71 Ind. 478 | Ind. | 1880
This was an information, in the nature of a quo warranto, in the name of the State of Indiana, on the relation of Henry U. Johnson, Esq., Prosecuting Attorney of the 17th Judicial Circuit, as plaintiff, against Jacob S. Moore, John Moore, Alfred Moore, John M. Shaffer and William Paddock, as defendants. The information charged, in substance, that the appellants, the defendants below, were acting within this State as a corporation, under the assumed corporate name of the “ Wayne and Union Straight Line Turnpike Company,” without haying been legally incorporated; and judgment of ouster was demanded against the appellants, and for their exclusion from the exercise of corporate rights and franchises, as such corporation, and for other proper relief in the premises. The appellants jointly answered in four paragraphs, of which the first was a general denial, and each of the other three paragraphs stated special matters, by way of defence. The
1. The circuit court erred in sustaining the demurrer to the second paragraph of their answer;
2. The court erred in sustaining the demurrer to the third paragraph of their answer;
3. The coui’t erred in sustaining the demurrer to the fourth paragraph of their answer;
4. The relator’s information did not state facts sufficient to constitute a cause of action; and,
5. The court erred in rendering a judgment against the corporation named in the information, which was not a party to the action, and in refusing to reform and correct its finding and judgment against said corporation.
It is necessary, we think, to a proper understanding of the case, and of the questions for decision therein, that we should first give a summary of the facts stated in the information. It was alleged therein, in substance, that the appellants were, and had been for one year last past, at Wayne county, Indiana, under the assumed corporate name of the “ Wayne and Union Straight Line Turnpike Company,” assuming, claiming and pretending to be a legally incorporated turnpike corporation, under the laws of this State, to wit, under and pursuant to the provisions
And the relator further alleged, that the sole manner of the attempted organization and incorporation of the appellants into said pretended turnpike corporation was as follows : That, at and long before the year 1872, there existed in Wayne and Union counties a gravel road corporation, known as the “Wayne and Union Straight Line Turnpike Company,” duly and legally incorporated under.the act of May 12th, 1852, entitled “An act authorizing the construction of plank, macadamized and gravel roads,” which said corporation owned and operated, in its corporate capacity, the said gravel and turnpike road, thereinbefore described; that said last named corporation possessed all the rights and franchises conferred by law on such corporations, was managed by its directors- duly chosen, and had erected toll-gates, and was collecting toll for travel upon said road ; that at the April term, 1872, of the court of common pleas of Wayne county, to wit, on May 2d, 1872, a judgment for the foreclosure of a certain mortgage previously executed by the said last named company, to secure the payment of money previously borrowed for the completion of its road, was rendered against said company, in favor of one John Raper and Zachariah Osborn, in an action then and there pending, wherein the said Raper and Osborn were plaintiffs, and the said company and others were defendants: that afterward, on June 14th, 1872, an order of sale duly certified was legally issued on said judgment, out of said court, to the sheriff of said Wayne county, for the sale of its said gravel road, by virtue of which said order of sale, the said sheriff, after due and legal notice, in due form of law, sold the said gravel road of said last named company, at sheriff’s sale, to said Raper and Osborn, on the 13th day of July, 1872, for the sum of fifteen hundred dollars; that, on the pur
And the appellee’s relator further alleged, that the said Raper and Osborn did not, nor did either of them ever, at any time before or after their said purchase of said gravel road at sheriff’s sale, make any effort whatever to organize a distinct corporation under the original charter of the said Wayne and Union Straight Line Turnpike Company, and the amendments thereto, by creating a stock not exceeding the cost of the construction of said road, or the part thereof purchased, and appointing a board of directors equal in numbers with that prescribed in said original charter and its amendments; that, in fact, said Raper and Osborn did not, either jointly or separately, at any time before or after said purchase, make any endeavors to organize a gravel, macadamized or turnpike road corporation of any kind whatsoever, with a view to or in order that they might enjoy and perpetuate the corporate rights and franchises of said turnpike company, as provided in the above entitled act of March 5th, 1859, and the acts supplemental to and amendatory thereof; that the appellant Jacob S. Moore, at no time, either before or after the said sheriff’s sale of said gravel road, made any effort, nor did he proceed, to organize a distinct corporation, under the oi’iginal charter of said turnpike company and the amendments thereto, nor did he ever create or make any effort to create a stock not exceeding the cost of the construction
And the relator further alleged; that, on said last named day, nearly three’ years after the said purchase of said gravel road, at said sheriff’s sale, by said Raper and Osborn, the said Jacob S. Moore for the first time attempted to preserve to himself the corporate rights and franchises of said turnpike company, and then, for the first time, proceeded, with, an attempted organization under the original charter and amendments of said turnpike company, by then attempting to appoint a board of directors equal in number with that prescribed in the original charter of said last mentioned company; that said board of directors, so sought to be appointed by said Moore, consisted of said Jacob S. Moore, Alfred Moore, John Moore, John M. Shaffer, appellants in this action, and Samuel L. Moore, since deceased; but said persons constituted all the stockholdei’s of said attempted organization; that it assumed, and took as its name, the name of the old turnpike corporation, whose road .was' so sold at said sheriff’s sale, to wit, the “ Wayne and Union Straight Line Turnpike Company ; ’’ that the appellants and said Samuel L. Moore soon thereafter filed in the offices of the recorders of Wayne and Union counties a certain statement, by them prepared and designed as the statement required by the 2d section of the aforesaid act of March 5th, 1859, and
