155 Ind. 433 | Ind. | 1900
— This was a proceeding by information, in the nature of a quo warranto, filed in the Cass Circuit Court, by the prosecuting attorney of Cass county, against the Eel Eiver Eailroad Company, a domestic corporation, charging it with doing and omitting acts amounting to a surrender and forfeiture of its rights and privileges as a corporation, and demanding a judicial declaration of such surrender and forfeiture.
The Wabash Eailroad Company, as the lessee of the railroad and property of the Eel Eiver Eailroad Company, and a participant in the alleged wrongful acts and omissions of the Eel Eiver Eailroad Company, was properly joined as a eodefendant with that company. §269 Burns 1894; Bittinger v. Bell, 65 Ind. 445.
The mandate of this court was- that the judgment of the Erdton Circuit Court be reversed, that the said court remand the cause to the Cass Circuit Court, and that the last named court sustain the motion of the Eel River Railroad Company to set aside the service, of process. Subsequently, on the 12th day of Eebruary, 1896, an alias summons for the Eel River Railroad Company was issued to the sheriff of Cass county, and was returned not- served, because that corporation was not found in Cass county, and bad no officer or person authorized to transact its business residing in that county upon whom process could be served. Similar writs were issued on the same day, Eebruary 12, 1896, to the sheriffs of the coimties of Miami, Wabash, Kosciusko, Whitley, Allen, Roble, and DeKalb, respectively, these being all of the counties in which and through which the railroad of the said Eel River Railroad Company was con
An order for notice to the Eel Biver Bailroad Company, by publication, under section one of an act approved December 21, 1858 (Acts 1858, p. 42) was next taken by the plaintiff below. The Eel Biver Bailroad Company thereupon entered a special appearance to the action, and moved to set aside the order of publication, on the ground, among others, shown by affidavit filed on behalf of the said company in support of its motion, that, prior to February 12, 1896, and ever since that date, one William V. Troutman, a citizen of the State of Indiana, residing at Butler, in DeKalb county, Indiana, was, and had been, and then remained the regularly appointed and constituted general agent of the Eel Biver Bailroad Company, upon whom any process issued against it could be served,.and with like effect as( if the service had been on the president or directors of said company. An alias summons for the Eel Biver Bail-road Company was then issued to the sheriff of DeKalb county, who made return thereto, showing that he had served the same on the said Eel River Railroad Company by reading it to William V. Troutman, the general agent of 'the said company, there being no chief officer, or other higher officer of the said corporation found in said DeKalb county, and by delivering to the said Troutman, as such general agent, a copy of the writ.
The motion of the Eel Biver Bailroad Company to strike out the order for publication was overruled, and proof of publication of a notice to that company to appear to and answer the information was duly made.
An amended information having been filed by the plaintiff below, the Eel Biver Bailroad Company filed its answer in abatement, properly verified, denying the jurisdiction of the Cass Circuit Court over its person. To this plea, the plaintiff below replied in two paragraphs, the first being special in its character, and the second a denial of the matters stated in the plea.
On motion of the plaintiff below, the answer of the Wabash Railroad Company in abatement, was stricken from the files, for the reason that it was filed too late, and after divers steps in the cause taken by that defendant.
A demurrer to the first paragraph of the reply to the answer of the Eel River Railroad Company in abatement was filed, but the record fails to show what disposition was made of it. We must presume that it was overruled.
The issues upon the plea in abatement filed by the Eel River Railroad Company were submitted to a jury for trial, and, at the request of both the parties, the jury were directed to return a special verdict in the form of answers to interrogatories framed under the direction of the court.
On the return of .the special verdict, the Eel River Railroad Company moved for judgment in its favor, and its motion was overruled. A motion by the Eel River Railroad Company for a new trial was also made and overruled. Judgment was thereupon entered in favor of the plaintiff upon the issues tried. At this point, the cause was, for some reason not disclosed by the record, but without objection by any of the parties, transferred to the Howard Superior Court.
