to state that both the companies are doing a large amount of work on their respective roads, and are day by day bringing them nearer to the standard required by law.
    “This great line, the value of which to the country is inestimable, and in which every citizen should feel a pride, has been built in about half the time allowed by Congress, ana is now a good and reliable means of communication between Omaha and Sacramento, well equipped, and fully prepared to carry passengers and freight with safety and dispatch, comparing in this respect favorably with a majority of the first-class roads in the United States.
    “Bespectfully submitted.
    ' “HIBAM WALBBIDGE,
    “S. M. FELTON,
    “O. B. COMSTOCK,
    ■ “E. F. WINSLOW,
    “J. F. BOYD,
    “ Commissioners.
    
    “Hon. J. D. Cox,
    “ Secretary of the InteriorP
    
    
      IX. On the 3d of November, 1869, the Secretary of the Interior addressed to the Commissioner of the General Land Office the following communication:
    “Department oe the Interior,
    “ Washington, J). G., November 3,1869.
    “Sir: The commission to examine-the Union Pacific and Central Pacific Eailroads have repotted, and its report being accepted and made the basis of an adjustment of the accounts between the United States and said railroad companies, yon are hereby authorized to commence the patenting of lands to such companies, under grants made by Congress, as follows:
    “In addition to the bonds retained by the United States as security for the completion of said roads in the matters reported deficient or not up to standard by said commission, one-half of the lands ready for patenting to the Union, Pacific Company will have patents suspended until further directions from this department.
    “ The other half may be patented to ,said company as fast as surveys and other preliminaries are completed; that is to say, beginning at Omaha and working westward, the odd-numbered sections 1, 6,9, etc., will be patented first to the company (there being no valid adverse claim found), and sections 3, 7, etc., withheld until further directions, as above stated.
    “Patents to’ the Central Pacific may in like manner issue, beginning at Sacramento and working westward.
    “It is my desire that the work be so systematized that it may be pushed forward as rapidly as possible.
    “Very respectfully, your obedient servant,
    “ J. D. COX, Secretary.
    
    “Hon. Jos. S. Wilson,
    “ Commissioner General. Land Office.”
    X. Up to the 6th of November, 1869, the point at which the Union Pacific Eailroad and the Central Pacific Eailroad should meet was not settled; but assuming that the former road would go no farther west than Ogden, 1,033.68 miles west of Omaha, the Secretary of the Treasury on that day ordered that bonds of the United States, at the rate of $32,000 per mile, for the distance of 13.68 miles from the 1020th mile-post to Ogden, should be issued, but ordered that the Eegister of the Treasury should hold $323,488 thereof as security for the overissue of first-mortgage bonds by the claimant, and deliver the balance of $114,272 to the claimant. In reference to the issue of the bonds for said 13.68 miles, the Secretary of the Treasury wrote the following letter and indorsed thereon the order subjoined thereto:
    “Treasury Department, November 6,1869.
    “ Sir : I have this day approved the report of the Assistant Solicitor of the Treasury, dated July 21,1869, in which he states that the Union Pacific Railroad Company is entitled to United States bonds to the amount of six hundred and forty thousand (640,000) dollars, being at the rate of $32,000 per mile upon the fortieth (40) section of the railroad and telegraph line of said company, commencing at the 1020th and terminating at the 1040th mile-post west from the initial point, near Omaha, Neb.
    “This report is referred to you for action under the following instructions: It is understood that the Union Pacific Railroad Company has issued first-mortgage bonds in excess of its legal right to issue such bonds if their road terminates at or near Ogden, and as at present advised you are instructed to act as though the road terminated at Ogden. You will therefore ascertain the amount of such excess. If that excess does not exceed the amount of first-mortgage bonds now in possession of the Government, you may issue subsidy bonds under the said report of the Assistant Solicitor of the Treasury, from the terminus of the 39th section west from Omaha to Ogden, which is understood to be about fourteen (14) miles. If, after deducting the amount of first-mortgage bonds held by the Government from the excess of issues, there is still a deficit, you will subtract the deficit from the amount of bonds which would otherwise be due to said railroad upon that portion of the 40th section which is east of Ogden, and issue subsidy bonds for the remainder upon receiving proper evidence from the attorney or agent of the railroad of his right to receive the same.
    “Yery respectfully,
    “GEO. S. BOUTWELL,
    “ Secretary
    
    “To J. P. Bigelow,
    “ Loan Division, Treasury Department.”
    
    “Treasury Department, November 6,1869.
    “Let there be issued on this letter, to the Union Pacific Railroad Company, $137,760, being for a section of 13^ miles, at $32,000 per mile, commencing at the 1020th mile-post and terminating at Ogden. Of the above amount the Register will hold $323,488 as security for the overissue of first-mortgage bonds of the road, delivering the balance, $114,272, to the attorney of the company.
    “GEO. S. BOUTWELL,
    “ Secretary.”
    Afterward, by arrrangementbetween the said two railroads, the place of junction wfis fixed at a point 5 miles west of Ogden; and thereby the claimant became entitled to bonds of the United States at the rate of $32,000 per mile for 5 miles from Ogden to the point of junction, and the same were issued to the claimant soon after the 14th of July, 1870.
    The bonds so issued for said 5 miles were the last that the claimant was entitled to receive from the United States on .account of the construction of said road, and they made an aggregate of $27,235,760 of bonds of the-United States received by the claimant on that account..
    All the subsidy bonds mentioned in this finding bore interest from the 16th of July, 1869.
    XI. Before the place of junction of said two roads was fixed at a point 5 miles west of Ogden, as stated in the last preceding finding, the claimant and the Central Pacific Railroad Company had agreed that the two roads should meet at some point within 8 miles west of Ogden; that claimant should build the road to Promontory Point, about 53 miles west of Ogden; and that the Central Pacific Railroad Company should pay the cost of the same; and that the claimant should draw the United States bonds to the terminus near Ogden, and the Central Pacific Company should draw the balance.
    On the 6th of November, 1869, the claimant had issued $29,000,000 of first-mortgage bonds on the basis of its completion of the road to Promontory Point; but owing to the fixing of the terminus of the claimant’s 'road at the point 5 miles west of Ogden, that amount was $1,763,000 more than the claimant was lawfully entitled to issue. The aforesaid 1,600 first-mortgage bonds which had been deposited as security for the completion of the road were not held by the Secretary of the Treasury after the 6th of November, 1869, as' security for that purpose, but were held by him from and after that date, and until they were surrendered canceled, as hereinafter stated, on account of said overissue; and in addition thereto, on the 5th of January, 1870, the claimant deposited with the Government 163 other of its first-mortgage bonds, also on account of. said over-issue; and on the said 7th of January, 1870, the Secretary of the Treasury delivered the said 163 bonds to the Treasurer of the United States, and directed him to hold the same, and also the said 1,600 bonds (which had been previously delivered to said Treasurer), on account of said overissue.
    The said 1,763 bonds remained in the hands of the said Treasurer until the 10th of August, 1870, when, by order of the S ec-retary of the Treasury, they were all canceled, and returned in a canceled condition to the claimant, whose treasurer receipted for the same on the 24th of October, 1870, and by said cancellation the said overissue was canceled.
    TO T. The suspension of patents for one-half of the lands ready for patenting to the claimant, which was ordered by the Secretary of the Interior in his letter of November 3, 1869, set forth in finding IX continued in force for more than five years after the same was ordered. In relation to that suspension the Secretary of the Interior wrote the following letter to the acting president of the claimant:
    “Department op the Interior,
    “ Washington, D. C., February 9,1874.
    “ Sir : I have considered your letter of the 3d ultimo, in relation to the withholding from your company of patents for half the lands granted them by the Acts of 1st July, 1862, and 2d July, 1864.
    “ The order directing such withholding was issued by Mr. Secretary Cox, on the 3d November, 1869. It was based on the report of the five “eminent citizens,” authorized by the Joint Eesolution of 10th April, 1869; and the patents were to be withheld as security for the completion of your company’s road in the matters reported deficient or not up to the standard.
    “During the four years that have elapsed since the issuing of said order, repeated applications have, as you state, been made to me for its rescinding or modification; applications which my sense of official duty has not permitted me to grant.
    “ Two examinations of the condition of the road have, of their own motion, been made by a portion of the Government directors of your company, who have submitted reports thereof to the department; but no examination has been made, at the instance of the department, to ascertain whether the defects reported by the “ eminent citizens” have been supplied. In the absence of legislation, directing such re-examination, it remains for the company to decide whether they will make application to the President for the appointment of commissioners for that purpose; and so I have more than once informed the agents of the company who urged the repeal of Mr. Secretary Cox’s order.
    “ I can only repeat to you what has been said to them, that until this re-examination be made, the order will not be disturbed.
    “Very respectfully, &c.,
    “C. DELANO,
    “ Secretary.
    
    John Dupe, Esq.,
    “ Vice-President and Acting President of Company,
    
    “ Office Morton, Bliss & Go., New York City, N. Y.”
    
    
      XIII. The president of the claimant having applied for a re-examination of its said road to determine whether it had been completed according to law, the Secretary of the Interior appointed three persons to make such re-examination, and the following is the letter of their appointment:
    “DEPARTMENT OF THE INTERIOR,
    “ Washington, D. (7., May 14, 1874.
    “Sirs: On the 80th October, 18G9, “five eminent citizens,” who were appointed commissioners by the President under Joint Eesolution of 10th April, 18G9, reported certain deficiencies in the construction of the Union Pacific Eailroad.
    “The president of the company that constructed said road applied on the 8th instant for its re-examination, to determine whether it has been completed as required bylaw and the report of said commissioners j you are hereby appointed commissioners to make such examination and report to this department.
    “ To aid and guide you in the examination, a printed copy of the report of the “eminent citizens” is inclosed herewith, and also a printed copy of the instructions to commissioners who are appointed to examine land-grant railroads.
    “It will be your duty to examine said road with special reference to the deficiencies above referred to, and to report whether they have been supplied. If they have been, and the road is completed as required by law and departmental instructions, you will ascertain, as near as practicable, and report the date of such completion.
    “You will report whether the company have shown a disposition to act in good faith in supplying such deficiencies, give full and exact information as to the present condition of the road, and if it be not yet completed, state what is, in your judgment, necessary to such completion.
    “The 21st section of the Act of 21th July, 1866 (14 Statutes, 299), fixes your compensation at $10 per day for each day actually and necessarily employed, and ten cents per mile for each mile actually and necessarily traveled in discharging the duties required of you, which per diem and mileage shall be in full compensation for your services and must be paid by the company.
    “You will proceed to such examination when notified so to do by the president of said company.
    “ Yery respectfullv, your obedient servant,
    “B. E. COWEN,
    
      “Acting Secretary.”
    
      XIY. Tbe commissioners so appointed made to the Secretary of the Interior the following report:
    “Salt Lake City, Utah,
    “ October 7, 1874.
    “To the lion, the Secretary or tiie Interior,
    “ Washington, D. 0.:
    
    “The undersigned, commissioners to examine and report whether the deficiencies in the construction of the Union Pacific 'Eailroad, as reported by the commission appointed under Act of Congress approved April 10, 1869, have been supplied and the road completed as required by said report, submit the following:
    “The examination was commenced on the 25th September and completed October 5, and has been made thoroughly and in detail. We find that the report of the commission of eminent citizens was made soon after the joining of the rails at Promontory, and before they or the company had the experience required to determine what material in the peculiar climate of this country was actually necessary to bring the road up to the standard required by law. This embarrassment was felt by that commission and is referred to in their report.
    “In most cases the expenditures of the company in the items reported by the former commissioners have far exceeded their estimate.
    “The present commission has found it, at this late day, impossible to ascertain whether or not the exact amounts advised by the commission of eminent citizens have in all cases been expended in the precise localities indicated, particularly as regards the improving of water-ways. .
    “Many of these have been changed in size and location; others have been entirely filled up. They have, therefore, been compelled to take the expenditures somewhat in bulk, and find the comparison as follows:
    
      “Comparative statement of estimates for supplying deficiency in construction account and actual expenditure from October 1, 1869, to September 1, 1874.
    
      
    
    
      
      Comparative statement of estimates for supplying deficiencies, &c. — Continued.
    
      
    
    “When amounts and location have been designated, the company have faithfully complied with the recommendation of the former commission, in almost all cases expending larger sums than advised by said commission, the only exception worthy of note being the machine-shops recommended at the junction, which have been built at Evanston, in Wyoming Territory, because of the failure of the two companies to obtain property at the junction until a very recent date.
    “Experience has demonstrated the Evanston location to be much more desirable, it being on the top of the maximum grade, and at the coal-mines of the company. These shops are built at a cost of more than three times the estimate for the junction.
    “Besides the expenditures shown in this statement, the company have paid out large sums in new constructions, maintenance of way, and in additional facilities for accommodating and handling economically the traffic of the road, showing not only that they have acted in good faith in supplying the deficiencies reported by the former commission, but their determination is to make and maintain it in all resxmcts a first-class road.
    “In accordance with your instructions, 4to give full and exact information as to the xiresent condition of the road,’ we submit the following detailed statement:
    “ Location. — The location of the road shows a thorough knowledge of the features of the country; its directness, its greater percentage of tangent over curved line (length of tangents being 887.45 miles, and of curved lines 148.54 miles); its light grade and curvature (the maximum grade being 90 feet per mile, and its sharpest curve six degrees) make it an excellent road to operate and maintain with a minimum exx>ense.
    
      “The deviation of the road from the accepted line at Uintah has been corrected. The 66-foot grade at Omaha has been reduced to a 30-foot grade, and the material taken out and used in the approaches to the bridge over the Missouri Eiver.
    
      “Missouri River bridge. — A Post’s patent truss-bridge resting on iron tubular columns, sunk hi the sand from 50 to 80 feet, has been built across the Missouri Eiver at Omaha. The lower chord of the truss is 50 feet above high water, and 70 feet above low water. The bridge proper is 2,750 feet in length, and the approaches about three miles in length.
    “The structure has been erected at a cost of $2,500,000. By it the Union Pacific Eailroad Company can make its connection with the roads coming from the east, north, and south.
    
      “Road-bed. — The road-bed in bank is 14 to 16 feet in width. Large expenditures have been made in widening banks, taking-out cuts, and in raising some two hundred miles of track from two to five feet, by which the company is relieved of a large expense in sustaining snow sheds and fences. The company is irsing three steam-shovels on the work, and in three years expect to avoid the use of snow-sheds and retain .only a very limited amount of snow-fences.
    “In the opinion of this commission, this action of the company will successfully relieve them from snow blockades and the large expenditure attending that embarrassment.
    “ Tunnels. — There are four short tunnels, one of which is arched, and all are in good condition.
    
