Copeland v. Memphis & C. R., 3 Woods 651

Copeland v. Memphis & C. R.

3 Woods 651 | U.S. Circuit Court for the District of Northern Alabama | 1878

WOODS, Circuit Judge.

The contention of counsel who move to remand is, that the act of the legislature of Alabama of January 7, 1850, entitled “An act to incorporate the Memphis & Charleston Railroad Company,” created a body corporate, separate and distinct from the corporation of the same name created by the legislature of Tennessee, February 2, 1S40, and that such body corporate was. of course, a citizen of the state of Alabama. by which it was created. On the other side, it is claimed that the purpose and effect of the legislation of Alabama was, either simply to confer new powers and privileges, within the state of Alabama, on a Tennessee corporation; in other words, that the act of January 7, 1850, was merely an enabling act, or that it was to confer a charter on the Tennessee company without creating a new corporation. There is no principle of public law which prohibits a state from authorizing a foreign corporation to extend a railroad into its own territory, and for that purpose to buy or take laud, and after its construction, to maintain and use its road. The corporation still remains one corporation — a domestic corporation, in the state which created, and a foreign corporation in the other, enjoying the franchises conferred by the charter in the one, and the powers derived from the enabling act in the other. There is certainly no reason for treating it as two corporations. Railroad Co. v. Harris, 12 Wall. [79 U. S.] 65. The question is not so simple when two states, by common legislation, create the same corporation. In such a case, it is not merely the corporation of one state, with enlarged powers derived from the other, but it is as much the corporation of one state as of the other, and is a citizen of both. If, however, the legislatures of both states were to make one corporation only, there is no legal or constitutional necessity for treating it as two corporations in any suits or proceedings by or against it It was, at one time, held by the supreme court of the United States, that a railroad corporation created by the legislature of two states, with the same capacities and powers, and for the same objects, and referred to in the laws of the states as one corporate body, although composed of the same persons and represented by one name, was nevertheless, on a legal and constitutional necessity, two distinct and separate corporations, upon the ground that the corporation was the creation of the sovereignty which brought it into being, and could have no legal existence beyond its jurisdiction. Ohio & M. R. Co. v. Wheeler, 1 Black [66 U. S.] 286. This, however, is no longer the holding of the supreme court of the United States. According to the recent and better view, as it seems to me, of that court, the question, whether there is a unity in the corporation, and in the proprietorship of the corporate property, is one of legislative intent, and not of legislative power. Several stat:s may, by competent legislation, unite in creating the same corporation, or in combining several pre-existing corporations into a single one. One state may make a corporation of another state, as then organized and conducted, a corporation of its own, as to any property within its territorial jurisdiction. A state may, by an enabling act, authorize a corporation created in ano.her state to build and use a railroad within its own limits without creating a new corporation. Railroad Co. v. Harris, supra. See, also, *504Bishop v. Brainerd, 28 Conn. 289; Connty of Allegheny v. Cleveland & P. R. Co., 51 Pa. St. 228.

The question to be decided, therefore, is resolved into this: Did the legislature of Alabama, by the act of January 7, 1850, intend to create a new corporate body to be known as the Memphis & Charleston Railroad Company, to be a corporation and citizen ,of Alabama, or merely to recognize the existence of a Tennessee corporation of the same name, and confer upon it the certain powers and privileges, and subject it to certain conditions and restrictions in the state of Alabama? I have had much difficulty in arriving at the object of the legislature in the passage of this act. I have, however, finally reached a conclusion, satisfactory to my own mind, that the design of the law was to create a body corporate in the state of Alabama, having the same powers and franchises as the Memphis & Charleston Railroad Company, incorporated by the legislature of Tennessee. The burden of proof is upon the defendant, to show that the Memphis & Charleston Railroad Company, defendant in this case, is not a citizen of the state of Alabama, but a citizen of Tennessee. The defendant, on this hearing, affirms the jurisdiction of this court, and the plaintiff denies it In a suit brought by or against a corporation, it is necessary that it be made to appear that the artificial being was brought into existence by the law of some state other than that of which the adverse party is a citizen. Muller v. Dows, 94 U. S. 444.

