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tracks, so long as it shall continue to use | in chapter 254 of the Laws of New York of such tracks, so constructed, under the pro- 1867, which, as amended by chapter 503 of visions of this act. In case of the neglect the Laws of 1879, is as follows: of such corporations to make such pavement or repairs the local authorities may make the same at the expense of such corporation after the expiration of thirty days' notice to do so."
Section 18 of the act provides that "all acts and parts of acts, whether general or special, inconsistent with this act, are hereby repealed, but nothing in this act shall. . interfere with or repeal or invalidate any rights heretofore acquired under the laws of this state by any horse railroad company, or affect or repeal any right of any existing street surface railroad company to construct, extend, operate, and maintain its road in accordance with the terms and provisions of its charter and the acts amendatory thereof."
The Rochester Railroad Company was incorporated for the purpose of acquiring the property of the Rochester City & Brighton Railroad Company, hereinafter called the Brighton Railroad. The Brighton Railroad was incorporated March 5, 1868, under a general law of the state of New York. Laws of 1850, chap. 140. That law contained no provision respecting the repairs of streets, and, differences having arisen between the Brighton Railroad and the city, as to the extent of the burden of such repairs properly to be borne by the railroad, they joined in an application to the legislature for the enactment of a law which should regulate that and other subjects. Such a law was enacted February 27, 1869, and its 5th section was as follows:
"Any railroad corporation created by the laws of this state, or its successors, being the lessee of the road of any other railroad corporation, may take a surrender or transfer of the capital stock of the stockholders, or any of them, in the corporation whose road is held under lease, and issue in exchange therefor the like additional amount of its own capital stock at par, or on such other terms and conditions as may be agreed upon between the two corporations; and whenever the greater part of the capital stock of any such corporation shall have been so surrendered or transferred, the directors of the corporation taking such surrender or transfer shall thereafter, on a resolution electing so to do, to be entered on their minutes, because ex officio the directors of the corporation whose road is so held under lease, and shall manage and conduct the affairs thereof, as provided by law; and whenever the whole of the said capital stock shall have been so surrendered or transferred, and a certificate thereof filed in the office of the secretary of state, under the common seal of the corporation to whom such surrender or transfer shall have been made, the estate, property, rights, privileges, and franchises of the said corporation whose stock shall have been so surrendered or transferred shall thereupon vest in and be held and enjoyed by the said corporation to whom such surrender or transfer shall have been made, as fully and entirely, and without change or diminution, as the same were before held and en
the board of directors of the said corporation to whom such surrender or transfer of the said stock shall have been made, and in the corporate name of such corporation. The rights of any stockholder not so surrendering or transferring his stock shall not be in any way affected hereby, nor shall existing liabilities or the rights of creditors of the corporation, where stock shall have been so surrendered or transferred, be in any way affected or impaired by this act."
"Said company shall put, keep, and main-joyed, and be managed and controlled by tain the surface of the streets inside the rails of its tracks in good and thorough repair, under the direction of the committee on streets and bridges of the common council of said city of Rochester; but, when. ever any of said streets are, by ordinance or otherwise, permanently improved, said company shall not be required to make any part or portion of such improvement, or bear any part of the expense thereof, but it shall make its rails in such street or streets conform to the grade thereof." [Laws of 1869, chap. 34.]
