City of New York v. Thirty-Fourth Street Crosstown Railway Co.

122 N.Y.S. 344 | N.Y. App. Div. | 1910

Miller, J.:

This action is brought under section 95 of the Railroad Law (Laws of 1890, chap. 565, as amd. by Laws of 1892, chap. 676), to recover five per cent of the gross receipts of the defendant for the years 1903, 1904 and 1905, less the sum of $23,555.44, which the plaintiff admits has been. paid. .The defendant was formed by a consolidation of two. street surface railroad corporations organized under chapter 252 of the Laws of 1884. It filed with the .comptroller of the city reports for the years 1903, 1904 and. 1905, containing a statement of gross receipts and stating that it was obliged to pay the said five per cent on such amounts or in the aggregate $23,555.44. The plaintiff claims that the gross receipts were not correctly stated, and that in fact they amounted to $1,550,281.90 for the years in question. The original answer admitted that the gross receipts during said years amounted to the sum alleged in the complaint, but by an amended answer the defendant denied, that it operated the lines, of railroad owned by it at all during the years in question. It appeared that on the 1st day of April, 1896, the defendant gave a mortgage to the Central Trust Company, and on the 21st of December, 1896, entered into an agreement with the Metropolitan Street Railway. Company whereby the latter guaranteed the payment of the principal and interest of the defendant’s first mortgage bonds, and .in consideration thereof was granted the right to run cars over the defendant’s road for 1,000 years. The defendant reserved the right to operate cars over its tracks; but agreed not to run more than three cars daily.- On the 14th of Feb- • ruary, 1902, the Metropolitan Street Eailway Company leased its property, including the right to operate cars over the line of the defendant, to the Interurban Street Eailway Company, whose name was in December, 1903, changed to the' New York City Eailway Company. It is practically undisputed that the defendant never ran any cars over its tracks after entering into the agreement of December 21, 1896. It did, however, make reports to the State Eailroad Commissioners, indicating that it was operating its road, but there is no evidence that those reports were ever brought to the attention of the defendant, nor is there.any evidence that the plaintiff did, or omitted to do, anything in reliance upon the reports filed with its comptroller. It did appear that the Interurban, later the New York City Eailway Company, paid the five per cent of the gross receipts reported for the years in question as aforesaid. At the close of the evidence both sides moved for the direction of a verdict. It was stipulated that the court might direct a verdict in the absence of a jury; the jury were discharged, and an adjournment was had to a later day, when the court denied the plaintiff’s motion,. whereupon the plaintiff asked to go to the jury. That motion was denied and the defendant’s motion granted.

It is contended that the admission in the original answer and the stateinents contained in the various reports, filed with the city comptroller and the said Eailroad Commissioners, raised a question1 of fact whether the defendant actually operated its road during the years in question; that it was, therefore, error to deny the plaintiff’s motion to go to the jury. But such a motion could not be entertained after the jury had been discharged upon the plaintiff’s consent. It is difficult to understand how the appellant can seriously- argue that it did not waive the right to go to the jury.

It is next urged that the defendant is estopped by its reports, filed with the city comptroller, to deny that it operated its road and received gross receipts therefrom during the years in question. It may he assumed that the city could have recovered. perforce of said reports the amount of the charge shown by them to be payable; but that amount has been' paid. The city based its claim in this action on the fact that those reports were untrue. There can be no estoppel unless the party asserting it has been induced by the representation relied upon to change its position. It is asserted that a suit against the operating company is now barred by the Statute of Limitations, but for all that appears in this record such a suit may now be pending. Moreover, this record indicates what of course was the fact, that the city officials knew what company was in fact operating the road.

It only remains to determine whether the defendant is jointly liable with the operating company. Section 8 of chapter 252 of the Laws of 1884, so far as material, is as follows : “ Every corporation incorporated Under, or constructing or operating á railroad constructed or extended under the provisions of this act, * * * shall * * * pay * * * three per cent of its gross receipts for and during the year ending the next preceding thirtieth day of September, and after the expiration of said five years, make a like annual payment' * * * of five per cent instead of three per cent of said gross receipts.”

As I understand it, the city does not dispute that the words “ gross receipts,” as used in the statute, mean receipts from the operation of the railroad, i. e., fares. Later on in the section the expression “gross earnings” is used as synonymous with “gross receipts.'” It would extend this opinion beyond reasonable limits to refer to all of the statutes, general and special, ■ with reference to the payment of license fees or a percentage of gross receipts by street railroads. But an examination of them makes it manifest that, wherever the words “ gross receipts ” are used, they refer to receipts from operation, and those words as thus used have been constructed to mean “ fares.” (Mayor, etc., v. Twenty-third Street R. Co., 113 N. Y. 311, 319.) It is plain, then, that the defendant did not have any gross receipts within the meaning of the statute during the years in question.

It will be noticed that the statute specifies in the alternative the corporations liable for the payment of the charge. ■ Each is required to pay a percentage of “ its gross receipts.” Neither is required to pay a percentage of some other corporation’s gross receipts. It seems to me plain, therefore, that only the corporation having gross receipts from operation of the road is liable to pay. a percentage thereon to the city. . While the defendant, by the agreement of 1896, did not absolutely surrender its chartered rights and privileges, as was the case in Mayor etc., v. Twenty-third Street R. Co. (supra), the practical effect of the arrangement was the same. True, that case did not decide that the lessor company was relieved from the obligation imposed by the statute under which' it- was orgánized to pay one per cent of the gross receipts from the, operation of its road, but the lessee, company was only held liable upon the theory that the obligations of the-lessor had devolved upon it. . The- situation in this ease is somewhat different. Here the operating company is liable perforce of the statute, and it seems to me impossible to construe the statute so as to. impose a joint obligation on both the owning and-the operating company. While a somewhat different question was involved in City of New York v. Sixth Ave. R. R. Co. (77 App. Div. 367) the decision in that case tends to support the conclusion which I have reached in this.

It may be said that it is difficult to perceive the practical importance of this action, in view of the fact that the percentage of gross receipts required to be paid is to be-deducted from the special .franchise, tax. (Heerwagen v. Crosstown St. R. Co., 179 N. Y. 99.)

The judgment should be affirmed, with costs.

' Ingraham, P. J., Laughlin, Clarke and Scott, JJ., concurred.

Judgment affirmed, with costs.