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The American law register, Volume 12 online

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legislative power, and that therefore laws may be made dependent
for their existence on any contingency. Indeed, Chief Justice
Rbdfield himself says, every contingency must be an equal and
fair one — a moral and a legal one — and %ofar connected with the
object atid purpose of the statute as not to be a mere idle and
arbitrary one. This is a qualification much greater than we shall
insist upon.

But in truth, all these laws of Congress are legitimate exer-
cises of legislative power, though depending upon the contingen-
cies mentioned.

It has often been said that a law cannot be made to depend
apon the will of any other than the legislative power. But this
is too broad. What is meant is, that a law, a rule laid down,
cannot be made by the legislative body where the legislative body,
in pretending to make it or lay it down, makes it in such terms
that it is the plain intention of the legislative body that it shall
not be law unless the very %ame law receives the sanction and
allowance of some other than itself.

There is a sense in which all laws depend upon the will of
others than the will of the legislator. No one will be obnoxious
to the penalty of a law or be entitled to its reward, unless he
wiDs to do the thing upon the doing of which the statute de-
nounces the penalty or promises the reward. It is plainly not
the intention of the legislative body in such cases to ask for its
law the approbation of the subject of its law, but to command
and exact the obedience of the subject.

This is the test — does the legislature ask the approbation of
the subject or of any one else before the law shall bind, or does
it command his obedience to the law ?

The laws of Congress, which are referred to by Chief Justice
RlDFiELD, are dependent upon the will of the foreigner — the laws,
edicts, orders and acts of foreign states, Iheir officers and people —
only in this sense. " If you will to do this, if you enact that —
if jou declare, proclaim or order the other — this shall be the law


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that wc will enforce." But in dealing with our own people, we
make laws which depend upon their overt acts.

As it would be unjust to make commercial regulations against
a whole nation because of the isolated acts of a single subjeet,
we do not consider the act of one foreigner to be the act of the
nation whose conduct it is the object of our regulations to bind
and control ; and therefore our laws describe and provide against
not the acts of individual foreigners, but the will of the nation,
expressed by its laws, edicts, orders or accredited public acts.

Our commercial regulations are not, ''if a single foreigner
shall do so and so, thus and so our officers shall treat him ;" bat,
*^ if the nation wills so, enacts so, issues such orders, proclama-
tions, or having them already, continues them in force, thus and
so shall our officers treat the whole nation." Do such provisions,
does such reference to the will, the laws, declarations and orders
of a foreign power by Congress show any intention that our laws
shall not be in force unless the foreign nation shall give its sanc-
tion and allowance to the same rules which we establish agamtt
them ?

Their approval of oar laws is the last thing we expect of them.
We do not leave to them to establish the same rule we establish ;
and declare, that until they do, our rule shall not be put in force.
We put it in force designedly against their will, and to coeroe
their will and their conduct, to alter their regulations. Their
assent to our rules would be idle, nugatory and absurd. Oor role
is penal, and against them.

They could not assent to the rules we lay down for our peqple
to treat them harshly. Wo do not permit them to assent to theoi ;
for it would be an assertion of jurisdiction over our territory and
officers. They would be declaring hostility against themselves to
re-enact our laws against them. We make them so that it wiU
be impossible for them to assent to them — to induce them to alter
their conduct outside of our jurisdiction.

Is this giving up our legislative power over our own territory T
Is it not indirectly extending it, instead of handing ourselves over
to them and their will, and saying, '' we enact this or that, whieh-
ever you like best, whichever you say shall be the rule. "

This would be a delegation of our legislative power. But iflmi
we do say to them is this : '^ We enact this in the United Staines,
because you have enacted that in your territory." We do not


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say: "We enact thU in the United States because you have
enacted the same in your territory." In the foreign case there is
no accord between the rules — they do not apply to the Bame place
nor to the Bame (although to a like) subject-matter.

