Fox River Paper Co. v. Railroad Commission

Background

Riparian owners who own land along the Fox River in Wisconsin operated a dam at Appleton built in 1878 without state permission. Wisconsin statutes since 1841 forbade building a dam on any navigable river without legislative consent. A 1925 law gave the state railroad commission authority over navigable waters and required permit applicants to agree in writing to detailed terms, including a clause letting the state or a municipality acquire the permittee’s dam and related rights after thirty years for compensation as the commission determined. The owners applied for permits but failed to file the proposals required by §31.09, and the commission dismissed the application for lack of jurisdiction. The owners sued, saying the statute’s acquisition condition took their property without due process of law.

Reasoning

The key question was whether the statute’s conditions amounted to an unconstitutional taking without due process. The Court accepted the Wisconsin Supreme Court’s interpretation of state law that any right to develop water power by damming a navigable river is subordinate to the state’s full control and requires the state’s consent. Because the state may forbid or condition dams, the Court concluded the owners did not hold a protected property right that the state had denied. The Court therefore found no Fourteenth Amendment violation in refusing the permit for failure to meet the statutory condition. The Court did not decide whether the statute’s compensation formula would be adequate if the owners had a protected right.

Real world impact

The decision means Wisconsin dam owners must follow permit rules and accept statutory acquisition conditions to keep dams on navigable rivers. It confirms that state law definitions of riparian rights determine whether federal constitutional protections apply. Challenges about the sufficiency of the statute’s compensation can be raised later but were not resolved here.