      "Bridges, trestles, and culverts. — All the trestles in the road have been filled, in accordance with the recommendation of the former commission, the last having been completed in September, 1874. Stone piers and abutments have been substituted for the piles and trestle-piers.
    “Several of the bridges on Bitter Creek have been dispensed with by changing the channel of that stream.
    “All the truss bridges appear to be sound, strong, and capable of sustaining any traffic, over them, additional rods liaving-been inserted to comply with the recommendation of the former commission.
    “The wooden truss bridges are renewed by combination of wood and iron, and many of the smaller trestles and culverts have been replaced, when the water-way allowed, by stone culverts, and by piles, bridges, and trestles on pile foundations; and, in the opinion or the commission, the very material improvement upon the bridges, the filling of trestles, and replacing piers with masonry makes these structures substantial and permanent.
    
      “/Shioic-fenees. — Since 1869 two hundred and sixty-nine miles of snow-fences and six miles of snow-sheds have been constructed, so that for two years no delay on account of snow has occurred.
    “During the last two years the company has abandoned a large amount of snow-fences by. raising tracks and. widening outcuts, as heretofore stated, and are proceeding during the spring, summer, and fall months, when earth can be economically moved, to release these structures. They evidently see that a permanent relief in this way, though costing more than the fencing and sheds, is true economy in the end.
    
      “Trade. — The track throughout is in excellent condition. Taking into consideration the material, we doubt if there is a road of its length in the country that can excel it. The iron is in good repair.
    “The chain-joints are being rapidly replaced by fish-plates. About seventy miles of new rails are laid annually. At Laramie, near the center of the road, the company is erecting extensive rolling-mills, to reroll their own rails, which will no doubt inaugurate an extensive iron business throughout the entire coal and iron districts.
    
      “Gross-ties are pine and oalc. — Since 1869, 2,000,000 new ties have been placed on the track. There are now on hand ready for use 400,000 more. All cottonwood ties have been replaced by pine and oak, and the condition of the track also shows that the road is well and fully tied, averaging fully 3,000 ties to the mile. On this item the company has expended since 1869, as we are informed by the auditor, $1,013,646.93.
    
      “Sidings. — The sidings on the road are ample, far exceeding the demand of the present business. They occur on an average ‘■every six miles, and since 1869 the capacity of the road in this particular has been doubled.
    
      “Ballast. — The road has been ballasted throughout with sand, gravel, or rock, and at many points ballast has been hauled long distances.
    “ Often the soil of the country throughout which the road runs has been found from experience to make excellent ballast, and in such cases has been used freely.
    “ Station-houses. — The station and freight houses are of good quality and ample in size, properly located, and sufficient in number and capacity to accommodate the natural and probable increase of business of the road for many years.
    “ At Fremont, Grand Island, North Platte, Sidney, Cheyenne, Laramie, Eawlins, Green Eiver, Evanston, and Ogden the company has erected, or caused to be built, large and commodious hotels and eating-houses, giving ample accommodations to the traveling public.
    
      “Tunics and water-supply. — The water-tanks average twelve miles apart and are generally of 60,000 gallons capacity, supplied in all cases by overhead flow and pumps worked by steam-power or wind-mills.
    “The additions made since 1869 make the supply ample. Through the dry country, from Eawlins to Green Eiver, seven .artesian wells, averaging 700 to 1,400 feet deep, have been sunk, giving a good supply of water, and, in two cases, flowing wells.
    
      
      “Coal. — Goal exists along .the line of the road from Laramie to Echo, the veins varying from three to thirty feet in thickness.
    “Within the past year the company have taken charge of their coal-mines, and, by delivering coal in large quantities, propose to make the cost to consumers much less titan it has been heretofore. The Central Pacific Eailroad is also obtaining coal from mines along this line.
    
      “Machine-shops are ample, their capacity being more than double the present requirements of the company.
    “The company estimates that the shops are sufficient to maintain double the amount of rolling-stock now in use. These shops are generally built of brick and stone, and are located at Omaha, North Platte, Cheyenne, Laramie, Bawlins, G-reen Eiver, and Evanston. » At the latter place the shops built were intended for the junction of the two roads, but the company preferred to make a short division, that could be doubled, and have the shops near their coal.
    “At the points named, it was supposed ample reservations were made in the right of way for the accommodation of the shops, and, generally, 1,000 feet was reserved for the shops, outbuildings, and tracks.
    “This commission is satisfied, from a personal examination of the ground, that this is no more than sufficient, and at some points are in doubt as to its being sufficient, for the growing business of the road.
    “These reservations, we are informed, were made at all points except Omaha, before the Government surveys were made, and since the completing of these surveys additional reservations have been made when the shops have been found to be located on the land of the company.
    “ This commission desires to call the attention of the department to the fact that when any portion of the reservation has fallen upon the even-numbered Government sections, parties have attempted to pre-empt the ground upon which the shops stand.
    “The attention of the commissioners was called to this fact at Cheyenne, at Laramie, and at Evanston; and they consider it would be a great detriment to the company and the Government to have their reservations curtailed, as' they are not more than sufficient for the accommodation of the present and future business of the road.
    “If the charter of the companj’' gives them authority to make theirreservationfor right of way, shops, etc., this commission is of opinion that a prompt decision in these cases will avoid complications, and relieve the company of a great source of annoyance.
    
      “Hound-houses are more than sufficient to house the machinery of the road not in use. They are all well built of brick and stone, and are located at Omaha, Grand Island, North Platte, Sidney, Cheyenne, Sherman, Laramie, Medicine Bow, Bitter Creek, Green River, and Evanston. At two of these points they are not needed and not used.
    
      " Bolling-stock. — There are now on the road 152 locomotives, 25 first-class coaches, 31 second-class coaches, 1 directors’ car, 1 officers’ car, 1 paymaster’s car, 8 emigrant-cars, 9 mail-cars, 9 extra cars, 12 baggage-cars, large; 6 baggage-cars, small; 78 way-cars, 3 wrecking cars and cabooses, 4 outfit-cars, 325 handcars, 75 rubble cars, 47 dump-cars, 1,230 box-cars, 947 flat-cars, 550 coal-cars, 2 iron-cars, 12 fruit-cars, 114 stock-cars.
    “At the car-shops they have ample facilities to manufacture cars of all kinds as fast as required, and have on hand a good supply of proper material for the purpose.
    “ There are also eight locomotives under contract at the Taun-ton works, Massachusetts, to be delivered before the spring of 1875. The equipment is first class, and folly up to the present requirement of the road.
    “In compliance with the following paragraph of your instructions, ‘If the road is completed as required by law and departmental instructions, you will ascertain as near as practicable and report the date of such completion,’ this commission has endeavored to ascertain as accurately as possible the time at which the deficiencies reported by the former commission were supplied.
    “From personal examination, and from the data furnished by the company? we find that the expenditure required by the former commission in finishing bridges, in replacing the high trestles by filling with earth, &c., were finally completed in the month of September, 1874.
    “This commission has, therefore, decided that the road was completed as required by law by the report of the former commission, and to comply with the instructions of the Interior Department, October 1, 1874, at a total cost of $115,214,587.79, as shown by the books of the company.
    “ Gondmion. — We consider the road, as built, a first-class railroad, fully complying with its charter and with the requirements of the law, and in accordance with the instructions of the department furnished to us.
    “The shops and round-houses are of brick and stone; its machinery all of the latest and most approved patterns; its locomotives and rolling-stock ample and in excellent condition.
    “Its passenger-trains are well appointed and first class, giving ample accommodation to the traveler.
    “Its structures are fast becoming permanent, iron being substituted for wood and stone, and, if the present policy of the road is continued, it will be but a short time before the maintenance of road-bed will be reduced to a minimum.
    “Its cheap fuel, and the effort being made by the company to develop the resources of the country through which it runs, will develop the local travel and traffic, and add largely to its tonnage and earnings.
    
      “ The condition of the road, its order, discipline, and the evident close attention to details, not only show ability on the part of the general officers, but reflect great credit upon its local management, its superintendent, and assistants.
    “Every facility for carrying out our instructions was furnished by the company.
    “ We have found no necessity for making use of the supplemental instructions of September 10, as in all cases where the use of brick or stone has been desirable that material has been used.
    “ Eespectfally submitted.
    “JAMES MOOEE,
    “IEA L. MEEEIAM,
    “J. S. DELANO,
    “ Commissioners.'”
    
    XV. The Secretary of the Interior made the following report to the President of the United States, who made thereon the in-dorsement subjoined thereto:
    “DepaetMent oe tiie Inteeiob,
    “Washington, D. 0., November 12, 1874.
    “Sib: Joint Eesolution approved 10th April, 1869 (16 Stat., 56), authorized you to appoint a board of eminent citizens to examine and report upon the condition of the Union Pacific Eailroad and the Central Pacific Eailroad, and what sums would be required to complete them as first-class railroads.
    “ The board were appointed, discharged the duties assigned them, and made their report (printed, copy herewith), in which they estimated that over $2,000,000 would be required to supply the deficiencies in both roads, of which $576,650 would be required to complete the Central Pacific road.
    “ On the 3d of November, 1869, Mr. Secretary Cox directed the Commissioner of the General Land Office to withhold from the companies that constructed said roads one-half the lands inuring to them under acts of Congress, as a security for the ■ supply of said deficiencies.
    “On the 21st of September last, this department appointed three commissioners to re-examine the Central Pacific Eail-road, and report whether said deficiencies had been supplied and the road completed as required by law and departmental instructions.
    “I have the honor to submit herewith their report, under the date of the 2d instant. They state that $4,544,387.23 have been expended on said road in excess of the sum estimated by said eminent citizens as necessary to supply the deficiencies, and express the opinion that the road is now completed as a first-class railroad, as required by law and the instructions of the department.
    
      
      1‘ Regarding the order of Mr. Secretary Cox, of the 3d of November, 1869, as a conditional acceptance of said road, and finding that the conditions have since been amply and fully complied with, I respectfully recommend that the Secretary of the Interior be authorized to issue patents to the company for the lands inuring to it, and that said order withholding them be revoked.
    “I am, sir, very respectfully,
    . “C. DELANO,
    “Secretary.
    “To the President.”
    “Executive Mansion, November 14,1874.
    “The within recommendations are hereby approved. The authority asked for is conferred, and the order of November 3, 1869, is revoked.
    “U. S. GRANT.”
    XYI. After the President of the United States approved the letter of the Secretary of the Interior set forth in the next preceding finding, the Secretary addressed the following letter to the Commissioner of the General Land Office:
    “Department oe the Interior,
    “ Washington, D. G., ISth November, 1874.
    “ Sir : Under. Joint Resolution approved 10th April, 1869 (16 Stat., 56), a board of eminent citizens was appointed to examine and report upon the condition of the Union Pacific Railroad and the Central Pacific Railroad, and what sums would be required to complete them as first-class railroads.
    “On the 30th of October, 1869, said eminent citizens made their report to tliis department; they approved the.location of the roads and their general construction, and submitted an estimate of the sums necessary for supplying the various deficiencies, enumerated in detail.
    “On the 3d of November, 1869, the Hon. J. D. Cox, then Secretary of the Interior, accepted said report and made it the basis of an adjustment of the land grant to the companies that had constructed said roads. He directed your predecessor to suspend the issue of patents for one-half the lands inuring to said companies until further directions from the department, and to issue patents for the other half as fast as surveys and other preliminaries should be completed.
    “ Commissioners appointed within the current year have reexamined said roads and reported said deficiencies to have been supplied, and the road completed as required by report of said eminent citizens. They also state that the Union Pacific Company have expended on their road $2,215,975, and the Central Pacific Company on their road $4,544,387.23 more than tbe sum estimated by said eminent citizens as necessary to be expended in supplying said deficiencies. They express tbe opinion that that tbe roads are completed as first-class railroads, fully complying witb tbe requirements of law and tbe instructions of this department.
    “In view of tbe foregoing facts, and regarding tbe action of tbe department on the 3d November, 18G9, as an acceptance of said roads upon condition that said deficiencies should be supplied, tbe Secretary of tbe Interior has been authorized by the President to direct, and be hereby does direct, tbe issuing of patents to said companies for all the lands inuring to them, and revokes, until further directions are given, so much of said order of 3d November, 1869, as requires tbe suspension of patents.
    “Very respectfully,
    “ C. DELANO, Secretary.
    
    “Hon. S. S. Btjedett,
    
      uGomm’r Gen. Lank Office.”
    
    XVII. From tbe time when tbe claimant’s road was.opened over its entire length for tbe transportation of passengers and freight, as stated in finding VII, up to tbe time of tbe institution of tbis suit, tbe claimant has performed sendee for tbe Government, at tbe request of tbe respective departments thereof, in tbe transmission of dispatches over its telegraph line, and in tbe carriage and transportation of tbe mail, troops, munitions of war, supphes, and public stores upon its railroad. For such part of tbe services so performed as bad, prior to and including the 12th day of May, 1874, been approved by tbe accounting officers of tbe defendants, the claimant lias heretofore recovered judgment in this court for tbe amount due therefor. Between that day and tbe time of the institution of tbis suit, to wit, January 28, 1876, those officers have approved and allowed accounts for other such services to tbe aggregate sum of $1,187,254.21; and that sum is now due on account of those services.
    XVIII. Tbe total amount of tbe earnings and tbe total amount of tbe expenditures of tbe Union Pacific Eailroad Company annually and for each year from November 6, 18G9, to November 5,1875, both inclusive, were as shown in tbis finding j and tbe respective amounts which should be deducted from such total amounts, respectively, as one theory or another may be adopted for ascertaining “net earnings,” were also during each and all the said periods as shown in tbis finding, either in tbe tables or in tbe statements herein contained.
    
      
      
    
    
      Items 1, 2, 3, 4, 5, 6, 8, 9,10, and 14 are not in dispute.
    As to item 7, fifteen per cent, should be deducted from the several items of earnings from company freight in case the items for “tenement-houses and hotels,” “new station buildings,” “tanks and water-tanks,” “Laramie rolling-mills,” and “ expenditures for station buildings, shops, and fixtures,” &c., which are included below in expenditures, be disallowed.
    Item 11, “car-service earnings” was the amount received for the use of cars by other companies. Item 12 includes among others the following earnings:
    
      
    
    And item 13 was the amount received for rent of tenement-houses and eating-houses. It is in dispute whether these several amounts in items 11,12, and 13 should he included in gross earnings.
    
      
      
    
    
      
      Detail of expenditures for station buildings, $~c.} constituting item 27 above.
    
    
      
    
    Items 5, 6, 7, 8, 9, 10, 11, 12, 14, and 15 are not in dispute.
    Item 1, “ conducting transportation expenses,” is liable to be reduced by the amounts shown in line 1 of the table below as expended for “ tenement-houses and hotels,” and by the amounts shown in hue 2 as expended for new station buildings; item 2, “motive-power expenses,” is liable to be reduced by the amounts shown in line 3 as expended for “ engine-equipment,” and by the amounts shown in line 4 as expended for “tanks and waterworks”; item 3, “maintenance of cars expenses,” is liable to be reduced by the amounts shown in line 5 as expended for “ ear-equipment”; and item 4, “maintenance of way expenses,” is Hable to be reduced by the amounts shown in Hue 6 as expended for the “Laramie rolHng-mills,”in ease such several and respective outlays are regarded as not proper to be deducted from “gross earnings” in order to arrive at “net earnings.”
    