In the domestic case there is not only accord between the rules,
bat they are the very same in terms— operate in the same place,
over the same subject-matter, and the donor and the donee of the
power are at one. But there is no donor in the other case. The
attitude of Congress is anything but that of donor ; it is that of
«a adversary. It makes the regulations, that it may be a donee.
In the one case the legislature gives away its legislative power ; m
the other it makes the utmost exertion of the power possible. *It
operates extra-territorially and beyond its jurisdiction, by a vigor-
^ons, hostile and unsparing exercise of its power within its juris-
diction against all subjects of the foreign power, whose will the
advocates of local option would have us believe we thereby pro-
pose to gratify to the same extent and with the like subserviency
jthat a legislature does, which declares its laws shall take effeot
imlj when the people choose to consider them binding.


Supreme Court of Mi$8ouri.

A railroa4 corporation cannot lawfully take, hold and deal in real estate for
etlier purposes and to a greater extent than it is authorized so to do by its charter,
bit the amount of lands which soch corporation can legally hold, can only be d«-
termined by a direct proceeding against the same by the state for » violatioD of its

While a contract to convey to such corporation land which is not to be nsed for
the purpose for which it is authorized by its charter to hold real estate cannot be
ipeelfically enforced in a court of equity, yet a deed made to such corporation, and
by the corporation to a third party, operates to oonrey all the title of ihe orighaU

Thb opinion of the court was delivered by

Adams, J. — This was an action of ejectment. Berth parties
olwned under one James C. McEeehan, who was the patenNe
under the United States Sor the land on which the lot in coirteo-
versjr was situated.

The defendants claim title through the Padfio RailrMd €Imk
pany, or rather through Fredmck S. BcUoiiy trustee for th'e solb


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use and benefit of the Pacific Railroad Company. The deed to
Bellon embraced one hundred and fifty-one town lots, distributed
alternately throughout the town of Knob Noster, situated on the
line of said railroad, and five and a half acres of depot grounds,
and was executed to the said trustee in 1858, for the use of said
company, for and in consideration of the sum of one dollar and
the benefits which the grantor expected to obtain from the loca-
tion of a passenger and freight station upon the land thereby con-
veyed ; and the deed also authorized a sale by the trustee of all
such portions of the real estate thereby conveyed, as should not
be required for the purposes of Said road, at such time and in
such manner as the board of directors of said company should
deem most conducive to the interest of said company.

The defendants claimed title under and through this conveyance
to Bellon, and have the oldest paper title, provided the deed to
Bellon as trustee is valid.

Numerous instructions were given and refused, raising the
question as to the power of the Pacific Railroad Company to take,
hold and dispose of the lands in question ; and the Circuit Qourt
having decided these questions in favor of the defendants, the
plaintiff has brought the case here by appeal.

The quekion as to the power of the Pacific Railroad Company
to receive grants of land, and to dispose of them, depends upon
the proper construction of its charter and the laws of this state
referring thereto.

By the first section of the charter, among other things, it is
provided that it " may hold, use, possess and enjoy the fee simple
or other title in and to any real estate, and may sell and dispose of
the same.** (See Laws of Missouri, 1849, p. 219.)

The seventh section of this act was amended in 1851 (see Laws of
1851, § 9, p. 272), when it was provided that " said company shall
have power to locate and construct a railroad, &c., and for that
purpose may hold a strip of land not exceeding one hundred feet
wide, except where it may be necessary for turn-outs, embank-
ments or excavations, in which case they may hold a sufficient
width for the preservation of their road, and may also hold suffi-
cient land for the erection and maintenance of depots, landing-
places or wharves, engine-houses, machine-shops, warehouses and
wood and water stations."

Section twenty of the Act of 1849, above referred to, provides


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that " the operations of said company shall be confined to the
general business of locating, constructing, managing and using
said railroad, and the acts necessary or proper to carry the same
into complete and successful operation."

