Page images
[blocks in formation]

tempted suspension without authority of law, he remaining ready and willing to discharge the duties of the place, could not, during the period of such wrongful suspension, have the effect to deprive him of the compensation legally belonging to one entitled to hold the position.

Judgment affirmed.










Nos, 331, 332, 333, 334, 335 and 336. Argued January 11, 12, 15, 1906.- Decision

announced March 12, 1906.-Opinion filed April 2, 1906.

Where notes are made by a corporation payable to the order of its own

treasurer, a citizen of the same State, as a matter of convenience and custom, and indorsed and delivered by him to a bona fide holder who, & citizen of a different State, furnishes the money. represented by the note directly to the corporation, the treasurer is not in fact an assignee of the note within the meaning of the act of August 13, 1888, 25 Stat. 433, and suit may be brought by such holder in the Circuit Court of the United States having jurisdiction of the parties, notwithstanding such diversity does not exist as to the treasurer first indorsing the note. Falk V. Moebe, 127 U. 8. 597; Holmes v. Goldsmith, 147 U. S. 150. Where there is a proper cause of action and diverse citizenship, jurisdiction

of the Federal courts exists, and the motive of the creditor who desires to litigate in that forum is immaterial, and does not affect the jurisdiction; nor is such jurisdiction if it actually exists, affected by the fact that a

[blocks in formation]

receivership was in view when judgments were entered. South Dakota

v. North Carolina, 192 U. S. 286. Where, as in this case, the attitude and claims of the municipality cast a

cloud upon the title to property consisting largely of franchises in the hands of receivers and to be administered under orders of the court, the receivers may, with the authority of the court, proceed by ancillary bill to protect the jurisdiction and right to administer the property, and to determine the validity of claims of parties which cast a cloud upon such franchises and in such a case it is proper to grant an injunction until the

rights of the parties can be determined. Whether a corporation having a limited and definite capacity to purchase

and hold real estate has exceeded those limits concerns only the State within whose jurisdiction the property is situated; the question cannot, unless the statute expressly or by necessary implication authorizes it, be

raised collaterally by private persons. Fritts v. Palmer, 132 U. 8. 282. The generality of the title of a state statute does not invalidate it under a

provision of the constitution of the State that private and local laws shall only embrace one siıbject which shall be expressed in the title, so long as the title is comprehensive enough to reasonably include within the general subject or the subordinate branches thereof, the several objects which the statute seeks to effect, and does not cover legislation incongruous in itself and which by no fair intendment can be included as having any

necessary and proper connection. Montclair v. Ramsdell, 107 U. S. 147. Although decisions of the highest court of a State are not binding on this

court in determining whether a contract was made by legislative action of that State which is entitled to protection under the impairment of obligation clause of the Federal Constitution, it will consider decisions

of that court on the point in question. One asserting private rights in public property under grants of franchises

must show that they have been conferred in plain terms, for nothing passes by the grant except it be clearly stated or necessarily implied. Legislative grants of franchises which are in any way ambiguous as to whether granted for a longer or a shorter period are to be construed

strictly against the grantee. As a rule of construction a statute amended is to be understood in the same

sense exactly as if it had read from the beginning as it does amended. Although a corporation be organized under a charter for a limited period

it may receive a grant inuring to the benefit of its lawful successors for a period beyond its corporate life, but the right granted must be construed with reference to the system of which it is a part and where that general system is for a limited period a single ordinance, not naming a

specific term, will not be construed as granting a franchise in perpetuity. A declaration in the title of state statutes that they concern horse railways,

where it is apparent that these terms were intended to indicate street railways as distinguished from steam railways, will not, because of a constitutional provision that the object of the statute must be expressed in the title, prevent the city from exercising its powers under the statute in


[blocks in formation]

such manner as to authorize the use of other power such as cable or

electricity. The repeal of a state statute authorizing every street railway to be operated

by such animal, electric or other power as the municipal authorities may bave granted would not destroy its effect to ratify contracts in existence

when it was passed. Where a state statute requires the consent of a municipal officer to au

thorize the extension of a street railway the abolition of that office does not authorize the extension without any official consent; and where the consent of municipal authorities is required for franchises relating to special localities by a statute, and subsequently a general act limits the time for which any such franchise can be granted in any city or village, the consent given will be presumed, in the absence of any period

specified not to be in perpetuity, but for the period as so limited. Under the law of Illinois municipal corporations have a fee simple in, and

exclusive control over, the streets, and the municipal authorities may do anything with, or allow any use of, the streets not incompatible with the ends for which streets are established, and it is a legitimate use of a street

to allow a street railroad track to be laid down in it. Applying the foregoing principles to the construction and effect of the various acts of the legislature of the State of Illinois, and of the ordinances of the municipal authorities of the city of Chicago and adjacent towns, in regard to the franchises of the several street railway companies owned and controlled by the Chicago Union Traction Company, and the receivers thereof held, that 1

1. The Circuit Court of the United States for the Northern District of Illinois had jurisdiction to render the judgments against the Chicago Union Traction Company, the North Chicago Street Railroad Company and the West Chicago Street Railroad Company set up in the bills afterwards filed for the appointment of receivers.