      
    
    
      Item 13, “expense account,” is subject to be reduced by the following amounts in case sucb outlays are regarded as not proper to be deducted from “gross earnings” in order to arrive at “net earnings,” viz: In tbe year November 6, 1869, to November 5,1870, expenses relating to an issueof bonds, $10,339.76; March. 13, 1871, cost of a plate for the bridge-bonds, $1,500; June 5, 1874, an expense relating to the issue of sinking-fund bonds, $6,579.10.
    The disputed expenditures in items 1, 2, 3, and 4 were for new construction. Item 27 was also for new construction.
    Item 16 was for the use of the cars of other companies.
    H ems 17, 20, 21, 22, 23, 24, and 25 show payments of interest on debts.
    Items 18 and 19 sIioav payments made on account of the land department of the company’s business.
    Item 26 shows payments in the construction of the Omaha bridge above the amounts received from the sale of the mortgage bonds secured by it.
    Items 28 and 29 show expenditures made for a sinking fund for the redemption of the company’s debt.
    Item 30 shows an assumed payment of a portion of the interest on the Government subsidy bonds by the application to it of half the Government transportation account.
    XIX. The total amount of the earnings and the total amount of the expenditures of the Union Pacific Bailroad Company for the year commencing October 1,1874, and terminating September 30, .1875, were as shown in this finding, and the respective amounts which should be deducted from such total amounts respectively, as one theory or another may be adopted for ascertaining “net earnings,” were also during the said year as shown in this finding, either in the tables or in the statements herein contained:
    A. — EARNINGS.
    1. Commercial passenger earnings. $4,171,048 07
    2. United States passenger earnings. 187,025'79
    3. United States mail earnings. 325,143 00
    4. Express earnings - .. 433,945 73
    5. Commercial freight earnings. 5,595,406 04
    6. United States freight earnings. 262,773 95
    7. Company freight earnings. 657,340 31
    8. Gar-service earnings. 10,741 86
    
      9.Miscellaneous earnings. $157,839 70
    10. Eents of buildings. 24,589 45
    11. Omaha bridge earnings. 456,786 01
    12. Surpulus in fuel and material. 59,865 50
    13. Dividends and interest on securities. 108,985 15
    14. Profit on investments. 93,000 00
    15. 12,544,490 56
    Items 1, 2, 3, 4, 5, 6, 11, and 12 are not in dispute.
    Should the items for “new station buildings,” “tenement-houses and hotels,” “tanks and water-tanks,” “new shops and machinery,” and “Laramie rolling-mills,” which are included in “expenditures” below, be disallowed, then 15 per cent, should be deducted from item 7, “company freight earnings,” in the above table. ■
    Item 8, “car-service earnings,” was the amount received by the Union Pacific Company for the use of its road by other companies.
    Item 9, “miscellaneous earnings,” includes, among others,
    the following earnings:
    Switching freight-cars and hauling special cars for
    other companies. $21,567 61
    Received from other railroad companies for use of sidings, labor of men, selling tickets, handling baggage, transferring freight, &c. 16, 685 59
    Rental of engines and cars .... 8,213 20
    Item-10, “ rents of buildings,” was the amount received for rent of tenement-houses, eating-houses, &c.
    Items 13 and 14 represent earnings from sources outside the road; it was not contended at the trial that these items form an element in “ gross earnings ” in this suit.
    It is disputed whether the several amounts in items 8, 9, and 10 should be included in “ gross earnings.”
    B. — Expenditures.
    16. Conducting transportation. $904,360 96
    17. Motive power. 1,801,139 12
    18. Maintenance of cars. 533, 554 25
    19. “ of way. 1,928,459 08
    20. General expenses (including taxes). 512,906 88
    
      21. Ornaba bridge, expenses of operating. $231,155 68
    22. Interest on first-mortgage bonds. 1,634,100 00
    23. “ on sinking-fund bonds... 1,021,388 88
    24. “ on land-grant bonds. 546,070 00
    25. “ on Ornaba bridge bonds. 220, 944 79
    26. “ on income bonds. 450 00
    27. Premium on gold to pay coupons. 273,107 74
    28. Discount and interest on floating debt. 89,481 90
    29. Salary accounts. 33,285 83
    30. Expense accounts. 18,746 21
    31. Legal expenses. 49,966 88
    32. Government directors. 4,180 45
    33. ' “ commissioners... 722 40
    34. Expenses of land and town-lot departments. 118,973 43
    35. Taxes on lands and town lots. 163,323 51
    36. Eequirements of sinking funds for tbe re-
    demption of funded debts:
    Sinking-fund mortgage bonds. 344,000 00
    Ornaba bridge bonds. 47,000 00
    37. Premium on Ornaba bridge bonds redeemed- 12,513 32
    38. United States interest, half transportation accounts charged diming tbe year. 350,609 94
    39... 10, 660,241 25
    Items 20, 21, 29, 30, 31, 32, and 33 are not in dispute.
    item 16, “ conducting transportation,” is liable to be reduced by $80,730.60, spent for “ new station buildings,” and $16,539.86 spent for “tenement-houses and hotels”; item 17, “motive power,” is bable to be reduced by $83,905.42, spent for “engine-equipment,” $9,664.42 spent for “ tanks and water-tanks,” and $15,917.58 spent for “new shops and machinery”; item 18, “ maintenance of cars,” is liable to be reduced by $192,832, spent for “ear-equipment”; and item 19, “maintenance of way,” is liable to be reduced by $192,989.74, spent for tbe “Laramie rolling-mill,” in case such several and respective outlays are regarded as not proper to be conducted from “ gross earnings ” in order to arrive at “net earnings.”
    Tbe disputed expenditures in items 16,17,18, and 19 were for new construction.
    Items 22, 23, 24, 25, 26, 27, and 28 show payments of interest on tbe company’s debts.
    
      Items 34 and 35 show payments on account of the land department of the company’s business.
    Items 36 and 37 show payments made for a sinking fund for the redemption of the company’s debts.
    Item 38 shows an assumed payment of a portion of the interest on the Government subsidy bonds by the application to it of half the Government transportation.
    XX. Up to the 1st of July, 1874, of the lands granted by the United States to the claimant, 3,445,781 acres had been patented to the claimant; of which, up to that date, the claimant had sold 1,013,774 acres.
    (Additional findings allowed on request of the claimant:)
    XXI. That the laying of the last rail of the road merely enabled the company to get a train over it, and that it is not practicable to complete a road before all its rails are laid. This was especially so in the case of this road, because a large portion of material that was required to make the final completion was at the west end of the road.
    XXII. That the road performed service for the Government at the request of the respective departments thereof, in the transmission of dispatches, and in the carriage and transportation of mails, troops, munitions of war, &c., for several years before the road was open for its entire length.
    •XXIII. That the disputed items in charges made by the company under the head of expenditures, namely, u tenement-houses and hotels, new station buildings, engine-equipments, tanks and water-works, car-equipment,” were each of them not ■only new, but rendered necessary by the increasing business of the road. That the said tenement-houses and hotels were necessary for occupancy by employes of the company and for feeding passengers. The rents of these hotels and tenements ■are credited among the earnings of the company in the statement of earnings, schedule B, reported in these findings.
    XXIV. That the Laramie rolling-mill was built as an economy. The company was obliged until its erection to transport its rails to distant places Bast to be rerolled, the expense of which had been charged to “ maintenance of way ” up to the completion of the rolling-mill. The charge, up to that period, is among the items of expenditure allowed and not disputed.
    XXV. On the 1st November, 1865, the company executed their first mortgage authorized by the 10th section of the Act of 1864. On the 6th November, 1869, the company owed a large floating debt and also a large funded debt, secured by income bonds, first-mortgage bonds, and land-grant bonds, to which were afterward added, on the 18th December, 1873, sinldng-fnnd bonds, and on the 1st April, 1871, Omaha bridge bonds. The amount of expenditures charged by the company, constituting items 17, 20, 21, 22,. 23, and 24 of schedule B are payments of interest upon said floating debt and said mortgage debts as the same accrued. Items 25, 28, and 29 of schedule B were sums paid for premiums, sinking fund, &c., required by the terms of the Omaha bridge mortgage and the sinking-fund mortgage. Items 18 and 19 of schedule B are expenditures made by the company for taxes connected with the sales of their lands mortgaged.
    (Additionalfindings allowed on request of the defendants:)
    XXVI. That the provisions of the Act of July 1, 1862, were accepted by the company September 4, 1862.
    XXVII. That the trestles and pile bridges on the road November 6,1869, were the same as used on all American roads, well put up, of the modern plans, strong and perfectly safe, and would not require replacing for several years.
    XXVIII. That on the 22d of July, 1869, in partial performance of the order of the President of July 15,1869, $640,000 of subsidy bonds were issued by the United States to the claimant, that amount being the subsidy bonds due on the section from the 1000th to the 1020th mile from Omaha, the subsidy bonds upon all the previous sections having been received by the claimant before that time.
    XXIX. That the reports upon sections of the road mentioned in finding V refer to those on the 1st, 2d, 3d, and 5th sections, defects and deficiencies on which were remedied before September 1,1866.
    XXX. That the bonds to which the claimant became entitled, mentioned in. finding X, remained unissued until July 14, 1870, in accordance with an agreement between the claimant and the Central Pacific Railroad Company of California.
    XXXI. That certain bonds were issued on September 1,1869, by the claimant, known as income bonds, and that for the purpose of securing the payment of interest warrants attached to such bonds, it was therein agreed “to devote the net earnings of its said railroad, after deducting therefrom the payments of iuterest tliat shall fall due upon the first mortgage of its road, and also upon the mortgage of its lands heretofore made and already issued or to be issued by it,” to the payment of such interest warrants, and the said claimant agreed further in said bond to make up and furnish, on the first days of January and July of each year, to the trustees named “ a fair and just account of the net earnings of said road for the six months next preceding, and will deduct therefrom the interest due and payable from it upon the first mortgage of its road heretofore issued and upon its land-mortgage bonds heretofore issued or to be issued,” &c.
    Upon the foregoing facts the conclusion of law was, that the defendants were entitled to recover, under their counter-claim, as five per cent, of the claimant’s net earnings, from November 6,1809, to November 5,1874, inclusive, the sum of $1,402,602.28; which sum is made up in the manner set forth in the opinion of the Chief Justice, concurred in by Eichardson, J.; and that the claimant was entitled to recover $593,027.10, as one-half of the compensation due from the defendants to it for services rendered; and that for the difference between those sums, to wit, $808,975.18, judgment should be rendered in favor of the defendants.
    
