The Origins of the American Public Trust Doctrine: What Really Happened in Illinois Central Joseph D

The Origins of the American Public Trust Doctrine: What Really Happened in Illinois Central Joseph D. Kearney & Thomas W. Merrillt Introduction ......................................................................................................... 800 I. The Standard Illinois Central Narrative .................................................. 805 II. Setting the Stage ........................................................................................ 811 A . The Lay of the Land ......................................................................... 811 B. Legal Uncertainty over Property Rights in Submerged Lands....826 C. Implications for the Lakefront ........................................................ 836 III. 1867: The Lakefront in Play ...................................................................... 838 IV. 1868: Debating the Future of the Lakefront ........................................... 842 V. 1869: Chicago and the Illinois Central Go to Springfield ...................... 853 A. A Note on Newspapers and State Legislatures in the M id-N ineteenth Century .................................................................. 853 B. The Lake Front Act of 1869 ............................................................. 860 C. The Motives of the Illinois Central ................................................. 877 D . The Public Interest ............................................................................ 881 E. The Question of Corruption ............................................................ 887 V I. A fter the A ct .............................................................................................. 894 A. 1869-1870: North Lake Park ............................................................ 895 B. 1870-1872: The Outer Harbor ......................................................... 900 C. 1873: R epeal ....................................................................................... 905 V II. The Lake Front Case ................................................................................. 912 VIII. What Illinois Central Really Tells Us about the Public Trust D octrine ................................................................................ 924 C onclusion ........................................................................................................... 930 t Kearney is Dean and Professor of Law, Marquette University Law School. Merrill is Charles Keller Beekman Professor of Law, Columbia Law School. The authors would like to thank Richard A. Epstein, Robert A. Ferguson, Richard H. Helmholz, John H. Langbein, Henry E. Smith, James B. Speta, and John Fabian Witt for helpful comments and suggestions on earlier drafts, and to thank the participants in faculty workshops at the University of Chicago, Colum- bia, and Yale law schools for stimulating feedback. The authors are also grateful to a number of librarians and archivists for their assistance, including Robert E. Bailey at the Illinois State Ar- chives, Steven M. Barkan at the University of Wisconsin School of Law, Christopher Simoni at Northwestern University School of Law, Julia A. Wentz at Loyola University School of Law, and to the reference staff at the Chicago Historical Society, Marquette University Law School, the Newberry Library, and the University of Chicago Law School. Daniel L. Abelson, Andrew B. Armstrong, Cynthia J. Cole, David M. Marquez, Jeremy R. McKenzie, Eric D. Meyer, Christo- pher S. Norborg, Annie L. Owens, Megan E. Pullem, and Jeremy J. Westlake provided invaluable help as research assistants. The University of Chicago Law Review [71:799 INTRODUCrION The public trust doctrine has always been controversial. The gen- eral rule in American law favors ownership of natural resources as private property. The public trust doctrine, a jarring exception of un- certain dimensions, posits that some resources are subject to a perpet- ual trust that forecloses private exclusion rights. For environmentalists and preservationists who view private ownership as a source of the degradation of our natural and historical resources, the public trust doctrine holds out the hope of salvation through what amounts to a judicially enforced inalienability rule that locks resources into public ownership.' For those who view private property as the bulwark of the free enterprise system and constitutional liberty, the doctrine looms as a vague threat Although proponents and detractors of the public trust doctrine dispute much, all agree that the leading case establishing the doctrine in the United States-the "lodestar" of the modern public trust doc- trine3 -is the United States Supreme Court's 1892 decision in Illinois Central Railroad Company v Illinois. The