The facts necessary to jurisdiction of the courts of the United States must be affirmatively averred, and if denied, proved. The defendant must, on this hearing, satisfy the court of its jurisdiction, and this can be done only by showing that the corpo.a.e boJy sued in this case is not a citizen of the state of Alabama. If this proposition is not made reasonably clear, the court ought not to take jurisdiction, but the motion to remand the cause to the state court should prevail. The controversy turns, mainly, on the construction of the act of January 7, 1850, to incorporate the Memphis & Charleston Railroad Company. The proper construction of a statute requires an examination of the body of the act, the preamble, where there is one, and in certain caseá, and for certain purposes. the title may be considered. The true meaning of a statute is generally to be sought in the purview, enacting part, or body of the act. Sedg. Const. 45.

It is an established rule in the' exposition of statutes, that the intention of the lawgiver is to be deduced from a view of the whole and of every part of the statute, taken and compared together. 1 Kent, Comm. 462; Dwar. St. 194. The preamble to a statute usually contains the motives and inducements to the making of it, but it has been held to be no pari of it, or rather it is not an essential part, and is frequently omitted. The preamble is properly referred to when doubts and ambiguities arise upon the words of the enacting part The preamble can never enlarge it, can not confer any powers per se. Its true office is to expound powers conferred, not substantially to create them. A preamble is not only not essential, and is often omitted, but it is, strictly speaking, without force in a legislative sense, being but a guide to and not the intent of the statute. And to what is it properly a guide? To the meaning of the enactment? No, but the intentions of the framer, which is only the first stage on the road in the construction of statutes. Dwar. St. 107, citing King v. Athos, 8 Mod. 144; Mills v. Wilkins, 6 Mod. 62; Story, Com. Rules Interp. Const. The preamble of an act may be resorted to to aid in the construction of the enacting clause when any ambiguity exists. Beard v. Rowan, 9 Pet [34 U. S.] 301.

The use of a title in expounding a statute is shown by the following citations: By the English decisions, the title of a statute has been frequently held to be no part of a statute, for it has usually been framed only by the clerk of the house in which the bill first passes, and is seldom read more than once. In Mills v. Wilkins, 6 Mod. 62, Chief Justice Holt said: “It is true, that the title of an act of parliament is no part of the law or enacting part, no more than the title of a book is a pare of a book, for the title is not the law, but the name or description given to it by the makers. Being, then, no part of the act, the title is seen to afford no legislative import. Dwarris, 103.” But even in England this rule has been modified, and it now seems that when the meaning of the body of the act is doubtful, the title may be relied on as an assumption in arriving at a conclusion. The King v. Cartwright, 4 Term R. 490. The title is worthy of more consideration, in the case of American statutes, when the legislature passes on the whole statute title, preamble, if any, and the body of the statute. In many American legislatures the title of the act is agreed to by a distinct vote of the body. But even in this country, though the title of an act cannot control plain words in the body of the statute, yet, taken with other parts, it may assist in removing ambiguities. Where the intent is plain nothing is left to construction, but when the mind labors to discover the design of the law-making power, everything which can aid this .object may be resorted to, and even the title of the act may receive a due share of consideration. U. S. v. Fisher, 2 Cranch [6 U. S.] 358; U. S. v. Palmer, 3 Wheat. [16 U. S.] 610; Com. v. Slifer, 53 Pa. St. 71. In doubtful cases the title of an act may serve to explain the general purport, but even then it has little weight. Hadden v. Collector, 5 Wall. [72 U. S.] 107.