      Mr. Sidney Bartlett for the claimant:
    The question we desire to submit to the court is, whether, by a just construction, it was or not the purpose of section 10 of the Act of 1864 to postpone the payment of the five per cent, of the net earnings until the new mortgage debt and its interest, which the section authorizes, shall first be discharged. In construing this seetion, it must be kept in view that the Act of 1804 was passed to accomplish, by further aid, the construction of a great public work, which, under the Act of 1802, it was found could not be effected. It must be also noticed that by the mortgage thus authorized there was to be created a debt by the corporation at the outset of the work, as fast as each section of the road was completed, and to accumulate during the entire ten years allowed for its completion, the interest on which was to be met semi-annually, and the principal from time to time, as the bonds matured. From some source this struggling company was, therefore, -from the start to find means to pay the semi-annual interest on this debt and to provide means for its ultimate extinction. Behind it lay the mortgage of the Government for twenty-seven millions of dollars. To do this its income must have been known to be its only resource; a slender resource at the outset of the work, and only on its completion likely to be sufficiently productive to accomplish the end.
    Such being the object of the Government, and such the means of the corporation, it is submitted that an agreement by the Government to suspend in favor of the new mortgage the duty of the company to apply a portion of its income (retaining, how- ■ ever, sums earned by Government transportation) to repayment of the subsidy is not repugnant to the general purpose of the Government disclosed by both acts, namely, to effect by its aid and with speed the accomplishment of the work.
    Going now to the terms of the section, it purports to “ subordinate” to the new mortgage “bonds” the “lien of the United States bonds,” with this exception, however, namely, except “the provisions of the sixth section “ of the act to which this act is an amendment, relating to the transportation of mails, troops, munitions of war, supplies and public stores for the Government.” The question then is, what was subordinated, and, further, what is the meaning and true construction of the word “ subordinate ” when thus used with a view to give to the new mortgage bonds some advantage or priority over the lien of the United States ?
    It is clear that the things subordinated are not confined to the mortgage held by the Government under the previous section to secure the reimbursement of its subsidy bonds. But what is decisive on this point is that the express exception in the section of the duty of transportation for the Government (with its attendant remuneration), which it declares shall not be subordinated, makes it unquestionable that the lien designed to be subordinated was not merely that created by the earlier mortgage provision, but included the lien for the performance of all the duties enumerated in section 6, with the exception of that one of them which it specially retained, and it is also a distinct declaration that to secure the performance of all those duties Government claimed and held a lien. That such lien existed is shown by the various provisions of the act.
    If, then, it be true that, to secure performance of each of the duties prescribed by the sixth section, Government had a lien, and that by the terms of the exception one only of these duties was excepted from subordination in favor of the new bonds, the next inquiry is in what sense is the word “ subordinate” used in the act ? Now, if it were true that the new bonds and mortgage had or could have a similar lien, or that the mortgage to secure the new bonds embraced the performance of the duties enumerated in the sixth section, there would be no difficulty in holding that the purpose was to postpone the performance of its duties by the company to the G-overnment contained in that section, and to allow their performance to the • new mortgagee while that new mortgage was unpaid. But the new mortgage had not in it, nor could it have, any provision of that character, and consequently no lien connected therewith. An interpretation of the word “subordinate” must therefore be found by looking at the declared purpose of the section, which clearly was to waive in favor of the new mortgage, while it existed, some right or lien of the Government. And it is submitted, if the premises be sound, that subordination of the duties required by the sixth section means, and can mean, nothing else except the postponement of the performance of those duties, including the payment of the five per cent., until, from out its income or otherwise, the corporation should be able to provide for the payment of the interest and principal of its new mortgage, which it had no other means to provide for, and not to diminish that income by the application of it toward the payment of the Government subsidy.
    If it shall be held that the rights of the Government are not postponed, as we contend, then the question arises, What, within the contemplation of the charter, is to constitute the net earnings of the company upon which the five per cent, is to be computed? The “lexical” and accurate definition of the word “earnings” is “gain as the reward or wages of labor.” Of course the use of this term as applied to railways, ships, factories, Sc., is merely figurative, and must have a different and much wider signification than the gain or reward of labor. It must mean the entire income from all direct or incidental sources during the period for which the account of said earnings is made up. As thus applied, the words “income” and “earnings” are convertible terms. If this view be correct, then it follows that all expenditures, of every description, connected with the operations which have resulted in that income are proper deductions to be made to arrive at net earnings or income, and that interest paid on money borrowed to carry on those operations 'which have resulted in this gross income are proper deductions to be made to arrive at net earning’s or income. To hold otherwise would, we think,, shock the mercantile if not the legal sense.
    This view as to what constitute net earnings is, we think, adopted by the Supreme Court in St. John v. The Trie Railway Company (22 Wall., 136), where it is declared that net earnings are “that which remains, after all charges and outlay, as net profit.”
    Let it not be said that net earnings as to stockholders and net earnings as to the Government have a different meaning. The assumption that the Government designed to claim five per cent, by a mode of computation of net earnings which computation may show that there were no net earnings for stockholders, nay, which might show that the company, after expending all its earnings to meet its expenses and obligations, had not only nothing left, but had increased its debt, is too extravagant to be sound.
    Finally, on this point of what is meant by the term net earnings, as used in the charters of railways, factories, commercial or other corporations, for gain, where there are no words of explanation or qualification, we submit that gross earnings comprehend all the gains of such corporations from the legitimate exercise of all direct and incidental powers conferred on them by their respective charters, and that, in stating an annual account to arrive at their net earnings, all expenditures made during the year in the legitimate use of those same powers, including interest paid upon loans, are, and are universally understood to be, proper deductions.
    We jjroceed next to an examination of the contract or charter of claimant, under which the question of the cause arises, to find if, from its general scheme or design, or from a scrutiny of any one or more of its provisions, it is to be inferred that this natural interpretation is directly or even by remote inference affected or changed; nay, more, whether it is not distinctly confirmed and established. At the outset we desire to advert to the words of the sixth section, namely, “ the net earnings of said road,” which, taken literally, might have a tendency to narrow the construction of net earnings and limit the samé to mere earnings of the track or transportation, and exclude the very considerable revenue of the company from rents, hire of locomotives, and other emoluments derived from its various structures and property, which, the company were required by the charter to construct, procure, and maintain, in order to make and sustain a first-class road to the acceptance of the Government and as defined by the charter. It will be found that the word “road” is used in various parts of the charter, as it is in common parlance, as synonymous with the word “company” or “corporation,” and in some instances whereat can mean nothing but corporation or company. The section that bears distinctly upon the construction of the words “ net earnings ” is section 18 of the Act of 1862, which is as follows:
    “That whenever it appears that the net earnings of the entire road and telegraph, including the amount allowed for services rendered for the United States, after deducting all expenditures —including repairs, and the furnishing, running, and managing of said road — shall exceed ten per centum upon its cost (exclusive of the five per centum to be paid to the United States), Congress may reduce the rates of fare thereon, if unreasonable in amount, and may fix and establish the same by law.”
    Now, it is clear that the words “ net earnings,” as thus used, are to be construed as earnings applicable to dividends (whether •divided or not), since the whole object of the section is, after allowing earnings sufficient for that purpose, namely, ten per cent., to enable Government to reduce the tolls. Unless, then, this purpose of protecting the public by reduction of tolls is so different in its character from the protection of the public by requiring reimbursement of the subsidy (as provided in section six,) as to require a different construction of the same terms, that construction will be held to be the same in both sections, and thus net earnings will be found to mean such earnings as leave a residue applicable (if the corporation choose to apply it) to dividends. Indeed, the enumeration of deductions allowed by the 18th section comprises all deductions which precede corporate dividends. Again, the words “exclusive of the five per cent, to be paid to the United States,” used, as they are, as part of a section defining the words net earnings, must be taken to define what is meant by the same words in the sixth section, since there is nothing to indicate that a different method of arriving at the “five per cent, to be paid to the United States” under the provisions of the sixth section is to be adopted from .the mode defined in this eighteenth section.
    Exit there is another feature of the charter and of subsequent legislation connected therewith which shows that from the outset and during the progress of construction the Government anticipated that, in the result and with all the aid it had afforded to the enterprise, it would not be conducted to a conclusion without loans from other quarters or debts subjecting the company to the payment of large sums annually, for interest, during a remote period of time, to meet which, save by further borrowings, its only resource was its earnings. Several of these loans, payable at distant periods, were established or authorized either by the charter or by subsequent legislation. Can it be supposed that by use of the term “ net earnings ” it was intended by either party that the annual payments from gross earnings of the interest on these loans, obtained to accomplish the purposes of the Government and largely with its sanction, should not be sums to be deducted in order to arrive at net earnings within the meaning of the act, but that the purpose was that the five per cent, should be calculated on these payments, and this even if the earnings should, as was probable at the outset, be all absorbed by these payments or even prove insufficient to make them ?
    But whatever may be held as to the principles upon which net earnings are to be computed, and if an account of the same is to be stated, the next question to be determined is, when was the road of the company completed within the meaning of its charter'? The result, as found by the auditor, and which cannot be successfully assailed, is, “I find and report that the President never formally ascertained and determined that the road was finally completed until in November, 1874, when he determined that it was completed on the 1st of October, 1874.” It will be noted that the charter required the construction of a road which, with all its “ depots, equipments, furniture, and appurtenances,” should be of the' first class (Act of 1862, Sect. 4), and to that standard was the company held throughout by the Government. Further, that the company had by the charter eleven years to complete the road, and that the final completion and acceptance was considerably within that period.
    It should be further noted that the time of actual completion, aside from the report of the Government commission, is established by the evidence, and that although the road was open for public use as early as May 10,1869, yet the uncontradicted testimony shows that when thus opened, it was capable of use only to a limited amount, and that a slow use. Finally, on this point, this same question, upon substantially the same evidence, has been the subject of adjudication in the circuit court of the United States for the district of California, in a suit brought by the United States against the Central Pacific Railroad Company, to recover the same five per cent. The judgment of that court— to whose careful examination we refer — decides that the road was not completed until October 1, 1874.
    
      Mr. Attorney-General Devens (with whom was Mr. J. K. Mc-Gammon) for the defendants:
    The claim of the United States is founded upon the last clause of the sixth section of the Act of 1862 (12 Stat. L., 493), whieh is in these words: “ And after said road is completed, until said bonds and interest are paid, at least five per centum of the net earnings of said road shall also be annually applied to the payment thereof.”
    The questions under the sixth section to be determined by the court in this controversy are: First, at what date was the Union Pacific Railroad completed? and, second, what constituted net earnings within the meaning of the statute during the period covered by the counter-claim ?
    As to the first question:
    The scheme of conipleting the road was that it should be constructed in sections originally of 40 miles by the Act of 1862, but afterward reduced to 20 miles by the Act of 1864; that upon the completion of each section the president of the company should mate oath thereto before a court of record that the section was completed as required by the act; that upon the presentation of an application, supported by this affidavit, the President was to appoint three commissioners (who are called in this statement “ section commissioners”), to examine and report upon that section 5 and that upon them report, if the section was found duly conqfieted as required by law, subsidy bonds and land patents were to be given in accordance with the provisions of the statute.
    The statutes constituting the charter of the railroad company have but one standard of completion; the distinctions between provisional and ultimate completion are unknown to them. And if the provisional completion was sufficient to authorize the company to receive tbe subsidy bonds, it should be sufficient to require it to perform tbe pecuniary obligations due on such completion ; if tbe provisional completion was sufficient to permit it to receive tbe equivalent of upward of twenty-seven millions in subsidy bonds, it should be sufficient to require it to pay tbe small percentage of its net earnings after tbe whole road has been so provisionally completed; and, if tbe company, by representations that its road was completed, upon which tbe United States acted and delivered to them tbe subsidy bonds because thereof; or if a standard of completion different from tbe charter standard was agreed upon, either expressly or impliedly, upon reaching which the railroad company was to receive and did receive the subsidy bonds; or if a standard of completion was assumed, upon reaching which, with assurances by the railroad company that further sufficient work and money were to be expended on said road by the company, the company received the subsidy bonds — upon either or any of these supposed cases, if the road was accepted as completed by the United States and the subsidy bonds were delivered or were ready for delivery, the company would be estopped from denying the completion of the road, and the road would in law be deemed so completed that the company is liable to pay the 5 per cent, of the net earnings due upon completion.
    The acts of the Executive are to be considered legal only when they are within the general or express authority pointed out by the Constitution and laws.
    The order of November 3, 1869, withholding one-half of the patents as security for the completion of the road was beyond the power of the Secretary of the Interior to issue; so all subsequent action respecting the withholding of land-patents, as far as it was attempted to affect the question of the completion of the road, was illegal and void.
    No act of Congress made the Executive the judge of when the road was completed; but the statutes provided that when certain things were done by the company, and verified by commissioners appointed by the President of the United States, then the road should be considered completed, and all the bonds due delivered to the company. As illustrative of the understanding of the company, it will be noticed that the contractors for constructing the road covenanted to complete the sections allotted them in such manner as would comply with the acts of Congress, and they were paid accordingly. This, therefore, should prevent the company from denying the non-completion of the road until 1874, because the large portion of the pecuniary benefit derived by the contractors, the Credit Mobilier, and the trustees of the Ames and Davis contract, was at the expense of the United States.
    The subsidy bonds and stock were delivered to contractors for constructing and completing a first-class railroad in 1869, but the United States, it is urged, must wait until some five years later before the road can be declared sufficiently completed to become a creditor to the United States to the extent of five per cent, on its net earnings. That this is the true interpretation of the Act of 1862 and other amendatory acts is denied by the United States, and such reasoning is believed to be contrary to justice, unsound in morals, and not warranted by the language of the statutes.
    The sections of the Act of 1862 fixed the test of a completed railroad. The sectional requirements were those of a first-class railroad, and successive completed and accepted sections formed, nil to and including the last mile-post, the completed railroad. What the President of the United States and the Secretaries and Attorney-General may have decided the company could do in the way of evading the requirements of the statute as to the elements entering into and necessary for completed sections the company are now estopped from asserting to the detriment of the rights of the United States. The same statute which provided for the issuing of land patents and subsidy bonds for completed sections made it obligatory upon the president of the company to make oath that the successive sections had been completed in the manner required by the act, viz, ready for the service contemplated by the acts, and supplied with all necessary drains, culverts, viaducts, crossings, sidings, bridges, turnouts, &c., and all other appurtenances of a first-class railroad, audit was made a condition that the commissioners to examine and report upon the sections should not be appointed by the President of the United States unless the president of the company presented to him this sworn statement.
    As without such sworn statements, verified by the commissioners, the President of the United States and Secretary of the Treasury were not permitted by the statute to issue bonds of the United States to the company, so in receiving the bonds issued, thus deriving large pecuniary interest from tbeir delivery, tbe railroad company is presumed to bave complied with tbe provisions of tbe Act of 1862 in every respect, and to bave carried out its part of tbe contract in good faith.
    Tbe language of section 5, Act 1862, “ shall ipso facto constitute a first mortgage,” &e., and “in consideration whereof,” &c., taken in connection with tbe clause of tbe sixth section, establishes that, as tbe law provides that all tbe bonds to which tbe company were ultimately entitled should not be issued unless-the successive sections and tbe whole road were completed, so tbeir issue raised a pecuniary obligation on the part of tbe company to pay live per cent, of its annual net earnings eo instanti. Tbe United States, having issued all tbe bonds provided for by law as to a completed road, was entitled under section 6, Act 1862, to bave live per cent, of net earnings applied annually for tbeir liquidation, tbe first annual period to begin on tbe date of tbe last bond issued. Tbe statute demanded that when certain acts were done a certain other thing should be tbe result, and no understanding of tbe company outside of tbe statute, even with United States officials, can avail it to prevent estoppel from operating against tbe present defense of tbe company as to tbe time of completion. A waiver of tbe condition of tbe requirements of tbe successive sections cannot be accepted as a waiver of tbe result which the statute provided should follow tbe accomplishment of other conditions, i. e., tbe completion of the road, for tbe reason that statutes can only be repealed or legally waived by subsequent statutes, and never by executive action.
    This obligation to apply five per cent, of tbe net earnings is dependent only upon tbe fact of tbe completion of the road. It is entirely independent of tbe fact whether all tbe subsidy bonds or land patents due bave been issued. Tbe fact of the non-issue of such bonds and patents may be a circumstance, with others, tending to show tbe road was not completed; but if tbe road was in fact completed, the non-issuing of tbe bonds and patents would be no excuse for tbe non-payment of tbe five per cent, of net earnings, although, as it has been argued, tbe issue and delivery of tbe bonds absolutely estops the company from setting up non-completion immediately after such delivery.
    As to tbe second question, What constitute “net earnings” Avithin the meaning of tbe sixth section, Act of 1862, and bad tbe road any such during tbe period coATered by the counter-claim?
    
      The United States contend that the words were used in the sense in which they were then used as in ordinary acceptation or as technical in regard to railroads, as meaning the gross earnings of a railroad in its capacity as a carrier and instrument for carrying, less the expenses of acquiring those earnings, including in these expenses the cost of keeping the road and its equipment good. Repairs, in kind, of existing structures, taxes, service, supplies are to be included; payments for construction, interest for debts, &c., to be excluded. Gross earnings, less legitimate operating expenses.
    The exact definition of net earnings, in railroad parlance, is given by Judge Blatchford in the case of St. John v. The Erie Railway Company (10 Blatch., 271-279): “Net earnings are, properly, the gross receipts, less the expenses of operating the road to earn such receipts. Interest on debts is paid out of what thus remains, that is, out of the net earnings. Many other liabilities are paid out of the net earnings. When all liabilities are paid, either out of the gross receipts or out of the net earnings, the remainder is the profit of the shareholders, to go toward dividends, which in that way are paid out of the net earnings.”
    This case was heard on apx>eal in the Supreme Court, and the court (22 Wall., p. 136) sustained the decision of Judge Blatch-ford.
    The lexical definition of “net,” as given by Webster, and adopted by Justice Swayne in St. Jolmv. The Frie Railway Co., is “clear of all charges and deductions.” Worcester: “That which remains after deduction of all charges or outlay, as ‘ net profits’; clear of all tare or tret, or other deduction, as ‘net weight.’” The word “net” means “clear” — clear of charges and deductions, and the charges and deductions that are to be cleared depend upon the subject to which the word net is applied. The “earnings” of a road had acquired in 1862 a specific meaning; its earnings as a common carrier from the transportation of persons and goods. “Net earnings” is the sum remaining after the deductions from the earnings necessary to obtain the earnings — to earn that which is earned.
    In Fysterv. The Centennial Board of Finance (94 U. S. R., 500), while the word “earnings” was not under discussion, the principle which the United States contend for was recognized. It was said that under the acts of Congress (June 1,1872, 17 Stat. L., 203, and February 16,1876,19 Stat. L., 3) tfie word “profits” must be field to be synonymous witfi receipts, and tfiat tfie receipts of tfie exhibition over and above its current expenses were tfie profits. They are in fact tfie net receipts, which, according to tfie common understanding, ordinarily represent tfie profits of a business, (p. 503.)
    In tfie eighteenth section, tfie explanation of what were net earnings is in harmony with tfie view heretofore stated. Tfie whole section is to be construed, “ tfiat whenever tfie earnings of tfie entire road and telegraph line, including tfie amount allowed for services rendered for tfie United States, shall exceed ten per cent, upon tfie cost of tfie road, in addition to tfie five per cent, on net earnings to be paid in, as provided in sixth section, Congress may reduce rates of fare, &c. j or when net earnings, less five per cent, thereon to be paid to tfie United States, shall exceed ten per cent, on cost of road, Congress may reduce, &c.; or when net earnings of tfie entire railroad, &c., which are reached by deducting ft'om tfie gross earning's, which shall include tfie amount allowed for services rendered for tfie United States, all expenditures, which include repairs and the furnishing, running, and managing-of said road, shall exceed ten per cent, upon tfie cost of tfie road (first deducting from tfie net earnings tfie five per cent, to be paid to tfie United States), Congress may reduce,” &c. It is of no importance whatever whether 100 per cent, or 95 per cent, of net earnings is to exceed 10 per cent, of tfie cost of tfie road.
    Tfie enumeration of a class of expenditures shows tfiat only those of tfiat class are to be deducted from gross earnings in order to find net earnings. No interest was to be deducted within tfie meaning of tfie eighteenth section, for tfie Act of 1862 did not contemplate any interest to be paid, as tfie first-mortgage bonds were issued on tfie authority of the tenth section, Act of 1864, and tfie interest on subsidy bonds was not to be paid until tfie maturity of tfie bonds. (U. S. v. Union Pao. R. R., 91 IT. S. E., 72.)
    Tfie tenth section of tfie Act of 1864 provides that “ tfie Union Pacific Eailroad Company can issue first-mortgage bonds, * * * and tfie lien of tfie United States bonds shall be subordinate to tfiat of tfie bonds of any or either of said companies hereby authorized to be issued.” This section only subordinates one lien to another — tfie lien of tfie subsidy bonds to tfiat of tfie first-mortgage bonds. This subordination is itself modified by tfie exception as to tbe provisions of the sixth, section of the Act of 1862, as to the transmission of dispatches, mails, &c., i. e., the vital purposes of the road. If first-mortgage bondholders take possession of the road on foreclosure, these duties would have to be performed by them.
    The exception of the tenth section was only to the provisions of the mortgage and is limited thereto. The provisions as to five per cent, in the sixth section of the Act of 1862 is distinct and independent from the mortgage. Indeed, it is a provision pro tcmto for repayment of the subsidy bonds. It is a duty resting upon the stockholders as long as they hold the road, and a distinct and independent duty to be performed by them. The superiority given to the first mortgage affects it in no way, and the provision for paying the five per cent, still remains. As between the United States and the company, while it remains in possession of the road, no change is effected in its contract. It is oidy when the first-mortgage bondholders come into possession of the road that they would be entitled to devote all the avails to the payment of their mortgage.
    The five per cent, being payable annually, interest should be added from November 5, in each year, on any of those items which may be allowed.
   Drake, Ch. .1.,

