Eaton v. Boston, Concord & Montreal Rail Road
[2] The case deals with the legal concepts of eminent domain and strict liability (which received attention as a result of the need to address new and expanding issues created by the emergence and growth of railroads in the United States during the nineteenth century),[3] and occupies a significant place in the historical background of eminent-domain and property-rights cases which emerged with the development of the railroads.
The court ruled that the waiver only protected the railroad from liability resulting from the taking of Eaton's property "for the laying out of road" and not for damages resulting from the "construction" of the railroad (which caused the flooding of Eaton's land), noting that " ... this was a taking of E.'s property, within the meaning of the constitutional prohibition; and that the legislature could not authorize the infliction of such an injury without making provision for compensation".
Eaton addressed legal and regulatory issues which emerged during the years after the 1872 decision: the exercise of power conferred by charter and eminent-domain questions (what constitutes a taking, what is considered public good and what is just compensation).
[4] Until 1870 much railroad law favored the industry, but Ely notes that after 1870 " ... lawmakers gradually shifted their focus toward controlling the behavior of the iron horse".
[5] These early cases usually sided with common law, which forbade the obstruction or manipulation of water flow from an adjacent stream to deprive another landowner of the right to fully enjoy his land.
[6] In addition to a dock and wharf rights, the company owned a lot in Chicago housing its offices and a shed where the steamers were stored and maintained.
[6] In addition to the damages caused by the excavation of a portion of LaSalle Street, the plaintiff alleged that during construction a cofferdam was built in front of its dock which prevented "the enjoyment of their land" by blocking its warehouse doors.
This left its sole access an entrance on Water Street, leaving its storage and maintenance inaccessible and requiring the plaintiff to rent an adjacent space.
[6] The plaintiff also argued that as a result of the cofferdam construction, it could not bring boats to the dock to land freight or passengers;[6] the LaSalle Street excavation was negligent and improper for the type of work performed.
[6] According to the court, the only question remaining for a jury to decide was whether the LaSalle Street excavation was conducted in an "unskillful" or "negligent" way (causing part of the building's walls to fall).
The court noted that unlike Eaton, where there was a physical invasion of the real estate, the construction merely inconvenienced the plaintiffs and did not amount to eminent domain.
[9] Two major common-law assumptions existed which would later be challenged in emerging disputes involving the rights of mill owners to obstruct the natural flow of streams adjacent to their property.
[10] This premise was based on the belief that the diversion or obstruction of streams adjacent to multiple property owners, without the consent of all interested parties, was an infringement of the natural right of enjoyment of one's land.
[5] In Shorey v. Gorrell (a case decided by the Massachusetts Supreme Court in 1783), "without long usage sufficient to confer a prescriptive right, there is no legal basis for preventing newcomers from obstructing a stream.
[5] Horwitz wrote about some of the insights of the new judiciary, "Some attempted the modification of common-law definition of injury to permit extensive, uncompensated use of water for business purposes".
[11] In the 1805 Palmer v. Mulligan, the New York Supreme Court asserted for the first time that upstream land owners could obstruct the flow of water for mill use.
[5] The court reasoned that to prevent a newcomer from obstructing part of a stream would inherently confer exclusive rights to "whomever first built a dam," and resolved that "competition and rivalry is always good for [the] public".
[12] The outcome of this case set a legal precedent, used by pro-economic judges tasked with determining injury related to water and property rights.
[5] In Shorey, Mulligan and Johnson, the early 19th-century courts introduced the view that injury was determined by "relative efficiencies of conflicting property uses" (as opposed to the English common-law tradition ensuring a natural right of enjoyment).
[16] "The Camden and Amboy was immediately a financial success, and the payment of dividends and transit duties constituted the principal source of revenue in the state budget.
