The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1897-07-23

sUEEEsL
declaration by the people OF Indiana in
their Constitution namely, corporations for
business and profit may De formed under
general laws left the Legislature at lib
erty TO decide that such corporations could
not be formed under general laws.
In the case at bar the charter agreement
between the corporation and the State on
the matter of rates, as expressed in Section
of the act of 1861, subject TO the condi-
tons in Sections u and II, was the chief
consideration which induced the acceptance
OF the charter by the corporators, the ex-
pcnditureS by the corporation in the streets
of Indianapolis and the investment in the
Under Section II the security, aside from
the wisdom and fairness of the Legislature
othefWlse than by an enactment which
would still leave the law as a whole gen
eral and of uniform operation upon all cor
poratlons formed or to be formed under it,
or at least upon all such corporations
formed or to be formed as could be as
sociated for legislative purposes by any
germane and appropriate classification No
such classified ton is made by the act of
1877. TO the contrary, upon this proposition
| find nothing in the opinion in the Navin
case. | may here add that, while the con-
stltutonal inhibition is against local or
SPECIFIC laws, the court rules in the Navin
case that it is not material whether the act
of 1897 be local or not, the decision rest
ing upon grounds entirely distinct from
that question.
THE CONTRACT ANALYZED.
1.-THE charter contract says: This act
may be amended at the discretion of the
Legislature Is the enactment of 1897 an
amendment to this act within the meanA
ing of the foregoing reservation? This Is
the question-and it concerns the construc-
ton of the charter contract. Whether the
act of 1897 is an amendment and what dis
erection the Legislature is vested within
other words, whether the act of 1897 would
break, or be in accord with, the contract
depends upon the sense of certain provi-
slons IN the Constitution of Indiana. 1
now call attention more specifically to the
State decision in the Navin case. Mr.. JUS
tice Monks says in the opinion:
" 1t is insisted by appellant that the act
OF 1887 is unconstitutional because it i'm
pairs the obligation of d contract Coun-
sci Tor appellant do not point out any con-
tract the obligation of which is impaired
by said act.
." If it is the contract under which the
street-rallWay company took possession of
It's tracks, it is sufficient to say that
the city was not authorized to en-
ter into any contract which would prevent
the Legislature from legislating upon the
subject of fares. 1t is settled law that the
Legislature has the power to reasonably
regulate the rates of fare for transported
tlon or passengers within the State on
street railways
Here a number of cases are cited; but
they are upon the general proposition that
where there is no charter contract on the
matter of rates, legislation looking to rea-
sonable rates is competent Not one of the
citations concerns any street-railroad cor
poration organized under the act of 1861
Inc opinion proceeds:
g Besides Section II of said act of 1861
belng Section 1863, r. s., 1894 Section A. 153
r. s., 1881, expressly reserves to the Ieeis-
lature the right to amend or repeaI said act
at its discretion.
g The right of the Legislature however.
TO regulate the fare upon street railroads
organized under the act of 1861 does NOT
depend upon the reservation of the right to
amend or repeal the act in Section II of the
act. That power would exist, even if the
right to amend or repeal the act had not
been reserved
How can this be? If Section II were
omitted, the Legislature could not touch
the subject of rates. Note the quotation
made above from the Reagan case Does
the supreme Court of Indiana mean that
where a charter contains no reservation of
power 10 amend, such reservation is i'm
pHed! or that the vested rights of a cor
porat!on- organized under a general incor-
pIoration law which contained no reserva-
ton or power to amend, can be dis
turbed by any subsequent amendment?
The opinion goes or:
IN order to exempt a common carrier
from legislative control over its rates of
fare, 1T must appear that the exemption
was made in its charter by clear and un-
exercise OF such power in the legislature
II Section II had been omitted, then, as
said, the charter agreement between the
corporation and the State would have
been that the directors of the corporation
could fix the rates, subject to no cOndi-
ton or limitation other than the agreement
with the city: AS the case stands, the grant
to the corporation as to the rate is sub
Ject to no condition or limitation other
than the agreement with the city and the
agreement with the State that the Iegis-
lature might within the appropriate consti-
act of 1861.
THE SILENCE AS TO RATES.
eff the learned writer of the opinion
means that, in addition to q contract
covering the subject of rates, there must
also appear in the charter an express
exemption from such legislative action as
might be competent if there were no con-
tract at all-which would be competent for
instance, as respects a carrier chartered by
some other State-I cannot agree with him.
The three citations made by Mr. Justice
Monks, among which are Banking Company
VS.! Smith, supra, and Railway Company VS..
Iowa, supra, are to the point, as above
stated herein, that if the charter contract
cover the matter of rates. legislative inter-
terence in that behalf otherwise than with
in the terms of the contract, is unauthor-
lied. The State opinion goes on:
Appellant (meaning the city of Indian
apolis) had the power to prescribe the
terms upon which and the time for which
street-railroad company organized under
said act of 1861 should occupy the streets
of said city, but such contract when made
was subject to the right of the Legislature
TO amend or repeal said act at its dscre-
ton, and no contract made by the city
with street-railroad company could pre-
vent the exercise of such power by the
legislature
Now follows the conclusion drawn by
Mr.. Justice Monks from those portions of
his opinion herein above quoted:
1t is clear. therefore, that said act of
1897 does not impair the Obligation of any
valid contract of either the State or the
appellant.
IF. in view of constitutional limitations
touching the legislative function as to
laws for the formation or creation of
corporations, the act of 1897 be not COM
petent as an amendment to the act of 1861.
then said act Of 1897 certainly does impair
the obligations of the charter agree
ment, as well as the obligation of the
contract made with the city-and this in
violation of the Constitution of the United
States.
THE learned writer of the state opinion
characterizes the enactment of 1897 "a
mere regulation of an existing corporation.
In so doing he still has reference to the
police power as the untrammeled source of
legislative authority for the enactment
ment. which would leave the act as
amended a special or local law, should be
made. The point is that the enactment
of 1897 is not the kind of amendment which
it stipulated in the charter agreement
could be made. The long settled doctrine
that the twelve sections of the act of 1861
constituted the contract between the State
of Indiana and any corporation organized
tract are ignored in the State opinion The
citations to the proposition that the act of
1897 is "a mere regulation of an existing cor
concern what may be done when
the State is not fettered by it's own agree
ment, upon the face of which the other
contracting party has acted and expended
his money
CANNOT DIMINISH POWERS.