Lakefront: Public Trust and Private Rights in Chicago

LAKEFRONT

Public Trust and Private

Rights in Chicago

Joseph D. Kearney and Thomas W. Merrill

CORNELL UNIVERSITY PRESS    ITHACA AND LONDON

In memory of Edmund W. and Mary Jane Kearney, among whose many gifts to me Chicago was only one —JDK

For the next generation: Jessie, Margaret, and Libby —TWM

Contents

Acknowledgments

Introduction

1. The Lake Front Steal

2. The Lake Front Case

3. The Watchdog of the Lakefront

4. The Struggle for Streeterville

5. Reversing the Chicago River

6. North Lake Shore Drive

7. South Lake Shore Drive and Bridging the River

8. The Transformation of the Public Trust Doctrine

9. The Lakefront Today

Conclusion

Notes

Index of Published Decisions

Index of Subjects

Acknowledgments

This book has been an unusually long time in the making. We began more than twenty years ago, when each of us had been a longtime resident of Chicago. Both of us moved to other cities, one to Milwaukee and the other to New York, where we acquired teaching and administrative responsibilities at different law schools. We found ourselves nevertheless—or, perhaps, all the more—unable to resist the challenge of untangling the history of the Chicago lakefront, which is at once a large puzzle and a kind of miracle. Given our other duties, these efforts were mostly concentrated in the summer months, when it was possible to return to the city. Three articles eventually emerged that are reflected in portions of the book. For example, aspects of chapters 1 and 2 originally appeared in the University of Chicago Law Review, and we appreciate its permission to draw on our article, cited in the notes; similarly, for chapters 3 and 4, we rely on our subsequent articles in the Northwestern University Law Review. At the same time, we have extensively reworked this material and drawn on further research. The balance of the book, covering most of the twentieth century and the early decades of the twenty-first, is entirely new.

Through the years, we have accumulated an extraordinary number of debts. We have benefited from a variety of excellent collections of archival material in Chicago. The Newberry Library includes in its holdings many of the papers of the Illinois Central Railroad, primarily up to 1906. Given that the railroad was a central player in most of the disputes on the lakefront during this period (to anticipate our story), these were invaluable, especially the onion skin copies of correspondence between the officers of the company. We thank the librarians at the Newberry for helping us locate and decipher these materials.

The Chicago History Museum and the Chicago Public Library were also important sources of primary material. Both have important collections of old Chicago newspapers, many of which are not available online. The Chicago History Museum has an unmatched archive of old photographs, to give only one other of many relevant examples. We wish to thank Lesley Martin, Johanna Russ, and others at these institutions for their assistance in mining their rich and well-curated collections.

The Chicago Park District provided critical assistance, especially in connection with the material in chapters 6 and 7 on the construction of Lake Shore Drive and associated lakefront parks. We are most indebted to Julia Sniderman Bachrach for giving us access to the park district’s extensive archives, without which these chapters could not have been written.

This scarcely exhausts the catalog. Much of the source material for the book comes from court records. We uncovered these in a number of different places, including the Illinois State Archives in Springfield; the Archives Department of the Clerk of the Circuit Court of Cook County; the National Archives and Records Administration at Chicago (with help from Glenn Longacre), at College Park, Maryland, and in Washington, DC; and the library of the Supreme Court of the United States. We gathered legislative materials from the Library of Congress as well as places already mentioned. Additional information came from the records of the US Army Corps of Engineers and the Metropolitan Water Reclamation District of Greater Chicago. We express our appreciation to each of these institutions for its help.

We were fortunate to enlist Dennis McClendon not only in making numerous original maps for the book but in helping sort out various relevant details. We are particularly grateful to him.

The librarians and archivists of the universities with which we have been affiliated or places at which we have presented ourselves also provided invaluable support. In addition to the entities noted above, these include Northwestern University School of Law and the McCormick Library of Special Collections and University Archives at Northwestern; the Evanston Public Library; the libraries of Columbia University, Loyola University Chicago, the University of Chicago, the University of Illinois at Chicago, the University of Illinois at Urbana-Champaign, and the University of Wisconsin Law School; the American Heritage Center at the University of Wyoming; and, last but especially, the Raynor Memorial Libraries and the Eckstein Law Library at Marquette University.

We drew on conversations and support from colleagues and others. James B. Speta and David A. Strifling made a number of helpful contributions to our work. Robert E. Bailey, Gerald A. Danzer, David A. Epstein, Richard A. Epstein, Timothy J. Gilfoyle, Jack Guthman, Richard H. Helmholz, Libby Hill, Ann Durkin Keating, John H. Langbein, Kevin B. Leonard, the late Dawn Clark Netsch, Carl Smith, Henry E. Smith, and John Fabian Witt provided suggestions or counsel at one point or another in this lengthy project. Our families heard and bore much of the lakefront project—and, to be sure, offered encouragement.

