In 1869 the Illinois legislature granted a parcel of land by/within the harbor of Chicago to the Illinois Central Railroad. The land was very valuable. However, the legislature did not give the Railroad exclusive control over the property. It just required the railroad to maintain and possess the land “in perpetuity” so long as they would not sell it to anyone else. The grant disallowed the railroad from keeping others out of the harbor as well. The railway did pay money for the land, but the sum was far below its true value. In 1873 the legislature reneged on the earlier grant and brought about the instant case to have the 1869 grant permanently declared invalid.
“Whether the legislature was competent to thus deprive the State of its ownership of the submerged lands in the harbor of Chicago, and of the consequent control of its waters; or in other words, whether the railroad corporation can hold the lands and control the waters by the grant, against any future exercise of power over them by the State.”
No. The title given to the railroad is different from a standard title. “It is a title held in trust for the people of the State that they may enjoy the navigation of the waters, carry on commerce over the, and have liberty of fishing therein freedom from the obstruction or interference of private parties.” The limitations placed on the harbor to the railway were limitations of constructing lots of docks or the conducting of certain types of business within the harbor. Because the state has a public trust, the state can never transfer control of public property to a private corporation; it was be as invalid as transferring property to another nation. Submerged lands are continuously held in trust for the public and cannot be given away “except in those instances mentioned of parcels used in the improvement of the interest of the publc.”