After the removal of the cause to the Howard Superior Court, a motion was made by the Eel River Railroad Company to dismiss the action for the want of a proper relator. Pending this motion, George S. Enstler, who had been reelected prosecuting attorney for the judicial circuit composed of the county of Cass, was substituted as the relator, and the motion to dismiss was overruled.
Each defendant filed a demurrer to the amended information, and these demurrers were overruled.
The cause was tried by a jury and a general verdict was returned for appellee, with answers to numerous interrogatories filed by the parties respectively. A motion by the appellants for an order requiring the jury to answer the fifteenth and sixteenth interrogatories was overruled. Separate motions by the appellants for a new trial and for judgment on the answers to the interrogatories were made and overruled. Motions by the Eel River Railroad Company for a venire -de novo, and in arrest, were overruled.
Appellee moved for the appointment of a. receiver, and the motion was sustained.
Judgment was rendered upon the verdict that the franchises of the Eel River Railroad Company be, and that the same were, forever forfeited and annulled; that the Wabash Railroad Company was unlawfully in the possession of the corporate property of the Eel River Railroad Company, and that it was unlawfully exercising the franchises of that company; that the Eel River Railro.ad Company, and the Wabash Railroad Company, and each of them, be ousted and excluded from the said Eel River Railroad, its powers, franchises, property, and corporate rights, and from the possession and enjoyment of the same; and that the Eel River Railroad Company be dissolved.
It was further adjudged that a receiver be appointed to take possession of the said Eel River Railroad Company, its railroad, property, and franchises, -to receive the assets of the said company, and to sell and dispose of the same under the orders of the court, and in accordance with the law in such cases. A receiver was appointed by the court, and the person so appointed .gave bond and qualified. The judgment defined the specific powers and duties of the receiver. He .was authorized to seize and take possession of all the
Motions to modify the judgment were made by the appellants, and were overruled.
The errors assigned .and discussed upon this appeal are the following: (1) The court erred in striking out the answer in abatement of the Wabash Eailroad Company; (2) the court erred in overruling the motion of the Eel Eiver Eailroad Company for judgment in its favor on the special verdict returned on the issue upon its answer in abatement; (3) the court erred in overruling appellants’ several demurrers to the amended information; (4) the court erred in overruling appellants’ motions for judgment on the special findings of the jury; (5) the court err.ed in' overruling appellants’ separate motions for a new trial; (6) the court erred in ^appointing a receiver; (7) the court erred in refusing to modify the judgment.
The supposed errors so assigned will be considered in their order:
(1) Did the court err in striking out the answer of the Wabash Eailroad Company in abatement of the action? Pleas in abatement of the writ or action being dilatory, and tendering no issue as to the merits of the controversy, have always been regarded by the courts wdth some degree of disfavor; and the rules governing them enforced with much strictness. In all transitory actions, objections to the juris
The Wabash Railroad Company was regularly served with a summons requiring it to appear in the Cass Circuit Court on a day named, and on the 7th day of June, 1893, by its attorneys, that company entered a full appearance to the action. On the 12th day of June, 1893, it applied for a change of venue, and its motion was sustained. October 11, 1893, it filed a motion to strike out parts of the complaint. October 12, 1893, it demurred to the complaint. February 6, 1894, it filed its separate answer in bar. Other steps were subsequently taken by the Wabash Railroad Company, but it is not necessary to set them out. On May 1, 1896, nearly three years after it had entered its full appearance in the cause, the Wabash Railroad Company filed its answer in abatement, then for the first time calling in question the jurisdiction of the court over its person.