We owe our largest debt to our research assistants, whose number the descriptive phrase army of would only slightly exaggerate. Some were law students at Northwestern and Columbia. By far the largest number have been students at Marquette Law School. It would be appropriate to acknowledge them individually, but given the long span of time, and the different contributions they have made—some working for part of a summer, others for the school year, and still others for multiple years—the risk of overlooking someone or failing to provide fair credit seems too great. We have thanked them individually, we hope, and we do so again collectively. Without their efforts, there would be no book.

INTRODUCTION

Those flying into Chicago from the east on a sunny day encounter a stunning vista. The first thing they see is a long strip of parkland, rising from the blue waters of Lake Michigan and running almost the entire length of the city from south to north. Immediately behind the parkland, a wall of glass and steel buildings thrusts upward, dramatically reflecting the greenery below. Perhaps most striking to the well-traveled eye, the line dividing the lake from the shore is remarkably free of unsightly vestiges of a rougher, more industrial past, such as rotting docks, abandoned factories and warehouses, or power plants. In this respect, the Chicago lakefront is different from the waterfront of other major cities, such as New York, London, Philadelphia, Cleveland, Detroit, or San Francisco. This book seeks to explain how Chicago came to have such a beautiful, well-tended, and publicly accessible lakefront—the city’s most treasured asset.

The path that led to the lakefront of today was by no means direct or inevitable. The history of the lakefront has been one of almost continual social conflict. If the disputes had been resolved differently, the lakefront would look very different today, and more like the waterfronts of other major cities.

Some of the division on the lakefront has pitted the haves against the have-nots. For example, the Potawatomi Indians at various times claimed the filled land along the lakefront, on the ground that their rights to the lakebed had never been validly extinguished. And for many years George Wellington Streeter and his band of squatters did battle with detectives hired by real estate investors over control of the land north of the Chicago River. Streeter was remarkably tenacious, but the wealthy investors eventually prevailed and gave us the high-rise enclave called Streeterville, named in homage to the vanquished contestant. Other conflicts, such as the one over reversing the Chicago River so that it flows out of the lake rather than into it, pitted Chicagoans against the residents of other states.

FIGURE 0.1. Looking north at Grant Park along the Chicago lakefront, 2018. Dbimages/Alamy Stock Photo.

The dominant form of social conflict on the lakefront, however, has been between different factions within the Chicago elite. To be sure, some of these factions have invoked the interests of the general public in support of their own cause. But the principal actors, and the driving forces behind the disputes, have been groups of wealthy and well-connected citizens who have had different visions about what should be done with the lakefront.

The first of these intramural disputes, which was not fully resolved until after the First World War, pitted the upscale landowners whose property was favored with views of the lake against various interests that wanted to use the lake for commercial development. The initial form of this dispute featured the Michigan Avenue property owners, on one side, and the Illinois Central Railroad, which had been allowed to enter the city along the lakefront, on the other. A related dispute, which involved some of the same actors, pitted the landowners against those who wanted to build an outer harbor in Lake Michigan in order to preserve Chicago’s status as a major inland port. Toward the end of the nineteenth century, the Michigan Avenue landowners faced a third challenge, as other wealthy Chicagoans and influential politicians sought to fill Grant Park, along the lake-front in the center of the city, with monumental buildings, many bearing their names.

Civic antagonism over the lakefront continued into the twentieth and twenty-first centuries, and it again largely took the form of a series of fights between rival factions of the elite. As lakefront parks spread out north and south from the city center, the commissioners of the park districts had to devise ways to overcome the opposition of riparian landowners, who prized their views and access to the lake. And with the emergence of the environmental movement, the lakefront has become the scene of renewed conflict, with those who want to preserve the existing shoreline and open park space versus those who favor using the lakefront for convention centers, expanded universities, museums, recreated football stadiums, and presidential centers. These sorts of fights no doubt will persist into the future. Figure 0.2 provides an overview of the Chicago lakefront and the sites of many of the major conflicts chronicled in the pages that follow.

