140 Mo. 539 | Mo. | 1897
This is a proceeding by the State at the relation of Kansas City, Missouri, by Marcy K. Brown, prosecuting attorney of Jackson county, Missouri, by quo warranto to oust defendants of their corporate franchises granted to them by said city by ordinances, to construct, maintain and operate a street railway on certain streets in said city, upon the ground of their failure to comply with said ordinance, and the consequent forfeiture of their franchise rights under said ordinance.
The petition alleges that the relator was on the ninth day of May> 1889, arid ever since has been, a municipal corporation under the laws of the State of Missouri having frill power and control over its streets. That defendants are corporations under the laws of this State, except defendant Thornton, who is trustee in a deed of trust executed by the East Fifth Street Railway Company on the first day of November, 1890, on the franchises hereinafter described. That by certain ordinances passed by said city, the right was given and accepted by said defendant railway company to construct, maintain and operate a street railway on certain of its streets. That by reason of said
The answer admits the acceptance of the ordinances by the railway company and alleges that said ordinances constitute valid and subsisting contracts between- said city and defendant railway company. The answer álso admits that defendant railway company and defendant trust company are now and were during the dates mentioned in said information, corporations organized under the laws of the State of Missouri, and that the deed of trust mentioned in the information has not been released or satisfied, and that defendants by reason of said ordinances, claim the right to run, maintain and operate a street railway over the streets named in said ordinances. It then alleges that section 17 of ordinance number 42389 requires an action for forfeiture to be brought within six months after cause of forfeiture has arisen, and that causes are alleged in the information- to have arisen eighteen months prior to the filing of the information. That defendant railway company was unlawfully prevented by the police of the city of Kansas from constructing its railway on Fifth street from Grand avenue
It appears from the record that in December, 1881, by an ordinance of Kansas City a franchise was granted to certain persons named in said ordinance, to construct and operate a street railway on certain streets in that city.
The franchise was to continúe for twenty years; the company was to keep the tracks in repair and the spaces between the tracks and for eighteen inches on the outside well paved; cars were to be regularly run for not less than sixteen hours per day, “during each and everyday of the entire year.” "With the consent, of the grantees of the franchise, a subsequent order was passed whereby the franchise was extended for thirty years from September 1, 1885, and the starting point fixed at Fifth street and Grand avenue, instead of Fifth and Main streets. In June, 1888, another ordinance was passed by said city which recites in its preamble, the following: “"Whereas, the East Fifth Street Railway Company is the successor and owner of all franchises and ordinances above granted.” This ordinance then, among other things, regulates the pavement of spaces between the tracks, and the keeping of them in good condition and repair. Section 12 of this ordinance provides for the equipment of the road and the running of the cars, and gave defendant
Prom the date of the original ordinance, December, 1881, to the time of trial in the court below, the road was only operated for two or three months and then by electric ears. The company then suspended operating the road from eighteen months to two years, after which it ran some steam cars from one and a half to two years. For about three years before the time of the trial of this cause it ran no cars at all, and did nothing toward the operation of the road. Some time prior to the bringing of this proceeding, they sold their cars to some company in Texas, and paid the proceeds upon a mortgage upon the road, upon which was due about
No notice was ever given by Kansas City to defendant railway company to run its cars. Nor was the information filed for more than six months after the alleged grounds for forfeiture arose.
At the conclusion of the evidence the court, at the request of the relator, gave the following declaration of law:
“The court declares the law to be that if defendant has ceased to operate its road, that it has sold its rolling stock and has none with which to operate its road, and that it has no means with which to purchase more stock and is heavily in debt, then judgment must go for relator.”
The. court gave judgment of ouster against the defendants, from which they appeal.
L Defendant’s contention is that quo warrmto is not the proper remedy in this case; that the State has no interest in this controversy; that the “franchise” granted by it and the only one that it is interested in, is not the subject-matter of this litigation; that the questions involved are of a personal nature, between the relator on the one hand, and the defendant railway company on the other, the relator alleging failure to comply with the terms and conditions óf a contract
In the case of Railroad v. Commissioners, 112 U. S. 619, the court says: “The essential properties of corporate existence are quite distinct from the franchises of the corporation. The franchise of being a corporation belongs to the corporators, while the powers and privileges vested in and to be exercised by the corporate body as such, are the franchises of the corporation. The latter has no power to dispose of the franchise of its members, which may survive in the mere fact of corporate existence, after the company has parted with all its property and all its franchises.”
It may be said that corporate existence is as much a franchise as the franchises of the corporation. The former is not property in the ordinary acceptation of the term, can not be transferred by ordinary conveyance, nor by sale under execution, unless the statutes of the State so provide,while corporate franchises are property, can be transferred by voluntary conveyance or by sale under execution against the corporation. Railroad v. Delamore, 114 U. S. 501. In the case in hand the privilege of laying its tracks on the designated streets, to run cars thereon, and to charge and receive fares from persons riding on its cars were franchises of the defendant railway company, without which the charter would be of no value. Such privileges were not mere licenses. A different view, however, seems to have been taken in the case of the People ex rel. v. Mutual Gaslight Co., 38 Mich. 154, in which it was ruled that the right to lay pipes in the streets of a city is not a State
While the franchises involved in this controversy were derived directly from the city by the East Fifth Street Railway Company, under ordinances passed under the grant of power contained in the city charter, that power was conferred upon the city by the G-eneral Assembly, so that the power came indirectly from the State, and in granting it the State acted through the city as its agent. Transportation Co. v. Chicago, 99 U. S. 641; Port of Mobile v. Railroad, 84 Ala., supra. The power of the city to grant the franchises in question is unquestionable.
