48 A. 1103 | N.H. | 1900
The state claims to recover from the defendants sums alleged to have been received by them in excess of the amount they are allowed to receive and retain, as against the public. It charges that the defendants have divided to their stockholders more than the ten per cent specified in the statutory grants *429 to them. The parties disagree as to what the amount is upon which the percentage is to be reckoned, and also as to whether the stockholders are entitled to interest upon deferred dividends.
The claim of the state is that the defendants can divide ten per cent upon the capital stock issued, and no more; while the defendants insist that they are entitled to that per cent upon all money expended in the construction of the road. It is not necessary to construe the provision of the charter upon this point (Laws 1847, c. 549, s. 5), because it is so nearly identical with the general law as to be superfluous. State v. Railroad,
One intention which the legislature of 1844 had was to establish a general railroad law, and this intention found expression in the act of which the section under consideration forms a part. Concord Railroad v. Greely,
This section provides for the return of unreasonable exactions as nearly as possible to those who have suffered thereby. State v. Railroad,
If the defendants' position were sound, it would follow that while the railroad could retain the sums here sought to be recovered, yet the state by reducing the tolls could have prevented the railroad from receiving the money. In this way one part of the act could be used to defeat the operation of another. Action by the state reducing. the tolls might still later be nullified by the road. For example, if stock was issued to the amount of $500,000, and the road was built at a cost of $1,000,000 (of which sum the corporation owed one half), the corporation could in the first year divide to its stockholders ten per cent upon the cost of the road, or $100,000. The state could not recover any part of this; but the legislature might enact that for the next year the tolls should be reduced so that the net income would be only $50,000. For this year the legal limit of the dividend, because of legislative action fixing the tolls, would be only one half what it was the previous year. Now if, in the third year, the corporation should fix its tolls so high that it would have $150,000 net profits, and should divide *431
that sum to the stockholders, when sued for the excess it would answer it had only divided an average of ten per cent from the beginning upon the cost of the road, and that the law allows. A construction which leads to such results puts "an undesigned and novel inequality in the place of uniformity, in violation of elementary principles." "If a statute is capable of two meanings, and one is more reasonable and therefore more probable than the other, this fact is necessarily considered with all other competent evidence, on the question of intent." Opinion of the Justices,
If the provisions of these sections were in acts passed at different times, there would be more ground for claiming that they had different meanings. When, as in this case, they are parts of one act, the rule to so construe it that the whole will, if possible, stand is of the highest importance. It has heretofore been said that the provision of section 11 "relates to . . . an excess of net income above ten per cent," and that of section 13 "to the alteration of tolls when the net income exceeds ten per cent." Opinion of the Justice,
The defendants' arguments against this conclusion are chiefly drawn from the construction which they say should be placed upon section 10 of the general law and section 9 of the charter. "The state may, at any time after twenty years, resume the right and privilege of the corporation. in such railroad, on giving one year's notice and paying to the corporation all it may not have received its expenditures, and interest on such. expenditures, at the rate ten per cent per annum." Laws 1844, c. 128, s. 10. It is argued that here, at least, expenditures means cost of construction. An examination of the section shows the claim to be unfounded. The object of this section was different from that of sections 11 and 13. Their aim was to prevent the corporation from taking what did not belong to it, while this was enacted to enable the state to buy the property of the corporation. The property to be purchased was not necessarily the railroad free from all debt. It was *432 "the right and privilege of the corporation in such railroad." For the amount stipulated the state could succeed to the right of the corporation. Like any other successor who pays a price for the interest of another in an enterprise, the state would take the concern as it was, subject to the burden of debts, or made valuable by credits due to it. Here, as in the other sections, the expenditures. referred to were those of the stockholders. Upon repayment of those and any deficiency in the annual income, the state steps into the place of the corporation, so far as owning the property goes. This is the only intelligible meaning to be given to the phrase "resume the right and privilege of the corporation in such railroad." This meaning is made still clearer by an examination of the provision of the charter upon the subject. "The state, . . . after the expiration of twenty years from the time of the completion of said road, may purchase the same of said corporation, and all the franchise rights and privileges of said corporation, by paying them therefor the amount expended in making said road, and in case at the time of the purchase the said corporation shall not have received a net income equal to ten per cent per annum on the amount of such expenditure from the time of the payment thereof by the stock-holders, by paying said corporation such additional sum as, together with the tolls and profits of every kind which they shall have received from said railroad, will, be equal to a net profit of ten per cent per annum on the cost of said road, from the time of the payment thereof by the stockholders to the time of purchase." Laws 1847, c. 549, s. 9. Here is a further specification of what is meant by expenditures. They are what has been expended by the stock-holders. The phrase "the payment thereof by the stockholders" shows in a clear light the legislative intent. The sum upon which the income was to be computed was what the stockholders had expended — not what the corporation might be owing for borrowed money.