decision arose out of a dispute over control of the bed of Lake Michigan east of downtown Chi- cago. Four contestants wrangled over this resource: the Illinois Central Railroad Company, the City of Chicago, the State of Illinois, and the United States government. Each had a plausible legal theory support- ing its claims, and each had reason to fear the consequences should another gain supremacy over development of the lakefront. Their struggle, beginning in the late 1860s, resulted in the enactment of the Lake Front Act by the Illinois legislature in 1869, which awarded the Illinois Central both a portion of the lakeshore for a new depot and over one thousand acres of submerged land for the development of an 1 See, for example, Charles F. Wilkinson, The Public Trust Doctrine in Public Land Law, 14 UC Davis L Rev 269, 299 (1980) (crediting the public trust doctrine with preserving public resources). 2 See, for example, Lloyd R. Cohen, The Public Trust Doctrine:An Economic Perspective, 29 Cal W L Rev 239, 275 (1992) (arguing that the public trust doctrine undermines the security of property rights); James L. Huffman, A Fish Out of Water: The Public Trust Doctrine in a Con- stitutionalDemocracy, 19 Envir L 527, 565 (1989) (stating that "the doctrine often permits non- democratic courts to overrule the decisions of theoretically democratic legislatures"). 3 Joseph L. Sax, The Public Trust Doctrine in Natural Resource Law: Effective JudicialIn- tervention, 68 Mich L Rev 471,489 (1970). 4 146 US 387 (1892). For examples of testaments to the importance of Illinois Central,see Daniel R. Coquillette, Mosses from an Old Manse: Another Look at Some Historic Property Cases about the Environment, 64 Cornell L Rev 761, 764, 810 (1979) (calling the case one of "three famous cases on Anglo-American property doctrine" and noting that "[t]he debate over the case has raged for nearly ninety years"); Carol Rose, The Comedy of the Commons: Custom, Commerce, and Inherently Public Property,53 U Chi L Rev 711, 737 (1986) (describing Illinois Central as the "most famous assertion of the public trust theory"); Gerald Torres, Seventh Annual Lloyd K. Garrison Lecture on Environmental Law- Who Owns the Sky?, 19 Pace Envir L Rev 515, 520 (2002) (noting that the decision is "one of [the Supreme Court's] most famous cases"). 2004] The Origins of the American Public Trust Doctrine outer harbor for Chicago. Just four years later, however, during the populist agitation known as the Granger Movement, the grant was re- pealed. For this and other reasons the legal dispute continued, leading to the litigation that eventually worked its way to the Supreme Court in 1892. The Illinois Central decision, as an exercise in dispute resolution, provided something for everyone. The Court held that the State of Il- linois, not the federal government or the owners of riparian lands abutting the lake, was given title to the bed of Lake Michigan when Il- linois was admitted to the Union in 1818.' It confirmed that the City of Chicago had title to the strip of land known as Lake Park (today ex- panded and renamed Grant Park) abutting the lake in the center of the City.' It acknowledged that the Illinois Central Railroad was the riparian owner north and south of Lake Park, and intimated that the railroad's existing landfills and improvements in these areas as well as its right of way though Lake Park would be allowed to remain undis- turbed.7 And it reaffirmed that the federal government had complete control over navigation in the harbor, to which the interests of all other property rights in the lakebed were subordinated. 8 The most difficult issue-and the one whose resolution was to have consequences extending far beyond the specific controversy- concerned the Illinois Central's claim that the 1869 Lake Front Act had conveyed vested rights of property which the legislature was powerless to repeal in 1873. This was a forceful claim in the nineteenth century, as the Court had held in Fletcher v Peck' that the Contracts Clause protected against repeal of a completed conveyance of property by a state government.'0 Writing for a bare majority of four Jus- tices in Illinois Central (only seven participated in the decision), Jus- tice Stephen Field deflected this claim by holding that the State had no power to alienate the land in the first place." Although the State held title to the bed of the lake, Justice Field explained, this title - given the surpassing public interest in preserving the lake for navigation-was held in trust for the people.'2 The State had violated this 5 Illinois Central,146 US at 434-37. 6 Id at 462-63. 7 Id at 445-48. 8 Id at 463. 9 10 US (6 Cranch) 87 (1810). 10 Id at 137. See also Douglas L. Grant, Underpinnings of the Public Trust Doctrine: Les- sons from Illinois

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