The appellee’s relator further alleged, that afterward the appellant "William Paddock, having been admitted by his co-appellants into the said pretended corporation, all of them assuming and claiming to be a legally incorporated turnpike company, under and by virtue of their pretended compliance with the aforesaid act of March 5th, 1859, and assuming to be a legal corporation under said act, at said county, under its said assumed corporate name, took possession of the above described gravel and turnpike road, as heretofore alleged, and performed the said pretended corporate acts and acts of user heretofore specified to have been done by them; that they were not, and never had been, a legal or rightful turnpike corporation, for the reason that their attempted incorporation as such was not made or completed within the time required by the above entitled act of March 5th, 1859, under which alone they attempted to incorporate and claim an incorporation, having never at any time .taken any steps to incorporate themselves under any other statute of this State; that they were the only members and stockholders of said pretended corporation ; that they had no lawful right or authority to exercise the rights, privileges or franchises of a turnpike corporation ; and that their said failure to comply with the provisions of the aforesaid act of March 5th, 1859, was unknown to the appellee or its officers, or to the relator, until within nine months last past. Wherefore, etc.
Section 2 of said act provides : “ Any association organized under the provisions of this act, shall, within thirty days from the date of such organization, file for record in the office of the recorder of each county into or through which said road, or part thereof so purchased extends, a statement of the road, or part thereof purchased, the date of such purchase, the name of the purchaser or pur-, chasers, the corporate name assumed by said organization, the amount of the capital stock, the number of shares and the names of the holders thereof, and the names of the directors and officers of said company, which statement shall be evidence of the organization of said company.”
The third and last section of said act “ declared that an emergency exists for the immediate taking effect of this act, and therefore the same shall be in force from and after its passage.”
Before passing to the consideration of the sufficiency of the appellants’ answers, we make the following general observations on the provisions of the statute which constitute the basis of the relator’s information in this ease.
1. The statutory provisions are permissive, and not prohibitory, in their character. There is nothing in the statute, from the enacting clause to the declaration of an emergency, as we read its provisions, which forbids the purchaser or purchasers of any one of the roads men
2. The statute under consideration is general in its terms; but yet it is manifest from its provisions, that it was enacted for the special purpose of saving to the purchaser or purchasers of some road, or part of a road, the benefits of a special charter and its amendments, which it was thought by him or them were more liberal in the rights, privileges and franchises conferred, than the general road law of the State applicable.to such road or part of a road.
In the second paragraph of their answer, the appellants alleged, in substauce, that in the year 1859 there was organized and regularly incorporated a gravel road or turnpike company, under the act of 1852, by the corporate name of the “ Wayne and Union Straight Line Turnpike Company,” operating and using a line of gravel or turnpike road, about six and one-half miles long, a part only of which was made, leaving several miles incomplete, beginning at a point on the Richmond and Boston turnpike, one and one-half miles south of the city of Richmond, Indiana, and running thence, in a south-westerly
It is conceded by the appellants’ counsel that the third and fourth paragraphs of the answer allege substantially the same facts as those set up in the second paragraph of answer. We need not, therefore, set out or summarize in
We are of the opinion that the facts stated in the second paragraph of the answer were sufficient to constitute a complete bar to the relator’s information. While it seems to us, that the provisions of the act of March 5th, 1859, above set out, are at least of doubtful application to the case made by the information, yet, if it he conceded that those provisions are strictly applicable to such case, and it is not necessary that we should, and we do not decide otherwise,*we think .that the averments of the second paragraph of answer constitute a complete defence to the case thus made. Prom the summary of this paragraph of answer which we have given, it will be readily seen that the appellants claimed therein, that, by. regular election, they were the directors of the original “ Wayne and Union Straight Line Turnpike Company,” organized for the construction of the road in controversy, whose organization had been kept up and maintained, as well as directors of the new corporation, which had been organized by them as a precautionary measure, upon the sheriff’s sale and conveyance of said road; hut that the said road and the franchises of the original corporation had never passed from said corporation, only so far as such transfer might be effected by the sheriff’s sale and conveyance of the road. Now, it was certainly competent for the appellants, as the directors of the original corporation, after the sheriff’s sale of its road, to raise the money and purchase and take an assignment of the sheriff’s certificate of sale. We do not think that the subsequent execution of the sheriff’s deed of the road to one of the appellants, as the assignee of said certificate, and the failure of such grantee and his associates to organize a new corporation, under and in accordance with the provisions of the aforesaid act of March 5th, 1859, and within the times limited
