Missouri, Kansas & Texas Railway Co. v. Oklahoma

Background

The dispute involves a railroad company that owned its right-of-way in fee and the city of McAlester, which sought a highway underpass at Comanche Avenue. The line had been built under a congressional land grant, and in 1921 the state Corporation Commission ordered the company to prepare plans and an estimate for a reinforced concrete subway with two openings and to construct the underpass within ninety days after the city arranged to pay its portion of the cost. In 1901 the predecessor city had passed an ordinance that the railroad accepted, agreeing that the city would bear the cost of the Comanche Avenue crossing and that the company would grant the right of way and waive claims for damages.

Reasoning

The Court acknowledged that state and municipal police power can regulate railroad crossings and that the commission has jurisdiction. But the Court held the company owned the land in fee and that the commission could not enforce the construction order in a way that contradicted the existing ordinance or before the railroad’s compensation was determined. Enforcing the order would impair the contract and deprive the company of property without due process, so the Court reversed the judgment.

Real world impact

The ruling prevents the commission from forcing immediate construction over the railroad’s fee land when a prior contract assigns cost to the city and the railroad’s compensation is unsettled. It leaves open the possibility of amicable settlement or condemnation to fix compensation before enforcement and affirms that cities may agree in advance to pay crossing costs.