*505In the light of these principles the act of January 7, 1850, is to be construed and it® meaning ascertained. The question to be decided is, is the act a mere enabling act to confer certain powers on a Tennessee ■corporation within the state of Alabama, or did it create a new body corporate, having the same franchises as the Tennessee corporation, but still being a distinct and separate artificial person. In resolving this question the preamble affords no assistance, for it is just as applicable to one theory as the other. It refers to the act of Tennessee, incorporating a company for the purpose of establishing a communication between Memphis and Charleston, recites that the most eligible route for said road is believed to be through a portion of this state, and that great and lasting benefits will accrue to the inhabitants of this state from said Improvement. These are the reasons given by the preamble which induced the passage of the act. These reasons are just as strong for the passage of an act to create a new Alabama corporation to assist in the enterprise, as for the passage of an enabling act for the benefit of a Tennessee corporation. The end in view, namely, the establishing of a railroad communication between Memphis and Charleston, and the consequent benefits to the inhabitants of Alabama, could be just as well secured by one enactment as the. other. We derive no light from the preamble, and must, therefore, look first to the body of the act to ascertain its meaning. The first section of the act. standing alone, gives strong warrant to the idea that the act is only an enabling act. If the act consisted of the first section only, and its title were “An act to confirm an act passed by the legislature of Tennessee to incorporate the Memphis & Charleston Railroad Company,” the controversy would fall directly under the authority of the case of Railroad Co. v. Harris, 12 Wall. [79 U. S.] 65, where it was held that such a law did not create a new corporation, but granted permission to a corporation of another state to exercise its functions within the boundaries of the state by which the act was passed. The conclusion of the supreme court in that case, in the construction of the law of Virginia, was reached only after re-argument, and after much difference of opinion upon the question, whether the law of Virginia created a new and distinct corporation, or was only an enabling act in respect to” the corporation known as the Baltimore & Ohio Railroad Company, as originally created by Maryland. And it is worthy of remark, that the same enactment of the Virginia legislature had been construed by the supreme. court of that state as creating a Virginia corporation — a new and distinct corporate body. The case of Williams v. Missouri, K. & T. Ry. Co. [Case No. 17,728] would also be an authority to support the view of the defendant, if the Alabama act consisted of the first section, only with the title changed as above suggested. But the act under consideration does not stop with the first section; several sections are added. It is, to my mind, very significant, that in the first section the company is called “the said company.” The section begins, “that said company shall be authorized and required to open books,” etc. The fourth section declares “that said company shall, at the first meeting of stockholders,” etc.; and throughout this act until we reach the seventh section, the company is referred to as “the said company.” But, in the seventh section, however, this phrase is abandoned, as if designedly, and the company is twice designated as “the company hereby incorporated.” Why this change? It was more natural to continue the use of the phrase, “the said company,” which had been employed seven times in the preceding sections of the act. But the legislature, with the apparent design of giving a construction to what had been done by the first section, declares, in the seventh, that “the company hereby incorporated shall not locate their road,” etc.; “and it shall be lawful for the company hereby incorporated to acquire by purchase,” etc. These words, used under these circumstances, mean something. They ought to have effect if possible. We are not authorized to reject them. They are not inconsistent with the first section. They are only explanatory of it. They are a declaration by the legislature, that the effect of the act was to incorporate a company. They remove the doubt which, for a long time, troubled the supreme court of the United States in construing the Virginia act in the case of Railroad Co. v. Harris, supra.

The question might be left here, but considering that the true meaning of the act is still open to some doubt, the case has arisen for resort to the title — and a case in which the title ought to have more than ordinary weight There is no dispute as to the purpose which the legislature had in view, for that is indicated by the preamble; it was to aid in establishing communication between Memphis and Charleston by a railroad passing over a portion of the territory of Alabama, and it was to afford that aid by an act either creating an Alabama railroad corporation, or t>y an act conferring upon a Tennessee railroad corporation franchises to be enjoyed within the territory of Alabama. The only question is, which of these two things was done by the act under consideration? The title is explicit, and so far as it deserves consideration, its weight is altogether in favor of the hypothesis that a new body corporate was created. It declares the purpose of the act to be “to incorporate the Memphis & Charleston Railroad Company.” There is no ambiguity here. To incorporate means “to form into a legal body, or body politic — to constitute *506into a corporation recognized by law as persons with special functions, rights and duties, as to incorporate a bank, a railroad company, or the like.” Webst. Diet. This seems to remove the doubt, if any existed. The title declares the purpose of the act to be to incorporate a certain railroad company, and the seventh section declares that by the act such a company was incorporated. But conceding that, after giving the title all the weight it deserves, the true construction of the act is still in doubt, nevertheless, it may be finally claimed that the doubt is of such strength as to preclude the jurisdiction of the courts of the United States. It is the duty of suitors who invoke that jurisdiction, to bring themselves clearly within it, as we have already seen. I am of opinion, therefore, that the defendant has not met the requirements of the law by showing that this court has jurisdiction of the case.

