Case Name: City of New Orleans vs. Crescent City Railroad Company
Court: Louisiana Supreme Court
Jurisdiction: Louisiana
Decision Date: 1889-11
Citations: 41 La. Ann. 904
Docket Number: No. 10,359
Parties: City of New Orleans vs. Crescent City Railroad Company.
Judges: 
Reporter: Louisiana Annual Reports
Volume: 41
Pages: 904–908

Head Matter:
No. 10,359.
City of New Orleans vs. Crescent City Railroad Company.
A judgment sustaining pleas of prescription and prematurity against parts of a demand, and dismissing tlio suit, and restricting the claim for the difference, is a final judgment which disposes of the case to a certain extent, and Avhich constitutes res judicata^ if unappealed from Avithin a year after the signature thereof.
An appeal from the judgment rendered on the merits of the claim as allowed to stand in court, does not bring up for reA'ie\\r the previous judgment dismissing other parts of the demand.
A municipal corporation, which lias contracted that a bonus shall he paid by a company to Avhich it has granted street railroad prmloge.s, in lieu of taxes, cannot after agreeing to remit, the bonus and to receiAre the taxes in place, and after collecting such taxes, sue to re.coA'er the bonus-, hoAVCAer true it he, that the immunity from taxes avus illegal. It can not claim both. 28 Ann. 497; 35 Ann. 548; 30 Ann. 432,
APPEAL from tbe Civil District Court for tlio Parish of Orleans. Hint/, J.
House c& Grant and Oarleion. Hunt, City Attorney for Plaintiff and Appellant.
1. The city has supervision and control over all the streets within her limits, and power to regulate the use thereof. Tilton a's. Railroad Co., 35 Ann. 1008; Pickles Ars. Dry Dock, 38 Ann. 412; "WaterAvorks Co. als. Sugar Refinery Co., 35 Ann. 1114; Draús vs. Mayor of R. Y., 14 R. Y. R. 506; 2 Dill. Municip. Corp. secs. 506, 507.
2. It cannot part with this power, even by contract. Cooley on Const. Dim., p. -207; Gozzler a's. GoorgetoAvn, 0 Wheat. 597; Reynolds vs. Shreveport, 13 Ann. 428; Milham vs. Sharp, 17 Barb., 435 ; S. C. 28 Barb., 228; Milham et al. Ars. Sharp,27 R. Y. R. Oil; People’s R. R. vs. Memphis R. R., 10 Wall. 38; DoitfsvjUle City Ry. Co. vs. City of Douisrillo, 8 Bush* 411. Shepherd Ars. Third Municipality, 3 Rob. 349.
3. The city had a right to require the Crescent City Railroad Company to remove her tracks to the neutral ground on Canal street, and conform to the plan for a trunk road. Therefore, she could make no valid release of her revenues in order to obtain compliance Avith her plan; and sbe Avas in error in supposing sbe must bargain therefor, and error in the motive renders her agreement void. C. C.'I1827 et seq. GoodAvynvs. Perry & Company, 25 Ann. 29; Tanner vs. Roberts, 5 IT. S. 255; Bartlett vs. Andry. 14 La. 30; Bell vs. McDonough, 19 Da. 40; C. C., 1893, 1896, 1824.
4. The remission of a part of the bonus by Ordinance Ro. 1443, R. S., was upon a suspensive potestative condition, depending upon the will of tlio defendant. O. C., 2024, 2043, 1 Poth. on Oblig., 198, 201. The effects of which were to suspend tlio reduction until the performance. IPotluer, 215. Meeker vs. Railroad Company, 2 Ann. 973.
5.The last paragraph applies also to the remission under Ordinance No. 3243, A. S., and no putting in default was necessary. Escoubas vs. La. Petroleum Co., 22 Ann. 280 ; C. O. 1911, No. 1; City of New Orleans vs. Rig’ney, 24 Ann. 235; C. C. 2038.
G. Novation did not take place because the conditions were not accomplished. Hyde et al. vs. Booraem & Co., 16 Pet. 180; Early vs. Rogers, 16 How. 599 ; Brown vs. Spofford, 95 V. S. 474. 1 Pothier, 199, 205.
