Fort Worth gazette. [volume] (Fort Worth, Tex.) 1891-1898, 1891-09-10

Other propositions subsidiary to and in
support or the first proposition. are stated
IN this and the supplemental brief fled by
the same counsel
Counsel for the receiver, anu the attOr-
ney-general for the state, among other pro-
positions, contend that I railroad continues
10 be public highway aS well after judg-
Elent forfaiting the charter Of the corpora
ton as before; and that the right of the
state 10 have the road maintained and prop
erly operated IS paramount 10 the rights IF
stockholders. mortgages and other credit
Ors; that is TO say. the property interests Of
stockholders and mortgages may properly
be charged with the expense OF maintaining
the road SO as 10 render safe and efficient
service to the public" And they maintain
that as one OF the grounds of forfeiture was
the failure Of the corporation 10 keep its road
III such repair Is the public interest re
quIred. and as il IS still III like bad Conti-
ton, that the court should cause it To be
placed in proper condition before releasing
it from the custody Of It's receiver.
l. That when a railroad las been con-
structed under charter from the state,
comforting valuable franchises aud privil-
eges, including the right OF eminent domain.
the corporation IS legally obligated 70 main
tain and operate il. Is Il doctrine clearely
established. - Wood on Railways. section
499; State vs.. Mimi. and Cent Railroad
ApAilFtliiA1 -hitA anu Otitl NsA>t'n
40: : Beach on Corporations. p. 1910: Gates
rs. BastOn & [. Railroad Company ;i3 Conn.
333 Meyer vs.. johnson, - Ala. :3,331. l'al-
colt vs.. Pincgrove. Flippen, 800 and T.,
Wall, $50; Long Branch ana Sea Shore rail
road case u y. J. Ed, 39S; State V. Rail
road Company, % Conn. 5SS.
,. The proposition just stated IS not con-
troverted by resisting counsel. but their
contention is. that while the state might 10y
an appropriate proceeding have compelled
the corporation TO discharge its corporate
duties, including the maintenance anu oper-
alton of its railroad, yet, having elected 10
revoke the charter and take the life of the
corporation, those who succeed 10 It's prop
erty rights take them free from all obiiga-
tiOns to the public, and that while they may
if they wish maintain and operate the road
as public highway, they cannot be re-
quired 50 TO do.
II IS true that the contract between them
which was the charter-and laws in force
when it was granted, and such as were
thereafter enacted ami accepted by the cor
pCratiOn, fixed the richts and obligations of
the state and the corporation, and
that the forfeiture Of the charter freed
the corporation from all obligations. 1t
does not follow. however, that tine death Of
the corporation left its property free from
its duties and obligations TO the public II
the revocation of the charter res cred 10 the
state all the rights and privileges which mad
been granted by the charter TO the CORPORA
ton, then it may be true that those who
succeeded to the property take it disc harged
from any public trust. But, il. on the COLI
trarv, any of the valuable rights granted
by the state We're not restored BY the for
fixture, but adhere To and pass with the
railroad itself, then on principle, it appears
Just and right that such property carrying
with it a valuable franchise. should also
aT
duty. The franchise TO maintain and operate
Il railroad Is Il property right, ye' q dissolU-
ton OF the corporation docs not restore this
franchise to the state, but il remains is an
incident TO the railroad and becomes the
property of the stockholders. This was
expressly decided in People vs.. O'Bren.
Iii New York. page / See also Rail
road Company Us. Commission, liz Supreme
Court United States, GOg Railroad Com
pany vs.. Delaware, iii Supreme Court
United States. SOL.
The franchise 10 operate railroad may.
in some Instances, he assigned. and such
franchises are frequently mort%aged and
thereby transferred from the corUorati9n
As to the effect Of such transfers. h!r
Beach says: In the case of uuasi-public
corporations, when such franchises as the
right of eminent domain or The right TO
maintain and operate y railway are trans
ferred by virtue Of foreclosure proceedings,
the purchasers take them subject 70 the
Obligations to the public which their pos
session imposes = Beach OIL Corpora
tons, p 1910.
L is the possession OF ownership OF the
franchise to maintain and operate rail
road which imposes the obligation so TO do.
No sound reason is perceived why the man
her OF acq Llriug the franchise can affect the
If purchaser of such
franchise, who, prior thereto, was not in
terestcd III the corporation, takes ii charged
with the duty OF its execution. surely when
the life of the corporation is taken because
of its failure 10 execute the franchise. the
execution of which Is a condition upon
which this and other valuable rights are
granted, and this valuable franchise IS not
restored to the state, but passes with the
physical property of corporation to It's
several stockholders they take ii charged
with at least the same obligations and du-
ties that purchaser docs. Besides the
right to be 4 corporation, the essential
rights granted We're first, the right of
domain; second, the right to con-
struct railroad, and third, the right to
maintain and operate the road for private
gain.
II is not shown to what extent the first
right was exercised.
The second was eNecuted-the road was
constructed
Upon the dissolution o. the corporation
the third right passed with the railroad, TO
the stockholders, for whose pecuniary ben
eft the corporation was created.
So. having obtained the benefit of the
essential rights granted by the state, the
stockholders. or those who succeeded to
their rights. ought to perform whatever re
mains uuperformcd Of the consideration
which moved he state TO grant the rights
In Gates vs.. Railroad Company, 50 Conn.
supra, it is said: Upon principle, it !
would seem that railroad property once
devoted and essential to public use, must
remain pledged TO that use, SO as 10 carry
10 full completion the purposes of its creti-
lion: and that this public right, existing by
reason of the public eXigency, demanded by
he occasion and created by the exercise Of
j private person of the powers of state. IS
superior to the property rights of corpora
ions. stockholders and bondhol6ers. =
1t is apparent that the bondholderS
oaned the money and took their bonds with
,ull notice that the security for the loan
was first pledged to the performance of 4
public trust. The necessary conclusion is,
hat the state has right to enforce the
continuous exercise of the corporate pow
.rs and franchise for public use, to the ex-
laustion of the value of such property and |
franchise; and this is true. no matter what |
private right may embrace the title of the |
Besides what has already been said the |
Constitution of the state (section .. article |
o. declares all railroads to be public high |
ways. and the act of March 90, 1889, Gen |
,ral Laws, page 2O) providing for the sale |
If railroads and authorizing purchasers to |
incorporate. declares: Nor shall the main |
rack of any railroad, once constructed and |