delivered the following opinion:

Before the 12th of May, 1874, and between that day and the date of the institution of this suit, the claimant performed service for the Government, in the transmission of dispatches over its telegraph line, and in the transportation of mails, troops, munitions of war, supplies, and public stores upon its railroad. For filie services so rendered the accounting officers of the Treasury Department have approved and allowed accounts to the amount of $1,187,254.21, and that sum is now due and unpaid on account of those services.

There is no controversy as to the rights of the respective parties in regard to that sum. The defendants are entitled to retain one-half of it in the Treasury toward the ultimate payment of bonds of the United States issued to the claimant; and the claimant is entitled to be paid the other half, provided the defendants’ counter-claim cannot be set off against it.

. This counter-claim is for u five per centum of the net earn-iugs ” of tlie claimant’s road after its completion, and is claimed by the defendants under section 6 of tlie Act of July 1, 1862, 11 to aid in the construction of a railroad and telegraph lime from the Missouri River to the Pacific Ocern, and to secure to the Government the use of the same for postal, military, cmd other purposes.” (12 Stat. L., 489.)

As in tlie decision of tlie questions arising under tbe counterclaim tlie third, fourth, fifth, and sixth sections of that act will be more or less brought under discussion, we present the mate-terial parts of them, as they were enacted, with some amendments incorporated, which were made by the Act of July 2, 1864 (13 Stat. L., 356).

“ Sec. 3. That there be, and is hereby, granted to the said company, for the purpose of aiding in the construction of said railroad and telegraph line, and to secure the safe and speedy transportation of the mails, troops, munitions of war, and public stores thereon, every alternate section of public land, designated by odd numbers, to the amount of ten alternate sections per mile on each side of said railroad, on the line thereof, and within the limits of twenty miles on each side of said road, not sold, reserved, or otherwise disposed of by the United States, and to which a pre-emption or homestead claim may not have attached at the time the line of said road is definitely fixed.
“ Sec. 4. That whenever said company shall have completed twenty consecutive miles of any portion of said railroad and telegraph line, ready for the service contemplated by this act, and supplied with ali necessary drains, culverts, viaducts, crossings, sidings, bridges, turnouts, watering-places, depots, equipments, furniture, and all other appurtenances of a first-class railroad— the rails and all tlie other iron used in the construction and equipment of said road to be American manufacture of tlie best quality — the President of the United States shall appoint three commissioners to examine the same and report to him in relation therein; and if it shall appear to him that twenty consecutive miles of said railroad and telegraph line have been completed and equipped in all respects as required by this act, then, upon certificate of said commissioners to that effect, patents shall issue conveying the right and title to said lands to said company, on each side of the road, as far as the same is completed, to the amount aforesaid; and patents shall in like manner issue as each twenty miles of said railroad and telegraph line are completed, upon certificate of said commissioners. Any vacancies occurring in said board of commissioners, by death, resignation, or otherwise, shall be filled by the President of the United States: Provided, hoto ever, That no such commissioners shall be appointed by the President of the United States, uuless there shall be presented to him a statement, verified on oath by the president of'said company, that such twenty miles have been completed in the manner required by this act, and setting forth with certainty the points where such twenty miles begin and where the same end, which oath shall be taken before a judge of a court of record.
“ Seo. 5. That for the purposes herein mentioned the Secretary of the Treasury shall, upon the certificate in writing of said commissioners of the completion and equipment of twenty consecutive miles of said railroad and telegraph, in accordance with the provisions of this act, issue to said company bonds of the United States, of one thousand dollars each, payable in thirty years after date, bearing six per centum per an-num interest (said interest payable semi-annually), which interest may be paid in United States Treasury notes or any other money or currency which the United States have or shall declare lawful money and a legal tender, to the amount of sixteen of said bonds per mile for such section of twenty miles; and to secure the repayment to the United States, as hereinafter provided, of the amount of said bonds so issued and delivered to said company, together with all interest thereon which shall have been paid by the United States, the issue of said bonds and delivery to the company shall ipso facto constitute a first mortgage on the whole line of the railroad and telegraph, together with the rolling-stock, fixtures, and property of every kind and description, and in consideration of which said bonds may be issued 5 and on the refusal or failure of said company to redeem said bonds, or any part of them, when required so to do by the Secretary of the Treasury, in accordance with the provisions of this act, the said road, with all the rights, functions, immunities, and appurtenances thereunto belonging, and also all lands granted to the said company by the United States which, at the time of said default, shall remain in the ownership of the said company, may be taken possession of by the Secretary of the Treasury, for the use and benefit of the United States: Provided, This section shall not apply to that part of any road now constructed.
“ Sec. 6. That the grants aforesaid are made upon condition that said company shall pay said bonds at maturity, and shall keep said railroad and telegraph line in repair and use, and shall at all times transmit dispatches over said telegraph line, and transport mails, troops, and munitions of war, supplies, and public stores upon said railroad for the government, whenever required to do so by any department thereof, and that the government shall at all times have the preference in the use of the same for all the purposes aforesaid (at fair and reasonable rates of compensation, not to exceed the amounts paid by private parties for the same kind of service), and one-half of all compensation for services rendered for the government shall be applied to the payment of said bonds and interest until the whole amount is fully paid. Said company may also pay the United States, wholly or in part, in tlie same or other bonds, Treasury notes, or other evidences of debt against the United States, to be allowed at par ; and after said road is completed, until said bonds and interest are paid, at least five per centum of the net earnings of said road shall also be annually applied to the payment thereof.”

■ The whole controversy in the case grows primarily out of these words at the close of the sixth section: uAnd after said road is completed, until said bonds and interest are paid, at least five per centum of the net earnings of said road shall also he a/mu-ally applied to the payment thereof.”

In support of the counter-claim, the defendants contend that the road was completed, within the meaning of those words, on or before the 6th of November, 1869; and that thereafter there were net earnings of the road, of which the claimant was bound to apply annually 5 per cent, to the payment of the bonds issued to it by the United States.

Against the counter-claim, the claimant insists that the road was not completed until the 1st of October, 1874; and that its net earnings were less than contended for by the defendants.

Two questions are therefore to be passed upon by the court, namely: 1. When was the Union Pacific Eailroad completed from Omaha to its western terminus, within the meaning of the act aforesaid 9 And 2. What were its annual net earnings after the date of its completion.

Before proceeding to discuss those points, a question raised by the claimant must be disposed of, for it suggests a view which, if sustained, would be fatal to any recovery on the counter-claim. The question is, whether it was not the purpose of section 10 of the Act of 1864 to postpone the payment of the 5 per cent, of the net earnings until the new mortgage debt and its interest, which that section authorized, should be first discharged "1

The following is the section referred to': .

“ Sec. 10. That section five of said act be so modified and amended that the Union Pacific Eailroad Company, the Central Pacific Eailroad Company, and any other company authorized to participate in the construction of said road, may, on the completion of each section of said road, as provided in this act and the act to which this act is an amendment, issue their first-mortgage bonds on their respective railroad and telegraph lines •to an amount not exceeding the amount of the bonds of the United States, and of even tenor and date, time of maturity, rate and character of interest, with the bonds authorized to be issued to said railroad companies respectively. And the lien of the United States bonds shall be subordinate to that of the bonds of any or either of said companies hereby authorized to be issued on their respective roads, property, and equipments, except as to the provisions of the sixth section of the act to which this act is an amendment, relating to the transmission of dispatches and the transportation of mails, troops, munitions of war, supplies, and public stores for the Government of the Uifited States.”

We are unable to perceive how the effect suggested can be given to this section, or to see the force of the train of reasoning by which the learned counsel for the claimant sought to give it that effect. We need not stop to controvert his positions in detail, but will state our own views of the subject.

The Act of 1862, in aid of the construction of the Union Pacific Eailroad, made four different grants to the claimant, viz: 1. The right of way through the public lands; 2. The right to take from the adjacent public lands materials for the construction of the road; 3. Alternate sections of public land; and, 4. Bonds of the United States to the amount of $16,000 per mile.

The issue and delivery of those bonds to the claimant was declared by the act to constitute a first mortgage on the whole line of its railroad, together with the rolling-stock, fixtures, and property of every kind and description appertaining thereto.

That is the sole lien imposed by that act on the property of the claimant.

But the grants above specified are declared to be made upon four conditions, viz: 1. That the claimant should-pay said bonds at maturity; 2. That it should keep its railroad and telegraph line in repair and use; 3. That it should at all times transmit dispatches over said telegraph line, and transport mails, troops, and munitions of war, supplies, and public stores upon said railroad for the Government whenever required to do so by any department thereof; and, 4. That the Government should at all times have the preference in the use of the road and telegraph line for the purposes aforesaid.

In addition to the lien and conditions so imposed and declared, the sixth section made the provision aforesaid in regard to the five per cent, of the net earnings of said road.

That provision imposed an obligation on the claimant which, bjr accepting the charter, it agreed to fulfill; but it was not de-dared that tliat obligation constituted a lien on the road, or that the grants made to the claimant, as above stated, were to be conditional upon the payment of the five per cent. It was simply a naked legal obligation, dependent for its fulfillment merely on the existence of net earnings.

Such being the state of the matter, the tenth section of the Act of 1804 authorized the claimant to issue $16,000 per mile of first-mortgage bonds, and, in connection with that authority, declared that “ the lien of the United States bonds shall be subordinate to that of the bonds * * * hereby authorized to be issued, except as to the provisions of the sixth section of the act to which this act is an amendment, relating to the transmission of dispatches and the transportation of mails,' troops, munitions of war, supplies, and public- stores for the Government of the United States.”

The confusion produced in that sentence, by declaring an exception where none in fact existed or could in the ñatee of things exist, since the matter excepted is wholly different in character from that from which it is excepted, tends to confusion in its construction. Without stopping to discuss it, we hold that the sentence means simply this: 1. That the Government yields its priority of lien on account of its bonds; and, 2. Eeasserts and reimposes the condition declared in the sixth section of the Act of 1862, as to the transmission of dispatches and the transportation of mails, troops, &e.

Has that provision any bearing on the five per cent, question involved in the present case? We think not. If it appeared that the earnings of the claimant’s road, after paying the expenses of its management and operation, were not sufficient to pay the interest on the first-mortgage bonds issued under the authority of that tenth section, we should not hesitate to hold that the Government could not demand the payment of the five per cent. But no such fact exists. ' On the contrary, those earnings are largely more than enough to pay both the interest on those bonds and the five per cent. No question, therefore, arises here, such as might arise between the Government and the first-mortgage bondholders, if the earnings were insufficient to pay that interest, and the Government should nevertheless insist on the payment of the five per cent. The question now is, whether that section, as between the claimant and the defendants, on the facts now shown to exist, affects the obligation of the claimant to pay the five per cent. We are clear that it does not. It does not refer in terms to that obligation; nor does it release the claimant from its contract to pay at maturity the bonds received by it from the Government; nor does it annul or release the Government’s lien for the payment of those bonds. It simply subordinates “ the lien of the United States bonds ” to that of the first-mortgage bonds, and does no more; leaving the five per cent, obligation in full force, and not postponed until the new mortgage debt and its interest should be first discharged.

Proceeding now to consider the sections of the Act of 1862, in connection with the subject-matter of the completion of the road, there are certain propositions which do not need extended argument for their establishment, but may be considered as entirely plain on the mere reading of the sections, and not capable of being overthrown by any argument. They are as follows:

1. The obligation to complete the road rested solely on the claimant.

2. The completion of the road was, therefore, to be determined solely by what the claimant did in building it.

3. As rights and obligations inter partes depended'on the fact of the completion of sections of the road, and, finally, of the whole road, the fact of completion in each case was of necessity to be ascertained and declared in some way binding and conclusive on both parties.

4. The act prescribes how the fact of completion should be ascertained and declared.

5. The defendants having enacted and the claimant accepted that act, they thereby mutually agreed that the fact of completion should be ascertained and declared as in that act prescribed, and not otherwise.

6. When the fact of completion of any section of the road was ascertained and declared in the way prescribed in the act, that fact was finally and immovably settled and determined, as between the claimant and the defendants, and could not be unsettled or changed by any executive authority, nor, except for fraud, by any judicial authority.

We do not pause to comment upon or amplify these propositions, believing them too plain to need either comment or amplification. If this be so, then we have only to give the legal deductions which seem to us to flow from them.

1. Iii tlie first place, tbe ascertainment and declaration, in tlie way prescribed in tbe act, of tbe completion of any section of tbe road, did, in and of itself, confer on tbe claimant tbe right to demand and receive lands and bonds, and impose on tbe defendants tbe obligation to convey and deliver tbe lands and bonds.