7. No putting in default was necessary. If there was it should have been pleaded in limine and comes too late in an answer after exceptions overruled. Pleas of novation and release were a waiver of such exception. 2 Hen. Dig. 1150, No. 6. The contract was one upon a suponsive, potestative, condition, and no default was necessary. Escoubus vs. La. Petroleum Co., 22 Ann. 280.
8. The city could not lawfully grant exemption from taxation, City of New Orleans vs. St. Charles St. Charles Street Railroad Company. 28 Ann. 497; and if could and did, the immunity could not be transferred by the grantee. Morgan vs. Louisiana, 93 U. S. 207; Railroad Company vs. Delamore, 34 Ann. 1125.
9. Plea of novation aud release is a judicial admission of tlio existence of the obligation at the time, and interrupts piescription. Insurance Company vs. Pike et al., 34 Ann.‘828. Every effort to obtain a reduction or release was an acknowledgment interrupting prescription, C. C. 3520. See also Boyle vs. Mann, 4 Ann, 170 ; 2 Troplong. 263, 264. 725; 2 N. S. 545; 1 Rob. 182.
John M. Bonner, for Defendant and Appellee :
1. The City Attorney is the legal adviser of the Council, and has the appointment of his assistants, and “no attorney shall, in any case, ho axipointed to assist him, unless by a vote of two-tbirds of the members present of the Council.” Sec. 27 of act 20 of 1882; 8 Nansas 487.
2. Messrs. Rouse & Grant were not appointed by the City Attorney, nor does it ax>pear that two-tliirds of the Council voted for their appointment. Tlioir axrpearanco in this caséis, therefore, without legal authority.
3. Contracts to employ attorneys on contingent fees tend to corrupt and degrade the administration of justice, and when such contracts are sanctioned by municipal councils they are clearly against a sound public policy. 2 Mar. 281; 7 La. 207 ; 25 Ann. 281.
4. The original contracts between the city and the defendants were comx>letely novated and extinguished by the subsequent contracts made in 1869, 1875 and 1879, under City Ordinances Nos. 1443, N. S.; 3243, A. S., and 4951, A. S. R. C. C. 2185 to 2189; 28 Ann. 679, 10 Rob. 34; C. P. 345.
5. Solemn notarial contracts, based on valid city ordinances, cannot bo collatterally"attacked by one of the contracting parties. 12 La. 105; 24 Ann. 224; 25 Ann. 369; 29 Aim. 112; 30 Ann. 249, 871; 32 Ann. 896 ; 38 Ann. 413.
6. “When the resolutory condition, implied in all communicative contracts, dexpends on the will of either party, the dissolution of the contract must he sued for. R. C. C. 2047; Gayden \vs. Railroad Company, 39 Ann. 269; 21 Wall. 44; 115 H. S- 469.
7. Before suit could be brought to dissolve these contracts it would be necessary to i>ut defendant in default. R. C. C. 1913, 2028, 23S; 3 Ann. 2076; 13 Ann. 605; 37 Aim. 495.
8. The plaintiff lias so often and so long acquiesced in the binding force of the contract of 1869, whereby the bonus was reduced to one-eightli of one cent for each passenger carried, that she has led others to act on her acquiescence, and she is now estoxvpcd from attacking said contract. 1 Wal. 281; 100 IT. S. 578; 32 Ann. 121 ; 33 Ann. 365; 34 Aim. 359; 35 Ann, 743, 924; 37 Ann. 323.
9. Defendant has a right to represent its stocholders. Morawitz on Corp., soc. 1 and sec. 227; 300 U. S. 317, 835.
10. All claims for bonus for more than three years prior to tl;e 20th of March, are barred by the prescription of three years under the express language of B. C. C. 3538, on two grounds: (.a) The suit is upon an open account, (b) The cottract sued on is a lease. B. O. C. 2G74; Jew. Dig., p. 431, sec. 6.
11. The bonus sued for was to be in lieu of taxation, and the city had no right to exempt from taxation. The stipulation to pay bonus was, therefore, in contravention of a prohibitory law, and void. B. O. C. 2031 ; 28 Ann. 497; 35 Ann. 548.

Opinion:
Tlie opinion of tlie Court was delivered by
Bermudez, C. J.
The city sues to recover $281,418 75 as due her by the defendant's company, as the successor of one McConnel to whom she had granted the privilege of running a street railway and was to pay, as a consideration for such right, a certain bonus, on eveiy passenger carried. The period covered by tlie claim extends from 1866 to 1886, when this suit was brought.
