Case Name: The Indiana Central Canal Co. v. The State
Court: Supreme Court of Indiana
Jurisdiction: Indiana
Decision Date: 1876-11
Citations: 53 Ind. 575
Docket Number: 
Parties: The Indiana Central Canal Co. v. The State.
Judges: 
Reporter: Indiana Reports
Volume: 53
Pages: 575–595

Head Matter:
The Indiana Central Canal Co. v. The State.
Canal.—Sale and Conveyance of Central Canal.—Contiguous Land Set Apart for Canal.—The Governor and Auditor of State, on behalf of the State in pursuance of authority conferred on them by law, sold and conveyed to the purchaser by their deed, made in conformity with such authority therein referred to, “ all the right, title, interest, claim and demand which the State may hold or possess in the Northern Division of the Central Canal, north of Morgan county, * ■*' * and the water-power and appurtenances thereunto belonging, including its banks, margins, towpaths, side-cuts, feeders, basins, right of way, dams, water-power, structures and all the appurtenances thereunto belonging, to have and to hold the same in as full and ample a manner as the undersigned are authorized by the laws aforesaid to convey the same.”
Held, in an action by the State against the Indiana Central Canal Company, holding through said deed of conveyance, to recover possession of certain land in the city of Indianapolis, lying contiguous to the portion of the canal conveyed by said deed, that said deed covered any land of the State, so situated, that had been set apart by the State for the use of the canal or water-power in their occupation and enjoyment, or that was necessary to their use and enjoyment.
Held, also, that though the State, by the sale of the canal, abandoned it as a proprietor, yet, the course of legislation showing an intent to encourage its completion and use as a canal, and there being nothing in the case showing that the purchaser or purchasers of the several parts were not to take all that was essential to the use and enjoyment of the whole as. a canal, the purchaser of the part in question took the title of land pertaining to the portion conveyed by said deed essential to the use and enjoyment of the canal viewed as a whole and considered as an entirety, though not essential to the complete enjoyment of the isolated portion so conveyed.
Held, also, that if the land in question, so. lying contiguous to the portion of the canal conveyed by said deed, was set apart by competent Slate authority for the use of the canal or water-power connected therewith, and it did not appear that the purchaser was notified, before he purchased, that the dedication had been revoked, the State could not, in said action, claim that said land was not essential to the enjoyment of the portion of the canal- conveyed by said deed, and the title to said land passed by the deed without reference to the question whether it was essential to the full enjoyment of said portion of the canal.
Held., also, that the word “margins,” as used in the statutes conferring the authority to sell and convey, and in said deed, in specifying the things included in the sale, should be construed as meaning something distinct from the other terms employed to designate what was to be sold and what was conveyed (as the “banks,” “tow-paths,” etc.) ; and it should not be interpreted as meaning a mere water-line, but should be regarded as covering any property belonging to the State adjacent and oh the margin of the canal, which had been appropriated or set apart or occupied by the State, for canal uses, or was reasonably necessary for such uses.
Same.—Statutes Passed at Same Session.—Construction of.—The act of January 19th, 1850, and that of January 21st, 1850, Acts 1850, pp. 21, 22, in relation to the Northern Division of the Central Canal, having been both passed at the same session of the legislature, should be regarded as both standing, to be construed together, the earlier not repealed by the later.
Same.—Extrancotis Evidence to Apply Deed to Subiect-Matier.—The property not being described by numbers or by metes and bounds, either in the statutes conferring the authority to sell and convey or in the deed of conveyance made in conformity with such authority, extraneous and parol evidence was admissible to ascertain whether a particular piece of property, definitely described and ascertained, constituted a “margin,” or “basin,” etc.
