Court Opinion

ID: 7891776
Source: CourtListenerOpinion
Date Created: 2022-09-08 21:49:43.26191+00
Date Added: 2024-06-11T16:31:56.042012
License: Public Domain

Bartol, J.,
delivered tho opinion of this Court:
The question presented by this appeal is one of great importance, both on account of the magnitude of the interests involved in the cause, and of the general importance of the principles involved in its decision.
We have read with much care the elaborate opinion delivered by the learned judge of tbe Circuit Court, and examined the adjudged cases in England and this country, cited by him, as well as those referred to in the argument, and are of opinion that the conclusions stated by him are in general correct. It is not necessary for us however, in disposing of the case, to enter upon the discussion of all the points presented in the briefs, and argued with so much, ability by counsel.
The facts presented by tbe record, so far as it is material to refer to them, may be briefly stated as follows: By a lateral road which diverges from the main stem, the Baltimore and Ohio Rail Road extends to a place called Ben-wood, on the bank of the Ohio River, opposite Belair, the station of the Central Ohio Rail Road, with which it connects by means of a steam ferry boat, for tho benefit of goods and passengers. Some time before the filing the bill in tbis cause, the appellee had loaned tó the Contra! Ohio *90Road $400,000, which was secured by the bonds of the latter, and a mortgage of its property, subject however to the encumbrance of prior mortgages, amounting in the aggregate to $3,000,000. Thefirst and second mortgages constituting the first mortgage on the whole road amounting to the sum of $1,250,000. On the same day this bill of complaint was exhibited, the appellee, at the meeting of the board of directors, adopted the resolution to be found ante page 62, and the object of the bill was to obtain an injunction prohibiting the appellee from carrying into effect the object and purpose of the resolution.
The ground upon which the interposition of the Court was invoked, was, as alleged in the bill, because the Act contemplated by the resolution was “beyond the corporate powers of the Baltimore and Ohio Rail Road Company.”
The appellee claims the right to make the advance and appropriation of money for the purpose stated in the resolution, on .two grounds: 1st. Under the supplement to its charter passed in 1836, ch. 276. 2nd. Because -being a mortgage creditor of the Central Ohio Rail Road Company to the amount of $400,000, it has the power to purchase the prior mortgage, for the purpose of preventing a fore-closure of the same, and the consequent loss of its own mortgage claim.
These propositions will be briefly considered in the light of the well established principles of 'law, governing the construction of statutes conferring powers upon incorporated c mpanies. These principles are stated with great precision and clearness in the first, ^econd, third and fourth points of the appellant’s brief. To each one of which we assent, without repeating them here, except that we do not agree to the proposition stated in the last part of their, fourth point, “that a corporation cannot exercise any implied powers, except such as- are shown to be incidental to its very existence.” To adopt such a principle would be carrying the doctrine' of strict construction too far, and would in many cases defeat the ends and objects of the charter.
*91Acts of incorpora don, like other statutes, must have a reasonable and feasible interpretation, so as to accomplish tho intention of the Legislature, and all such powers are implied as may be necessary to carry into effect those expressly granted — that is to say, such as are reasonably incidental to the exercise of the express powers.
It must also he borne in mind, that we are not dealing with an ordinary private corporation, created only for the pecuniary benefit of its stockholders. The powers granted to the appellee are of tho most extensive and comprehensive kind, involving in their exercise great public interests, to promote which was the chief object of its charter. Looking to the great and important objects which the Legislature designed to accomplish by the charter of the Baltimore and Ohio Rail Road Company, the Court of Appeals (in 6 Gill, 297) have declared tho rules by which its charter ought to be construed.
After stating that the Legislature regarded the completion of the work asa “ great State object,” tbe Court say: “In expounding, therefore, those provisions of the charter of the Company, by which its expressed privileges and exemptions are imparted, liberal rules of interpretation for its benefit ought to he adopted to effectuate tho benevolent designs of the Legislature, and not such rules of restriction and limitation as should be applied to the charters of Companies incorporated for the peculiar benefit of their stockholders.”
We come now to the supplement of 1836, eh. 2*76, and find the appellee authorized, according to its discretion, “ to subscribe towards the construction of any lateral, continuing, or connecting road, and acquire an interest therein to an extent not exceeding two-fifths of its estimated cost.”
We are clearly of opinion, upon the agreed facts in this record, that the Central Ohio Road is a road connecting with the Baltimore and Ohio Rail Road, within tho meaning of the,Act of 1836, and that consequently the “appellee possessed the express power under its charter, to sub-*92scribe for or aid in its construction, to the extent declared in the Act. Under such a power the appellee might lawfully loan or furnish money to the Ohio Company to aid in its construction, and take a mortgage or other security therefor. We adopt the rule stated by the Court in 3 Sandford’s Ch. Rep., 625, that where the thing done by a corporation is substantially that which its charter authorized, Courts have not been disposed to declare the Act unauthorized, though not strictly and literally the same as that mentioned in the law.”
It is not necessary for this Court to express any opinion upon .the abstract question, whether the appellee would be authorized under the Act of 1836, without reference to its existing claim against the Ohio Company, to make the appropriation necessary to acquire the first mortgage claim against that company, with the view and purpose of controlling the working of that road, so as to promote the great interests involved in the successful operations of the Baltimore and Ohio Rail Road.
The appellee was a creditor of the Ohio Company to a large amount. No allegation is made in the bill that the debt so existing was not lawfully created, and within the corporate powers of the appellee. Now one of the purposes declared in the resolution for making the advance necéssary to acquire the first mortgage, was for the security of the debt already due. This Court cannot say that such a purpose was not perfectly legitimate and proper, and the means proposed fairly within the implied powers of the Company. In such a case, the decision of questions of expediency, as to the fitness of the means employed, are properly confided by the law to the Board of Directors. Courts of Justice will not undertake to pass upon them— they are manifestly incompetent to the task — and to attempt to do so, would often defeat the ends of the law. Their province is to determine only whether the corporation, in the Act complained of, has exceeded its corporate powers; and having arrived at the conclusion in the case before us, *93that the bill of complaint is not well founded in that behalf, the order of the Circuit Court dissolving the injunction will be affirmed.
(Decided Feb’y 24th, 1864.)
Wo concur in the ruling of the Judge of the Circuit Court upon the question presented by the second appeal, and, for the reasons assigned bj him in his opinion thereon, we affirm that order also.

Orders affirmed.