The defendant pleaded prescription, prematurity and estoppel.
A judgment was rendered sustaining the plea of prescription as against any claim for the bonus, previous to the 24th of March, 1876, and maintaining tlie defence of pennatuiity to the claim for a certain other bonus, subsequent to that date and permitting the suit to stand for the difference.
The judgment thus rendered was signed on the 1st of July, 1887.
Answering the petition, the defendant's company pleaded mainly, that, under the contracts with the city, the bonus stipulated was to stand in place of taxes and that, by an agreement subsequently entered into, the city relieved tlie company from tlie payment of the bonus, on payment of the taxes and that the taxes having been paid, the city cannot now claim insiypra, the bonus, as it cannot demand both.
The District Court after hearing, gave judgment 'for the defendant and the city appeals.
The defendant urges that tlie judgment first rendered, signed as stated, cannot be reviewed here, for the reason that, not having been appealed from, it constitutes res judicata.
An inspection of that judgment shows that it rejected plaintiff's demand in part, absolutely, by denying to her the right to sue for the bonus claimed prior to 24th March, 1876, the same being barred by prescription, and that it dismisses another part of the demand as premature.
The plaintiff, if aggrieved by that judgment ought to have appealed from it within the year following its signature and as she did not do so, -that judgment cannot be reviewed here.
Besides, by reference to the motion of appeal in the record and which brings up the matter in controversy before this court, it appears that the city complains only of the judgment rendered on February 25th and signed on March 1st, 1839, in favor of the defendant.
The appeal from the judgment on the merits does not imply an appeal from an anterior final judgment which disposed definitively of such parts of the demand as were not passed upon by the subsequent judgment just mentioned.
The objection is therefore well founded and the claim for the bonus said to be due anterior to March 24th, 1876, and some other, after that date, cannot be here passed upon. C. P. 593, 9 M. 519, 2 R. 342, 14 Ann. 788.
So that, the only matter to be considered is the demand for certain boivus said to be due after that date.
It would be tedious to enter into a recital of the lengthy different ordinances passed and contracts entered into, in relation to the rights and obligations of the respective parties. It is sufficient to state, that it clearly results from their spirit and tenor and from the construction put upon them by the parties, that the homes was to be in place of taxes and that all claim by the city to the bonus was relinquished on the defendants paying their taxes. The evidence showing' such payment, it follows that the claim for the bonus is without foundation, as the city can not have a standing to claim both. New Orleans vs. St. Charles R. R. Co., 28, Ann. 497; New Orleans vs. Sugar Shed Co., 35, Ann. 548; New Orleans vs. Water Works Co., 36 Ann. 432, R. C. C. 2031.
The record shows that, consulted as to the validity of a claim by the city of the bonus demafided, the then City Attorney reported adversely thereto. The special action, nevertheless, was brought by counsel specially engaged, who subsequently were joined by the succcessor of .the consulted City Attorney, but who did not offer any oral argument on the hearing of the case in this court.
The district judge, after an elaborate statement of the pleadings, and of the evidence, as well as the different contentions of the parties, and points made by counsel, with an industry which does him credit, came to the conclusion that the judgment signed in July, 1887, could not be reviewed by him, as it had not been appealed from, and passing upon the merits of what was left of the original demand by that judgment, he tersely and appropriately said:
"-The suit is for the bonus of seven-sixteenths of one, from March, 1876. From that date to the present time, under ordinances passed by the City Council, the city has collected all the taxes due, $117,910 17, and no bonus. The bonus under the original contract, was in lieu of taxation.
" The city cannot collect both bonus and taxes. Having elected to collect the taxes, she cannot now sue for the bonus. It has been so decided by the Supreme Court.
"There can be no doubt that, as the city had no power to exempt from taxes, or agree legally to a commutation, the stipulation of exoneration was in contravention of law; but it does not follow that, therefore, the city must recover the bonus. The understanding was that the bonus should bo paid, provided no taxes were demanded. If the condition upon which the bonus was to be paid be prohibited, then it is void, and its nullity is destructive of the contract upon it. .
" The city, therefore, cannot recover both, the tax and the bonus."
We think those reasons conclusive and we adopt them.
Judgment affirmed.