Story v. Jersey City & Bergen Point Plank Road Co.

16 N.J. Eq. 13 | New York Court of Chancery | 1863

The Chancellor.

Most of the points discussed by counsel upon the hearing, and upon which the decision of the present application in any degree rests, are free from serious doubt or difficulty. At the present stage of the cause they will be disposed of without further discussion, by stating briefly the grounds of the decision.

I am of opinion—

1. That the occupation of a part of the ancient highway on which the plank road is constructed, by the railway, with the consent of the plank road company, without the personal consent of the complainant, the plank road company having been authorized by the legislature to lay rails upon their road, is no violation of the rights of the complainant, as a stockholder of said company.

2. That the sale by the plank road company of the whole or a part of their road to the railroad company, without the personal consent of the complainant, is not such an infringement (if any) of the complainant’s rights as a stockholder, as this court will interfere to restrain by injunction.

3. That a change of the route of the plank road by authority of the legislature, at the instance of the plank road company, is not a fundamental change of the objects of the company, nor a fundamental alteration of the structure thereof, which equity will restrain at the instance of a stockholder.

This disposes of the motion, so far as an injunction is asked to protect the property of the complainant or his rights, from any violation by the acts of the defendants under existing laws.

But the court is further asked, that the plank road company may be perpetually restrained from making any application to the legislature for authority to abandon any part of their plank road, or to alter fundamentally the structure of the said company; and that the said company, its officers and promoters, may be perpetually enjoined from aiding and abetting such application.

f This, it is believed, is the first instance in this country, of an application to a court of equity to restrain, by writ of injunction, an application to the legislature for any purpose, either of public or private concern.^ It is admitted that there is no American precedent for the exercise of such power. This fact in itself, though not decisive, is a persuasive argument against the propriety of its exercise. In England, though applications to parliament have been restrained by injunction, the practice is of very recent origin, and there are but few reported cases of its exercise. It was adopted by Vice Chancellor Shadwell, in 1831, in Cunliff v. The Manchester and Bolton Canal Company, and in Ware v. The Grand Junction Water Works Company, 2 Russ. & M. 470, and note. The former case was compromised without appeal; the latter was reversed on appeal by the Lord Chancellor.

In The Stockton and Hartlepool Railway Company v. The Leeds and Thirsk and The Clarence Railway Companies, 2 Phillips 666, (1848), an injunction was granted by Vice Chancellor Shadwell to restrain a railroad company from opposing a bill brought before parliament by another railroad company, for the amalgamation of the two companies. On appeal the injunction was dissolved upon the merits, though the jurisdiction of the court was maintained by Lord Oottenham.

In Heathcote v. The North Staffordshire Railway Company, 2 Macnaghten and Gar. 100, (1850), an injunction was granted by the Vice Chancellor, restraining the defendants from making application to parliament for any act to authorize them to abandon certain branch railways, or to authorize anything to be done or omitted by the company, inconsistent with, or repugnant to, a covenant entered into by them with the complainant. This injunction was also dissolved by Lord Oottenham upon the merits. In no one of these cases was the injunction restraining a party from making-application to parliament, either in support of or in opposition to a bill, finally sustained.

There are a number of cases in which the court have enjoined a corporation having funds for distinct objects, from using them to promote an application to parliament for a fundamental change in their charter. But this, it is obvious, is an exercise of power resting on very different principles. It is simply a restraint upon the corporation of a diversion of its funds from the purposes for which they are held in trust to other and different purposes. The Attorney General v. The Corp. of Norwich, 16 Simons 225; Munt v. The Shrewsbury and Chester Railway Co., 13 Beav. 1; Stevens v. The South Devon Railway Co., Ibid 48; The Great West. Railway Co. v. Rushout, 5 De Gex and Small, 290, (10 Eng. Law and Eq. 72); Simpson v. Denison, 10 Hare 51, (16 Jur. 828).

The rule seems to be well settled in England, that a court ••of equity will not, either at the instance of a stockholder or bf a third party, restrain a corporation from applying to parliament for an alteration of its charter.

As has been already intimated, the jurisdiction of the Court of Chancery to restrain a .party from petitioning parliament for or against a measure, has been repeatedly affirmed by the English Chancellors. Thus, in The Stockton and Hartlepool Railway Company v. The Leeds and Thirsk and The Clarence Railway Companies, Lord Cottenham said: “There is no question whatever about the jurisdiction; a party who comes to oppose a railway bill in parliament, does so solely in respect of his private interest, not as representing any interest of the public, or for the purpose of communicating any information to parliament. This court, therefore, if it sees a proper case connected with private property or interest, has just the same jurisdiction to restrain a party from petitioning against a bill in parliament as if he were bringing an action at law, or asserting any other right connected with the enjoyment of the property "or interest which he claims.” And in the earlier case of Ware v. The Grand Junction Water Works Company, Lord Chancellor Brougham said.: “ It is quite idle to represent this as an attempt to restrain by injunction the proceedings of parliament.”

