Crook Horner & Co. v. Old Point Comfort Hotel Co.

• Decision Date: 28 February 1893
• Citation: 54 F. 604
• Parties: CROOK, HORNER & CO. v. OLD POINT COMFORT HOTEL CO. et al.
• Court: U.S. Court of Appeals — Fourth Circuit

54 F. 604

CROOK, HORNER & CO. v. OLD POINT COMFORT HOTEL CO. et al.

United States Circuit Court, E.D. Virginia.

February 28, 1893

White &amp Garnett, for complainant

Tunstall & Thom, for defendant Old Point Comfort Hotel Co. and trustee.

Thomas Tabb, Harmanson & Heath, Sharp & Hughes, and R. S. Bickford for claims of mechanics and material men.

HUGHES District Judge.

This case is heard on sundry exceptions to the report of the master in chancery appointed by the court, marshaling the liens resting on the property of the hotel company. This property consists exclusively of an unfinished hotel building of large dimensions and cost, called the 'Chamberlin Hotel,' and standing on land belonging to the United States by cession from the state of Virginia.

The principal question before the court is upon the priority of liens. The hotel building is under a mortgage from the defendant company to the Knickerbocker Trust Company of New York city as trustee, executed for the purpose of securing bonds to a large amount, which have been sold for moneys expended in constructing the building. In competition with the mortgage are a number of liens filed by mechanics and others who have expended labor and used material upon the unfinished structure. This mortgage and these liens have been filed and registered in the clerk's office of the county court of Elizabeth City county, Va., in which the lands of the United States at Old Point Comfort lie. They have been registered in pursuance of registration laws in force in Virginia. A principal question in the case is whether the general laws of Virginia, especially her registration laws are in force in the territory at Old Point Comfort, or Fortress Monroe, held by the United States under cession from Virginia.

The history of the cession, and the legislation ensuing upon it is as follows: On the 1st of March, 1821, the general assembly of Virginia passed the following act:

'Whereas, it is shown to the present general assembly that the government of the United States is solicitous that certain lands at Old Point Comfort and at the shoal called the 'Rip Raps' should be, and with the right of property and entire jurisdiction thereon, vested in the said United States for the purpose of fortification and other objects of national defense: (1) Be it enacted by the general assembly, that it shall be lawful and proper for the governor of this commonwealth, by conveyance or deeds in writing under his hand and the seal of the state, to transfer, assign, and make over unto the said United States the right of property and title, as well as all the jurisdiction which this commonwealth possesses over the lands and shoal at Old Point Comfort and the Rip Raps: provided, the cession at Old Point Comfort shall not exceed two hundred and fifty acres, and the cession of the shoal at the Rip Raps shall not exceed fifteen acres: and provided, also, that the said cession shall not be construed or taken so as to prevent the officers of the state from executing any process or discharging any legal functions with the jurisdiction or territory herein directed to be ceded, nor to prevent, abolish, or restrain the right and privilege of fishery hitherto enjoyed and used by the citizens of this commonwealth within the limits aforesaid: and provided, further, that nothing in the deed of conveyance, required by the first section of this act, shall authorize the discontinuance of the present road to the fort, or in any manner prevent the pilots from erecting such marks and beacons as may be deemed necessary. (2) And be it further enacted, that should the said United States at any time abandon the said lands and shoal, or appropriate them to any other purpose than those indicated in the preamble to this act, that then, and in that case, the same shall revert to and revest in this commonwealth. (3) This act shall commence and be in force from and after the passing thereof.'

It is evident that this act contemplated the use of this land simply for a fort, and that its use for any other purpose should cause a reverter both of title and of jurisdiction to Virginia. Its use for hotel purposes in competition with other parts of Virginia equally favored by nature was not only not contemplated, but by the reverter clause was forbidden. This is the only act of cession by a state to the United States which contains such a clause. All acts of cession contain the provision allowing the service of process. But in the various acts none appear to have this reverter clause. It is to be observed also that the title of the government to the lands at Old Point was obtained by direct cession from the state, of land till then belonging to the state; and not by purchase from private individuals within the state, under consent from the state. The importance of this distinction will appear hereafter.

In connection with this subject it may be observed that Virginia, in a code of general laws passed on the 15th day of August, 1849, enacted, with reference to her cession of lands at Old Point Comfort, and over other places within her territory, designated in the act, as follows:

'It is hereby declared that this state retains concurrent jurisdiction with the United States over the said places, so far as it lawfully can, consistently with the acts (of cession;) and its courts, magistrates, and officers may take such cognizance, execute such process, and discharge such other legal functions within the same as may not be incompatible with the true intent and meaning of the said acts. ' Code 1849, p. 59.

The said hotel was erected, and the use of the public land of the United States on which the same stands, was acquired from the United States, and is held subject to its control and supervision, under and by virtue of the following act:

'Resolved by the senate and house of representatives of the United States of America in congress assembled, that the secretary of war be, and he is hereby authorized to grant permission to John F. Chamberlin to build a hotel upon the lands of the United States at Fortress Monroe, Virginia, upon such site, and with such plans and dimensions, as may be approved by the secretary of war: provided, that the state of Virginia, by its general assembly and governor, shall by proper legal enactment give the consent of said state to the erection of such hotel, and that the building or buildings erected shall be removed at the expense of the owner or owners whenever the secretary of war shall so direct; and no claim for damages by reason of such removal shall be made upon the government of the United States: and provided, further, that the building so erected shall be subject to state and national taxation as other property. Approved March 3, 1887.' See 24 U.S.St.at Large, p. 648.

In accordance with this resolution, the secretary of war granted to John F. Chamberlin permission to erect said hotel on the site whereon it now stands, according to certain plans and dimensions, and subject to the restrictions imposed by the joint resolution. On the 30th day of March, 1887, the general assembly of Virginia gave its consent to the erection of the hotel on said lands, subject to certain restrictions and conditions, (see act of said assembly, chapter 11, Acts Ex. Sess. 1887,) as follows:

'Be it enacted by the general assembly of Virginia, that the consent of the state of Virginia is hereby given to John F. Chamberlin to erect a hotel upon the lands of the United States at Fortress Monroe, in accordance with a joint resolution of the congress of the United States, authorizing him to erect a hotel; but the said building, property, or business connected therewith or transacted therein shall be liable to the same taxes as any other property or licensed business in the commonwealth of Virginia. And this consent is granted upon the further condition that all taxes and assessments upon the said property in favor of the commonwealth of Virginia are to be paid in currency, and not in coupons.'

On the 18th day of February, 1890, Chamberlin sold and conveyed all his rights and privileges under the resolution of congress and the permission granted by the secretary of war and the state of Virginia to the defendant company, the Old Point Comfort Hotel Company. Pursuant to the act of March 1, 1821, David Campbell, as governor, made a deed to the United States, which was admitted to record in the county court of Elizabeth City county on December 12, 1838. This deed recites the statute of cession, and grants, transfers, conveys, and cedes to the United States 'all the right of property and title and jurisdiction' of the commonwealth of Virginia to the property ceded.

In respect to territory derived from the states by the United States the following clause is embodied in the constitution of the United States, (article 1, Sec. 8, cl. 17:)

'Congress shall have power to exercise exclusive legislation in all cases whatsoever over such district (not exceeding ten miles square) as may by cession of particular states and the acceptance of congress become the seat of government of the United States, and to exercise like authority over all places purchased by the consent of the legislature of the state in which the same shall be for the erection of forts, magazines, arsenals, dock yards, and other needful buildings.'

While con...