G. C. R'Y Co. v. G. C. S. R'Y Co.

• Decision Date: 20 March 1885
• Docket Number: Case No. 2006.
• Parties: THE G. C. R'Y CO. v. THE G. C. S. R'Y CO.
• Court: Texas Supreme Court

63 Tex. 529

THE G. C. R'Y CO.

v.THE G. C. S. R'Y CO.

Case No. 2006.

Supreme Court of Texas.

Mar. 20, 1885.

APPEAL from Galveston. Tried below before the Hon. Wm. H. Stewart.

April 9, 1884, appellee brought this suit to recover damages, and for injunction to restrain defendant from interfering with appellee in constructing street railroads over certain streets and avenues in the city of Galveston, alleging that plaintiff was duly incorporated in accordance with the general laws of the state of Texas; that it had secured the consent of the city council to construct its lines on certain streets named; that appellant wrongfully, and without the consent of the city council, also commenced work upon the same streets, and operated in such way as to interfere with and to prevent appellee from prosecuting the work; and also wrongfully caused collisions between its laborers and those of the appellee.

Appellant answered that it was duly incorporated by virtue of the special act of the legislature passed in 1866, and amended in 1871; that, as such corporation, it had the exclusive right to the streets of Galveston, for the purpose of constructing and operating street railways thereon. That the city council had granted the right to construct and maintain street railways on all the streets to which appellee asserted that right to the People's Railway Company, which had been duly incorporated under the general laws of the state; and which company had been, by and with the consent of the city council, bought out by appellant in 1879, and that thereby appellant secured its franchise, rights and property.

The cause was tried without a jury, and the court, as to certain streets named, perpetually enjoined appellant from in any manner interfering with appellee, etc.

Appellant's assignments of error were numerous and lengthy.

Appellee was incorporated in 1883, and amended articles were filed in the secretary of state's office March 24, 1884.

The articles of incorporation of the People's Railway Company were filed December 10, 1873.

It appeared from the evidence that, with one or two exceptions, the streets upon which appellee claimed the right to construct and maintain its lines were never occupied by any other street railway, and that, in reference to the exceptions, the road-bed had been removed and the streets abandoned for about four years before the city council gave appellee consent to use the same.

Scott & Levi, for appellant, contended that the permission given by the city to construct and operate the road was a contract that could not be disregarded or divested except by due course of law, citing: Const., U. S., art. 1, sec. 10, amendment 14; Const., State Bill of Rights, sec. 19; 24 Tex., 122, 125;People's R. R. v. Memphis R. R., 10 Wall., 52et seq.; Cooley's Const. Lim., 339; Hiss v. Balt., etc., R. R. Co., 62 Md., 262; S. C., 4 Am. and Eng. R'y Dec., 201, 210; Morawetz on Corp., secs. 422, 423, 424, 431, 432; Canal Co. v. R. R. Co., 4 G. & J., p. 146.

That the city could not grant such a franchise, they cited: Galveston City Charter, 1876, secs. 34, 73, 74; Const. of Texas, 1876, art. 10, sec. 7; art. 12, secs. 3, 7; Dillon on Mun. Corp., secs. 55, 566; People's R. R. v. Memphis R. R., 10 Wall., 50, 52.

Hume & Shepard and James B. Stubbs, for appellee, that the city, in giving permission to construct a road, gave but a license which might be converted into a franchise by the state, and lost by a failure to build or maintain as required by the city, cited: City Charter, secs. 34, 73, 74, 81; Const., art. 10, sec. 7; Dillon, Mun. Corp., sec. 563; Citizens' Gaslight Co. v. Louisville Gas Co., S. C. Ky., June 16, 1883; 1 Am. & Eng. Corp. Cases, 156.

As to the power to charter except by special law, they cited: Tunstall v. Wormley, 54 Tex., 476;Tex. & Miss. R. C. and Nav. Co. v. County Court of Galveston, 45 Tex., 272; Boone on Corporations, sec. 21; Morawetz's Private Corporations, sec. 7; 5 Wait's Act. and Defenses, 273-4.

WATTS, J. COM. APP.

There is but one way in which a street railway company can be incorporated under the present constitution, and that is by virtue of and in accordance with the general statutes of the state. These companies cannot now be incorporated by special act of the legislature. Const., art. 3, sec. 56; R. S., art. 566, clause 24.

And the right of such company to occupy with its road-bed any particular street is wholly dependent upon the consent of the local authorities who have control of the same. Without the consent of the local authorities having first been obtained, it is not within the power of the legislature to confer such right. Const., art. 10, sec. 7.

Appellant claims that appellee is not a legal corporation, with capacity to construct street railways in the city of Galveston, because there is no express provision contained in the city charter which would authorize the council to grant the right of way over the streets, and without such right of way there could be no franchise.

In this two distinct and different elements pertaining to this class of corporations are confounded, and from the confusion an erroneous conclusion is deduced.

Now the right to organize as an artificial person under a particular name, to have succession, maintain and defend judicial proceedings, to use a common seal, and to conduct the business for which it was created, constitutes the franchise or chartered rights of the company, and these must emanate from express legislative enactment. 1 Dillon on Municipal Corporations, sec. 37; Angell & Ames on Corporations, sec. 71.

But the right to occupy any particular street with its road-bed is entirely dependent upon the consent of the city authorities. To that end these local authorities have full control and management of the streets, and may or not consent to their use for such purpose. Const., art. 10, sec. 7; R. S., art. 4173; Indianola v. G., W. T. & P. R'y, 56 Tex., 599.

It clearly appears that appellee had filed the articles of incorporation in accordance with the statute, and had also procured the consent of the city authorities for the occupancy of certain of the streets and avenues with its road-bed; so that the objection to the capacity of appellee to maintain the proceeding...