On the 25th day of February, 1890, the Brighton Railroad duly executed and delivered a lease of its property, franchises, rights, and privileges, for the unexpired term of its charter, to the Rochester Railroad, which accepted the lease and took possession of the property. Subsequently, in the same year, the Rochester Railroad acquired the entire capital stock of the Brighton Railroad. The acquisition of stock was in pursuance of the authority contained
Subsequently the Rochester Railroad duly obtained permission to convert the road into an electric trolley road, expended large sums of money in doing so, and, in the acquisition of the stock of the Brighton Railroad and the conversion of its road into an electric road, relied upon the provisions of the act of 1869 as a contract exempting it, with respect to the streets covered by the tracks of the Brighton Railroad, from other street repairs than those therein described. The city acquiesced in this view until October, 1898, when, upon
The Rochester Railroad, not denying its liability in ordinary cases to bear the expense of paving, asserts that, with respect to the two streets in question, it was exempted from that burden by contract with the state of New York, made with its predecessor in title, the Brighton Railroad, and transferred to it with the title to the property of that railroad. The contract relied upon is found in a law enacted in 1869, for the benefit of the Brighton Railroad, which relieved that road from the burden of pavement of any part of the streets in which its tracks were situated. The Rochester Railroad claims that the law of New York, so far as that law imposes upon it the cost of the pavement of the streets in
the suit of an owner of adjoining property, | pair includes the duty of laying new pavethe court of appeals held that, under § 9 ments. Conway v. Rochester, 157 N. Y. 33, of the act of 1884, and § 98 of chapter 39 51 N. E. 395. of the General Laws, which were regarded as substantially the same, the Rochester Railroad was bound to bear the expense of a new pavement on the location acquired from the Brighton Railroad. Conway v. Rochester, 157 N. Y. 33, 51 N. E. 395. Subsequently, the city repaved two streets which were within the location acquired and operated by the Brighton Railroad, prior to the passage of the act of 1884, and, in obedience to the decision in the Conway Case, assessed against the Rochester Railroad its share of the expense of pavement, and brought this action to recover the amount of the assessment. It was set up in defense of the action that, by the act of 1869, the state of New York had entered into an inviolable contract with the Brigh-question, was in violation of that provision ton Railroad, exempting it from the expense of pavement, that the contract had passed with the property of the Brighton Railroad to the Rochester Railroad, and that the assessment was in violation of the Constitution of the United States. The contentions of the Rochester Railroad were denied by the court of appeals of New York (182 N. Y. 116, 70 L.R.A. 773, 74 N. E. 953), which held, first, that the statute mentioned did not constitute a contract between the state and the railroad company, and, second, that if it did, the exemption granted by the statute was personal to the Brighton Railroad, and did not pass to the Rochester Railroad. The case was remand-ferences having arisen between the Brighton ed to the supreme court and a judgment entered pursuant to the remittitur from the court of appeals, and by writ of error that judgment is brought here for review.
Messers. Charles J. Bissell, William C. Trull, and Joseph S. Clark for plaintiff in
Messrs. William W. Webb and Benjamin B. Cunningham for defendant in error.
Mr. Justice Moody, after making the foregoing statement, delivered the opinion of the court:
By the judgment of the highest court of the state of New York, the city of Rochester was allowed to recover from the Rochester Railroad, a street surface railroad corporation, the cost of laying new pavements on the parts of two streets which lay between the tracks, the rails of the tracks, and 2 feet outside of the tracks of the railroad. This recovery was had under a statute of New York which required such railroads to keep that part of the street over which their tracks ran in permanent repair. The requirement of permanent re
of the Constitution of the United States which forbids a state to pass any law impairing the obligation of contracts.
The Brighton Railroad was incorporated in 1862, under the general law of 1850, which contained no provision with respect to the railroad's share of street repairs. Until the enactment of the law of 1884, under which the Rochester Railroad was subsequently incorporated, there was general law regulating the apportionment between street railroads and municipalities of the expense of such repairs, and the question was determined in individual cases either by agreement or a special law. Dif
Railroad and the city of Rochester as to the share of the expense of street repair which ought to be borne by the railroad, they joined in a request for legislation which would settle this and other disagreements. In response to that request the law of 1869 was enacted. The 5th section of the law, after providing that the railroad should put and keep the surface and street inside of the rails of its tracks in repair, enacts that: "Whenever any of said streets are, by ordinance or otherwise, permanently improved, said company shall not be required to make any part or portion of such improvement, or bear any part of the expense thereof."