We do not think, however, that the fact that the franchises in question are in a sense contractual in their nature,' is a barrier to the prosecution of this suit if the facts alleged and proven be sufficient to oust defendant company of its franchises, notwithstanding section 17, supra, of the ordinance passed in June, 1888, provides that in case of failure, neglect or refusal by the defendant railway company to obey and comply with any of the provisions of said ordinance, said company shall forfeit all rights, powers and privileges conferred thereby, and that such forfeiture may be had by proceedings instituted by said city in its own name, against said company in a court of record in Jackson county, Missouri. The sovereign power of the State to proceed against defendant company by quo warranto for forfeiture of its franchises even at the relation of the city could not be contracted away or in any way abridged by the city. At most such a provision in the ordinance only provided the city another remedy. Fatk
Moreover, a proceeding in equity is not the proper remedy to enforce the forfeiture of a franchise. Pomeroy, in his work on Equity [2 Ed.], sec. 459, says: “It is a well settled and .familiar doctrine that a court of equity will not interfere on behalf of the party entitled thereto, and enforce a forfeiture, but will leave him to his legal remedies, if any, even though the case might be one in which no equitable relief would be given to the defaulting party against the forfeiture.” The same rule is announced in High on Extraordinary Remedies [2 Ed.], sec. 660, in which it is said: “The dissolution of a corporation and the revocation of its franchises are generally considered . matters of legal rather than of equitable cognizance, and unless a court of chancery is especially empowered to divest a corporation of its franchises, the more appropriate remedy for this purpose is by information in the nature of a quo warranto.” Att’y-General v. Tudor Ice Go., 104 Mass. 239; National Bank v. Matthews, 98 U. S. 621. In Hovelman v. Railroad, supra, this court said: “It is the" settled rule that the acts of a corporation can be . assailed for abuse or excess of its corporate powers only, in a direct proceeding brought by the State-for that purpose.” The city granted the franchises in the interest of the public, and we see no reason why she should not be relator in this proceeding to have the franchises forfeited in the interest of the public also, if the facts and circumstances in proof justify such a result.
The question then arises, was the non-user ,of the franchises, by defendant company under the circumstances disclosed by the record, sufficient to justify the court in declaring their forfeiture! In considering this question it may be said that the insolvency of the cor
In the case of The Roanoke Inv. Co. v. Railroad, 108 Mo. 50, it is said: “But while it is true that mere non-user will not amount to an abandonment, it is well settled that an easement acquired by grant or its equivalent may be lost by abandonment. To constitute an abandonment of an easement acquired by grant, acts must be shown of such an unequivocal nature as to indicate a clear intention to abandon. Curran v. Louisville, 83 Ky. 628; Dyer v. Sanford, 9 Metc. 395; Hayford v. Spokesfield, 100 Mass. 491. It is said, how
The generally accepted doctrine is that the omission of an express duty imposed by the charter of a corporation is cause for its forfeiture, and in such circumstances the sovereign who granted the charter may insist on resuming the grant for breach of the duty imposed. Commonwealth v. Bank, 28 Pa. St. 383; Attorney-General v. Railroad, 6 Ired. 456; Railroad v. Casey, 26 Pa. St. 287. And where there has been a willful misuser or non-user by a corporation it is subject to dissolution by forfeiture of its franchises. Mumma v. Potomac Company, 8 Peters, 281; Terrett v. Taylor, 9 Cranch, 51; Chicago Life Ins. Co. v. Needles, 113 U. S. 574; People v. Railroad, 126 N. Y. 29. “The rule in
2. But it is insisted by defendant that relator is estopped to maintain this action upon the ground: First, that by its military force it prevented the company and still prevents it from completing its contract and entering on the enjoyment of its grant; second, that the city by its common council passed an ordinance repealing, or attempting so to do, the grant made to defendant; third, 'that relator compelled the defendant to tear up its turntable, and that by reason thereof, necessitated and required the defendant to change its equipment and to dispose of the equipment purchased by it and- then in use; fourth, that relator, by litigation instituted before defendant ceased to operate the road, rendered impossible the operation of the road on the part of defendant, and is by reason thereof estopped from taking advantage of its own wrong.
With respect to the first proposition W. J. Smith,
Nor do we see how the fact that the city may have passed an ordinance repealing, or attempting to so do, the grant made to defendant, could have afforded it any excuse for non-compliance-with the ordinances.
It is well settled that estoppel in pais must be pleaded, and as the answer contains no allegation to the effect that the city compelled defendant to tear up its turntable, that question can not be considered by this court.
The records of the suits mentioned in the fourth proposition are not copied into .the bill of exceptions; so that it is impossible to tell anything about'-the issues involved in them, or what possible effect they may have had upon defendant’s failure to operate the road. The only litigation mentioned in the answer seems to have been by the city, and the evidence shows that it resulted in favor of defendant. But even the record in this suit is not in the bill of exceptions.
5. A further contention is that.the record shows that the relator waived all the causes of forfeiture com
Moreover, the city had no power or authority by ordinance or otherwise to take away from its sovereign the right to proceed by its public officer, the prosecuting attorney of the county, against the defendant by quo warranto for ouster of its franchises upon the ground of their forfeiture.
The judgment is affirmed.