Because the majority of the social conflicts over the lakefront have been waged by rival elites, the forums in which these disputes have unfolded have been legal ones. The reason is simple: the elites have had the resources to retain lobbyists and lawyers in the hope of enlisting the power of the state on their side. Efforts to influence public opinion have not been ignored, but the critical showdowns have taken place in the city council, the state and federal legislatures, and, perhaps most importantly, the courts; indeed, the lakefront has been the subject of virtually nonstop litigation from the 1850s to the present. We have mined these resources, extracting previously undiscovered or unappreciated information about the contending political forces and personalities involved in the individual disputes. We have tried to describe the legal controversies in such a way that one does not have to be a lawyer to understand the legal context of the disputes in question. But we strongly believe that one cannot fully grasp what was going on without considering the legal processes that shaped and motivated the contesting parties.

Tapping into the legal sources has several unanticipated payoffs. Perhaps most notably, it allows us to draw on a rich source of archival material that has not previously been factored into histories of the lakefront. For another advantage, it reveals certain critical changes in the law—crucial factors, as it turns out, in generating many of the conflicts that emerged over time. One of the most important was a reversal in the understanding about who owns the land under Lake Michigan. Up until about 1860, the legal understanding was that the owners of land on the shore—riparian owners—also owned the submerged land. In the 1890s,

FIGURE 0.2. Major areas along the Chicago lakefront.

it became clear that the State of Illinois owned the submerged land. But in the thirty-some years in between, there was confusion and uncertainty about who owned the lakebed. This, in turn, helps explain much of the private landfilling that occurred during this period, by the Illinois Central Railroad and a forerunner of the US Steel Corporation among others, as well as the shenanigans over control of the area now called Streeterville.

Another legal development of general importance was the slow but inexorable development of new institutions to regulate the lakefront. At the beginning of the period covered by this book, government at all levels was weak, and at the state and local levels was often corrupt. The only way to provide public goods such as wharves, or to preserve open spaces for parks, was through lawsuits invoking the common law. Toward the end of the nineteenth century, the US Army Corps of Engineers and specially created government commissions, such as the sanitary district and the park districts, emerged as major players on the lakefront. Eventually these institutions were able to gain control of the lakefront for public use, and to prevent further illegal landfilling and squatting.

The exploration of legal sources also makes our account broadly relevant to those interested in environmental and urban history. Land that fronts on a major body of water like Lake Michigan is always vexed by tension between public and private rights. But as this book will show, it is not a simple matter to identify what sort of legal regime will strike the right balance between public and private in this context. In some circumstances, private rights—such as the right of private landowners to sue to protect their view of the water—will do more to protect the interests of the general public than will more explicitly public remedies. And defining the public interest in the waters that adjoin land is not easy. Is the public interest served or disserved by filling open water to build parks, museums, convention centers, private universities, and wharves—or railroads and steel mills that employ thousands? And which institution should make these decisions—the legislature, the city, the courts, an administrative agency, or perhaps the people themselves in a referendum?

Focusing more precisely, our history can be seen as an extended case study about one particular legal idea that emerged on the Chicago lakefront and has come to play an important role in American law more generally: the public trust doctrine. Although the outer reaches of this doctrine remain contested, at its core it protects the right of the general public to access navigable waterways. In order to resolve a major controversy over whether the Illinois legislature could grant one thousand acres of submerged land on the lakefront to the Illinois Central Railroad, and then rescind the grant four years later, the US Supreme Court in 1892 decided that such a grant would violate the public trust in which the submerged land was held. The Lake Front Case has since been regarded as the leading authority recognizing the public trust doctrine in the United States.*

The public trust doctrine has become intensely controversial. Some would like to see it extended to cover all kinds of resources, from wildlife to the atmosphere to cyberspace. Others see it as a threat to the very existence of private property rights. Our account sheds important light on the circumstances that gave rise to the doctrine on the Chicago lakefront, how the doctrine has performed in its original setting relative to other legal doctrines, how it was transformed in the twentieth century, and how its legacy in protecting public resources has been mixed, in both its original and its transformed versions. We do not suggest that our account answers all the large questions about the public trust doctrine. But it will surely be of interest to those who engage in ongoing debates about it.

Even more broadly, our book can be seen as an examination of the importance of law and, in particular, legal property rights in the long-term development of an important resource like the lakefront. In the short run, the law unquestionably played a significant role in resolving many of the controversies we examine, whether through the adoption of legislation or the resolution of litigation by the courts. In the longer run, we find reason for skepticism. Some legal doctrines emerged to resolve certain controversies, only to be repudiated later on. Others emerged with great force, only to be fatally weakened, or transformed beyond recognition as time passed.