This law, obviously, as held by the court of appeals, exempted the railroad from the expense of new pavements, which is the expense sought to be recovered in this action. This was the effect conceded to the statute by the city for the whole time during which the railroad property was owned and operated by the Brighton Railroad, and even after it parted with the property, and until the decision in Conway v. Rochester, supra, in 1898. Whether this statute was a contract between the state of New York and
molested as long as he chooses, but there his rights end, and he cannot, by any form of conveyance, transmit the contract or its benefits to a successor. Morgan v. Louisiana, 93 U. S. 217, 23 L. ed. 860; Wilson v. Gaines, 103 U. S. 417, 26 L. ed. 401; Louisville & N. R. Co. v. Palmes, 109 U. S. 244, 27 L. ed. 922, 3 Sup. Ct. Rep. 193; Picard v. East Tennessee, V. & G. R. Co. 130 U. S. 637, 32 L. ed. 1051, 9 Sup. Ct. Rep. 640; St. Louis & S. F. R. Co. v. Gill, 156 U. S. 649, 39 L. ed. 567, 15 Sup. Ct. Rep. 484; Norfolk & W. R. Co. v. Pendleton, 156 U. S. 667, 39
the Brighton Railroad, inviolable by the Federal Constitution, and if so, whether its benefits have been waived or it has been lawfully modified or repealed by virtue of the powers reserved by the Constitution or laws of New York, are questions which have been much argued at the bar. We do not deem it necessary in this case to decide those questions, and therefore put out of view many facts found in the record which | were deemed by both parties to be relevant to them. We assume, for the purpose of our decision, that there was a contract exempting the Brighton Railroad from the ex-L. ed. 574, 15 Sup. Ct. Rep. 413. But the pense of street pavements, and that the contract could not constitutionally be impaired by the state of New York, and that its benefits have not been waived.
It becomes, therefore, necessary to inquire whether the contract has been transferred with the property of the Brighton Railroad to the Rochester Railroad, the plaintiff in error.
The Rochester Railroad was incorporated for the purpose of acquiring the property of the Brighton Railroad, which was accomplished by a lease of the property, franchises, rights, and privileges of the Brighton Railroad, followed by the purchase of its capital stock. This was done under the authority of a statute which provided that a railroad corporation, being the lessee of the property of another railroad corporation, might acquire the whole of the capital stock of the latter, and in such a case its "estate, property, rights, privileges, and franchises should vest in and be held and enjoyed by" the purchasing corporation. It is contended that the effect of the transfer under this law is to vest in the Rochester Railroad the exemption from the expense of street pavement which the Brighton Railroad enjoyed through the contract with the state of New York. This contention presents the question to be decided.
state, by virtue of the same power which
Keeping these fundamental principles steadily in mind, we proceed to inquire whether the state of New York has authorized or directed the transfer from the
Brighton Railroad to the Rochester Railroad of the contract of exemption. legislative authorization of the transfer of "the property and franchises" (Morgan v. Louisiana, and Picard v. East Tennessee, V. & G. R. Co. ubi supra); of "the property" (Wilson v. Gaines and Louisville & N. R. Co. v. Palmes, ubi supra); of "the charter and works" (Memphis & L. R. R. Co. v. Railroad Comrs. (Memphis & L. R. R. Co. v. Berry), 112 U. S. 609, 28 L. ed. 837, 5 This court has frequently had occasion to Sup. Ct. Rep. 299); or of "the rights of decide whether an immunity from the exer- franchise and property" (Norfolk & W. R. cise of governmental power which has been Co. v. Pendleton, ubi supra),-is not suf granted by contract to one has, by legis- ficient to include an exemption from the lative authority, been vested in or trans- taxing or other power of the state, and it ferred to another, and in the decisions cannot be contended that the word "estate" certain general principles, which control in has any larger meaning. It is, however, the determination of the case at bar, have argued that the word "privileges" is suibeen established. Although the obligations ficiently broad to embrace within its meanof such a contract are protected by the ing such an exemption, and that, when it is Federal Constitution from impairment by added to the other words, the legislative the state, the contract itself is not property, intent to transfer the. exemption is clearly which, as such, can be transferred by the manifested, and that the words of the law owner to another, because, being personal under consideration, "the estate, property, to him with whom it was made, it is in- rights, privileges, and franchises," indicate capable of assignment. The person with the purpose to vest in the purchasing whom the contract is made by the state corporation every asset of the selling corpomay continue to enjoy its benefits unration which is of conceivable value. There
is authority sustaining this position, which | lowed the Muscogee Railroad to unite with cannot be set aside without examination. the Southwestern Railroad into one com
pany, under the charter of the latter, and
and privileges" of another railroad corporation, and "all the powers and privileges" of a third railroad corporation, included the immunities from taxation enjoyed respectively by the latter corporations, the ground of the decision being that an exemption from taxation is, in the common acceptation of the term, a privilege.