2. The proceedings for the appointment of receivers were not shown to be collusive and fraudulent, and the court had jurisdiction to entertain the bills and appoint the receivers and put them in possession of the property of the railway companies.

3. The ancillary bills filed by the receivers were maintainable in aid of the court's jurisdiction to settle controversies as to the property which was to be administered and disposed of under the orders and decree of the court.

4. The acts of 1859, 1861 and 1865 were not unconstitutional under the constitution of Illinois of 1848 in force when the same were passed.

5. The act of February 6, 1865, amending the act of February 14, 1859, had the effect to extend the corporate lives of the Chicago City Railway Company, the North Chicago City Railway Company and the Chicago West Division Railway Company, for the term of ninety-nine years. It

1 The numbered paragraphs are as stated by MR. JUSTICE Day in announcing the decision and judgment of the court.

[blocks in formation]

affirmed the contracts with the city prescribing rights and privileges in the streets of Chicago in all respects as theretofore made, including time limitations as contained in the ordinances previously passed. It recognized and continued in force the right of the city and the companies to make contracts for the use of the streets upon terms and conditions, including the time of occupancy, as might be agreed upon between the council and the corporations.

6. Corporate privileges can only be held to be granted as against public rights, when conferred in plain and explicit terms. The ambiguous phrase in the act of 1865, “during the life hereof,” did not operate to extend existing contracts for the term of ninety-nine years or limit the right of the city to make future contracts with the companies covering shorter periods.

7. The amending act of 1865 had reference to the North Chicago City Railway Company as well as the corporations specifically named in the first sections of the acts of 1859 and 1861.

8. The ordinances of May 23, 1859, granting rights and privileges in certain streets to the Chicago City Railway Company and the North Chicago City Railway Company, respectively, are radically different. The grant to the former company for the south and west divisions of the city is during all the term specified in the act of February 14, 1859, which act expressly ratified the ordinance of 1858, granting the right to use the streets therein named for the term of twenty-five years and until the city sball purchase and pay for the same as set forth in said ordinance. On the north side the term granted is for twenty-five years "and no longer.” The privileges conferred upon the Chicago City Railway Company and its grantee were confirmed, as made, by the act of 1865, with the effect to continue the right of the companies to occupy the streets named in the ordinances of 1858, May 23, 1859, and similar ordinances, for the term of twenty-five years and until the city shall elect to purchase and pay for the property of said railway companies. On the north side, no such right exists to remain in the use of the streets until purchase by the city.

9. Whatever rights existed in the streets, were not lost to the come panies by the acceptance of the ordinances granting a change from animal to cable or electric power in the operation of the railways.

10. The grants in the town of Jefferson, having been made after the acceptance of the Cities and Villages Act, are limited to the term of twenty years.

11. The grants by the supervisor of Lake View are not in perpetuity, as the Lake View road was but an extension of the North Side system, which was expressly limited in the duration of its grants to the term of twenty-five years. No intention will be presumed to make an extension of this part beyond the life of the grant to the main lines of the North Side road.

12. The grants by the trustees of Lake View will not extend beyond the life of the corporation making them and upon the annexation of the town of Lake View to Chicago, the further right to use the streets must be de

[ocr errors]

Statement of the Case.

201 U.S.

rived from grants by the council of that city under power conferred by the Cities and Villages Act.

The decree is reversed and cause remanded for further proceedings in accordance with the views herein expressed.

THESE are appeals from two decrees of the Circuit Court of the United States for the Northern District of Illinois. The origin of the cases dates from April 22, 1903, when the Guaranty Trust Company of New York, a corporation and citizen of that State, filed three suits in the Circuit Court of the United States for the Northern District of Illinois against the Chicago Union Traction Company, the North Chicago Street Railroad Company, and the West Chicago Street Railroad Company, corporations and citizens of the State of Illinois. On the day the declaration was filed the general issue was joined, the jury waived, and upon trial judgment was rendered against the respective defendants for $318,690.66, $565,052.66, and $270,440. Executions having been awarded and returned no property found, bills were filed by the Guaranty Trust Company, and receivers appointed for the property of each and all of those companies. Under the order of the court of July 18, 1903, the receivers filed two ancillary bills, one against the City of Chicago, the Chicago West Division Railway Company, the Chicago Union Traction Company and the West Chicago Street Railroad Company; the other, against the City of Chicago, the Chicago Union Traction Company, the North Chicago Street Railroad Company and the North Chicago City Railway Company. They were afterwards amended by leave of the court. These bills state, among other things (having reference now to the West Side case), that, as receivers and under the order of the court, the complainants were in possession of the system of street railroads; that the property included the rights, privileges and franchises originally granted to the Chicago West Division Railway Company by the State of Illinois; that on October 20, 1887, the Chicago West Division Railway Company leased the property to the West Chicago Street Railroad Company for the full term of nine

« PreviousContinue »