The reversal of the judgment of the Eulton Circuit Court on the ground that the Cass Circuit Court had not jurisdiction of the person of its codefendant, the Eel River Railroad Company, thereby vacating the proceedings of the Eulton Circuit Court, did not, in our opinion, relieve the Wabash Railroad Company from the legal effect of the steps taken by it in the cause. On that appeal no question was made or decided as to the jurisdiction of the court over the Wabash Railroad Company. It is also to be observed that the full appearance of this appellant was made in the Cass Circuit Court, and its application for a change of venue from that county took place prior to the removal of the cause to Eulton county, and long before the proceedings in the Eulton Circuit Court which were vacated by the reversal of the judgment. These facts, in connection with the long delay, in interposing the objection, under the settled rules of pleading and practice, wholly disabled the Wabash Railroad Company to assert a want of jurisdiction of the Cass Circuit Court over its person, and consequently the court did right in striking from the files its answer in abatement. Brink v. Reid, 122 Ind. 257; Watts v. Sweeney, 127 Ind. 116, 22 Am. St. 615.
(2) Was the Eel River Railroad Company entitled to a judgment in its favor upon the special verdict upon the issue made by its answer in abatement and the reply thereto ? The determination of this question depends upon the facts found as to the legal residence or domicil of the Eel River Railroad Company at the time of the commencement of the suit; the capacity of the supposed agent and representative of that corporation on whom the summons
The material parts of the special verdict were as follows: The Detroit, Eel River & Illinois Railroad Company was a corporation organized under the laws of this State to build and operate a railroad from Logansport, in Cass county, Indiana, eastward through the counties of Cass, Miami, Wabash, Kosciusco, Whitley, Allen, Noble and DeKalb, and it was so constructed. The railroad and other property of the Detroit, Eel River & Illinois Railroad Company was afterwards sold under a decree of foreclosure rendered by the Cass Circuit Court. In 1877 a new corjjoration, known as the Eel River Railroad Company, was organized under the laws of the State of Indiana, for the purpose of purchasing the railroad and other property of the Detroit, Eel River & Illinois Railroad Company, and the corporation, so organized, after acquiring the said railroad property, operated the railroad so purchased until the fall of 1887. The road was equipped with rolling-stock and machine shops. The general offices and general shops of the Detroit, Eel River & Illinois Railroad Company, and of its successor, the Eel River Railroad Company, were located at Logansport, Cass county, the western terminus of said railroad, and not elsewhere. In the fall of 1879, the Eel River Railroad Company, by contract with the predecessor of the Wabash Railroad Company, surrendered the possession of its road, rolling-stock, and equipment to the said Wabash Railroad Company, discharged all of its agents and employes in the State of Indiana, and, by the order of its board of directors, removed its general offices, books, papers, and other documents from Logansport, Cass county, Indiana, to the city of Detroit, in the state of Michigan, from whence they were afterwards removed to Boston, Massachusetts. The Eel River Railroad Company has had no office, officer, or employe except William V. Troutman in
It is indispensably necessary to the exercise of the supervisory authority of the State over railroad corporations created by it, and owning property and enjoying corporate franchises within its territory, that every such
The visitation of civil corporations is by the government itself, through the medium of the courts of justice, which exercise common law jurisdiction over all such corporations by writ’ of mandamus, and by information in the nature of quo warranto.. The State which creates the corporation has the right, at all times, to inquire, through the courts, into abuses of its franchises by a body politic, and, in case of non-user or misuser, by the same medium to impose the penalty of forfeiture according to the course of the common law, or in pursuance of statutes applicable to such cases. 2 Kent’s Com. 300, 305. It is, therefore, one of the duties which a domestic corporation owes to the State to maintain a place of residence,- or domicil, at which the sovereign may call upon it to show cause why its franchises should not be seized, and the corporation dissolved; and where a disposi
The general rule of the statute is that an action shall be commenced in the county where the defendant, or one of the defendants, has his usual place of residence. §314 Burns 189d. This rule applies as well to corporations as to natural persons. The statutory exceptions to it authorize the bringing of the suit, under some circumstances, in counties other than that in which the defendant has his, or its, usual place of residence, but they do not prevent the bringing of the suit in the county of such usual residence.