2. Tbe claimant, having demanded and received tbe lands and bonds, as provided in tbe act, for each several section of completed road from end to end of tbe line, expressly on tbe ground that each section was u completed and equipped in all respects as required by said act,” cannot be permitted afterward to deny tbe fact of tbe completion of any such section.

3. Tbe completion of tbe whole road, when ascertained and declared as aforesaid, did, in and of itself, confer on tbe defendants tbe right to demand, and impose on tbe claimant tbe obligation to pay, five per cent, of tbe net earnings of tbe road.

4. Tlie claimant having, through tbe oath of its president, affirmed tbe completion, “ as required by tbe act,” of each and every section of tbe whole road; and tbe fact of such completion having been ascertained and declared in tbe way prescribed and agreed upon, and tbe claimant having demanded and received tbe Ml benefit in lands and'bonds of such completion for each and every section of the road, it is not competent for it now to deny or question, except for fraud, tbe fact of tbe completion of tbe entire road; but it is absolutely estopped from so doing.

Tbe only escape from these conclusions is, that the completion referred to in section 6 is a different thing from tbe completion referred to in sections 4 and 5. This is, in effect, tbe mew urged by tbe claimant, as showing that tbe completion did not exist, for tbe purpose of taking money from it, until about five years after it bad existed for tbe purpose of its demanding and receiving lands and bonds. Of course, if tbe act was so framed as to require this extraordinary interpretation, it must be so interpreted; but such a meaning is not to be ascribed, unless tbe language leave no escape from it.

No intelligent and unbiased reader of those sections would suppose that they were intended to require two completions. There can be no such thing as two completions of any piece of work. There may be different degrees and. different stages of completion, but when completion is reached, that is the end.

And yet the claimant insists that two completions were there authorized. And singularly enough, as the act is viewed by the claimant, each completion was to inure to its benefit, and each to operate adversely to the defendants. This is to say, to enable the claimant to get lands and bonds, the road was complete in 1869; but to entitle the Government to the five per cent, of the net earnings, the road was not completed till 1874. It seems to us impossible that any such one-sided absurdity could have been intended. The completion referred to in the sections above set forth was one. In section 4 it is a completion by sections; in section 6 a completion of the aggregate of all the sections.

The sole answer to this, attempted by the claimant, is, that to the President of the United States was confided by law the supervision of the construction of the road, and that he never formally ascertained and determined that the road was finally completed until November, 1874, when he determined that it was completed on the 1st of October, 1874.

There is nothing in this position, unless it be shown that the law devolved on the President the duty of ascertaining and determining when the road rvas “finally completed.” No such duty was imposed on him. In fact, the law did not raise the question of final completion of the road. The statute nowhere uses the word final or finally in that connection. Had it done so, the case would have been involved in greater difficulty than it is; for it would have been almost impossible to decide when the point of final completion had been reached; that is, the point at which nothing more could be done to bring the road up to the highest state of completeness that the intellect and knowledge and skill of man could devise. The language of the act which was to be applied, and was in fact applied, by sections, to every foot of the road from its eastern to its western terminus, was as follows:

“Whenever said company shall have completed twenty consecutive miles of any portion of said railroad and telegraph line, ready for the service contemplated by this act, and supplied with all necessary drains, culverts, viaducts, crossings, sidings, bridges, turnouts, watering-places, depots, equipments, furniture, and all other appurtenances of a first-class railroad, * * * the President of the United States shall appoint three commissioners to examine and report to him in relation thereto; and if it shall appear to him that twenty consecutive miles of said railroad and telegraph, line have been completed and equipped in all respects as required by this act, then, upon certificate of said commissioners to that effect, patents shall issue conveying the right and title to said lands to said company, on each side of the road as far as the same is completed, to the amount aforesaid; and patents shall in like manner issue as each twenty miles of said road and telegraph line are completed, upon certificate of said commissioners. * * * For the purposes herein mentioned the Secretary of the Treasury shall, upon the certificate in writing of said commissioners of the completion and equipment of twenty consecutive miles of said railroad and telegraph, in accordance with the provisions of this act, issue to said company bonds,” &c.
Now, the claimant practically insists that the road was not to be considered as having reached completion within the meaning of this language until it had reached completeness ; but this was not, in our opinion, the intent of the law. The act does not require an entirely complete first-class railroad, but a rad-road “completed and" equipped in all respects as required by this act.”

And what constituted such a road % Changing the collocation of the clauses, but not in the least changing the meaning, the requirements of the acts were simply these, and no more: 1. That the road should be “ supplied with all necessary drains, culverts, viaducts, crossings, sidings, bridges, turnouts, watering-places, depots, equipments, furniture, and all other appurtenances of a first-class railroad”; and, 2. That the road should be “ready for the service contemplated by this act”; which service, as stated in section 3, was “the safe and speedy transportation of the mails, troops, munitions of war, and public.stores.”

It seems to us clear that this language did not require the sections of the road, when examined, to be in the highest condition of completeness attainable in a first-class railroad, but only in such state of completion, in the parti culars above recited, as to be ready for the service contemplated by the act. If we had any doubt on this point, it would be removed by the language of the proviso to the fourth section, requiring an oath to be made by the president of the claimant in order to obtain the appointment of commissioners to examine and report upon a section of the road. That officer was required to swear, not that the section had reached completeness, but that it had been11 completed in the manner required by the act.”

If this mew be correct, then it is undeniably true that every mile of the road was found and reported by commissioners, appointed as prescribed in tbe act, to bave been completed and equipped as a first-class railroad and ready for service, and that the President of the United States acted upon every one of their reports, and ordered patents for lands and bonds to be unconditionally issued to the claimant for each section of the road as so reported.

And here, in our judgment, ended the authority of the President in the matter. There is not, as we consider, the least ground for claiming that the supervision of the construction of the road was confided to him by law. Nor is there any ground for claiming that he was authorized to ascertain and determine whether the road was finally completed. His whole authority was (1) to appoint commissioners to make report to him, and (2) when they reported, to say whether it appeared to him that twenty consecutive miles of the road had been “ completed and equipped in all respects as required by this act.” When he performed those two duties his functions were ended. And when the commissioners made report to him that the westernmost and last section of the road was so completed and equipped, and he signified that it so appeared to him, then the whole road was, within the meaning and for the purposes of the act, a completed road ; and nothing which the President might afterward say or do could have effect in law to make it otherwise. It is upon the President’s further action in the premises, now to be considered, that the claimant bases its demand for the fixation of October 1, 1874, as the day of the completion of the road.

On the 9th of February, 1869, the Secretary of the Interior laid before the President the report of the commissioners upon the two sections, of twenty miles each, “ commencing at the 960th and terminating at the 1000th mile-post west of the initial point on the Missouri Biver near Omaha ”; the latter mile-post being only 38.68 miles from the western terminus of claimant’s road, as ultimately established.

The report represented those sections as “ ready for present service, and completed and equipped as a first-class railroad”; and the Secretary of the Interior recommended u the acceptance of the same, and the issue to said company of bonds and of patents for lands due on account of said sections.” The President, on the same 9th of February, 1869, indorsed on the Secretary’s letter these words: “ The within recommendations of the Secretary of the Interior are approved, and the Secretary of the Treasury and liimself are hereby directed to carry the same into effect.”

This was exactly what had. been done in the case of each previously-examined section of the road, except some of the first, which were reported as in some respects deficient, but the defects were afterward remedied. Therefore, on that 9th of February, 1869, it was a fact, undisputed and indisputable, that one thousand miles of the claimant’s road had been reported upon by commissioners and accepted by the President of the United States as “ ready for present service, and completed and equipped as a first-class railroad.” This was all that the statute required to entitle the claimant to the benefits resulting from the construction of its road. There the claimant was lawfully entitled to rest, and demand and receive all those benefits.

But the claimant chose not to rest there; but, three days after all its rights up to the 1000th mile-post had been settled and fixed in the manner prescribed by law, it engaged in a transaction which has so important a bearing on this case that special notice must be taken of it, for out of it springs and upon it rests the claimant’s demand upon the court to fix the 1st of October, 1874, as the date of the completion of the road, from and after which the claimant was bound, if bound at all, to apply 5 per cent, of its net earnings to the payment of the bonds issued to it.

This was the transaction: On the 12th of February, 1869, when only 38.68 miles of its road remained to be constructed, the claimant signed two written declarations and agreements, which, in effect, formally admitted and declared that its road up to the 1000 mile-post had never been completed and equipped as a first-class railroad, and, therefore, that the previous reports of the commissioners were false. The .first of those writings agreed that $3,000,000 of its first-mortgage bonds should be deposited with the defendants “ as security for the completion of the structure and equipment of the road, according to the provisions of the statutes of the United States providing for the building and completion, of said road and its equipments ”; and that the bonds so deposited should be held by the Treasury Department “ until the President of the United States, on a proper examination of the actual completed road and equipments, shall be satisfied that the same are so completed as a first-class railroad according to law.” The second of those writings, as a further security to the same end,” agreed that “ the lands given to the company by the acts of Congress ” should “remain without patents being taken out therefor until the President of the United States, upon a proper examination of the actual condition of the road, its structure and equipments, shall be satisfied that the same have been completed according to law.”

It appears that the claimant was required by the Attorney-General of the United States to execute those papers “ as a guarantee for the ultimate full completion and equipment of its road ”; and that fact is relied on as giving full force and efficacy to the proceeding. However desirable it may have been that the road should be brought to a higher degree of completeness than that contemplated and required by the act, we were not referred to any statute which made the question of its completion dependent on the judgment or action of the Attorney-General, or vested him with any control over the action of the claimant in the premises. Hence when the claimant, in pursuance of his requirement, executed those papers, its- act in so doing was purely voluntary. Not only so, but the execution of those papers was directly in the claimant’s interest, and against that of the defendants. It was, on the one hand, the interest of the Government to begin, as soon as it lawfully could, the application of the five per cent, of the net earnings of the road to the payment of its bonds; while, on the other hand, it was the interest of the claimant to postpone to the latest possible da3r the payment of the five per cent., amounting the first year after the completion of the road to more than §135,000, and regularly increasing until, in the fifth 3*ear, it grew to more than $345,000. Whether the claimant was prompted b3' this large pecuniary interest to sign those papers does not appear by direct proof; but presumably it understood its interest, and saw that through the operation of those papers the time of the beginning of the five per cent, payment might be postponed, and well knew that every dayr’s postponement was for its direct and Large benefit. In point of fact, it was not until the 18th of November, 1874, that the President formally terminated the suspension of patents and ordered the issue of them for all the lands to which the claimant had become entitled. And it is claimed that this action of the President was decisive of the question of the completion of tbe road and of tbe tune when, tbe computation of tbe five per •cent, payment should begin. This position, in our judgment, cannot be maintained, for tbe following reasons:

1. Tbe time of tbe completion of tbe road was to be determined in tbe way prescribed in tbe claimant’s charter, and in that way alone.

2. It was, therefore, wholly incompetent for tbe claimant, by its own sole act, to prescribe or authorize some other way to that end.

3. Tbe papers in question were no agreement on tbe part of tbe Government to submit tbe question of tbe time of completion of tbe road to tbe decision of tbe President, but only a voluntary agreement to that effect on the part of tbe claimant.

4. That agreement of the claimant did not and could not have, in law, any effect whatever to vest a power in tbe President which was not vested in him by law.

5. Therefore, when tbe President, in 1874, undertook to declare' tbe completion of tbe road, be • simply performed an act which, so far as it was adverse to tbe United States, was without legal authority, and therefore void.

6. Hence, if tbe declaration of tbe President in 3874 fixed tbe time of tbe completion of tbe road at a later day than that at which it bad before been fixed in tbe way prescribed bjr tbe act, then that declaration was wholly destitute of legal effect as against tbe United States.

This brings us directly to tbe great controlling point of tbe case, namely: When was the road completed and equipped within the meaning of tbe act? In the light of tbe views previously expressed there is but one answer to this, and that is, that when tbe last section of tbe road was reported by tbe commissioners and accepted by tbe President as completed, then tbe Union Pacific Eailroad was completed within tbe meaning of tlie act.

"When that last report was made, tbe legal question was not whether tbe road was then up to tbe condition of “ ultimate full' completion,” or to that of “ ultimate completion,” whatever either phrase might be held - to mean, but whether it bad been “completed and equipped as required by the act” to entitle tbe claimant to lands and bonds. When reported as having attained that condition of completion, and tbe report was accepted by the President, the question of completion was finally settled and determined, unless it could be impeached for fraud.

Applying these views, we consider that the road was completed as a whole, 'within the meaning of the act, on the 15th of July, 1869; for on that day the President of the United States accepted the report of the commissioners on the westernmost and last section of the road, which report represented it “ as ready for present service, and completed and equipped as a first-class railroad.”

Nevertheless, we are of opinion that that date should not be adopted as the basis of the judgment of the court for reasons now to be stated.

On the 10th of April, 1869 (16 Stat. L., 56), Congress passed a joint resolution, the second section of which is as follows:

“ Sec. 2. That, to ascertain the condition of the Union Pacific Railroad and the Central Pacific Railroad, the President of the United States is authorized to appoint a board of eminent citizens, not exceeding five in number, and who shall not be interested in either road, to examine and report upon the condition of, and what sum or sums, if any, Avill be required to complete each of said roads, for the entire length thereof, to the said terminus as a first-class railroad, in compliance with the several acts relating to said roads.” * * *

In pursuance of that provision five commissioners were appointed, who examined the roads, and, on the 30th of October, 3869, made report thereon, which is given in full in the finding’ of facts, and from which we extract the following two paragraphs:

“In the opinion of the commission, the requirements of the law will be satisfied, and the designs of Congress carried out, if the roads be properly located, with judicious grades; have substantial road-beds of good width; ballasting which, with proper care, shall be able to keep the track in good condition throughout the year; permanent structures for crossing streams, good cross-ties, iron and joint fastenings; sufficient sidings, water-tanks, buildings, machinery, and adequate rolling-stock— the more important machine shops and engine-houses being of masonry — and the commission is glad to be able to say that, in its opinion, while some expenditures still need to be made, these two roads are substantially such roads to-day. The expenditures needed for completion will be given in detail for each road.
“ This great line, the value of which to the country is inestimable, and in' which every citizen should feel a pride, has been built in about half the time allowed by Congress, and is now a good and reliable means of communication between Omaha and Sacramento, well equipped, and fully prepared to carry passengers and freight with safety and dispatch, comparing in this respect favorably with a majority of the first-class roads in the United States.”

The report, nevertheless, estimated that an expenditure of $1,586,100 would be necessary for the completion of the Union Pacific Eailroad.

Notwithstanding that estimate, the Secretary of the Treasury, on the 6th of November, 1869, ordered the issue of subsidy bonds due to the claimant on the westernmost and last section of the road; and in the presentation of this case the Government has treated that day as the one from which, for the purposes of the case, the completion of the road should be dated. We therefore hold that to be the day of the completion.

It remains to ascertain whether, after that day, there were net earnings of the road, and, if so, what amount.