The only dimension of the law that stands out as a strong predictor of the outcome of the struggles on the lakefront is the power of possession. The Illinois Central Railroad engaged in massive landfilling on the lakefront, often (as it turned out) with no legal justification, but was allowed to keep all the improvements it actively possessed, including its former rail yard built on landfill south of the Chicago River, now full of skyscrapers. The wealthy private investors who claimed the made land in Streeterville were allowed to keep it, once they were able to oust Streeter and began developing that land with substantial structures, even if some of the land technically belonged to the state. The construction of Lake Shore Drive was made possible by low-visibility transfers of submerged land to riparian owners, who filled the land and took possession of it without any public protest. The importance of possession was intuitively obvious both to the high-priced lawyers who defended the conduct of the Illinois Central and to the scalawag Streeter, who thought that so long as he remained in possession of some portion of the reclaimed land, someday it would be his. We cannot be sure that this generalization extends beyond riparian land or even beyond the Chicago lakefront. But it suggests that greater attention should be given to possession in considering the potential significance of property rights.

Chicago has been singularly lucky in that the many social conflicts over the lakefront were resolved in the way they were. Massive landfilling of the lake occurred, but it did not ultimately detract from the beauty or value of the lake, in large part because Lake Michigan is so vast. Some structures were built on the fill, but their number was limited, in large part because of the opposition of riparian owners to losing their view of the lake. And once the park districts gained control of much of the lakefront, the structures that were built were largely dedicated to public uses. If the outcome in Chicago was largely fortuitous, part of our motivation in writing this book has been to suggest how a more deliberate mix of policies might produce similar results elsewhere. Conflicting visions and political realities will always frustrate any attempt at comprehensive planning. But understanding how particular choices conspired to produce a generally happy outcome in one particular setting may provide inspiration, or at least some cautionary tales and instructive lessons, for those who aspire to achieve the same ends elsewhere.

* We use the name Lake Front Case to refer to the 1888 circuit court decision and the 1892 ruling in the Supreme Court for a number of reasons. It is the popular convention that began in the nineteenth century, from the early days of the case, and has endured. See, e.g., United States v. Illinois Central Railroad Co., 154 U.S. 225, 233 (1894) (noting in a second appeal that this is how the several cases [were] known and spoken of together in the trial court). In addition, the Illinois Central and the State of Illinois are such a large part of our story, with so many relevant cases of the era bearing their names, that to refer to Illinois Central Railroad Co. v. Illinois, from the caption of the lead case in the 1892 Supreme Court decision, let alone to use some short form of that, would not seem specific enough to be useful in the context of this book.

1

THE LAKE FRONT STEAL

Our story begins with the construction of the Illinois Central Railroad along the shore of Lake Michigan in Chicago. Today, the railroad has effectively disappeared. Beginning in the 1850s and for more than a century, however, the Illinois Central’s massive rail yards and facilities were the lakefront’s most prominent feature. The railroad’s landfilling to create this empire generated much of the conflict—legal, political, and social—that vexed the lakefront in the ensuing years. It was also responsible for much of the configuration of the lakefront today.

The Illinois Central’s facilities stood on what had been Lake Michigan. Whether the railroad had the right to construct these facilities turned on who owned the submerged land and whether that owner had the authority to permit such landfilling. Although these questions seemed to trouble no one when the railroad first entered the city in 1852, they soon became important—and the answers increasingly uncertain. These uncertainties would produce, in 1869, what came to be known as The Lake Front Steal.

The Lay of the Land

The site of Chicago was long thought to be a potentially valuable port. While the south end of Lake Michigan had few natural harbors, the Chicago River was one, at least potentially. The river was also intriguingly close to the watershed of the Mississippi River—suggesting that, with the digging of a canal, the river might connect the Great Lakes to the Mississippi River and thence to New Orleans and the Gulf of Mexico.¹

The principal impediment to using the Chicago River as a port was Lake Michigan’s current. The water in the southern part of the lake tends to circulate counterclockwise. As depicted in figure 1.1, this created a long sandbar, curving south, at the mouth of the Chicago River. The result was that the water at the mouth was often too shallow for shipping.²

Soldiers stationed at Fort Dearborn, on the south bank of the river, repeatedly cut a channel through the sandbar, but it always silted in again. In the mid-1830s, army engineers more or less solved the problem by building piers into Lake Michigan from the river’s north and south banks. The twin piers functioned like a spout, discharging the river straight into the lake, and thereby reduced the formation of sandbars at the entrance.³

FIGURE 1.1. Mouth of the Chicago River, 1830. Chicago History Museum, ICHi-021558.

