Galveston Wharf Co. v. City of Galveston

• Decision Date: 19 December 1884
• Docket Number: Case No. 1600.
• Citation: 63 Tex. 14
• Parties: THE GALVESTON WHARF CO. v. THE CITY OF GALVESTON.
• Court: Texas Supreme Court

63 Tex. 14

THE GALVESTON WHARF CO.

v.THE CITY OF GALVESTON.

Case No. 1600.

Supreme Court of Texas.

Dec. 19, 1884.

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

The opinion states the case.

Ballinger, Mott & Terry, and Trezevant & Franklin, for appellant, cited: Const., art. VII, §§ 1, 2, 3; art. XI, §§ 5, 9; art. XII, §§ 3, 4, 5; Act February 8, 1851; City of Galveston v. Menard, 23 Tex., 349; Cooley on Tax., 130, 131; Burroughs on Tax., §§ 73, 142, 25; Dillon on Mun. Corp., §§ 64, 646; Townsend v. Greely, 5 Wall., 326;Klein v. New Orleans, 99 U. S., 149; N. O. v. Carrollton R. Co., 7 La. Ann. 148; Decision of Judge Woods, U. S. Circuit Court, Hitchcock v. Wharf Company, garnishing city wharf stock; Hart v. Burnett, 15 Cal., 530;Fulton v. Henlow, 20 Cal., 486; Fall v. Marysville, 19 Cal., 381; Law v. Lewis, 46 Cal., 552; Piper v. Singer, 4 S. & R., 354; Dir. of Poor v. School Dir., 42 Penn. St., 25; Gibson v. Hora, 37 Ia., 170;State v. Gaffney, 34 N. J., 133;Nashville Bank v. Tenn., 1 Swan, 269;People v. Salomon, 51 Ill., 52.

That injunction was appellant's proper remedy, they cited: Const., secs. 13 and 15, art. 8; Amended Charter, secs. 96 and 97; Cooley on Tax., 278-280; Id., 341-2; Burroughs on Tax., 302; Blackwell, Tax Titles, 279-289; Clegg v. State, 42 Tex., 609;State v. Baker, 49 Tex., 763;Edmonson v. City of Galveston, 53 Tex., 157;Hayden v. Foster, 13 Pick., 492;Terrell v. Graves, 18 Cal., 149;Shimmin v. Inman, 26 Me., 228; Cooley on Con. Lim., 521; 1 High on Inj., §§ 517, 529; Johnson v. Hahn, 4 Neb., 143;Abbott v. Edgerton, 53 Ind., 196;Freemont v. Bowling, 11 Cal., 380;Webb v. Cutsinger, 48 Ind., 246.

James B. Stubbs, for appellee, on the proposition that the property was not exempt, even in part, from taxation, cited: Const., art. 8, secs. 2, 4; art. 11, sec. 9; Van Allen v. The Assessors, 3 Wall., 584, 598; Queen v. Arnold, 9 Ad. & Ell. (N. S.), 806; Richmond v. R. & D. R. Co., 21 Gratt., 604;Atkins v. Gamble, 42 Cal., 86;Baltimore v. B. & O. R. R. Co., 6 Gill, 288; Burroughs on Tax., 142, 385; 2 Wait's Actions and Defenses, 311; Dillon, Mun. Corp., § 776; City of Galveston v. Menard, 23 Tex., 349;Norris v. City of Waco, 57 Tex., 635;Fall v. Maryville, 19 Cal., 391; Cooley on Taxation, 145, 146, 149, 150, 151, 152-54, and notes, 199, 482, 123, note, 163; Red v. Johnson, 53 Tex., 287;Bank v. Tennessee, 104 U. S., 493;Erie R. R. Co. v. Penn., 21 Wall., 492;N. O. v. St. Anna Asylum, 31 La. Ann., 292; Stein v. Mobile, 17 Ala., 134; Brennan v. Bradshaw, 53 Tex., 338.

STAYTON, ASSOCIATE JUSTICE.

The nature and result of this action is correctly stated in the brief of counsel for appellant as follows:

“Suit was brought by the Galveston Wharf Company, a corporationchartered in 1854, against the city of Galveston, to enjoin the sale of certain property advertised for sale for the payment of taxes to the city of Galveston from the wharf company, so far as the taxes were assessed on the one-third interest in certain wharf property in possession of the company, under compromise between the city and the company, confirmed by the legislature, on the ground that the said interest is the property of the city in trust for its present and future inhabitants, and is used only for public purposes, and not taxable by the constitution and laws of the state. An injunction was granted against the enforcement of the tax by the district judge of Harris county, in the absence of the district judge of Galveston county. But on the trial of the case before the latter judge the injunction was dissolved and the suit dismissed. There were various other objections to the tax as levied by the city, all of which were overruled by the judgment below, and some of which cannot be considered, owing to a failure to obtain the signature of the judge to the statement of facts. So far as the case is presented for review by this court, the pleadings and special agreement of the parties concurred in the facts.”

