Court Opinion

ID: 8185213
Source: CourtListenerOpinion
Date Created: 2022-09-09 23:07:36.328363+00
Date Added: 2024-06-11T16:40:23.465758
License: Public Domain

PiNNET, J.
The allegations of the complaint do not show a consolidation of the Milwaukee & Northern Kailroad Company with the corporation defendant, under N. S. sec. 1833 or sec. 1788, or otherwise, so as to impose on the latter the liabilities of the former company. Cases cited declaring and illustrating the effect of consolidation in respect to the debts and liabilities of the companies of which the consolidated company is composed are not material to the present inquiry. The complaint shows simply that what is called in some of the books a “ succession ” has taken place, and that the property and franchises of a corporation have been purchased at private sale, which differs from a consolidation in this respect: that the purchaser thus acquiring the property and franchises of the selling corporation does not become responsible for its liabilities already accrued. This is quite well settled, and we have not been referred to any well-considered case to the contrary. Taylor, Priv. Corp. .§ 415; Wright v. M. & St. P. R. Co. 25 Wis. 46; Vilas v. M. & P. du C. R. Co. 17 Wis. 502; Gilman v. S. & F. du L. R. Co. 37 Wis. 319; Neff v. Wolf River B. Co. 50 Wis. 585; Menasha v. M. & N. R. Co. 52 Wis. 414. In Wright v. M. & St. P. R. Co., supra, the allegations relied on to charge the defendant company were, in substance, the same as in the present case, and extended there, as here, to a sale of the franchises; but it was held that this averment should be *347interpreted as extending only to the franchise of operating the road sold, and PaiNE, J., states tersely that “ the distinction between the franchise of constructing and operating a railroad, and the franchise of being a corporation and of ■contracting, suing, and being sued as such, is well established,” and that upon such allegations it was only the former that passed to the purchaser. In the absence of a contract or of a statute imposing the liability contended for, it does not exist. Hoard v. C. & O. R. Co. 123 U. S. 222; Chesapeake & O. R. Co. v. Miller, 114 U. S. 176; Cook v. D., N. H. & M. R. Co. 43 Mich. 349; Lake Erie & W. R. Co. v. Griffin, 92 Ind. 487, 492; Pennsylvania Transp. Co's Appeal, 101 Pa. St. 576; Hammond v. P. R. & A. R. Co. 15 S. C. 10. The Milwaukee & Northern Railroad Company, so far as the allegations of the complaint show, is a still existing corporation, and has presumptively received a proper consideration for the sale of its property. This is not an action to assail the validity of the transfer of the property, but is a legal action to recover against the defendant, the purchasing .company, damages for the previously committed tort of its vendor. The Milwaukee & Northern Railroad Company could not, by any act of its own will, transfer its franchise to be a corporation. Such a franchise is not the subject of sale and transfer, unless by virtue of some positive statutory provision. It is entirely distinct from the franchises of the corporation to construct, operate, and manage its road. 1 Beach, Priv. Corp. §§ 361, 362; Memphis & L. R. R. Co. v. R. R. Comm’rs, 112 U. S. 609, 619; Comm. v. Smith, 10 Allen, 448, 455; Snell v. Chicago, 152 U. S. 197.
The remedy of the plaintiff, if any, is against the Milwaukee & Northern Railroad Company. Upon the allegations of the complaint, he has none against the defendant company.
By the Court.— The order appealed from is reversed, and the cause is remanded for further proceedings according to law.