Houston & T. C. Ry. Co. v. State

Decision Date02 December 1896
Citation39 S.W. 390
PartiesHOUSTON & T. C. RY. CO. et al. v. STATE.
CourtTexas Court of Appeals

Appeal from district court, Travis county; James H. Robertson, Judge.

Suit by the state of Texas against the Houston & Texas Central Railway Company and another. Judgment for plaintiff. Defendants appeal. Reversed.

This suit was originally brought September 3, 1891, in the district court of Lipscomb county, by the state of Texas, acting by her attorney general, C. A. Culberson, against the Houston & Texas Central Railway Company and Frederick P. Olcott, for 170,880 acres of land. The venue was changed to Travis county, November 30, 1892, by consent of parties, where, in the district court, judgment was rendered for the state, from which this appeal is taken.

The original petition of plaintiff was in form of trespass to try title. On the 21st day of January, 1893, in the district court of Travis county, defendants filed a petition to remove the cause to the United States circuit court for the Western district of Texas. The court refused to remove the cause, and this ruling is the ground of the first assignment of error by appellants. The original suit, as before stated, was in form of the statutory action of trespass to try title, filed in Lipscomb county, September 3, 1891. Defendants, having been duly served, filed, on the 27th day of November, 1891, a general demurrer and plea of not guilty. There was a regular term of the court for Lipscomb county in November, 1891, and regular terms in June and November, 1892. On May 3, 1892, the state filed an abstract of its title, the grounds and laws relied on as title in the state, which abstract was amended May 23, 1892, claiming that the Houston & Texas Central Railway Company had failed to alienate the lands sued for, granted by the state, in the time required by the constitution and laws granting the land, whereby the lands were forfeited to the state. The agreement consenting to the change of venue was that no effect should be given thereto as to any right of defendants to remove the cause to the federal court. The district court of Travis county convened on the 2d day of January, 1893.