Same.—Principal and Agent. — Acts of Special Agent of the State in Excess of Authority.—Estoppel —Rescission of Contract.—As, under said statutes, said officers must be regarded as the special agents of the State, with power to sell and convey said property, and as said property could not be precisely identified by reference to the statutes conferring said power, it was the right and duty of said agents to identify and point out to the purchaser the particular property to be sold; and if either of said agents pointed out or designated to the purchaser particular property belonging to the State, as included in or being part of the property to be sold, that would be competent and prima facie evidence that it was such, and con- elusive until shown by the State not to have been such; but the State was not estopped to show that property thus pointed out or designated was not a part of the property which said officers were authorized to sell; and in such case, the purchaser would not be entitled to hold such property, although the State should not rescind the contract and place the purchaser in statu pio.
Power. — Implied Power. ■—• Delivery of Possession. — The power to sell and convey implies a power to deliver possession of the property to the purchaser.
Vendor and Purchaser.—Delivery of Key of Premises.—-The delivery of a key by a vendor to a purchaser, at the conclusion of a treaty for the sale of property, is a symbol indicative of the delivery of the possession of the house or premises purchased, to which the key belongs.
Erom the Hendricks Circuit Court.
A. G. Porter, B. Harrison, IF. P. Fishbach, C. G. Hines, W. H. II. Miller, G. T. Porter, G. Baher, 0. B. Hord, A. W. Ilendrichs, 8. II. Buslcirh and J. IF. Nichol, for appellant.
J. G. Benny, Attorney General, and G. A. Buslcirh, Attorney General, for the State.

Opinion:
Wojrden, J.
This was an action brought by the State against the appellant, in Marion county, to recover a certain piece of land, situate in the city of Indianapolis, bounded on the east by West street, on the west by Blackford street, on the south by Market street, and on the north by the crosscut of the Central Canal. The venue was changed to the Hendricks Circuit Court, where the cause was tried by jury, resulting in a verdict and judgment for the State, the defendant having unsuccessfully moved for a new trial.
The land, as will be seen by the above description, adjoins the arm of the Central Canal, and was the property of the State, at and long before the date of the deed hereinafter set out. The State executed the following deed:
"This indenture, made this 30th day of June, in the year of our Lord, one thousand eight hundred and fifty-one, between Joseph A. Wright, Governor of the State of Indiana, and Erastus W. H. Ellis, Auditor of said State, of the first part, and Francis A. Conwell, of the second part, wit nesseth, that in pursuance of the provision of an act of the legislature of said State, entitled ' An act to authorize the Governor of Indiana to compromise with, and to cause suit to be brought against the lessees of the water-power of the Northern Division of the Central Canal/ approved January 19th, 1850; also an act entitled 'An act to authorize the sale of the Northern Division of the Central Canal/ approved January 21st, 1850, the said Joseph A. Wright and Erastus W. H. Ellis caused an advertisement to be published in the Indiana State Sentinel, in the Indiana State Journal, also in newspapers of general circulation published in the cities of Louisville, Cincinnati, New York, Philadelphia and Boston, at least sixty days before the sale, setting forth the time, place and conditions of such sale, as specified in said act; and did, on the 16th day of November, 1850, at the door of the Capitol, in Indianapolis, sell to George G. Shoup, James Rariden and John S. Newman, of the State aforesaid, all the right, title and interest of the State of Indiana in and to the portion of the Northern Division of the Central Canal situate north of Morgan county, and all the rents which shall become due after the sale of said property, and the water-power and appurtenances thereunto belonging, and all the right, title, interest, claim and demand which the State may hold or possess in such portion of said canal, including its banks, margins, tow-paths, side-cuts, feeders, basins, right of way, dams, water-power, structures, and all the appurtenances thereunto belonging, for the sum of two thousand four hundred and twenty-five dollars, being more than two-thirds of the appraised value thereof, the said Shoup, Rariden and Newman being the highest and best bidders for the same; which said purchase-money, with interest thereon, has been paid into the treasury of the State of Indiana, by the parties aforesaid, as appears by the receipt of the Treasurer of State, No. 7939, bearing date February 7th, 1851; and whereas the legislature aforesaid enacted a joint resolution entitled ' A joint resolution on the subject of the sale of the Northern Division of the Central Canal/ approved February 7th, 1851, confirming said sale, and directing the Governor aforesaid to convey said portion of said canal, with the rights, privileges and appurtenances thereunto belonging, as sold by him to the purchasers, their heirs and assigns, so soon as said purchasers, their heirs and assigns, shall pay the purchase-money by them severally bid, and executed the bond pursuant to the conditions of sale, to the acceptance of his Excellency, the Governor.