The petition sets out very fully the history of the grant to M. B. Menard, on which is situated the city of Galveston, through which and subsequent legislation conflicting claims to the flats and wharf privileges arose between the city of Galveston and others, who were claiming through the grant to Menard, out of which grew the suit which was decided in this court in 1859. A full history of that case and the questions involved and decided will be found in City of Galveston v. Menard, 23 Tex., 349.

The ownership of the soil in the flats in front of the lots out to the channel was held, in that case, to be in Menard and his vendees, who were declared to have the right to devote it to wharf or other like purposes, free from the control of the public, under the qualification incident to all property, that it was not to be so used as to be a common nuisance, and at the same time, in view of the purposes for which the grant to Menard was made, it was held that the city had a like right to build and control wharves in front of the streets of the city, which might be extended to or over the flats to the channel.

Within a year after the decision was made in the case of The City of Galveston v. Menard, a suit was brought by the city of Galveston against the Galveston Wharf Company, which had been organized pending the prior litigation, and was composed of the owners of wharves sued in the former case, and other owners of wharves and wharf property. That action was transferred to Brazoria county, where it was pending until April 1, 1869, when, by agreement of parties, a consent decree was entered by the district court of that county, which was intended by the parties to be a full settlement and compromise of all matters in controversy between the city of Galveston and the Galveston Wharf Company. The decree thus rendered was confirmed by an act of the legislature of June 23, 1870. There therefore arises no question as to the binding force and effect of that decree, which might arise but for the confirmatory act.

The assignments of errors are as follows:

1. “The court erred in its judgment in holding that the interest or share of the city of Galveston in the property assessed and taxed by the city of Galveston is subject to taxation by the city of Galveston.”

2. “The court erred in its judgment in holding that the sale against which the writ of injunction was sued out could lawfully be made to satisfy taxes assessed by the city of Galveston on its own interest, held in trust for the public, in the property assessed by it for taxes.”

3. “Because the interest of the city of Galveston in the wharf property, the subject of controversy, is held by the city of Galveston in trust for its present and future inhabitants, and solely for public purposes, as authorized by the legislature of the state, and is not lawfully subject to taxation by the city of Galveston, the court erred in its judgment in holding the same liable to such taxation.”

The question which arises is: Has the city such interest in the one-third interest in the property sought to be taxed as exempts it from taxation by the city?

The character of interest held by the city in the Galveston Wharf Company's property depends on the true construction to be given to the decree of the district court for Brazoria county before referred to.

So much of that decree as is necessary to an examination and determination of that question is as follows:

“It is considered, ordered, adjudged and decreed by the court, that the present capital stock of the Galveston Wharf Company, consisting of twelve thousand four hundred and forty-four shares of stock of $100 per share, amounting in the aggregate to $1,244,400, shall be increased the full one-half thereof, viz.: by six thousand two hundred and twenty-two shares of $100 each, amounting to the sum of $622,200, which said stock of said sum of $622,200 shall be the property of the mayor, aldermen and inhabitants of the city of Galveston, and the same shall stand and remain on the books of said company as the property of said mayor, aldermen and inhabitants of the city of Galveston, and the equal, undivided one-third of the property of said company, to be consolidated and vested in it by this decree, shall be owned by said city, and represented by its said stock, and the said stock, and the rights and interests therein, and in said property, of said mayor, aldermen and inhabitants of the city of Galveston, shall be in trust for the present and future inhabitants of the city of Galveston, and all and every part thereof shall be inalienable, and not subject to conveyance, assignment, transfer, pledge, mortgage, or any liability for debt whatever, in any other manner than by the vote of four-fifths of all the qualified voters of said city in favor of some clear and specific proposition therefor. The dividends and net earnings of said stock shall be regularly paid to said mayor, aldermen and inhabitants of the city of Galveston, to be disbursed and expended for the public good and benefit of said present and future inhabitants of said city.”

Said decree then proceeds to fix the respective representation and rights of said city and company on the board of directors, giving the city three directors in said board of nine, one to be the mayor, and one of the committee on finance, another an alderman, and the third an alderman or citizen, but to be elected by the council. And said decree further provides:

“In consideration of all which, it is further agreed between the parties, and is now considered,??ordered, adjudged and decreed by the court, that all the property, rights and claims of every kind and description (except certain lots and property hereinafter specified) of the said Galveston Wharf Company, and also all the right, title, interest and claim of every kind and description whatsoever, of the said mayor, aldermen and inhabitants of the city of Galveston, in and to all the land and ground extending from the shore or...