Commonwealth ex rel. Margiotti v. Union Traction Co. of Philadelphia

• Decision Date: 08 October 1937
• Docket Number: 1
• Citation: 194 A. 661,327 Pa. 497
• Parties: Commonwealth ex rel. Margiotti, Appellant, v. Union Traction Company of Philadelphia et al
• Court: Pennsylvania Supreme Court

194 A. 661

327 Pa. 497

Commonwealth ex rel. Margiotti, Appellant, v. Union Traction Company of Philadelphia et al

No. 1

Supreme Court of Pennsylvania

October 8, 1937

Argued June 25, 1937

Appeal, No. 1, May T., 1938, from order of C.P. Dauphin Co No. 154, Commonwealth Docket, 1936, in case of Commonwealth ex rel. Charles J. Margiotti, Attorney General, v. Union Traction Company of Philadelphia et al. Order appealed from is affirmed.

Proceeding upon writ of quo warranto issued at the relation of and on a suggestion filed by the Attorney General.

The opinion of the Supreme Court states the facts.

Motions to quash sustained and writ of quo warranto quashed, opinion by FOX, J. Commonwealth appealed.

Error assigned, among others, was judgment quashing writ of quo warranto.

The order appealed from is affirmed, costs to be paid by appellant.

Charles J. Margiotti, Attorney General, with him Edward Friedman and Harry Polikoff, Deputy Attorneys General, for appellant.

Geo. Ross Hull, with him Arthur H. Hull, of Snyder, Hull, Hull & Leiby, and Maurice Bower Saul, William E. Mikell, Jr., Gilfillan, Gilpin & Brehman and John J. Sullivan, for appellees.

Spencer G. Nauman, of Nauman, Smith & Hurlock, John Russell, Jr., and Wm. Clarke Mason, for appellees.

W. W. Montgomery, Jr., Sterling G. McNees and Ulric J. Mengert, for appellees.

Before KEPHART, C.J., SCHAFFER, MAXEY, DREW, LINN, STERN and BARNES, JJ.

OPINION

MR. JUSTICE LINN:

This appeal is from an order quashing a writ of quo warranto directed to forty-three respondent corporations and intended to procure forfeiture of their charters for alleged misuser and nonuser of secondary franchises to hold and operate street railways in Philadelphia. The writ was issued at the relation of and on a Suggestion filed by the attorney general. The charge is that by lease and stock ownership respondents unlawfully conspired to avoid performing corporate duties, with resulting damage to the public. The extent of the conspiracy, in point of time, and its character, as respects overt acts, may be understood by keeping in mind that many of the respondents were incorporated by special acts of assembly prior ^[1] to the adoption of the Constitution of 1873 and many of them under general acts passed since ^[2]; that many leases, ^[3] contracts, enabling acts and city ordinances passed long ago are involved; that the last lease made by any respondent was made in 1902 by Union Traction Company to Philadelphia Rapid Transit Company (not a party to this suit). It also appears that since then the lessee has been operating street railways in Philadelphia under that lease, and under additional leases and contracts of the same character as some of those complained of.

Respondents moved to quash the writ, assigning many reasons which the learned court below reduced to twelve. ^[4] We need not consider whether all are valid; as the Suggestion for the writ shows on its face that the Commonwealth is estopped from claiming the forfeiture on the case presented, the Suggestion is defective in substance. It is therefore unnecessary to state in detail the grounds for the proceeding set forth in the Suggestion. Assuming that some defects might be cured by amendment, there is no escape from the conclusion that the record shows the Commonwealth is estopped from forfeiting the charters.

1. The attorney general insists that if the Commonwealth, at his relation, files a suggestion for a writ of quo warranto the writ must be granted; that the Commonwealth's right to the writ and to a trial is absolute as the exercise of the sovereign's prerogative; that the court has no discretion about it, even though discretion may be exercised to the extent of refusing or quashing a writ sought in the name of the Commonwealth at the instance of a private relator; that a motion to quash will not lie; that respondents have no alternative but to demur, answer or plead.

The contention must be rejected. Against it are the express terms of the Act of June 14, 1836, P.L. 621, 12 PS section 2021 et seq., as well as prior and subsequent decisions dealing with this subject. The jurisdiction in quo warranto, for the first time vested in the common pleas by the Act of 1836, is an adaptation of provisions of the statute of 9th Anne (1710) reprinted in Roberts' Digest, page 384, which, as a result of the construction put upon our Act of 1722, may be said, in a general way, to have determined the nature of the jurisdiction in quo warranto exercised by this court, ^[5] as well as the procedure.