By section fifty-seven of an act entitled " An Act to authorize
the formation of railroad associations, and to regulate the same,"
approved December 13, 1865, it is provided that " all existing
railroa(J corporations within this state, and such as now or may
be hereafter chartered, shall respectively have and possess all the
powers and privileges contained in this act, and they shall be
subject to all the duties, liabilities and provisions not inconsistent
with the provisions of their charter contained in this act."

Among the privileges referred to in this section are those con-
tained in section 29 of the same act (see First Revised Laws,
1855, p. 425), which provides that such company may " take and
hold such voluntary grants of real estate and other property as
may be made to it to aid in the construction, maintenance and
accommodation of its railroad, but the real estate received by
Voluntary grant shall be held and used for the purpose of such
grant only."

It may also '^ purchase, hold and use all such real estate and
other property as may be necessary for the construction and
maintenance of its railroad and the stations and other accommo-
dations necessary to accomplish the object of its incorporation."

From these enactments it is evident to my mind that it was the
intention of the legislature to invest the Pacific Railroad Com-
pany with power to take two classes of real estate ; one class it
had the right to receive and dispose of at pleasure, for the pur-
pose of aiding in the construction of its road, or for raising funds,
to pay debts contracted in its construction, &c. : the other class
it can only hold for depots, road-beds, &c.

The history of the country shows that this is the proper con-
struction of the acts referred to. From the time the charter was
granted, donations of real estate to aid in its construction have
been, made all along the line of the road, and titles have been
acquired and investments made on the faith of this being the
proper construction of the charter. It is true that this company,
Uke all other corporations, is subject to all the limitations ex-
pressed in the charter, but the charter and the laws above referred
Vol. XXL— 10


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to expressly authorize grants of land to be made to aid in the
construction of the road.

The state considered this railroad company able to receive the
lands donated by Congress without any enlargement of its char-
ter, and accordingly made the grant to aid in construction of the
main trunk line to the bifurcation of the south-west branch, and
from that point to apply the lands to the south-west branch.

Although this railroad company may receive grants of land^
and sell and dispose of the same for the purposes of its construc-
tion and payment of its debts, &c., it cannot become a larger
landed proprietor for purposes not connected with its creation.
But the amount of lands it may receive cannot be decided be-
tween these parties ; conceding the power to receive lands for the
purposes aforesaid, no one, except the state, can raise the ques-
tion as to the amount that may be received. This was decided by
this court in the case of Chambers v. The City of St. LouiSy 29
Mo. Rep. 576-7 ; also by the Supreme Court of the United States
in the case of Meyer v. Croft^ reported in 11 American Law Reg-
ister 308 ; see also, to the same effect, Smith v. Sheely^ decided
by the Supreme Court of the United States at the December Term

Judge Scott, in Chambers v. City of St, Louisy says, delivering
the opinion of the court, " There being a right in the city to take
and hold lands, if there is a capacity in the vendor to convey, so
soon as the conveyance is made there is a complete sale, and if
the corporation in purchasing violates or abuses the power to do
so, that is no concern of the vendor or his heirs. It is a matter
between the state and the city."

So this question can only arise in a direct proceeding by the
state against the Pacific Railroad Company, and not in a collate-
ral proceeding like this.

The case of the Pacific Railroad Co. v. Seeley's Heirs^ 46
Missouri 212, was a suit in equity for the specific conveyance of
lands, and not an executed conveyance. That case went off on
the ground that the contract in question upon its face showed that
it was against public policy. The petition was demurred to and
the demurrer was sustained by the Circuit Court, and the judg-
ment of the Circuit Court was properly affirmed by this court,
on the ground that, the contract was void as. being against public


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There is a manifest distinction between executory and executed
contracts ; ' whilst a party may not be compelled by a court of
equity to carry a contract into specific execution, yet if he should
voluntarily make a deed, it will be good to pass all his title.