The controlling facts as to the usual place of residence of the Eel River Railroad Company, found by the special verdict, are that, so long as that corporation held the possession of and operated its railroad, its principal offices ánd place of business were at Logansport, in Cass county, Indiana, the western terminus of its road, and that at no time since the Eel River Railroad Company transferred the use and possession of its railroad to other corporations had it any office for the transaction of its business as a railroad company in any county in the State of Indiana. The place of the principal office of a railroad corporation, where its business is transacted, and where its books and records are kept, is generally considered the residence of such corporation.
The fact that after the surrender of the railroad, its prop
The appellant, the Eel River Railroad Company, was a domestic corporation. Its railroad was wholly within the State of Indiana, yet, when this proceeding was instituted, it had no office or officer, agent or agency, in any of the eight counties in which, and through which, its road was constructed. Writs issued to the sheriffs of all of these counties were returned “Hot found,” because there was no officer or person in any one of them on whom service could be made. So long as the corporation attempted to carry out the purposes for which it was organized, so long as it engaged in the business of operating its railroad, it maintained its prinicpal offices and place of business at Logansport, in Cass county, and its legal residence was, therefore, in that county. Ho new residence having been acquired by the company, we think; that the residence so established should be held to have continued, and that the action was properly brought in Cass county. The action having been properly brought in that county, the statute expressly authorized service of the summons in any other county in the State where any person, authorized to transact business in the name of the corporation, officer, or agent, could be found. §318 Burns 1894. William V. Troutman, having been appointed the agent of the company in DeKalb county “to
(3) Was there error in overruling the demurrers to the amended information? Omitting the formal commencement, the material facts alleged were the following: That, on the 4th day of December, 1877, the Eel River Railroad Company was incorporated under the laws of the State of Indiana, for the purpose of owning, operating, and maintaining a railroad lying wholly within said State, and extending from Logansport, in Cass county, eastward, through the counties of Miami, Wabash, Kosciusko, Whitley, Allen, and Noble, to the town of Butler, in DeKalb county, in said State, a total length of about ninety-four miles, and formerly known as the Detroit, Eel River & Illinois Railroad. That, by virtue of such incorporation, the Eel River Railroad Company was authorized to, and did, take possession of the said railroad, its property, and franchises, and held and operated the same. That at the time said Eel River Railroad Company took possession of said property, said Railroad was fully constructed, completed, and equipped with ninety-four miles, of main track, with side-tracks, switches, depots, stations, roundhouses, and machine shops, located at Logansport and Butler, with engines and cars sufficient to do a large passenger and freight business, and was fully equipped for the accommodation of the public along the line of said railroad. That, on or about October 6, 1887, said Eel River Railroad Company executed and delivered to the Wabash Western Railway Company a lease of said Eel River Railroad for a period of ninety-nine years, renewable in like periods, at the option of said lessee, for
It was further charged that the Wabash Railroad Company holds possession of the Eel River Railroad, its property and franchises, without right; that it has usurped, intruded into, and unlawfully exercised the corporate franchises of said company, and is unlawfully operating said railroad, and exercising such franchises. Prayer that the charter and franchises be declared forfeited, that the defendants be ousted from said railroad and franchises, and that a receiver be appointed to take possession of said railroad, its property, etc., and wind up the affairs of the said Eel River Railroad Company.
The acts and omissions for which a forfeiture of the franchises of the Eel River Railroad Company and a dissolution of that corporation are demanded are these: The execution of a lease to the Wabash Railroad Company for a term of ninety-nine years, with the right of perpetual renewal at the option of the lessee; the surrender and abandonment of the possession and control of its railroad by the Eel River Railroad Company; the closing of all its offices, and the discharge of all its agents and employes; the destruction of twenty-two miles of its railroad from Logansport to Chili, with all of the side-tracks, switches, and bridges on that part of its line; the dismantling and removal of its roundhouses, and machine shops; the total diversion of the railroad from the purpose of its construction as a competing line with the Wabash Western Railway Company and the Wabash Railroad Company, and its conversion into an interrupted, subordinate, and tributary road.