It soon became clear that the piers channeling the Chicago River had only redirected the lake’s relentless currents. South of the south pier, the lake currents subtracted land by erosion. This area featured Lake Park, running along the lakefront from Randolph Street south to Park Row (a street running eastward from Michigan Avenue, just north of 12th Street). By 1850, some twenty of the park’s thirty-five acres had washed away. Across from the park, the west side of Michigan Avenue was lined with residential structures, including an array of fine townhouses called Terrace Row, where many of the city’s elite lived. These properties were in potential jeopardy from the encroaching lake waters. On occasion, residents had to work through the night to prevent Michigan Avenue from collapsing into the lake.⁴

The solution to the erosion problem was assumed to be the construction of an offshore breakwater. Multiple initiatives toward this end in the 1840s and early 1850s were unsuccessful, with disagreement as to whether Michigan Avenue residents or, more generally, the taxpayers of Chicago should pay for it. The matter reached an impasse.⁵

Enter the Illinois Central Railroad. The railroad was the product of coordinated federal and state legislation. In 1850, Congress granted a two-hundred-foot-wide right of way and alternate sections of land on either side, in checkerboard fashion, to the State of Illinois, to support a north–south railroad. The total grant encompassed some 2.5 million acres. The Illinois legislature in 1851 then chartered the Illinois Central Railroad Company and reconveyed the federal lands to the new railroad to subsidize its construction.⁶

The law specified that the railroad would generally follow a Y shape, with its southern terminus at Cairo, on the Ohio River. As constructed (see figure 1.2), it would run north to the town of Centralia. There it would split in two, variously heading northwest toward Galena and northeast to Chicago. In addition to regranting the land that had been in the federal domain, the state charter provided, rather imprecisely, that for purposes of constructing depots, shops, yards, and other railroad facilities besides rights of way, the railroad could enter upon and take possession of and use any lands, streams and materials of every kind belonging to the state. If the railroad needed to acquire privately owned land, it was given the power to condemn such lands using the power of eminent domain—a compulsory transfer of property in return for the payment of just compensation to the owner. Finally, the charter required that if the railroad entered any municipality, it had to obtain the consent of the local government to its location.⁷

This last provision effectively gave the Chicago Common Council control of the Illinois Central’s location within the city. The railroad initially preferred a route that would put its terminal on the south branch of the Chicago River. But much of the land along the route was already possessed by other railroads, so the Illinois Central proposed an approach locating its right of way along the city’s lakefront. To accomplish this, and as an inducement to the city, the railroad said that it would build and pay for a breakwater to protect the shore from erosion.⁸

FIGURE 1.2. The Illinois Central Railroad as initially constructed.

Michigan Avenue residents strongly opposed the idea. A railroad would be noisy and smoky. It would also impair their view of the lake, and likely compromise their property values. But the common council was more sympathetic. As Robin Einhorn has written, If the Michigan Avenue owners would not pay for lake shore protection in cash, they would be forced to pay some other way. On June 14, 1852, over a mayoral veto, Chicago enacted an ordinance permitting the Illinois Central to enter the city along the lakefront. For the next century, the railroad and the Michigan Avenue property owners would be in more or less continual conflict.⁹

The 1852 city ordinance fixed the railroad’s location and established its powers in the city. The carrier would enter where the city’s southern boundary (then 22nd Street) met the lakeshore. The line would proceed north, first along the lakeshore to 12th Street, then across the open space known as Lake Park to Randolph Street, and finally to such grounds between Randolph and the Chicago River as the railroad might obtain to build a terminal. The ordinance gave the railroad a three-hundred-foot right of way from 12th Street to Randolph Street. This was one hundred feet wider than the right of way specified in the federal grant and the state charter. The ordinance did not explain the source of the city’s authority to permit this.¹⁰

Given the erosion that had taken place in Lake Park, the ordinance specified, in effect, that the right of way would run along the shoreline from 22nd Street to 12th Street, but that north of 12th the railroad would be built in the lake—roughly three hundred feet from the shore, by the time it got to Monroe and to Madison.¹¹

Some other important particulars concerned the areas south of 12th and north of Randolph. To the north, the ordinance contemplated that the railroad would itself acquire the necessary rights for a terminal and other railroad facilities, through either purchase or condemnation. In addition, the ordinance gave the railroad the authority, starting with whatever riparian lands it acquired in this area, to extend [its] works and fill out into the lake, to a point four hundred feet west of the east end of the south pier of the Chicago River. In this area would be located the depot of said railroad within the city, and such other buildings, slips or apparatus, as may be necessary and convenient for the business of said company. The ordinance offered no hint about the source of the city’s authority to permit this landfilling. Nor did it authorize any landfills or other improvements south of 12th Street.¹²