It is further argued that if the corporation built the road without issuing any stock, the whole net profit might be recovered by the state, — a result which the defendants assume is beyond question outside the legislative intent. Conceding, for the purpose of the argument, that the corporation could legally carry on business in this way, the result would be as stated. This is the true construction of the act. The defendants assert that the legislature could not have intended such a result, but they advance no reason why a corporation which has risked nothing of its own should reap a profit. To whom would such profit go? Not to those who loaned the corporation money, for payment of interest to them must be made before there could be any net income. It would not go to stockholders, for there would be none in existence. *433
The intangible thing called the corporation, in which no one had any financial interest, might well be called upon to return to the state the privileges in the development of which no one had risked anything as proprietor. Beyond this, it is not probable that the legislators of 1844 had in mind the modern methods of doing business referred to in the defendants' proposition. It was then supposed that the right to issue stock was granted for the purpose enabling the company to accumulate the capital with which to carry on business. The construction of the act cannot be based upon the unfounded assumption that the legislature expected that this and other railroad corporations were to be nothing but names, and without financial substance. "The meaning of a written law is not found, beyond the fair scope of its terms, in . . . a policy not sufficiently established at the date of the act to be presumably known to the legislature." Opinion of the Justices,
The legislature intended to pass a general law applicable to all railroads. It intended to have each section of the act have some effect. It intended to pass a law which was not in conflict, one part with another. Its members thought, understood, and intended in accordance with what was then known and understood. Giving due weight to these facts in the interpretation of the statute, it appears more probable than otherwise that the phrases "expenditures and interest on such expenditures" (Laws 1844, c. 128, s. 10), "their expenditures from the commencement of their operations" (Ib., s. 11), "the net income of the stock" (Ib., s. 13), and "the cost of said road from the time of payment thereof by the stockholders" (Laws 1847, c. 549, s. 9) all refer to a common quantity as the basis upon which the computations were to be made. This quantity is the capital stock paid in, and upon this sum the percentage is to be calculated.
For a considerable time the annual dividend or net income was less than ten per cent upon the capital stock. In one year it exceeded that amount. Upon the whole, it exceeded an average of ten per cent from the commencement of their operations, unless the stockholders are to be credited with interest upon the deferred dividends. Whether they are to be so credited depends upon the meaning of the statute. The referee ruled that such meaning, or the intent of the parties, was a question of fact, and he passed upon it as such. The defendants now contend that this finding is conclusive, and cannot be reviewed here. It was based upon the statement that "the interpretation of this charter, like the interpretation of any other grant, statutory, contractual, or testamentary, is the ascertainment of intention; and the question of intention is a question of fact to be determined upon competent *434
evidence." Burke v. Railroad,
There is a finding as to the amount distributed to stockholders, but whether it was taken from the net income is left undetermined. Until this fact is found for the state there can be no recovery in this suit. "The state in this action stands precisely as an individual in a like action. It is subject to the same rules of law and evidence. It has no greater power, rights, or privileges than any plaintiff. It must establish the defendants' legal indebtedness, or it must fail." State v. Railroad,
It appears that this objection was seasonably made at the trial. It was claimed by the defendants that a large part of the sum recovered in their suit against the Concord Railroad, and distributed as dividends, was an award for their rights in certain property and of interest upon payments of income which should have been made at a time when the principal sum would not have exceeded the legal limit of dividends. The referee did not pass upon the question so raised because, as stated in the report, it was immaterial in the view he took of the method by which the legal limit for dividends was to be determined. The question now becomes material. "It often happens that grave and difficult questions of law arise, . . . which disappear upon an investigation of the facts. In these cases, it is clear that the facts should be found before an attempt is made to settle the law controlling the rights of the parties." Fellows v. Fellows,
The report should be recommitted for further findings of fact.
Case discharged.
CHASE, PIKE, and YOUNG, JJ., did not sit: the others concurred. *436