The case of The State v. Commissioners of Mansfield^ 8 Zabris-
kie's Rep. (N. J.) 610, so strongly reliea on by the counsel for
appellants, is not in conflict with any of the doctrines here laid
In that case the Camden and Amboy Railroad and Transporta-
tion Company claimed that certain real estate, consisting of houses
and lots owned by that company and let by them to their work-
men and employees, were exempt from taxation under a clause in
their charter exempting the " company from all further taxation. "
The court held that this property was liable to taxation, whilst the
road-bed, turnouts, &c., were exempt, thereby holding that there
were two classes of real estate which the company had the power
to acquire and hold, the one being liable to taxation and the other
exempt. The same doctrine was maintained in Massachusetts in
the case of The Inhabitants of Worcester v. The Wilson Railroad
Corporation^ 4 Met. 564, which is looked upon as a well-considered
case. See also Whitehead v. Vinyard^ decided at St. Louis by
this court, at the March Term 1872, not reported.

Under the view we take of this case, the judgment must be

The above decision will be read with
^rcat interest bj the people of the state
in which it was rendered. There has
been in Missouri a large amonnt of rail-
road town speculation. Connties have
subscribed liberally to the building of
railroads, with the understanding that
, when constructed they were to pass
through and thus benefit certain towns
and cities therein ; and towns and cities
hare subscribed expecting they were to
pass through their incorporated limits;
but not unfrequently the railroad com-
panies would purchase, or take by gift,
lands adjoining or lying near to such
mnnieipiilities, and with the aid of their
railroad lay off and establish new towns
or additions — thus destroying the value

of the property of their benefactors to fill
their own treasuries.

But as a general thing such lands
were immediately laid off into town-lots
and sold to third parties, who entered
upon and improved them under their
titles from the railroad companies.

The companies in such instances were
only authorized by their charters to hold
lands sufficient for their road-beds, de-
pots, landing-places, &c.

In this condition of things the Su-
preme Court of Missouri, in the case
of the Pacific R, R, Co. v. Seehy et at.,
45 Mo. 312, which was a suit for specific
performance of a contract to lay off into
town-lots one hundred and sixty acres
of land, and to make a deed to an undi-


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Tided fourth part thereof to the railroad
company, held that the company had no
power or capacity under its charter to
take or hold the property. The court
says : ** The act of incorporation gave
the plaintiff the power to acquire a strip
of land, not exceeding one hundred feet
wide, for a right of*way, and to hold
sufficient ground for the erection and
maintenance of its depots, landing-
places or wharves, engine-houses, offices,
machine-shops, and wood and water sta-
tions; but it conferred upon it no au-
thority to became a real estate broker or
speculator in town-lots. I think the
contract, so far as it proposed to invest '
the company with the title to the lots,
was utterly void.*'

The general principles on which this
case was made to turn, as stated by
Chief Justice Marshall, in Dartmouth
College v. Woodward, 4 Wheat. 518,
that ^* A corporation being the mere
creature of law, possesses only those
properties which the charter of ita incor-
poration confers upon it, either expressly
or as incidental to its very existence," is
recognised by all the cases : Beaty v.
KnowleSf 4 Pet. 152.

When the decision in Pacific R, R,
Co, V. Seeley et al. was made, it was ge-
nerally thought that it would unsettle
the title to all property held by deeds
from the railroad companies througbout
the state, but the effect of the above de-
cision is to render such titles perfectly
good, and by a process of reasoning
which we think is wholly unanswerable.

In Smith v. Sheeley, 12 Wall. 35,
the Supreme Court of the United States
decided that the capacity of a corporation
to take and hold real estate could not be
raised collaterally. The court says:
" It is insisted, however, as an addition-
al ground of objection to this deed, that
the bank was not a competent grantee to
receive title. It is not denied that the
bank was duly organized in pursuances

of the provisions of an act of the legis-
lature of the territory of Nebraska, but
it is said it had no right to transact
business until the charter creating it was
approved by Congress. This is so, and
it could not legally exercise its powers
until this approval was obtained ; but
this defect in its constitution cannot be
taken advantage of collaterally. No
proposition, is more thoroughly settled
than this, and it is unnecessary to refer
to authorities to support it. Conceding
the bank to be guilty of usurpation, it
was still a body corporate de facto, ex-
ercising at least one of the franchises
which the legislature attempted to confer
upon it; and in such a case the party
who makes a sale of real estate to it is
not in a position to question its capacity
to take the title after it has paid the con-
sideration for the purchase."