If it were true, as appellants affirm, that the corporation did not impliedly agree with the State that it wonld operate the railroad with its own employes, and never transfer its franchises or property, still, we think it clear that it did impliedly agree that it would not, without the permission of the State, destroy a part of its line of railroad, change its terminal points, and turn over to a rival and competing company the possession, control, and exclusive management of the whole of its corporate property, and the enjoyment of all its corporate franchises.
Although incorporated under the act of March 3, 1865, nevertheless it was subject to the general provisions of the laws of this State, as far as it is possible'to construe them together, and there is nothing in the act of March 3, 1865, which relieved the Eel Eiver Eailroad Company from the
It was not necessary that the information should aver that the delinquent company had done any act in contravention of a prohibitory statute, or of a statute imposing a definite penalty. A forfeiture of corporate existence and franchises may result, although no statute in express terms enjoins or prohibits the acts or omissions complained of. While certain specific acts and omissions may, by statute, be made causes of forfeiture of the charter or franchises of corporate bodies, yet it is generally recognized that misuser, and non-user, of such franchises, even where the specific offenses are not particularly defined by statute, are sufficient grounds for proceedings for such forfeiture and dissolution. State Bank v. State, 1 Blackf. 267, 12 Am. Dec. 234; People v. Kingston, etc., R. Co., 23 Wend. 193; People v. Bristol, etc., Co., 23 Wend. 222; Thompson v. People, 23 Wend. 537; People v. Hillsdale, etc., Co., 23 Wend. 254; People v. Bank, 6 Cow. (N. Y.) 216; State v. Seneca County Bank, 5 Ohio St. 171; St. Louis, etc., Co. v. Sandoval, etc., Co., 116 Ill. 170, 5 N. E. 370; Ward v. Sea Ins. Co., 7 Paige (N. Y.) 294; In Re Jackson Ins. Co., 4 Sandf. Ch. (N. Y.) 596; 5 Thompson on Corp. §6618; Dartmouth College v. Woodward, 4 Wheat. 519, 4 L. ed. 629; Morawetz on Priv. Corp., §§1114, 1115; New York, etc., R. Co., v. Newman, 17 How. 30, 15 L. ed. 27; Territt v. Taylor, 9 Cranch 52, 3 L. ed. 650; State v. Minnesota R. Co., 36 Minn. 246, 30 N. W. 816; State v. Portland, etc., Co., 153 Ind. 483; Pennsylvania R. Co. v. St. Louis, etc., Co., 118 U. S. 290, 630, 6 Sup. Ct. 1094, 7 Sup. Ct. 24, 30 L. ed. 83, 284; Board, etc., v. Lafayette, etc., R. Co., 50 Ind. 85; Thomas v. West Jersey R. Co., 101 U. S. 71, 83; Elliott on Railroads, §§48, 49, and §50, note 5; State, ex rel., v. Atkinson, etc., R. Co., 24 Neb. 143, 38 N. W. 43, 2 L. R. A. 564, 8 Am. St. 164, and notes.
It is further said by counsel for appellants that the lease was not prohibited by law, nor wrongful in itself, and that the information contains no averment that public injury resulted from the acts complained of. In answer to this, it is sufficient to say that the lease to the competing company was not authorized by any statute; that its execution and the consequent abandonment of its railroad by the Eel River Railroad Company were against public policy; and that from the facts averred in the information injury to the public may be conclusively presumed. Elliott on Railroads, §49; Board, etc., v. Lafayette, etc., R. Co., 50 Ind. 85; Bast St. Louis, etc., R. Co. v. Jarvis, 92 Fed. 735, 34 C. C. A. 639; Central, etc., Co. v. Indiana, etc., Co., 98 Fed. 666, 39 C. C. A. 220.