In deciding what are net earnings, we take: 1. The gross receipts of the claimant from operating its road and telegraph line; and 2. The gross receipts from the rents of buildings, or parts of building's, belonging to the road; and from the aggregate of those two items we deduct the expenses of operating the road and line to earn the first description of receipts; and the remainder constitutes the net earnings.

The Supreme Court of the United States having, in Union Pacific Railroad Company v. Hall (91 U. S. R., 343), decided that the bridge constructed by the claimant over the Missouii Eiver at Omaha is a part of its road, the receipts therefrom and the expenses of operating it are brought into oirr computation hereinafter set forth.

In ascertaining the expenses of the road, we exclude all amounts paid on construction account, because the claimant is not, in our view, entitled to charge them against earnings until it shows that its construction fund was exhausted; and no attempt was made to show that. On the contrary, it must, as we conceive, be certain that that .fund has not yet been exhausted.

The claimant’s construction fund consisted of four items, viz: 1. Capital stock; 2. First-mortgage bonds; 3. United States bonds; and 4. Lands received from the United States.

From Senate Eeport No. Ill, Forty-fifth Congress, second session, we ascertain that the amounts of the first three of these items were as follows:

1. Capital stock paid in. $36,762,300

2. First-mortgage bonds. 27,232,000

3. United States bonds. 27,236,512

Total. 91,230,812

In addition to this sum, the land grant to the claimant was about 12,000,000 acres, of which, up to July 1, 1874, only 3,445,781 acres had been patented to the claimant, leaving- nearly three-fomths of the entire grant not then fully available for any irarpose of expenditure, and, therefore, certainly not used in construction.

But of the quantity patented the claimant had, up to .that date, sold only 1,013,774 acres, leaving nearly 11,000,000 acres not yet at that time used for any purpose of construction.

As the claimant’s demand comes down only to December 31, 1875, we deem ourselves justified in holding that on that day there must have been millions of acres of those lands still undis-posed of by the claimant, the proceeds of the sales of which would more than suffice to meet all accruing outlays for construction. While that condition existed, we are clear in the opinion that the claimant had no legal right to charge any construction expense whatever against its gross earnings, so as thereby to diminish the amount of earnings out of which it should apply five per cent, toward payment of the bonds of the Government.

In ascertaining the expenses, there is another very large item of the claimant’s expenditures which we do not consider properly chargeable against its earnings, namely, interest paid on its floating and bonded debt. This cannot, in our judgment, be regarded as an expense of operating the road.

On the same ground we disallow the following items:

1. Expenses of land and town-lot department.

2. Taxes on lands and town lots.

3. Premiums on gold to pay coupons.

4. Bequixements of sinking funds.

5. Premiums bn Omaha bridge bonds redeemed.

In ascertaining the gross earnings of the road, we rest primarily upon the table of earnings set forth in finding XVIII, with the following deductions:

1. Fifteen per cent, from item 7 in each year.

2. From item 12 ,in the year 1869-NO, the. sum of $23,400, being dividends from stock of Pullman Pacific Car Company, as set forth in the second table of earnings in finding XVIII.

In ascertaining the. expenses, we take the table of expenses set forth in that finding, and make deductions therefrom as hereinafter indicated.

Having thus stated our views of what legitimately constitute earnings and expenses, we tabulate the result, year by year, from November 6,1809, to November 5,1875, both inclusive, as follows:

1869-NO:

Gross earnings, as per findings.$8,125,212 40

Deduct therefrom—

Fifteen per cent, of item 7. $72,358 12

Pullman car dividends in item 12. 23,400 00

—:- 95, 758 12

Actual gross earnings. 8,029,454 28

Total expenditures, as per findings.$10,287,954 25

Deduct therefrom—

Printing bonds in

item 13. $10,339 76

Items 17 to 30, inclusive . 4,951,848 52

- 4,962,188 28

- 5,325,705 97

Net earnings for the year. 2, 703,688 31

3870-N1:

Gross earnings, as per findings. 7,563,006 59

Deduct 15 per cent, of item 7. 54,321 6S

Actual gross earnings. 7,508,684 91

Total expenditures, as per findings .$7,942,755 88

Deduct therefrom—

Printing bonds in item 33. $1,500 00

Items 17 to 30, inclusive . 4,245,440 96

-:— 4,246,940 96

- 3,695,814 92

Net earnings for the year. 3,812,869 99

1871-’72:.

Gross earnings, as per findings.$8, 659,031 66

Deduct therefrom 15 percent. of item 7. 60,538 78

Actual gross earnings. 8,598,492 -88

Total expenditures, as per findings .$9,572,784 15

Deduct therefrom items 17 to 30, inclusive. 4,671,634 66

-- 4,901,149 49

Net'earnings for the year. 3,697,343 39

1872-’73: ' '

Gross earnings, as per findings. 10,667,117 26

Deduct'therefrom 15 per cent, of item 7. 69,860 10

Actual gross earnings... 10,596,257 16

Total expenditures, as per find-

ings .$9,968,854 70

Deduct therefrom—

New stations in item 1. $6,909 98

Items 17 to 30, inclusive . 4,642, 866 86

- 4, 649, 776 84

-:- 5,319,077 86

Net earnings for the year. 5,277,179 30'

1873-’74: "

Gross earnings, as per findings. 10,834,651 49

Deduct therefrom 15 per cent, of item 7. 76,004 77

Actual gross earnings. 10,758,646 72

Total expenditures, as per findings .$9,809,105 08

Deduct therefrom—

Tenements a n d

new stations in

item 1. $19,806 73

Engines, &c., in item 2. 26,133 68

Cars from item 3. 3,600 00

Laramie rolling-mills in item 4. 43,716 01

Printing bonds in item 13. 6,579 10

Items 17 to 30, inclusive . 4, 593,404 03

- 4,693,239 55

- 5,115,865 53

Net earnings for the year.-6-. 5,642,781 19

1874D75:

Gross earnings, as per findings.$12,481,204 48

Deduct therefrom 15 per cent, of item 7. 98,646 28

Actual gross earnings. 12,382,558 20

Total expenditures, as per findings.$10,628,208 16

Deduct therefrom—

Tenements and new stations in item 1. $99,819 10

Engines, &c., in item 2. 75,727 83

Cars,&c.,initem3. 206,930 36

Laramie mills, item 4. 149,859 30

Items 17 to 30, inclusive . 4,631,496 86

- 5,163,833 45

- 5,464,374 71

Net earnings for the year. 6,918,183 49

RECAPITULATION.

Net earnings. Five per cent.

Year ending November 5,1870.. $2,703, 688 31 $135,184 42

Year ending November 5,1871.. 3,812,869 99 190, 643 49

Year ending November 5,1872.. 3,697,343 39 184,867 17

Year ending November 5,1873.. 5,277,179 30 263,858 96

Year ending November 5,1874.. 5,642,781 19 282,139 06

Year ending November 5,1875.. 6,918,183 49 345,909 18

28, 052, 045 67 1, 402, 602 28

Before declaring the judgment of the court, the question whether the claimant is legally bound to pay interest on the annnally-accrued five per cent, must be considered.

By the Act of 1862, the claimant is bound to repay to the defendants the amount of the bonds issued by them to it, together with all interest thereon which shall have been paid by the United States.

Toward providing an accruing fund for such repayment, the act authorizes the Government to retain one-half of the compensation earned by the claimant for services to the Government ; and requires the claimant, in addition thereto, after its road is completed, to pay annually at least five per cent, of its net earnings.

In United States v. Union Pacific Railroad Company (91 U. S. R., 72), it was decided by tlie Supreme Court of tbe United States that tbe claimant is bound to pay those bonds and tbe interest thereon, only at tbe maturity of tbe bonds, thirty years after their date.

Whatever, therefore, of compensation for sendees rendered might be retained by the Government, or of five per cent, of net earnings might be paid to the Government, is to be applied, not inpreesenti, but to be held for application at the maturity of the bonds toward the payment of the principal and interest thereof.

As the act does not require the Government to allow the claimant interest on the compensation retained by it, nor require the claimant to pay interest on the five per cent, of net earnings from the expiration of each year in which they accrued, we are of the opinion that it was not the intention of the legislature to require the payment of interest on either side; and therefore, that no interest should be allowed against the claimant on the counter-claim.

The defendants, therefore, can recover only the five per cent, accrued, as above stated, viz, #1,402,602.28, less one-half of the amount of compensation for services rendered by the claimant, viz, #593,627.10; and for the balance of #808,975.18 judgment will be rendered in favor of the defendants.

Davis, J.:

I acquiesce in this judgment, in order to put the case in a shape to be taken to the appellate court, which both parties desire to have done. I agree in the disposition of the -principal question at issue, but for different reasons from those expressed by the Chief Justice. I dissent from the conclusions of my associates on minor points, which involve in the aggregate-large sums of money. The magnitude of the amounts at stake justifies an endeavor to state, as clearly as I am able, the points of difference, and the reasons for my opinions on the whole case.

The United States holds a double relation toward the Union Pacific Eailroad Company. On the one hand, as sovereign, it is the fountain of their corporate franchises; on. the other hand, as a great land-owner, it has contracted with them for the construction of a first-class railroad between two widely-separated points of its territory. Tbis suit concerns only its relations as contractor.

Tbe provisions of tbe contract are few and simple. They may be found in tbe Acts of July 1, 1862, and July 2, 1864, enacted by tbe defendant, and both formally accepted by tbe claimants.

Tbe claimants agreed to construct a first-class railroad and a telegraph for a distance wbicb was subsequently ascertained to be 1,038.68 miles, tbe work to be done in sections, and tbe whole to be completed before July 1,1874.

Tbe defendant agreed, as each section was completed and accepted in a manner to be hereafter more particularly set forth, to deliver to tbe claimants patents for a certain quantity of land, and also its own bonds for specified amounts; tbe lands to be tbe claimants’ property; tbe bonds to be a loan of credit, to be redeemed by the claimants.

Tbe claimants agreed that one-half of tbe revenue derived from service for tbe defendant should be applied to tbe redemption of such bonds and interest; and also that after completion of tbe road five per cent, of its net earnings should be annually applied to tbe same object. They further agreed to transmit dispatches and transport mails, troops, munitions of war, supplies, and public stores for tbe defendant whenever requested, and always to give tbe Government preference in service.

Tbe issue and delivery of tbe subsidy bonds were to constitute ipso facto a mortgage on tbe railroad and telegraph; but tbe claimants were to be at liberty to make a first mortgage on their road to an amount equal to tbe proposed subsidy bonds, and to be issued in like manner as sections of tbe road should be completed; and the statutory mortgage and tbe ben of tbe United States bonds were to be subordinate to tbe said first mortgage, except as to the provisions relating to tbe transmission of dispatches and tbe transport of mails, troops, munitions of war, supplies, and public stores.

Under tbis contract work was begun in tbe autumn of 1865. Tbe President accepted tbe first section with deficiencies of construction, wbicb tip company agreed to remedy. He ordered tbe subsidies of both kinds to issue without waiting till tbe deficiencies should be supplied.

A board of experts bid been organized in order to secure a uniform standard of construction for adoption as sections should be presented for acceptance. Before the second section was presented this board made its report, recommending that sections should be accepted in many respects incomplete, as measured by the statutory standard of a first-class railroad, and that the sections should be brought up to standard after acceptance. The President approved the report, and ordered directors and commissioners to guide themselves by it as a standard in directing or accepting work.

The various acts and measures which made the present contention possible grew out of this report and of the action of the President upon it. The course which it advised, and which was approved and followed until the whole road was open for traffic, is now assailed as a violation of law.

If that course had any warrant in the statute, it is to be found in the seventeenth section of the Act of 1862, providing for a retention of bonds as a guarantee for completion of the road; a provision repealed in 1864, but showing, so far as it bears on the question, a possible contemplation by Congress that sections would be accepted in an incomplete state. It can at least be said for it that, under its operation, a first-class railroad was constructed and equipped between the Missouri and the Pacific within three months of the period named in the statute, without affecting the company’s statutory obligations to the Government. These considerations, however, can be urged in the forum of public opinion more properly than in a judicial tribunal.

The work went on rapidly after it was once fairly begun. The proposed first mortgage was executed, and first-mortgage bonds were from túne to time issued and sold. In September, 1868, twenty-seven sections of the road, amounting to 760 miles, had been accepted by the President, and the issue of the subsidies thereon had been ordered. Much of the work on these accepted sections was far below the requirements of the statute. Under these circumstances, the opinion of the Attorney-General was taken as to the duties and responsibilities of the Executive.

Attorney-General Evarts answnred: “I entertain no doubt that the mode of procedure was a competeit and useful discharge of the executive duty in the premises. * * * But upon the same reasons, and in pursuance of the same method hitherto followed, I am of the opinion that it is entirely competent to the Executive * * * to provide for a revision of the work in the particulars in which a provisionalcompleteness of successive sections was accepted, subject to an obligation on the part of tbe companies to make good, as far and as fast as might be, what needed to be subsequently supplied.” In conformity with tbis suggestion, the claimants in February, 1869, deposited with the defendant $1,600,000 of them first-mortgage bonds as security for the completion of the road according to law, and agreed that all their land patents might be retained for the same purpose. This was done by an instrument which I shall have occasion to consider hereafter.

On the 10th of the following April, Congress, by joint resolution, authorized the President to appoint a board of eminent citizens to visit the road and report what amount would be necessary to secure its completion according to law. They also directed the President, in order to secure such completion, to retain subsidy bonds enough for that purpose ; or, if that were impracticable, to require the company to return enough bonds to make, with the unissued bonds, the requisite amount; or, if both plans were found impracticable, to authorize the Attorney-G-eneral to institute a suit to protect the interests of the United States and to insure the completion of the road.

On the 10th of May, 1869, the last rail was laid, and it became possible for trams to run over the whole road. On the 13th of the same month a sworn certificate by the company’s officers of the completion of the last section, and also of the road as a whole, was laid before the President. On the 15th of the following July, he accepted the section and ordered the issue of the subsidies; but nothing was done by the departments on this order until November, for reasons Avhich clearly appear in the findings of fact.

There was a difference between the Central Pacific and the Union Pacific about the point of junction. Until that difference should be arranged, the distribution of the subsidy for a few miles of the through line on the one side of the other of the point of junction was uncertain. The Secretary of the Interior therefore recommended the President to authorize the bonds and patents due on account of the last section to issue only “ after full investigation of the respective claims of the two companies,” and to require the company to deposit with the Secretary of the Treasury the security for the ultimate completion of the road, which had been recommended in the Secretary’s letter of May 27,1869. In that letter the Secretary had designated the first-mortgage bonds of the company as the desired security.

Tbe Secretary’s letter of tbe 27tb May, as well as that of July 15, was written after tbe Joint Eesolution of tbe lOtb April became law. We must therefore suppose that bis recommendations were intended to be in harmony with tbe expressed views of Congress; and we are warranted in assuming that neither tbe first nor the second modes of obtaining sufficient security were practicable. ' Instead of resorting to th e third mode, and obtain - ing security as tbe possible result of a successful law suit, tbe Secretary advised availing- of tbe §1,600,000 first-mortgage bonds already in tbe Government’s possession. Before tbe following November events took place which greatly affected the security which be proposed.