"And whereas the said Shoup, Rariden and Newman, on the 7th day of February, 1851, executed an instrument in writing, and thereby assigned and transferred to Francis A. Conwell, his heirs and assigns, all their right, title and interest in the purchase aforesaid.
"And whereas the said Conwell, on the 30th day of June, 1851, executed and delivered to the Governor aforesaid, the bond spoken of and required in the several acts herein named, to the acceptance and approval of the said Governor.
"Now, therefore, be it known, that by virtue of the powers vested in us, by the acts and joint resolution herein named, we, Joseph A. Wright, Governor of the State of Indiana, and Erastus W. H. Ellis, Auditor of said State, do hereby convey to the said Francis A. Conwell, his heirs and assigns forever, all the property sold, as herein specified, being all the right, title, interest, claim and demand, which the State may hold or possess in the Northern Division of the Central Canal, north of Mohgan county, and all the rents which may have become or shall become due, after the sale of said property, and the water-power and appurtenances thereunto belonging, including its banks, margins, towpaths, side-cuts, feeders, basins, right of way, dams, waterpower, structures and all the appurtenances thereunto belonging, to have and to hold the same in as full and ample a manner as the undersigned are authorized by the laws aforesaid to convey the same.
" In testimony whereof, we have hereunto set our hands and affixed the seal of said State, at the city of [seal.] Indianapolis, the day and the year first above written.
"Joseph A. Weight, Governor.
"Erastus W- H. Ellis, Auditor of State.
'Charles Test, Secretary of State."
The question involved in the case was, whether the title to the property in controversy passed by the deed above set out. If it did not, the State was entitled to recover. If it did, the State ivas not entitled to recover.
The deed was made in pursuance of two acts of the legislature referred to therein. Acts 1850, pp. 21, 22. The latter act contains the following section:
"That the Governor and Auditor of State be and the same are hereby authorized to make sale and dispose of all the right, title, interest, claim, and demand which the State holds in or to the Northern Division of the Central Canal, situated in the State of Indiana with all the water-power and appurtenances thereunto belonging, and the said Governor and Auditor are hereby authorized to convey the same to the purchaser on behalf of the State, in the name of the State of Indiana, all the right, title, interest, claim, and demand, which the State may hold or possess in such canal: Provided, however, that neither the Governor nor Auditor of State shall be authorized to sell said canal for a less sum than two-thirds of the fair appraised value thereof: Provided, that the portion of the canal and appurtenances in the county of Morgan shall be appraised, offered, and made sale of, as a separate and distinct division of the said property."
It is not disputed by the appellee that the Governor and Auditor of State had power to sell and convey the canal, with all the water-power and appurtenances thereunto belonging, but she insists that the property in question was no part of the canal or water-power or appurtenances. The appellant, however, claims that the property in controversy was, before the sale, dedicated and set apart by the State for the uses and purposes of the canal and water-power, and was necessary to the full and complete enjoyment thereof, and therefore, that the title to it passed by the deed.
The appellant asked the following instruction without the proviso, which the court refused as asked, but gave it with the proviso, to which the appellant excepted, viz.:
" N V. If the State had once set apart the parcel of land in controversy to provide sites for the use of hydraulic power, or for warehouses or docks, or for any other canal uses, the land so set apart must be held to have passed by the sale made to Conwell, unless there is clear evidence to show that Conwell, before he purchased, was notified that the dedication had been revoked; provided, that the land was essential to a full enjoyment, by the purchasers, of the part of the canal they bought."