In the subsequent case of Myers v.
Crojl, 13 Wall. 291, b. c. 11 Ameri-
can Law Register 308, the same court
says : '* In relation to the first objection,
that the Sulphur Springs Land Company
was not a competent grantee to receive
the title, it is sufficient to say, in the ab-
sence of any proof whatever on the sub-
ject, that it will be presumed the land
company was capable, in law, to take a
conveyance of real estate. Besides,
neither Fraily, who made the deed, nor
Myers, who claims under him, is in a
position to question the capacity of the
company to take the title after it has
naid to Fraily full value for the proper-

The result of these decisions is, that
neither a grantor, or any one claiming
under him, can questign the capacity of
the grantee to take and hold real estate,
and therefore a title coming through a
railroad or other corporation, is good,
without reference to the charter, as
against such vendor and his privies.
H. B. Johnson.


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Supreme Court of Michigan.

DWIQHT MAY, Attorney-General, on relation of COOK and others p.

The Attorney-General has the right to enjoin in equity an abase of a corporate
franchise, as for instance, the payment of money by a municipal corporation on a
contract made in disregard of its charter.

But to warrant his interference the abuse must be one of a substantial nature, and
not one merely technical and unimportant. It should appear that the public has,
a substantial interest in the question ; the right involyed should be a public right,
or at least not a private right merely ; the wrong done or attempted, if it consist
in a misuse or misappropriation of funds, should be either one involving questions
of public policy, or, when that is not the case, the amount involved should be
something more than merely nominal ; something it is not beneath the dignity of
tlie state to take notice of and protect by such a proceeding.

Where contracts for paving city streets are required by law to be let to the lowest
bidder, the purpose is to secure such competition as the nature of the case will
admit ; and something is necessarily left to the discretion of the city council in
determining what course will best accomplish that end.

It is not illegal under such a law to call for proposals for the putting down of
the various kinds of wood and stone pavement, thus putting them in competition
with each other ; and then when the proposals are in, select for putting down the
kind for which the most satisfactory bids, all things considered, are received.

But when the kind is thus selected the lowest bidder therefor has an absolute
right to a contract.

Where, however, the Common Council awarded the contract to the highest of
two bidders, but the difference in the bids was less than two hundred dollars, and
less than thirty dollars of this was to be paid by the city, the rest being a charge
upon lot-owners, and the contractors went on without objection and incurred large
expenses, and the lot-owners did not complain, Heldf that the amount involved
was too insignificant to warrant the intervention of the Attorney-Gteneral, espe-
cially as there wtis no ground for charging the Common Council with intentional
wrong, and the error, if any, was one of judgment only.

Appeal from Wayne Circuit. Opinion by

CooLEY, J. — The right of the Attorney-General to proceed in
equity to enjoin an abuse of corporate power consisting in the
appropriation of corporate funds in a manner not justified by law,
appears to me to rest on sound principles. The municipality and
its citizens are not alone concerned in such an abuse. The cor-
porate powers have been conferred by the state, with such restric-
tions and limitations as were thouglit important, some of which
were imposed for the protection of the corporators against unjust
and oppressive action of oflScials and others from considerations
of general public policy. It can never be admitted that because


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the corporation and its members in general, or even all of them,
consent to or connive at the setting aside of these restrictions and
limitations, the state, which deemed them important, shall not be
at liberty to complain, for this would be to annihilate the just and
necessary supremacy of the state, and to make the corporators
sole judges of what franchises they should exercise and what
powers the corporation should possess over them. It is the right

Online LibraryDonald FraserThe American law register, Volume 12 → online text (page 17 of 102)