Plaintiff filed an amendment to its petition on the 3d day of January, 1893, with usual allegations of trespass to try title, and averred that the original certificates upon which the land sued for was located and patented were issued to defendant railway company December 22, 1873, wholly for sidings and turnouts on the main line of the railroad, aggregating 17 miles and 4,349 feet of sidings, or 3 miles and 1,694 feet north of the town of McKinney, in Collin county, and 14 miles and 2,655 feet south of the town of McKinney; that, at the time of the construction of such part of the road and the issuance of the certificates, there was no law in force in Texas permitting the issuance of certificates to the defendant railway company for any purpose; and that, if such law existed, the company had forfeited its right to the same by failing to construct and complete the several branches of its road in the time required by law; and that the issuance of the certificates and patents was without authority, and in violation of the constitution of the state in force at the time. It was further alleged that the approval by the governor of the engineer's report of the 3 miles and 1,694 feet north of McKinney, the issuance of certificates, the location thereof, and the issuance of patents thereon, were illegal and void, because the main line of the road, on which sidings and turnouts were built, was not and had not been accepted by the state; that there was no law in force in the state authorizing issuance of certificates for land to defendant company for sidings and turnouts. It was also alleged that, if there were any law authorizing the issuance of certificates, the company was required by law to alienate the land within stated periods after its acquisition, and that the land had not been so alienated. Prayer for title, cancellation of the certificates, and patents for the land, and for damages. Prior to the filing of the foregoing amendment by plaintiff, and before the venue was changed from Lipscomb county, to wit, on the 29th day of November, 1892, defendants filed an amended answer, to the effect that Charles Dillingham was at the time receiver of the railway company, by appointment of the circuit court of the United States for the Fifth circuit and Eastern district of Texas; and he was in possession of the lands sued for, and was authorized by the court to defend all suits in the name of the company. And, for plea to the jurisdiction, defendants say that at the time before suit, and now, the Houston & Texas Central Railway Company, its lands, franchises, and properties, were and are in the possession of the said circuit court, through its receivers; that the same were placed in the hands of Charles Dillingham, Nelson S. Easton, and James Rintoul, joint receivers, by decree of said court, made May 26, 1886, giving the style and number of the cause, which decree was modified by the court December 7, 1888, by order of the court, relieving Easton and Rintoul as receivers, continuing Dillingham as sole receiver. The plea sets out the order in full, and it is alleged that Dillingham, as sole receiver, alone had the right to defend all actions against the company or its properties until sold and delivered to the purchasers; that the property is still in the hands of the receiver; wherefore it is claimed that the said circuit court has exclusive jurisdiction of the present cause; that this suit was filed without leave of the said circuit court; and that, therefore, the court is without jurisdiction in the premises. The answer further set up the same matter, and claimed that Dillingham has such an interest in the property in suit as to make him a necessary party to the suit. This answer pleads a general denial in case other pleas and exceptions are overruled. The answer further alleged that on the 4th day of May, 1888, the said United States circuit court, in a certain cause (styled and numbered), ordered that the defendant company pay into court, within 30 days, certain sums of money, adjudged to be due to holders of certain bonds and coupons secured by certain deeds of trust, and further ordered that, in default of such payment, certain lands be sold to pay said debts, the lands in suit being a part of the lands ordered sold; that the defendant company failed to pay into court the sums so ordered within the time ordered, and thereupon the lands were sold pursuant to the decree of the court, in the city of Galveston, on the 8th day of September, 1888, to F. P. Olcott, the sale alleged to have been of all the properties of defendant company, except such as are subject to first mortgage lien on the Waco & Northwestern Division, of date June 16, 1875; that, pursuant to such sale, Dillingham, as special master commissioner, duly appointed by the said court, made and delivered, under the said decree, a deed to defendant Olcott, conveying to him the lands and properties aforesaid, the company, in assurance of the title, joining in the deed, by its president, A. C. Hutchinson; wherefore it is alleged that Olcott became invested with full title to the property purchased by him, of which the land claimed by plaintiff forms a part, and that Olcott is still the owner in fee simple of all the lands so conveyed to him, including the land claimed by plaintiff. The answer set up various special and general acts of the legislature granting lands and franchises to the company, and section 10 of article 1 of the constitution of the United States, and the fourteenth amendment thereto, as a defense, and specially set up that the cause is one arising under the constitution and laws of the United States, averring that the property in suit exceeds $5,000 in value. It also set up the various acts of officials of the state, the issuance of the certificates and patents to the land, the payment of taxes on it, showing that the laws were construed in favor of defendant company by such officials, and that they recognized its right to the land, and prayed for judgment in favor of Olcott for the land. This answer was filed November 29, 1892.

The petition for removal to the federal court was filed January 21, 1893, in the district court of Travis county. It was predicated on the ground that the amended petition of plaintiff, filed January 3, 1893, set up a new cause of action, to wit, that the land had not been alienated in the time provided by law, and that the suit is one arising under the laws of the United States. The petition for removal also set up that the lands had been alienated under orders of the federal court, as before stated, showing that defendant Olcott's title was made by virtue of the decree of said federal court, and by deed of the master commissioner under the order and decree of the said United States court, by which decree and sale thereunder the land was alienated long before this suit was brought. The state answered the petition for removal: That the grounds for removal—that the suit involves questions arising under the constitution and laws of the United States— were set up in defendants' answer, filed November 29, 1892, and that, therefore, the application to remove came too late; further, that plaintiff's amended petition, filed January 3, 1893, did not set up a new cause of action; that the amendment said to make a new cause of action was in reply to demurrer interposed by defendants calling for more specific allegations by plaintiff as to her claim to the land, and that the amendment is no more than a statement made necessary by pleadings of defendants; and, further, that the abstract of title filed by her had long before given notice of claims of the state to the land; and that the claim of forfeiture was included in the original petition. The state also set up that the agreement...

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