The court gave, of its own motion, the following instructions, amongst others, to which the appellant excepted, viz.:
" 8. In determining whether the State ever set this property apart, or reserved it for canal purposes, it is proper to consider the state of the canal as to its contemplated extent and business necessities at the time the State was buying property along its line for these purposes, and all facts tending to show that the land was so held by the State, and the fitness and convenience of this particular property for canal uses.
"9. But something more than this the defendant must prove, in order to show that the disputed property was necessary to the full enjoyment of the thing the purchasers at the sale bought, and which is designated in the conveyance. They did not buy the whole canal in its integrity, as projected by the State, but only a separate division of it. Obviously, property there may have been, which had been held by the State and set apart for contemplated canal uses, which would have been not only convenient, but necessary for a complete beneficial use of the whole projected canal, in connection with a great system of state canals, which would not be at all essential to complete enjoyment of the isolated section of one canal bought at the sale by these parties, in all the uses of which in itself it was capable.
" 10. In passing upon the question, it will be your duty to consider that portion of the canal sold in relation to and in comparison with the canal as a whole, as originally projected, as part of the general system of internal improvements, and to remember that it is the test whether the land in question was essential to the full enjoyment of the portion sold, and not to the full enjoyment of the canal as a whole, and connected with a great system of water communication. This is the vital question upon which the case turns. What the purchasers paid is not at all important.
" 15. Therefore, if you believe that the land in dispute, at the time of the sale to the parties under whom the defendants claim, had been set.apart by competent state authority for the use of the canal, and was then so held; and further, that the land in dispute was essential to the complete use and enjoyment of that part of the Northern Division of the Central Canal sold to these parties, that is, that the thing sold could not be completely enjoyed without it, then you should find for the defendants. But should you find that it was not so set apart,, or, being so set apart, was not so essential to the full enjoyment of what those purchasers bought, then the title of the State remains good, and the plaintiff should recover against the canal company."
The deed does not, in terms, describe any particular land by metes and bounds or by numbers, but its language is broad enough to cover any land that had been set apart by the State for the use of the canal or water-power in their occupation and enjoyment, or that was essential to their use and enjoyment. Sheets v. Selden's Lessee, 2 Wal. 177. As to what is to be deemed essential or necessary, see Matter of The N. Y. C. R. R. Co., 49 N. Y. 414; Prather v. The Jeff., Mad. & Ind. R. R. Co., 52 Ind. 16.
It follows, that if the land in controversy had been set apart by the State for the use of the canal or water-power in their occupation and enjoyment, or was essential to their úse and enjoyment, it passed by the deed, and the State had no right to recover.
We think the charges above set out, as given by the court of its own motion, involve an untenable legal proposition. As we understand the proposition involved in the charges, it is this, as applied to the case: that although the land in dispute may have been essential to the use and enjoyment of the canal, viewed as a whole and considered as an entirety, yet if it was not essential to the complete enjoyment of the isolated portion conveyed by the deed in question, the title to it did not pass by the deed.
It is argued, in support of the charges, that when the State sold out the canal, she abandoned it as a canal; that she did not sell it to be used by the purchaser as a canal; and therefore that the purchaser did not take all that might be necessary to its use as a canal in its entirety. The State, doubtless, when she sold thé canal, abandoned it as a proprietor; but we find nothing in her legislation showing that she had abandoned the hope or expectation that it might be finished and operated by the purchaser or others. There is nothing in the case showing that the purchaser or purchasers of the several parts were not to take all that was essential to the use and enjoyment of the whole as a canal. An act -was passed January 28th, 1842 (Acts 1842, p. 3), which was in force, so far' as we are advised, at the time of the passage of the acts authorizing the sale, which contemplated a surrender by the State of her internal improvements, including the canal in question, to corporations, and the completion and operation of the same. Then, soon after the passage of the acts authorizing the sale, viz., on June 17th, 1852 (1 G. & H. 205), an act Avas passed authorizing all persons, corporations or associations Avho had purchased from the State any of the unfinished canals of the State, or any part of either of them, to proceed to the completion of such canal in Avhole or in part, etc. These acts must be taken in pari materia, and they show a clear intent on the part of the legislature, while the State abandoned this canal as a proprie tor, by the sale thereof, to encourage the completion and use of the same as a canal.
