174 Pa. 605 | Pa. | 1896
Opinion by
The issue in this case was framed to determine the title to certain steel rails seized by the sheriff of Schuylkill county under an attachment as the property of the Inte.r-County Street Railway Company. The railway company was authorized by its charter to construct and maintain a railway from Tamaqua, Schuylkill county, to Lansford, Carbon county. After a part
The claim of the attaching creditor is based upon the ground that the railway company being insolvent could not lawfully prefer one of its creditors by a sale or transfer of property necessary for its operations. It is undoubtedly the rule that when the operations of a corporation are matters of direct public interest and concern, its property which is reasonably essential to the exercise of its franchises cannot be aliened by the corporation or sold by its creditors piecemeal so as to stop its operations or defeat the object of its charter: Susquehanna Coal Co. v. Bonham, 9 W. & S. 27; Reynolds v. Reynolds Lumber Co., 169 Pa. 626. The grant by the state to the Inter-County Railway Co. was for a use in which the public was interested, and it may be assumed that if the company had reached the stage of active operation and the rails in question had become a part of its roadway they could not under the circumstances have been sold, as the company was insolvent and the effect of the sale would have been to strip it of property necessary for the exercise of its franchises. The right contested however was that of a company which had not completed or operated any part of its road to sell rails which had not become part of its structure, and for which it had no present use. Its right to make the sale if the surplus had resulted from an overpurchase or had been caused by the shortening of its route or the abandoning of a part
The sale was effected by means of a written instrument regularly executed by the proper officers of the company in pursuance of a resolution of the board of directors. At the meeting of the board five of the eight members were present and the action was unanimous, and has not since been objected to by any one interested in the company. Under the circumstances disclosed by the testimony the appellant has no standing to question it.
The judgment is affirmed.