It was urged, in the argument, that the requirements of the fourth section are inconsistent with the view here taken. The requirement referred to is, that “the said company shall designate a time and place in north Alabama where, for the convenience of Alabama stockholders, elections of directors shall be held,” etc. It is urged that it would be absurd for the law to require the directors of a Tennessee corporation to fix the time and place for the election of the directors of an Alabama corporation. The obvious answer to this is, that it was the plain intent of the law that while there were to be two corporate bodies of the same name — one in Tennessee and one in Alabama —yet they were to have the same board of directors and the same officers, in a word, the same organization. That this could be done, is held in the case of Ohio & M. R. Co. v. Wheeler, supra. If the two corporations were to be governed by the same board of directors, there was great propriety in the enactment that the Alabama stockholders should have notice of the time and place fixed for their election, and that a poll for the election of directors should be opened in north Alabama.

The act of February 12, 1850, to amend the above recited act to incorporate the Memphis & Charleston Railroad Company, is not inconsistent with the view above taken. As it was the purpose of the original act that both the Tennessee and Alabama corporations should have but one organization and board of officers, the amendatory act provided that in a certain contingency the subscribers to the capital stock of the Memphis & Charleston Railroad Company, in Alabama, might, if they deemed it expedient, form a separate and independent organisation. In other words, that being already a body corporate, they might withdraw from their connection with the Memphis & Charleston Railroad Company of Tennessee, and take a new name, and for this purpose commissioners, or corporators, were named, and were authorized to change the western terminus of their road. In fact, this amenda-tory act seems entirely inconsistent with the theory that there was no Alabama corporation known as the Memphis & Charleston Railroad Company. The subsequent legislation of the state, although not decisive, seems to proceed on the idea that it is dealing with a domestic corporation. In an act approved February 7, 1856, the act of January 7, 1850, is referred to as the “charter granted to said company by the general assembly of this state,” and four different acts have been passed by the legislature of Alabama to authorize the Memphis & Charleston Railroad. Company to borrow money and secure its. payment by mortgage on its road, without any hint that this power was conferred on a foreign corporation. In the case of Memphis & C. R. Co. v. Bibb, 37 Ala. 699, the said company is designated as a corporation chartered by an act of the legislature of this state. This is, to be sure, merely obiter dictum, but it tends to show how the railroad company has been regarded by the highest judicial tribunal, of the state. But it is claimed by counsel for the railroad company, that even admitting that the act of January 7, 1850, was a charter, yet it was a charter conferred on a corporation of the state of Tennessee, without creating a new- corporate body. It is true, that two states may unite in creating one and the same corporate body, and it was so held in Railroad Co. v. Harris, supra. But when two states unite to create the same body corporate, it is a citizen in each of the states by whose legislature it is created. Railroad Co. v. Whitton, 13 Wall. [80 U. S.] 270; Ohio & M. R. Co. v. Wheeler, 1 Black [66 U. S.] 286.

After an attentive consideration of the arguments of counsel, and on examination of the authorities cited by them, I am of opinion that the act of January 7, 1850, of the general assembly of this state, created the Memphis & Charleston Railroad Company as an Alabama corporation. The consequence of this view is, that this court has not jurisdiction of this case, and that the motion to remand it to the state court from which it was removed must prevail.