The extraordinary development of the railroad system of transportation, since that time, may have disappointed the expectations of the State, and, indeed, of the purchasers of the canal, and rendered the latter in a measure useless; but this cannot change the situation of things as they stood at that time.
It seems to us, that when the State sold the canal, although sold in parcels, she sold everything that was necessary to the use of it as a canal in its entirety, the same as if the whole of it had been sold together, and to one purchaser. The several parts of a thing must be equal to the whole. "When the purchasers bought the part of the canal in question, they bought it with the right to use it in connection with the other part, and took whatever there was pertaining to the part which they bought which was necessary to its use in connection with the other part.
The charges given on this point were, in our opinion, erroneous.
The fifteenth charge given contains another erroneous proposition, as we think, in that the jury were told that if the land in dispute had been set apart by competent state authority for the canal, but was not essential to the enjoyment of what these purchasers bought, then the title of the State remained good, and she could recover.
The land in controversy lies contiguous to the portion of the canal conveyed by the deed of the Governor and Auditor, hereinbefore set out, and if it had been set apart by the State for the use of the canal, it passed with that part of the canal. If it -was thus set apart by the State, for the use of the canaly we think the State cannot say that it was not essential to the enjoyment of that portion of the canal. If it was essential to the enjoyment of any part of the canal, it was that part conveyed by the deed. That it was thus essential, was admitted by the State in setting it apart for that purpose, if she did so set it apart. The purchasers hav ing bought this portion of the canal, with this piece of land so set apart for its use, the State cannot now claim, any more than could a private individual, that it was not essential to the enjoyment of the part of the canal for the use of which it was set apart.
The charge asked by the appellant should, as we think, have been given without the proviso.
^ There was evidence tending to show that the land in controversy had been set apart by the State for the use of the canal or water-power connected therewith, as was assumed by the court in giving the charge with the proviso. But the proviso destroys the vitality of the charge.
If the land in controversy had been thus set apart by the State for the use of the canal, as is hypothetically assumed in the charge, the title passed by the deed, without reference to the question whether it was essential to the full enjoyment of the part of the canal purchased.
As before observed, if the State set apart this piece of land, lying where it does, for the use of the canal, it was set apart for the use of.this portion of the canal, and she cannot now be heard to say that it was not essential to the enjoyment of this portion.
It was shown, on the trial, that at and before the sale, the governor pointed out and designated the piece of land in controversy as being a part of the canal property, and declared that it was being sold with it. The appellant makes the point that this estops the State to set up now that the property did not pass by the sale and deed. The views of the court not being entirely harmonious on this point, no opinion is expressed in relation to it, as the judgment below will have to be reversed for the reasons above stated, and yet to be stated.
On the trial, Daniel Yandes was introduced by the State as a witness, who testified that he knew Jesse L. "Williams, who was the principal engineer of the canal at the time of a conversation between him and Mr. Williams.
Statements of Mr. Williams to the witness, not explana tory of any thing Mr. Williams was then doing as such engineer, but as to what he had done as such, and his opinions in relation to several matters, were given in evidence, over the objection and exception of the appellant. The admission of this evidence was clearly erroneous. The mere opinions of Mr. Williams, expressed to the witness, could not be competent for any purpose that we can conceive of. The statement of what he had done as the chief engineer of the canal, viewing him as the agent of the State, could not be competent, because it was no part of the res gestae.
The statements were not made concurrently with the act done and explanatory thereof, but afterwards, and were inadmissible. 1 Greenl. Ev., sec. 113.
The judgment below is reversed, with costs, and the cause remanded for a new trial.