We have already said, that, while the act of March 5th, 1859, above quoted, was general in its terms, as it had to be under the constitution of 1851, yet its provisions indicated that it had probably been enacted for the special purpose of saving to the purchaser of some road, or part of a road, constructed under a special'charter enacted by the Legislature prior to 1851, the benefits of such special charter. We do not think that the act of March 5th, 1859, either in terms or by implication, repealed or impaired the provisions of an act entitled “ An act to amend the act entitled £ An act authorizing the construction of plank, macadamized, and gravel roads,’ and to empower the same to make sale of a portion of their roads,” approved February 28th, 1855. In the 1st section of this amendatory act, it is provided, “ That it shall he lawful for any number of persons, not less than three, to form themselves into a company under the act authorizing the construction of plank, macadamized, and gravel roads, for the purpose as well of purchasing and using a part or
There is nothing in the articles of association of the new corporation, as the same appear in the record of this cause, to indicate that the appellants intended therein and thereby to incorporate themselves under the provisions of the aforesaid act of March 5th, 1859, or of any other specified act. It will be observed, that, in the section above quoted of the act of February 28th, 1855, there is no restriction or limitation as to the time within which the purchasers of a road, or part of a road, should organize a corporation under the law, for the purposes of constructing, maintaining, operating and using such road, or part of a road. The appellants’ counsel claim, and with much force and show of reason, that there is nothing in this act to prohibit or prevent the purchaser of a road or part of a road, at a sheriff’s sale thereof, from organizing at any time a new corporation, clothed with all the rights, privileges and franchises conferred by law, to take possession of and use the property purchased for all or any of the purposes specified in said act. Counsel further claim, that as the articles of association of the new corporation, in this case, do not indicate that the appellants sought and intended to incorporate themselves under the- harsh and restrictive provisions of the aforesaid act of March 5th, 1859, the courts might well assume, and ought to assume, in the interest and for the protection of the rights of private property, they intended to and did organize and form such new corporation, not under those provisions of that act, hut under the wiser and more liberal provisions of the above entitled act of February 28th, 1855, for the purposes therein specified. We fully concur with the appellants’ counsel in their claims and views in this regard, for we can not believe that it is the policy of the law, or was the intent of the law-makers, to forfeit the property rights and
We are of the opinion, therefore, that the appellants showed very clearly, in and by the averments of the second paragraph of their answer, that as the directors of either the old or the new corporation, or perhaps of both corporations, they were lawfully possessed of the road in controversy, and of the requisite rights, privileges and franchises under the law, to construct, maintain, operate and use such road. The respective rights of the two corporations, as between themselves or their corporators, in and to such road, is a question we are not asked to decide, and in which, perhaps, the State has no interest. One or the other of the two corporations is the owner, and lawfully entitled to the possession, of the road and its franchises, and the appellants are the duly elected and acting directors of both corporations. Under these facts, which must be taken as true, as the case comes before us, the State was not entitled to a judgment of ouster and exclusion against the appellants; and, therefore, we think that the court erred in sustaining the relator’s demurrer to the second paragraph of the appellants’ answer.
The views we have expressed, in regard to the liberality which the courts should extend towards such road corporations as the one organized by the appellants in this case, are fortified, strengthened and sustained by the provisions of “ An act to legalize defective organizations of corporations in certain cases,” approved March 3d, 1877. This act was passed nearly two years after the organization by the appellants of the new corporation, mentioned in the information, and became a law on the 2d day of July, 1877, more than two years prior to the commencement of this suit. Omitting the enacting clause, it was provided in this act as follows : *
*496 “ That in all cases, where the purchasers of gravel or macadamized roads, at sheriffs’ sales, have filed their articles of association for reorganization, in the proper office, but have failed to file such articles within the time limited by law, or where said organizations are imperfect because of omission of any mere matter of form, if the requirements of the law have been substantially complied with, so that the law can be enforced, and the rights of third parties are not injuriously affected, the same are hereby legalized, and such companies shall be held to be regularly incorporated from the date of filing such articles.” Acts 1877, Reg. Sess., p. 89.
It was certainly competent for the General Assembly to pass this law; and, by its enactment, it would seem that the organization by the appellants of their new corporation, at least so far as the State is concerned, was thereby legalized, and that, after the law took effect, the State was not entitled to a judgment of ouster and exclusion against the appellants, upon the grounds specified in the relator’s information.
Eor the reasons given, we think that the court also erred in sustaining the relator’s demurrers to the third and fourth paragraphs of the appellants’ answer, ’ in which substantially the same facts were pleaded in bar of the information, as in the second paragraph of the answer. Our conclusion in regard to .the insufficiency of' these paragraphs of answer renders it unnecessary for us to consider the other error complained of, in regard to the judgment rendered by the court.
The judgment is l’eversed, and the cause is remanded, with instructions to overrule the relator’s demurrers to the second, third and fourth paragraph of the appellants’ answer, and for further proceedings not inconsistent with this opinion.