# Union Pacific Railroad Company v. United States (99 U.S. 402)
## Dissenting Opinion

    Strong
United States Supreme Court
99 U.S. 402
Union Pacific Railroad Company v. United States
APPEAL from the Court of Claims.
This is a suit by the Union Pacific Railroad Company to recover compensation for services rendered to the United States prior to 1874, and during a portion of that year 1874, and the whole of the year 1875. A counter-claim is set up for five per cent of the net earnings of the company, under the provision of the sixth section of the act of July, 1, 1862 (12 Stat. 489), that 'after the 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 United States alleges that the road was completed on the 6th of November, 1869, and that since that time a large amount of net earnings has been realized by the company, which it has failed to pay or apply to the said bonds. The company denies this, and alleges that its road was not finished until Oct. 1, 1874, and that it has not realized any net earnings in any year, since either the 6th of November, 1869, or the 1st of October, 1874; and denies that it was its duty to pay to the United States annually any money whatever, as and for five per cent upon its net earnings, to be applied in the aforesaid.
The Court of Claims decided that the road was completed on the 6th of November, 1869, and that the company did, after that period, annually realize net earnings to a large amount, for the six years from Nov. 6, 1869, to Nov. 6, 1875, amounting in the aggregate to the sum of $28,052,045.67; and that five per cent thereof, to wit, the sum of $1,402,602.28, was payable to the government; whilst one-half of the compensation due for the services rendered by the company to the government, for the period covered by the petition, amounted to only $593,627.10; and, therefore, that the government was entitled to recover from the company the difference between these two sums, amounting to the sum of $808,975.18. From this judgment the company appealed.
So much of the eighteenth finding by the Court of Claims as is referred to and commented on in the opinion of the court is as follows:--
A.-EARNINGS.
Nov. 6, 1869, to Nov. 6, 1870, to Nov. 6,1871, to
Nov. 5, 1870. Nov. 5, 1871. Nov. 5, 1872.
7. Company freight earnings $482,387.43 $362,414.56 $403,591.
12. Miscellaneous 116,300.14 94,610.20 112,920.
Nov. 6, 1872, to Nov. 6, 1873 Nov. 6,1874, to
Nov. 5, 1873. Nov. 5, 1874. Nov. 5, 1875.
7. Company freight earnin $465,734.02 $506,698.53$657,641.
12. Miscellaneous 140,039.31 218,942.15 166.696.94 B.-EXPENDITURES.
Nov. 6, 1869, Nov. 6, 1870,
to to
Nov. 5, 1870. Nov. 5, 1871.
expenses $829,771.15 $671,194.
2. Motive-power expenses 1,778,601.44 1,229,048.
expenses 608,622.90 302,225.
expenses 1,403,090.28 995,683.
(including taxes) 445,119.88 397,651.
and material account 75,577.
stamps 6,639.32 926.
commissioners 2,391.
refunded
of operating
on floating debt 409,668.66 188,136.
town-lot departments 41,524.47 60,824.
town lots35,778.90 85,105.
20. Interest on first-
mortgage bonds 2,015,326.28 1,715,200.
21. Interest on land-
grant bonds 553,947.91 601,647.
bonds 673,238.41 882,306.
23. Interest on sinking-
fund bonds
bridge bonds
pay coupons 117,569.
bridge
station building
shops, and fixtures,
&c, as per statement
attached 896,977.03 66,849.73 28. Requirements of
sinking-funds for
the redemption of
funded debts:
bonds
mortgage bonds
bridge bonds
redeemed
interest half
transportation
accounts charged
during the year 324,697.40 527,799.
Total $10,287,954.25 $7,942,755.88 DETAIL OF EXPENDITURES FOR STATION BUILDINGS, &c., CONSTITUTING ITEM 27 ABOVE.
Nov. 6, 1869, to Nov. 6, 1870, to Nov. 6, 1871, to Nov. 6, 1872, too
Nov. 5, 1870. Nov. 5, 1871. Nov. 5, 1872. Nov. 5, 1873. Nov. Nov. 6, 1873, t5, 1874.
1. Station buildings $249,384.74 $48,286.40 $119,795.14 $14,580.
2. Shops and fixtures 40,618.27 94,855.51 106,067.83 2,744.02 $1,718.32 --------------
3. Equipment 109,933.18 47,598.03 8,380.72 93,213.
4. Government commissioners 91.80 proper to be deducted from 'gross earnings' in order to arrive at 'net earnings.'
1. Tenement-houses and hotels $1,659.96 $21,229.
2. New station-buildings $6,909.98 18,146.77 78,589.
3. Engine-equipment 25,398.69 63,277.
4. Tanks and water-works 734.99 12,450.
5. Car equipment3,600.00 206,930.
6. Laramie rolling-mills 43,716.01 149,859.
Item 13, 'expense account,' is subject to be reduced by the following amounts in case such outlays are regarded as not proper to be deducted from 'gross earnings' in order to arrive at 'net earnings;' viz., In the year, Nov. 6, 1869, to Nov. 5, 1870, expenses relating to an issue of bonds, $10,339.76; March 13, 1871, cost of a plate for the bridge bonds, $1,500; June 5, 1874, and 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.
Items 17, 20, 21, 22, 23, 24, and 25 show payments of interest on debts.
Items 18 and 19 show 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.
Mr. Sidney Bartlett for the appellant.
The Attorney-General and Mr. Joseph K. McCammon, contra.
MR. JUSTICE BRADLEY, after stating the case, delivered the opinion of the court.

## Notes

This work is in the public domain in the United States because it is a work of the United States federal government (see 17 U.S.C. 105).
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