For its part, the railroad agreed to erect within three years, and thereafter to maintain, along the eastern edge of its right of way from Randolph south to 22nd Street, a breakwater sufficient to protect the entire front of [Chicago] . . . from further damage or injury from the lake waters. In deference to the Michigan Avenue residents, the ordinance prohibited the Illinois Central from constructing any buildings or other improvements to the east of Lake Park that might obstruct views of the lake from the shore. Nor could the railroad allow its locomotives or cars to remain standing on the tracks in this area.¹³

The Illinois Central moved quickly. The railroad drove piles into the lakebed to support a double line of track sitting on trestles. Initially, for both the tracks and the breakwater, it used only two hundred feet of the authorized right of way. North of Randolph Street, the railroad acquired the necessary riparian land and began almost immediately to fill the lake east of this area. Here it constructed its terminal, approximately where the Prudential Insurance Building is located today. Known as Great Central Station, the terminal was the largest building in Chicago when it opened in 1856. The railroad also did some filling south of Lake Park, between 12th and 16th Streets, where it built an engine house and its Weldon repair shops.¹⁴

FIGURE 1.3. The Chicago lakefront, looking north, ca. 1865. Chicago History Museum, ICHi-062330.

It soon became clear that the 1852 ordinance presented operational difficulties. In 1855, the common council permitted the railroad to curve its tracks westward as they approached Randolph Street from the south and to fill in the resulting triangular area. This curve improved access to the terminal building. One year later, the common council similarly permitted the railroad to curve its tracks eastward as they approached Randolph. This gave the railroad better access

FIGURE 1.4. Major Chicago rail facilities, ca. 1860.

to grain elevators being constructed on further landfill jutting east, along the line of the river’s south pier. As with the 1852 ordinance’s grant of an extra hundred feet of right of way, neither the 1855 nor the 1856 ordinance explained the city’s authority to convey these additional rights to fill and develop the lakebed.¹⁵

After a lull in further construction but with the end of the Civil War, the lake-front again became the focus of attention. Many called for the construction of an outer harbor to the east of the breakwater, to relieve the congestion in the Chicago River from the growing water traffic. Increased passenger traffic on the Illinois Central and affiliated lines gave rise to calls for a larger depot, perhaps in Lake Park between Michigan Avenue and the Illinois Central right of way. To accommodate rising transshipments of grain, lumber, and other commodities, the railroad built new piers and sidings in the landfill area north of Randolph and east of its terminal building. Finally, both Michigan Avenue residents and public advocates, wanting Chicago to follow in the footsteps of eastern cities and create a system of public parks, promoted an improved park along the lakefront.¹⁶

Figure 1.3 is a photograph of the lakefront taken ca. 1865, looking northward along Michigan Avenue. Terrace Row can be seen at the left. Lake Park, a narrow strip of land, is in the center, with the Illinois Central tracks on the right, standing on piles in the lake and leading to Great Central Station and the railroad’s grain elevators, in the distance, north of Randolph. Figure 1.4 shows the configuration of the lakefront and downtown railroad facilities around this time.

Legal Uncertainty over Property Rights in Submerged Lands

We pause in our narrative for an important discussion of a seemingly obscure matter of riparian property rights. This will explain some of the puzzling behavior of the City of Chicago and the Illinois Central in the arrangements allowing the railroad to enter along the lakefront in the 1850s. It also sets the stage for the drama over the lakefront that emerged in the 1860s and produced the Lake Front Steal.

Under English law, a critical distinction was drawn between the rights in areas of water affected by the ebb and flow of tides and the rights in rivers and lakes not so affected. The king as sovereign owned the submerged land under tidal waters. In contrast, submerged land under rivers and lakes not affected by the tides was subject to private ownership. Absent a grant to the contrary, the title-holder of such nontidal riparian land owned the submerged land to the center-line of the river or lake that the riparian land abutted. Importantly, however, all waters, whether tidal or not, were subject to a general public right of free navigation. Thus, neither the king (as owner of submerged tidal lands) nor private riparians (as owners of submerged nontidal lands) could use their ownership of submerged lands to create obstructions that would block free navigation.¹⁷

In 1842, the Supreme Court of the United States took an important first step in adapting these understandings to the American context. The court held that the original colonies had succeeded to the English Crown’s ownership of submerged lands under navigable waters. Thus, upon independence, title to these lands vested in the state governments. A few years later, under the so-called equal-footing doctrine, the court held that subsequently admitted states created out of federal territory inherited the same ownership rights to submerged lands under navigable waters as the original thirteen.¹⁸

These decisions involved lands under tidal waters. In England, only tidal waters were officially deemed to be navigable waters. Given its long coastline and short rivers, this understanding did not do great violence to commercial realities. The North American continent, in contrast, contains a large number of waterways that are not tidal but are navigable in fact, including the Great Lakes. By the 1840s, if not before, it was clear that these waterways would play a vital role in the development of American commerce.