It will be freely admitted that the injunction operates directly, not upon the legislature but upon the party enjoined, and in no wise interferes with the exercise by the legislature of its rightful powers. But I cannot resist the conviction that such exercise of power, under our form of government, is an infringement of the rights of the people and of their representatives. If not a direct infraction of the bill of rights and of the letter of the constitution, it is in conflict with the spirit of republican government and the structure of its institutions. Every citizen has an unquestioned right to petition either branch of the legislature upon any subject of ^Legislation in which he is interested. Every legislator has a right to be informed of the views and wishes of all parties interested in the enactment of a law. This right to perfect freedom of intercourse between the representative and his constituents is not founded upon any constitutional provision or bill of rights, but springs from the very structure of the government. By what authority shall this court step between the representative and his constituents, and deny to the one or the other the exercise of his political rights in their fullest freedom ? It is conceded that the legislative powers cannot be trammeled by inj unction. The legislature can neither be restrained from legislating upon any subject, nor from exercising their authority to obtain information upon any matter of legislation. And if the legislature cannot be restrained from asking the information, can the citizen be restrained from giving it ? Are the rights of the representative more sacred than those of his constituents ? It appears to me that the granting of such injunction is an unauthorized abridgment of the political rights of the party enjoined. The proper office of courts of of justice is to maintain and enforce the legal and equitable rights of parties litigant, as established by existing law. It is no part of their office to determine in advance what laws ought or ought not to be enacted, or to interfere, directly or indirectly, with the course of legislation.

The complainant’s bill is framed upon the theory that the charter of an incorporated company cannot be altered in any essential particular, even with the consent of the corporation, without the consent, express or implied, of every stockholder; and that such alteration would be unconstitutional, as impairing the obligation of the contract entered into between the state and such stockholder. If this doctrine should be admitted in its fullest extent, it is not perceived that it can affect the result of the present application.

When the charter of the Jersey City and Bergen Point Plank Road Company, of which the complainant claims to be a stockholder, was granted, it was provided by a general law of the state that the charter of every corporation granted by the legislature should be subject to alteration, suspension and repeal, in the discretion of the legislature. The legislature, therefore, in granting the charter to the plank road company, must be deemed to have reserved to themselves the right of altering, suspending, or repealing the charter, whenever, in their discretion, the public good might require it, as fully as if the reservation were inserted in the charter. And all the contracts, express or implied, resulting from the act of incorporation and its acceptance by the stockholders, must be deemed to have been entered into by both parties, subject to that reservation. Whatever limitation may exist to the reserved right of the legislature to alter or repeal the contract, I am clear that the reservation is in itself valid, and that this court ought not, upon a motion for a preliminary injunction, to pronounce any alteration, suspension, or repeal of the charter to be unconstitutional or illegal. Much less should this court make such declaration in advance of any actual legislation.

The plank road company were incorporated with power to construct a plank road upon an ancient public highway and with the franchise of taking tolls thereon. No limit is fixed for the duration of the charter. The legislature have since incorporated a company to construct a horse railroad between the same termini. They have authorized the railroad company to purchase the plank road. They have also authorized the plank road company to lay rails upon their track. They have, however, provided that if the plank road is purchased by the railroad company, the plank road shall be continued; and if the rails are laid thereon by the plank road company, they shall be so laid as not to hinder or obstruct public travel. It must be presumed that the public convenience demanded the increased facility to be afforded by the construction of the railroad. Of that the legislature were the peculiar exclusive judges.

The complainant, a' stockholder in the plank road company, now asks that the company shall be restrained from making any application to the legislature to abandon or change any part of their route, for this, it is insisted, would be fundamentally changing the objects of the company without his consent ; and that the railroad company, its officers, stockholders and promotors, shall be enjoined from aiding and abetting such application. If this claim have any foundation in law or in equity, which is by no means admitted, and if it be recognized, it would place it in the power of a single stockholder, for his own pecuniary interest, against the wish of every other stockholder and the convenience of the whole community interested in the line of travel, to prevent even a petition for a change.

The injunction is denied without costs.