Prior to the Act of 1836 vesting concurrent jurisdiction in the common pleas in certain cases in quo warranto, this court had exclusive jurisdiction. Section 1, vesting jurisdiction in the Supreme Court, was declaratory of the existing law: Murphy v. Farmers' Bank of Schuylkill County, 20 Pa. 415. Section 2 provides: "Writs of quo warranto in the form and manner hereinafter provided, may also be issued by the several courts of Common Pleas, concurrently with the Supreme court in the following cases, to wit: . . . IV. In case any association, or number of persons, shall act as a corporation, or shall exercise any of the franchises or privileges of a corporation, within the respective county, without lawful authority. V. In case any corporation as aforesaid, shall forfeit by misuser, or nonuser, its corporate rights, privileges or franchises, or shall do, suffer, or omit to do, any act, matter or thing, whereby a forfeiture thereof shall by law be created, or shall exercise any power, privilege or franchise not granted or appertaining to such corporation. And in any such case, the writ aforesaid may be issued upon the suggestion of the Attorney General, or his deputy, in the respective county, or of any person or persons desiring to prosecute the same."

Section 3 provides, "Whenever the Attorney General shall have reason to believe that any association as aforesaid, have acted as a corporation, or exercised any of the franchises or privileges thereof, without lawful authority, or that any corporation has forfeited its corporate rights, privileges, or franchises, as aforesaid, or exercised any power, privilege, or franchise, not granted or appertaining to such corporation, it shall be his duty to file, or cause to be filed, a suggestion as aforesaid, and to proceed thereon for the determination of the matter."

The words of the Act are that the writ "may also be issued" by the common pleas. The cases hold that "may" is used in its permissive and not in its mandatory sense, and that whether the writ shall issue, or, having issued, shall be tried, rests in the discretion of the court. To accept the attorney general's argument that a motion to quash will not be entertained and that respondents must demur, answer or plead, even though the Suggestion shows that the Commonwealth is not entitled to assert the forfeiture, would require a reversal of the procedure long established and followed and would place a power in the attorney general hitherto withheld from that officer. To show that he is in error in contending that the cases support his view, and that, on the contrary, they support respondents' position, we shall refer to a number of them at the risk of unduly extending this opinion.

In Commonwealth v. Jones, 12 Pa. 365 (1850), in quashing a writ, GIBSON, C.J., said: "The writ of quo warranto under the Act of 1836 is not more a matter of right than is the quo warranto information under the statute of Anne. The legislature has spoken guardedly on the subject. 'Writs of quo warranto MAY be issued by the Supreme Court,' and 'writs of quo warranto MAY be issued by the Common Pleas,' is language so circumspect as to convince us that the intention was to give the same control over the writ which the Court had exercised over the information. The object was to combine in it all that was valuable in the ancient writ, with all that was convenient and proper in the quo warranto information. . . ."

"Now it is well known that an information at the suggestion of a relator was always preceded, in this Court, by a rule to show cause, as it is in the Queen's Bench at this day. The Court itself stood as an inquest, between the accuser and the accused. No man would submit to be the dispenser of corporate patronage, if nothing else were between him and vexatious prosecution, than the magnanimity and justice of the displaced officer or disappointed applicant. . . ."

"The practice under our statute, however, has been wrong. The writ has inadvertently issued on the filing of the suggestion, and consequently improvidently; so that it would be impossible to resist a motion to quash for that reason alone. But the ground of the prosecution may, at the same time, be examined as if the case stood on a rule to show cause. [Italics supplied.] The eye of the Court had not been directed to the irregularity, but henceforth it shall be avoided.

"Now a Court will refuse its leave to issue a quo warranto writ wherever it would have refused its leave to file a quo warranto information. Before the accession of Lord Mansfield to the chiefship of the King's Bench, it was the practice to file almost of course; but in Rex v. Wardroper, 4 Burr. 1964, he put his hand on it, saying that 'the Stat. 9 Ann. c. 20, had a view to the speedy justice to be done against the usurpers of offices in corporations, as well as to quiet the possession of those who had right; and that act,' he said, 'does not leave it to the discretion of the officer (the master of the crown office), as it was before, but puts it in the discretion of the Court; therefore the Court must exercise a discretion. It would be very grievous if the information should go of course, and it would be a breach...