The courts of the various states divided over how the Supreme Court’s decisions recognizing state ownership of tidal lands should apply to land under waters that were not tidal but were navigable in fact. A majority of states, adhering to English law, held that state ownership was limited to land under tidal waters. A significant minority of states, however, concluded that English law was unsuited to conditions in North America. These courts adopted what can be called the American view: submerged lands under all waters that are navigable in fact, whether tidal or not, are owned by the state as sovereign.¹⁹

In 1842, in a dispute over the rights to timber on an island in the Mississippi River, the Illinois Supreme Court cast its lot with the traditional English view. The Illinois courts would continue to adhere to this view—at least with respect to land under navigable rivers. To take but one example, the state supreme court in 1868 rejected the City of Chicago’s attempt to order the destruction of a wharf built out into the Chicago River. The court said that the rule is well settled, that the title of a riparian owner extends to the middle thread of the stream if it is called for as a boundary.²⁰

If this were all of the law bearing on the question of ownership of the lakefront in Chicago, then the relevant legal principle would seem clear. Lake Michigan is not regarded as tidal water. Hence, the owner of riparian land bordering on Lake Michigan would own the submerged land to the centerline of the lake. There would be only one question: who owns the land on the shore? Considerable evidence suggests that this was in fact the assumed legal rule about ownership of the bed of Lake Michigan up through the 1850s.²¹

Illinois’s acceptance of the English view of riparian rights in submerged lands explains why the Chicago Common Council believed that it could convey a three-hundred-foot right of way to the railroad for its operations in the lake. The city evidently assumed that it was the owner of Lake Park. Hence, under the English view, the city also owned the bed of Lake Michigan off Lake Park and could convey an interest in this lakebed to the railroad (provided that it did not interfere with the public right of navigation). The same assumption explains the city’s grant of authority to the railroad to engage in extensive landfilling north of Randolph Street and to curve its tracks outside the three-hundred-foot right of way south of Randolph. Likewise, we can understand why the Illinois Central, as the owner of riparian lands along this segment of the lakeshore, felt free to engage in aggressive landfilling south of 12th Street without any official blessing of the common council. Under the English view, the railroad as riparian owner could engage in fills and improvements of adjacent submerged lands, provided that it did not impair the public right of free navigation on the lake.

Soon, however, discordant themes began to emerge in the law that would eventually undermine any confidence about the ownership of submerged lands beneath Lake Michigan. One came in 1852, when the Supreme Court of the United States, in The Propeller Genesee Chief v. Fitzhugh, overruled earlier precedent and held that the admiralty jurisdiction of the federal courts was not limited to tidal waters but extended to all waters that are navigable in fact, including the Great Lakes. The court cited many of the same factors, including the greater importance of inland rivers and lakes to commerce in North America, that had convinced some state courts to reject the English definition of navigability in disputes over the ownership of submerged lands. The court cautioned that its decision involved only admiralty jurisdiction, not property rights, but in retrospect The Genesee Chief undoubtedly tipped the balance in favor of the American view regarding ownership of submerged lands, at least in those jurisdictions and circumstances where the issue was open.²²

Another discordant element concerned a rule of boundary construction. Early in the nineteenth century, it was well established that when a deed specified a river or stream as the boundary of property, courts would presume that the property extended to the centerline of the watercourse. Gradually, however, American courts began to differentiate between the rules applicable to rivers or streams, on the one hand, and ponds or lakes, on the other. By 1850 a leading treatise declared that "[t]he law of boundary, as applied to rivers, is without doubt inapplicable to the lakes and other large natural collections of fresh water in this country." The author suggested that when a deed describes a lake as a boundary, the riparian landowner is presumed to own only to the shore or edge of the lake—and thus not to own the submerged land to the centerline.²³

In 1860, the Illinois Supreme Court embraced the new rule of construction for large lakes. In a decision called Seaman v. Smith, the court held that a deed referring to Lake Michigan meant the shoreline, not the centerline of the lake. The circular shape of most lakes, the court said, militated in favor of the shoreline as the correct boundary. Although no question was presented in Seaman about who in fact owned the bed of Lake Michigan, after 1860 a careful Illinois lawyer would have reason to doubt whether the English view of riparian rights in submerged lands, faithfully followed by the Illinois courts with respect to rivers, would necessarily be extended to riparian lands abutting Lake Michigan. Authoritative word on the subject nevertheless did not come until the lakefront litigation and the 1890s—far in the future.²⁴