In tbe first place, tbe board of eminent citizens reported that constructive work to the amount of $1,586,100 remained to be done in order to bring tbe road and equipment to standard. This gave a measure for tbe amount of security to be taken.

In tbe next place, tbe point of junction of tbe two roads was so far settled that it became apparent that tbe Union Pacific road would be shortened some forty miles. It resulted from this that there was a large overissue of first-mortgage bonds, and that tbe bonds deposited with tbe Government as security were valueless.

It was therefore decided that these bonds should be canceled, and that tbe Government should look to tbe land patents for security; and it was further decided that one-half tbe remaining patents would be ample security for tbe sum named in tbe report of tbe board of eminent citizens, and that tbe other half might be delivered; and an executive order was issued from tbe Department of tbe Interior to that effect.

This order continued in force until tbe autumn of 1874. Tbe claimants repeatedly asked to have it rescinded or modified, but them requests were met by refusals to do so until an examination, to be made at their request, should show, that tbe road and equipment were completed up to the statutory standard.

In tbe summer of 1874 they asked to have such an examination made. Tbe commissioners appointed for tbe purpose reported that tbe deficiencies found in tbe summer of 1869 bad been more than supplied, and that tbe road was completed as a first-class road on tbe 1st day of October, 1874. Tbe President thereupon, on tbe recommendation of tbe Secretary of tbe Interior, revoked tbe order of November, 1869, and directed that tbe suspended land patents should be issued.

At tbe trial, eachparty introduced evidence as to tbe time of tbe completion of tbe road, and eacb argued at length tbe bearing of tbe evidence upon tbe decision of that question. In my judgment tbe statute required tbe President to decide that question at tbe time of tbe occurrence of tbe completion. It was not to be settled in tbe future by evidence aliunde. Tbe statute empowered tbe President to determine, section by section, on evidence of a particular and prescribed character, when eacb section Avas completed. On eacb decision be was authorized to issue the- land and bond subsidies for the particular section, tbe eAÚdence on which tbe decision was formed being first filed in tbe Interior Department and in tbe Treasury. In practice he accepted incomplete Avork; but this did not modify tbe combined operation of tbe acceptance of tbe road and of the issue of tbe subsidies upon tbe agreement to pay tbe five per cent, of tbe net earnings. Tbe statute contemplated that, when tbe last section should be accepted and tbe last subsidies issued, tbe road would be complete as a money-earning machine, and tbe obligation to pay tbe five per cent, of net earnings would begin.

On tbe other band, tbe statutory contract bound tbe defendant to furnish, or to be ready to furnish, tbe subsidies, in order to entitle it to tbe payment of tbe five per cent. Tbe sequence in which tbe acts Avere to be performed shows this. First, tbe claimants Avere to construct and equip a-section of tbe road. Next, they Avere to ptresent it for acceptance. Next, tbe President, after examination by commissioners, was to decide whether the section was completed and equipped in all respects as required by tbe act.” Next, tbe land patents for tbe section were to issue from tbe Interior Department and tbe subsidy-bonds from tbe Treasury. Finally, after these things were done in detail, section by section, iwe per cent, of tbe net earnings were to be set aside Avhen tbe road should be completed as a whole. Tbe issue of tbe last subsidy and tbe completion of tbe road were to take place simultaneously, and tbe obligation to set aside five per cent, of tbe net - earnings was not to begin until after tbe occurrence of these tAvo simultaneous eArents.

If we quit this solid ground, there is no sure foothold for tbe construction of this contract.

We cannot say that tbe obligation to pay tbe five per cent, would arise on tbe completion of tbe road if no subsidy were furnished, since tbe payment is intended as a contribution toward tbe redemption of a portion of tbe subsidy.

No one contends that it arose when the last rail was laid, on the 10th May, 1869, nor when, on the 13th of May, the president of the company made oath that the road was completed according to law.

If the obligation sprang solely from the President’s acceptance of the road, it had no reference to the outstanding amount of the loan subsidy, so long as something was outstanding, and was equally obligatory whether $2,700 or $27,000,000 were issued.

But if it was to spring from the completion of the road and the concurrent readiness to issue all the promised and unissued subsidy, which is the best construction of the statute, then we must remember that the issue of the land .subsidy was made by law as imperative on the G-overnment as the issue of the loan subsidy. Consequently, the expectation of the performance of the defendant’s promise respecting both classes of subsidy furnished the moving consideration for the claimant’s promise to set aside the five per cent. The Government could not, under the statutory contract, enforce upon the compan3r a performance of its agreement to do an act that was to be subsequent in time to the receipt of the subsidies, without showing either a readiness on its part to deliver all the undelivered subsidies, or a waiver on the part of the company to insist upon their delivery at the time and in the manner provided, by the contract.

Now, the Government, on the one hand, certainly did not fulfill its original engagements respecting the land subsidy until October, 1874. Had the delay happened without the consent and against the wishes of the claimants, the latter would have been free from the obligation to contribute the five per cent, during the detention. But we have seen that the delay in the delivery was caused by the making of a new engagement between the defendant and the company. On the 12th February, 1869, the officers of the latter executed an authorized instrument in which this language was used: “ The Union Pacific liailroad Company, having been requested by the Government of the United States * * *, as security for the due completion and equipment of its road * * *, to leave the lands given to the said company by act of Congress * * *, without taking out patents for the same, until the President shall be satisfied, upon proper examination of the road, its structure and equipments, that the same have been completed according to the provisions of law * *. Now, this is to declare that the said company assents to the aforesaid requirements in respect to the lands given the said company as aforesaid.”

At a later date the Government consented to relinquish one-half of the suspended patents, and to hold the other half only for the performance of the specific work recommended by the board of eminent citizens, constituted under the Joint Resolution of April 10. In that step there was certainly nothing that weakened the force of the company’s consent to the reservation.

The recommendations of the board of eminent citizens contemplated the expenditure of upward of $1,000,000 upon sections which had been accepted, and for which the order for the entire subsidies had been made. These sections were therefore “com-' pleted?’ within the meaning of the term as used in the sixth sec-' tion of the Act of 1862. The obligation to contribute toward' the five per cent, so soon as the remaining sections should be “completed” had attached to them. Therefore, as to all such' sections, the statutory contract was abrogated by mutual consent on the 12th February, 1869, so far as related to the unissued land patents, and the Government became thereafter the custodian of the lands under a new agreement, and for a new pru’pose.

It is contended that the President had no x>ower to make this new agreement, and that his action in withholding the land patents under it was illegal and void. I donotthink so. Theaction of President Johnson, in February, 1869, was justified by the condition of the imfinished road at that time; and the subsequent action of President Grant, inrelinquishing half the patents which were held as security, was a compliance in spirit, if notin letter, with the requirements of the Joint Resolution of Congress of April 10,1869, and was a wise act of protection' to the Government and a liberal act as regarded the company.

We are now in a position to consider the President’s action, and to ascertain the day which he fixed as the date of the completion of the road.

There is no dispute about the first thirty-eight sections, 1,000 miles in all. They were accepted, and the order was made .for the issue of the subsidies before February 12,1869,' and it was to them that the provisions of that agreement immediately applied.

There remained then only 38.68 miles to be completed, in' order to entitle the Government to the five per cent. We have already seen that the company certified on the ‘13th May that this section was completed, and that the President on the 15th July accepted it, and ordered the bond subsidy to be issued. The land subsidy had been disposed of by the agreement of the previous February.

The President’s order to issue the bond subsidy for this section was to take effect upon the happening of circumstances which were within the claimants’ control. The dispute with the Central Pacific Company was theirs, not the Government’s. The delay which it caused in the issue of the subsidy does not defer the defendant’s right to the payment of the five per cent, of the net earnings; This accrued on the 15th July, when the President rendered his decision that the road was completed, and ordered the subsidies to issue for it, and when the road consequently was completed in the eye of the law.

In order to ascertain what are the net earnings upon which the computation of the percentage is to be made, we must first settle what are tojbe taken as gross earnings.

The claimants carry on two distinct branches of business. They are common carriers and they are large landed proprietors. With the latter branch of their business we are not concerned, since the statute requires the payments to be made out of the net earnings of the road.

Confining ourselves to the former branch, the claimants maintain that the gross earnings of a corporation comprehend . all its gains from the legitimate exercise of all direct and incidental powers conferred upon it by its charter.

A railroad operated in connection with other roads is certain to bring into its owners’ hands moneys belonging' to other coinpa-■jiies for whom it collects freights at the stations of arrival on its own road, or for whom it sells passenger tickets. Assuming that the word “ gains ” is used in the claimants’ proposition in the sense of receipts on their own account, the statement; commands my assent; but it is also true that this particular corporation cannot set up against the United States, the grantor of their franchises, that they have corporate gains derived from the exercise of powers not conferred upon them by their charter. Income from tenement-houses, from hotels, from Pullman car-stock, from the rent of engines and cars, for services performed for other roads, and from investments outside of transportation, but not connected with the other branch of business, are to be regarded as ancillary to the claimants’ exercise of their franchises as common carriers, and as necessary to the use of their road in the unsettled districts which it traverses.

The cost of earning gross earnings must be deducted from them in order to ascertain what are net earnings. This includes not only the actual expenses of transportation, but also general corporate expenses, such as salaries of officers, wages of em-ployés, taxes, assessments, insurance, law expenses, losses and damages to persons and property, and other similar charges, and, above all, the cost of maintaining the road, the plant, and the entire property, so that at the close of the year they shall be in as good condition as at the beginning.

The claimants further maintain that interest on loans and obligatory contributions to sinking funds, or to the redemption of the subsidy loan, are also proper to be deducted.

This proposition confounds two things which are quite distinct in themselves: the net earnings of the property and the net income of the owners of the property.

Regarding the property as an entity, the moneys which go into its construction, whether -stock or debt, are to be treated as capital. Its net earnings (that is, the net earnings of the property, not of the capital invested in it) are to be ascertained by the rule already, laid down. After they are ascertained, their application depends upon the respective priority of right of the different classes of capital which went into the construction of the property. Loan capital as creditor has priority over share capital as debtor and as the owner of the property. So, too, the higher classes of loan capital stand prior in right to the lower classes. -But, though the just claims of loan capital must be satisfied before share capital can receive anything, it is wrong to say that they must be satisfied before the net earnings of the property itself can be ascertained.

The claimants also contend that the tenth section of the Act of 1864 postpones the payment of the five per cent, until the payment of the first-mortgage debt and interest. This contention cannot be maintained. It is true that the section referred to recognizes that the United States has a lien upon the property to enforce both the payment of the subsidy bonds and the rights reserved by the sixth section of the Act of 1862. The light of the defendant to the five per cent, is clearly subordinated by it to .the rights of the first-mortgage bondholders.'! If net earnings 'will not satisfy first-mortgage interest and the five per' cent., the latter must give way to the former. When the principal of the mortgage debt matures, it will be a charge on revenue prior to the five per cent. But, as between the Government and the companj', there is no change in the definition of net earnings; no enlargement of the rights of the company; no discharge of the right of the Government to claim and receive the five per cent., if earned and not required for the ex-tinguishment of mortgage debt or interest.

Some expenditures for “ station buildings,” “tenement-houses and hotels,” “engine-equipment,” “tanks and water-tanks,” “new shops and machines,” “car-equipment,” and “Laramie rolling-mills” are said to be improperly charged to earnings.

Undoubtedly new construction, theoretically, should come from capital. Practically it is often difficult to separate new from old. A station is rebuilt on a larger scale; an iron bridge replaces a wooden bridge; an old car or locomotive is rebuilt; a steel rail is substituted for an iron rail. Many prudent managers think it best not only to make such “construction” as this out of earnings, but even to resort to that source for the increase demanded by the ordinary growth of traffic rather than swell capital account bjr augmenting* the funded debt or shares. Such matters are usually left to .the discretion of a board of directors. The organic law of the corporation placed representatives of the Government in the direction to guard the interests of the United States. It was the duty of these agents — perhaps it is not too much to say that it was their principal duty — to watch the expenditures of the company, and to see that none were made from earnings which would improperly reduce the amount upon which the Government’s percentage was to be calculated. In the absence of complaint from them, I do not think this court should impose upon the company an inflexible rule, which is often practically opposed to sound and economical administration. The expenditures objected to certainly increased the value of the security which the Government holds for the ultimate retirement of the loan subsidy.

The items relating to the Omaha bridge are in dispute. The bridge was constructed under authority contained in the ninth section of the Act of 1864. The Act of 1871 authorized the" ■claimants to contract a mortgage debt for its construction. The mortgage failed to realize enough to meet its .cost, and the deficit (about $28,000) was met from earnings. The bridge accounts are now carried into the general operations of tbe road. Although technically a separate property, the bridge is practically operated as a part of the claimants’ road, and is, in fact, necessary to it. If the principles which I have laid down are correct, its receipts should form a part of gross earnings, and the cost of its operation a part of the expenditures, to be deducted from gross earnings. The small outlay in its construction not having been objected to by the Government directors, is to be treated as legitimate. The interest paid on its mortgage is to he treated as the interest on the other funded debt of the company.

Some charges for the printing of corporation bonds were objected to. On the principles laid down, they are fairly within the corporate expenses which are chargeable to earnings. On the other hand, sundry contested expenditures for expenses of town lots and taxes on land and town lots are properly held by the court not to be chargeable to the earnings of the road.

The claimants are bound to apply the five per cent, of the net earnings of the road annually; that is to say, on the recurring anniversary of the day of the month on which the road was completed. The defendant maintains that the obligation to pay the percentage began on the 6th November, 1869, and makes a rest annually between November 5 and November 6 in the tables ■which it furnishes. I agree that the defendant can waive the percentage between the 15th July and the 6th November. I do not agree that the road was completed for the first time on the latter date; but I think we are warranted, on the pleadings in this suit, in giving judgment from and including the 6th November, 1869.

On the principles which I have laid down, the respective annual amounts for which the defendant would be entitled to judgment are the following:

For the year ending November 5, 1870 . $94,606 48

1871 . 189, 942 09

1872 . 163,000 32

1873 . 258, 002 77

1874 . 271,871 74

1875 . 324,084 15

Total. 1,301,407 55

I agree with my associates that no interest should be allowed on these sums.

It is conceded by the Government that at the commencement of this suittheclaim ants had earnedin the transportation ofmails, troops, munitions of war, and supplies, and hi the transmission of dispatches, $1,187,254.21, none of which has been paid, In this suit the claimants are entitled to recover one-half that amount, $593,627.10. That amount should be deducted from the defendant’s counter-claim, and the defendant, in my opinion, should have judgment for $707,880.45

This result differs from that reached by my associates by $101,194.73. For reasons already given, I surrender my own convictions and I concur in forming the judgment of the court.

Eichardson, J., concurred in the opinion read by the Chief Justice.

Nott, J., heard the ease, but was prevented by illness from being present when it was decided.  