In the case of Humphrey v. Pegues, 16 Wall. 244, 21 L. ed. 326, it appeared that the charter of the Northeastern Railroad Company, granted by the state of South Carolina, originally contained no exemption from taxation, but that, by amendment to the charter, some years later, the real estate and stock of the company were exempted from all taxation during the continuance of its charter. Subsequently the legislature 29 L. ed. 833, 6 Sup. Ct. Rep. 649, it was granted the charter of the Cheraw & Dar-held that a statute conferring upon a raillington Railroad Company, and provided road corporation "all the rights, rowers, that "all the powers, rights, and privileges granted by the charter of the Northeastern Railroad Company are hereby granted to the Cheraw & Darlington Railroad Company." The state of South Carolina attempted to tax the stock and property of the Cheraw & Darlington Railroad Company, and the validity of that taxation was the question in the case. The court held that the powers, rights, and privileges granted to the Cheraw & Darlington Railroad Company were those contained in the amendment of the charter, as well as those contained in the original charter, and said, by Mr. Justice Hunt: "All the 'privileges,' as well as powers and rights, of the prior company, were granted to the latter. A more important or more comprehensive privilege than a perpetual immunity from taxation can scarcely be imagined. It conIt contains the essential idea of a peculiar benefit or advantage, of a special exemption from a burden falling upon others." Upon this reasoning it was held that the stock and real estate of the Cheraw & Darlington Railroad Company were exempt from taxation. See Gunter v. Atlantic Coast Line R. Co. 200 U. S. 273, 50 L. ed. 477, 26 Sup. Ct. Rep. 252.
In Chesapeake & O. R. Co. v. Virginia, 94 U. S. 718, 24 L. ed. 310, it was said that an act conferring upon a railroad corporation "the benefits of the charter" of another corporation which had an immunity from taxation, and "the rights, privileges, franchises, and property" of another corporation, which, when formed, would have the "rights, privileges, and franchises and property" of the corporation holding the immunity, was sufficient to transfer the immunity from taxation. pression of opinion was unnecessary to the decision of the case, which merely decided that where a railroad corporation acquired the property of another railroad corporation, to which was attached an immunity from taxation, that immunity did not extend beyond the property thus acquired. In Southwestern R. Co. v. Georgia, 92 U. S. 676, note, 23 L. ed. 782, where a statute al
But this ex
If the authority of these four cases, supported by some dicta which need not be cited, remained unimpaired, it would justify the opinion that a legislative transfer of the "privileges" of a corporation includes an exemption from the taxing or other governmental power granted by a contract with the state. But other and later cases have essentially modified the rule which may be deduced from them.
In the case of the Chesapeake & O. R. Co. v. Miller, 114 U. S. 176, 29 L. ed. 121, 5 Sup. Ct. Rep. 813, it was held that the foreclosure of a mortgage on railroad property under the provisions of a statute which authorized the purchaser under a foreclosure sale to become a corporation, and provided that it should "succeed to all such franchises, rights, and privileges" as were possessed by the mortgagor company, did not vest in the purchasing corporation an immunity from taxation.
In Picard v. East Tennessee, V. & G. R. Co. 130 U. S. 637, 32 L. ed. 1051, 9 Sup. Ct. Rep. 640, Mr. Justice Field, in delivering the opinion of the court, said: "The later, and, we think, the better, opinion, is that unless other provisions remove all doubt of the intention of the legislature to include the immunity in the term 'privileges,' it will not be so construed. It can have its full force by confining it to other grants to the corporation."
In Wilmington & W. R. Co. v. Alsbrook, 146 U. S. 279, 36 L. ed. 972, 13 Sup. Ct. Rep. 72, Mr. Chief Justice Fuller, in delivering the opinion of the court, said, on page 297, L. ed. page 979, Sup. Ct. Rep. page 77: "We do not deny that exemption from taxation may be construed as included in the word 'privileges,' if there are other pro
visions removing all doubt of the intention of the legislature in that respect.'