The identity of the riparian owner of the land known as Lake Park was even less clear than the rule determining ownership of the bed of Lake Michigan. This is revealed by a remarkable editorial and follow-on letters published by the Chicago Tribune in 1867. The editorial, headlined Who Owns Lake Park?, suggested that although [i]t has been supposed that the city of Chicago had an unquestionable title to this important piece of property, a closer examination of the subject disclosed arguments to be made that the park was owned, instead, by the state, by the commissioners of the Illinois and Michigan Canal (whom we shall meet hereafter), or by the United States government. Believing the last of these to have the best possible claim adverse to the city, the Tribune encouraged the city to seek congressional legislation ceding the federal government’s rights and title to the city.²⁵

The editorial elicited some legally sophisticated responses. One writer concluded that the canal commissioners owned not only the park but also, all beyond to a distance of a nautical league from the shore. At the end of this letter, the editor of the Tribune appended the following comment: Query.—Where does our correspondent find any authority for the assumption that the title to the bottom of the lake . . . is vested in the riparian owner? The answer (not stated in the paper) was, of course, that the Illinois Supreme Court’s doctrine about the ownership of riverbeds provided the authority. But by 1867, at least for newspaper editors, this answer was too implausible to be taken seriously with respect to Lake Michigan.²⁶

In short, by 1867 the legal title to the Chicago lakefront was deeply vexed—from the ownership of the strip of land known as Lake Park to the applicability of the English or American rule to the lands under Lake Michigan. If the American rule applied, then the state owned the submerged lands, subject to whatever rights the Illinois Central had acquired through its charter from the state in 1851. (The rights the railroad had obtained from the city would be of no value, unless the state had first granted its rights to the city, which it had not done.) If the English rule applied, then the submerged lands were owned by whoever was determined to be the owner of Lake Park, subject to whatever rights the railroad had acquired from this party. It was a fine mess.

1867: The Lakefront in Play

The uncertainties about the legal status of Lake Park and the submerged land of Lake Michigan involved relatively esoteric questions about property rights. Some lawyers thought they could predict the answers. A few of the more confident tried to exploit these predictions to seize all or part of the lakefront for themselves.

The first concerted effort emerged in the 1867 session of the Illinois legislature. The General Assembly at that time met in odd-numbered years. As the session was about to commence, the Illinois Central’s president, John M. Douglas, in Chicago, wrote to William H. Osborn, chairman of the executive committee of the company’s board of directors in New York City, that he did not believe this Company has any enemies in the legislature or out of it.²⁷

Douglas was badly mistaken. In early February 1867, a bill was introduced to incorporate a private company, the Chicago Harbor, Pier and Dock Company. It would have the power to construct a new outer harbor for Chicago and to connect the same by roadways across railroad tracks, body of water or land, using the power of eminent domain if necessary. The named promoters included a number of Chicago’s leading citizens, lawyers being especially prominent. These included Jonathan Young Scammon, who had interests in Michigan Avenue real estate, and Melville W. Fuller, the future chief justice of the United States. The bill’s sponsor in the state house was Henry M. Shepard, Fuller’s law partner.²⁸

Reaction in the Chicago newspapers was fierce. The Chicago Tribune, employing an early use of the word steal in connection with lakefront legislation, asserted that a bolder or more infamous attempt to steal a vast property belonging to the public has never been attempted. The proposed grant would give the company the right to build a city with water privileges upon the site belonging to Chicago, and not render any compensation therefor. The Chicago Times speculated that the scheme’s object was to obtain the submerged land and then resell it to the city.²⁹

The bill’s sponsor, Henry M. Shepard, was a busy man during the legislative session. He also introduced and obtained lower-house passage of another bill, which became known as the Skating Park Bill. One unfavorable review characterized this as giving the Michigan Park basin in the city in fee to a company of private speculators, under the pretence of cutting ice, skating, yachting, and other festive employments. The Chicago Times characterized the bill as the Michigan Park Steal.³⁰

The Illinois Central was understandably alarmed by these efforts to wrest control of the lakefront via legislative grants. Its primary concern was that its physical improvements and its right to use the lakefront not be imperiled by a grant of the submerged land to some other entity. On February 16, 1867, the railroad’s president, Douglas, instructed the company’s Springfield representative, Devote yourself entirely to lake matter. . . . Better stay and see that nothing goes through surreptitiously—Make the city keep a strong delegation there till the close of the session and see it out. He expected a hard fight. To fend off the efforts to secure a legislative grant of the lakebed for a private corporation, the railroad threw its support behind an effort to secure greater control over the lakefront, including any harbor, for the City of Chicago.³¹

Intrigue over the lakefront continued throughout the 1867 legislative session. In the end, however, despite the efforts of