The execution of the lease to the Wabash Railroad Company and the disability resulting from such lease rendered the lessor company incapable of performing its duties to the
Objection is made that the action was not brought in the proper county, but, for the reasons already given in this opinion, we think the suit was properly commenced in the Cass Circuit Court.
It is also insisted that when the venue of the cause was changed from Cass county to Howard county, there should have been a change of the relator, and that the prosecuting attorney of the Howard Circuit Court should have been substituted. We cannot adopt this view. The action was a civil one, and a change of venue did not require a change of parties. Originating as it did in Cass county, the prosecuting- attorney of that county was the proper relator, and so remained, notwithstanding the removal of the cause from that county. The statute provides that the information may be filed by the prosecuting attorney in the circuit court of the proper county, upon his own relation, whenever he shall deem it his duty to do so, or shall be directed by the court, or other competent authority. §1146 Burns 1894.
It certainly was not intended that upon every change of venue there should be a change of the relator. Counsel for appellants refer us to no authority in support of this position, and we have been able to find none. The analogy to criminal practice and pleading, suggested by counsel for
Upon the whole information, we think it appears that there was a wilful misuser and non-user by the Eel River Railroad Company of its franchises in regard to matters which go to the essence of the contract between the corporation and the State; that the Cass Circuit Court had jurisdiction of the subject-matter of the action and the persons of the defendants, and that there was no defect of parties. The demurrers of the appellants were properly overruled.
(4) Were the appellants entitled to judgment on the special findings of the jury? The findings of fact closely pursued, and fully sustained, the allegations of the information, and it is not necessary to set them out. Special answers separately filed by the appellants set up the defense that the cause of action did not accrue within fifteen years before the commencement of the action. The verdict finds that on the 6th day of October, 1887, the lease mentioned in the information was executed, and that thereupon the Eel River Railroad Company surrendered the absolute control and possession of its railroad, its equipments, and franchises to the Wabash Western Railway Company. Nothing is said in the special finding concerning the execution of a lease in 1879, or at any date other than October 6, 1887. But if a previous lease had been made, the execution of another instrument of like character by and between the same parties, or their successors, in 1887, may have annulled or merged the former agreement, and it undoubtedly had the effect of a new and substantive violation of the
Besides, we think the misuser of the franchises of the Eel River Railroad Company constituted a continuing wrong. Peck v. City of Michigan City, 149 Ind. 670; Gunder v. Titbits, 153 Ind. 591.
The special findings of fact were entirely consistent with the' general verdict, and there was no error in overruling appellants’ motion for judgment in their favor.
(5) Upon a careful examination of all the reasons for a new trial discussed by appellants’ counsel, we are satisfied •that the action of the court in overruling the motion was correct. We think the verdict and the special findings were sustained by sufficient evidence, and were in accordance with the law; that no error was committed in giving, or refusing to give, instructions; and that the court did not err in refusing to compel the jury to answer interrogatories numbered fifteen and sixteen filed by appellants.
In determining the questions arising upon the decision of the court on the motion for a new trial, we do not deem it necessary to take them up in detail, or to extend this opinion by comment upon their merits. The views we have expressed upon the controlling questions in the cause suffi
(6) The statute expressly authorized the appointment of a receiver in the event that judgment was rendered against the corporation. The judgment, in case of a forfeiture, is that the franchise be seized into the hands of the State, and that the corporation be dissolved. 2 Kent’s Com. 300-305; State Bank v. State, 1 Blackf. 267; Ryan v. Vanlandingham, 7 Ind. 416.
The appointment of a receiver to take possession of the property of the company was necessary and, in the exercise of its general powers, we think the court was authorized to make such appointment. It was asked for in the information, and no harm could result from the appointment as a part of the proceedings in the cause. Had it not been made until after judgment, the court would doubtless have had the right to make the appointment on the motion of the prosecuting attorney, and without further notice. A correct result having been reached, we do not think the action of the court should be disturbed, or that any reason exists for a modification of its judgment.
Judgment affirmed.