In Keokuk & W. R. Co. v. Missouri, 152 U. S. 301, 38 L. ed. 450, 14 Sup. Ct. Rep. 592, Mr. Justice Brown, in delivering the opinion of the court, said: "Whether, under the name 'franchises and privileges,' an immunity from taxation would pass to the new company, may admit of some doubt, in view of the decisions of this court, which, upon this point, are not easy to be reconciled."
These conflicting views were before the court in Phoenix F. & M. Ins. Co. v. Tennessee, 161 U. S. 174, 40 L. ed. 660, 16 Sup. Ct. Rep. 471. The plaintiff in error in that case claimed to have an immunity from taxation by virtue of a provision in its charter granting it "all the rights and privileges" of the De Soto Insurance Company, which had an immunity from taxation by virtue of a provision in its charter granting it "all the rights, privileges, and immunities" of the Bluff City Insurance Company, whose charter contained an expressed immunity from taxation. Mr. Justice PeckMr. Justice Peckham, in delivering the opinion of the court, stated the question for decision in these words: "Is immunity from taxation granted to plaintiff in error under language which grants 'all the rights and privileges' of a company which has such immunity?" Much significance was given to the fact that the word "immunity," which clearly includes an exemption, was used in the charter of the De Soto company, and not used in the charter of the plaintiff in error, granted seven years later. But the decision was not rested on this circumstance, although the omission was thought to cast a grave doubt upon the plaintiff's claim. The opinion reviews all the cases, cites the foregoing quotations from the opinions of Mr. Justice Brown, Mr. Justice Field, and of the Chief Justice, and, after saying: "There must be other language than the mere word 'privilege,' or other provisions in the statute removing all doubt as to the intention of the legislature before the exemption will be admitted," concludes that: "If this were an original question we should have no hesitation in holding that the plaintiff in error did not acquire the exemption from taxation claimed by it, and we think at the present time the weight of authority, as well as the better opinion, is in favor of the same conclusion which we should otherwise reach."
In Gulf & S. I. R. Co. v. Hewes, 183 U. S. 66, 46 L. ed. 86, 22 Sup. Ct. Rep. 26, Mr. Justice Brown, in delivering the opinion of the court, said, citing this case as authority: "The better opinion is that a subrogation to the 'rights and privileges' of
a former corporation does not include an immunity from taxation."
We think it is now the rule, notwithstanding earlier decisions and dicta to thecontrary, that a statute authorizing or directing the grant or transfer of the "privileges" of a corporation which enjoys immunity from taxation. or regulation should not be interpreted as including that immunity. We, therefore, conclude that the words "the estate, property, rights, privileges, and franchises" did not embrace within their meaning the immunity from the burden of paving enjoyed by the Brighton Railroad Company. Nor is there anything in this, or any other statute, which tends to show that the legislature used the words with any larger meaning than they would have standing alone. The meaning is not enlarged, as faintly suggested, by the expression in the statute that they are to be held by the successor "fully and entirely, and and entirely, and without change and diminution,"-words of unnecessary emphasis, without which all included in "estate, property, rights, privileges, and franchises" would pass, and with which nothing more could pass. On the contrary, it appears, as clearly as it did in the Phoenix Fire Insurance Company Case, that the legislature intended to use the words "rights, franchises, and privileges" in the restricted sense. The law under which this transfer was made was enacted in 1867 and amended in 1879. In 1869 an act was passed authorizing the merger and consolidation of railroad corporations (chap. 917, Laws of 1869), which provided that, upon the consolidation, "all and singular the rights, privileges, exemptions, and franchises should be transferred to the new corporation." In 1876 an act was passed (chap. 446, Laws of 1876) which authorized the purchasers of the rights, privileges, and franchises of railroad corporations (except street railroad corporations) under a foreclosure sale to become a corporation, and thereupon have "all the franchises, rights, powers, privileges, and immunities" of the corporation whose property was sold. The omission in the statute under consideration of the words. "exemptions" or "immunities," either of which would be apt to transfer the immunity claimed, is significant, in view of the fact that each of these words was employed by the legislature about the same time in other statutes dealing with the transfer of corporate property, and raises a doubt of the intention of the legislature, which, in cases of the interpretation of a statute claimed to devest the state of a governmental power, is equivalent to a denial.
The conclusion that the exemption of the