Case Name: New York City and Westchester Railway Company, Appellant, v. The Portchester Street Railway Company, Respondent
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 1897-12
Citations: 23 A.D. 407
Docket Number: 
Parties: New York City and Westchester Railway Company, Appellant, v. The Portchester Street Railway Company, Respondent.
Judges: 
Reporter: Appellate Division Reports
Volume: 23
Pages: 407–410

Head Matter:
New York City and Westchester Railway Company, Appellant, v. The Portchester Street Railway Company, Respondent.
Injunction—restraining the construction of one railroad at the suit if another— proof as to the expenditure of ten per cent of the capital stock,
A preliminary injunction, sought in an action brought by a railroad corporation to restrain a similar corporation from constructing roads in the same county', is properly refused where it appears that the plaintiff, although incorporated in 1887, and required to expend at least ten per cent of the amount of its capital stock, within five years after the recording of its articles of incorporation, as a condition of its corporate existence, has not constructed and is not ready to construct its road, and where there is no clear proof that, within five years from the recording of its articles of incorporation, it expended the required ten per cent of the amount of its capital stock. ; ^
Appeal by the plaintiff, the New York City and Westchester Railway Company, from an order of the Supreme Court, made at the New York Special Term and' entered in the office of the clerk of the county of New York on the 1st day of October, 1897, denying the plaintiff’s motion for an injunction.
Charles Lock Easton, for the appellant.
Frederick W. Sherman, for the respondent.

Opinion:
Ingraham, J.:
The plaintiff applied for a preliminary injunction, pending the trial of the action, to restrain the defendant from proceeding to construct its roads in the county of Westchester. The right of the plaintiff to construct the road, and the fact of its existence as a corporation, is challenged by the defendant. That right depends upon the expenditure by the pfiaintiff of ten per cent of the amount of its capital stock within five years after its articles of incorporation were recorded in the office of the Secretary of State. The plaintiff was incorporated April 18,1887; it was required to expend, an amount equal to at least five per cent of its capital stock before April 18,1892, and in the event of a failure to comply with this condition, its corporate existence and powers, ceased. The plaintiff's capital -is $200,000, and the evidence of its compliance with this provision of the statute is most indefinite. Mr. Bergholz, who describes himself as the chief engineer of the railroad company, swears that, beginning in the month of June, 1887, he began the work of constructing the railroad of the plaintiff company, and that, between June, 1887, and September, 1890, deponent, with two assistant engineers,, was engaged in relocating, resurveying and cross-sectioning the entire line of the railroad. He also swears that he caused to be employed foremen and laborers during said period upon the work of clearing and repairing. the roadbed and culverts, which had been formerly constructed by the New York, Westchester and Boston Railway Company. The assistant engineers were engaged in such work of construction in - and during the years 1887 to 1890 inclusive, and during that time employed laborers upon those portions of the line of' railway " marked in blue upon the annexed map, and during that period the plaintiff company expended in such work of construction, etc., on vouchers certified and paid by deponenit upon its authority and on its behalf the sum of twenty-seven thousand and five hundred and sixteen dollars and forty cents." He further swears that, as one of the stockholders of the plaintiff company, he was personally interested in procuring subscriptions to the capital stock; and such subscriptions are stated to be the ten per cent paid by the incorporators, two subscriptions by Bergholz ' amounting to $6,554.53, money advanced by Bergholz amounting to $5,662, and subscription by others amounting to $15,100. The president of the road, Mr. Roosevelt, also makes an affidavit, in which he substantially repeats these allegations; and, in a statement annexed to his affidavit, it is stated that from April 12 to December 29, 1887, for pay roll of engineers and laborers there was expended $2,581.39 ; that in 1888, from January 26 to November 1, inclusive, there was expended $2,674.02; that in 1889, from June 1 to December 30, there was expended for pay roll of engineers and laborers, etc., bills, office expenses, engineer corps, bills for staking and legal expenses, $16,367.29, and that in 1890, from April 15 to September 5, inclusive, there was expended for pay roll of engineers and laborers, revising main line, repairing culverts and ditches, rights of way, office expenses and engineers, $5,609.45, making a total of $27,516.40. Nothing seems to have been done from 1890 down to -the present time. The statement of expenses is, as before stated, quite indefinite. The chief engineer, who advanced a large portion of the money, is the one who is credited with receiving an indefinite portion of it. Whether or not the money that he advanced was advanced in good faith and spent for the corporation, or was merely advanced by him with the understanding that it was to be paid back to him upon some account, for services rendered or as salary as engineer, is not stated. There is a lack.of a definite statement of money actually spent in, the construction of the road, which leaves the matter most indefinite and uncertain.
The court below, in the exercise of its discretion, refused to grant a preliminary injunction, thus leaving the plaintiff to establish upon the trial of the action that fact upon which the continuance of the existence of the corporation depends; and, under the circumstances, we do not think that this discretion was incorrectly exercised. The plaintiff does not pretend that it is at present prepared to build its road, but in the general indefinite way in which the facts are stated, the impression is sought to be made that, if it can obtain an injunc tian preventing the defendant from building, and adjudicating that the plaintiff has the right to so build, there are persons who will advance the necessary money to begin the construction of the road. No persons are named, however, "who have consented to make such advances, and from the statements made it is evident that the question is not at all settled. If the plaintiff had proceeded to the trial of the- action, it could before this have liad the question of the existence of its road determined, after a cross-examination of the witnesses, in a. much more satisfactory manner than it can be- determined by affidavits; and that course is still open to the plaintiff. By bringing this case on for trial it can be definitely ascertained just how much money this plaintiff has spent on this road, and the questions of fact can be established much more satisfactorily than upon affidavit. '
Without passing upon the questions as to just what interest a corporation organized to construct a railroad acquires by filing its articles of incorporation and laying out a route as provided for by the statute, when it' discontinues all proceedings under it, it is sufficient to say here that, considering the indefinite statements of the plaintiff's affidavits and the great length of time which has elapsed since anything was done under the charter, we think that the court below was quite justified in refusing to grant the preliminary injunction; and for this, reason the order appealed from is affirmed, with ten dollars- costs and disbursements.
Van Brunt, P. J., Rumsey and Patterson, JJ., concurred.
Order affirmed, with ten dollars costs and disbursements.