Illinois Cen. R.R. Co. v. East Sioux Falls Quarry Co.

• Decision Date: 30 December 1913
• Citation: 33 S.D. 63,144 N.W. 724
• Parties: ILLINOIS CENTRAL RAILROAD COMPANY, Plaintiff and respondent, v. EAST SIQUX FALLS QUARRY COMPANY et al., Defendants and appellants.
• Court: South Dakota Supreme Court

33 S.D. 63, 144 N.W. 724 (1913)

ILLINOIS CENTRAL RAILROAD COMPANY,

Plaintiff and respondent,

v. EAST SIQUX FALLS QUARRY COMPANY et al.,

Defendants and appellants.

South Dakota Supreme Court

Appeal from Circuit Court, Minnehaha County, SD

Hon. Joseph W. Jones, Judge

Affirmed

Boyce, Warren & Fairbank

Attorneys for Appellants.

Bailey & Voorhees, Helsell & Helsell

Attorneys for Respondents.

Opinion filed December 30, 1913

WHITING, P. J.

Plaintiff, a foreign corporation, as lessee of the owner thereof, another foreign corporation, operates a line of railway extending into this state from the state of Iowa, and brought this action seeking to exercise the right of eminent domain, and thereby condemn a right of way for a spur or industrial track, this proposed spur track to branch from the main line of such railway, and to extend across the land of defendants; its objective point being a private stone quarry owned by one Lowe. Trial was had; a judgment condemning such land entered; motion for new trial denied; and defendants appealed from such judgment and order denying a new trial.

Appellants declare, and we think correctly, that it devolves upon a party seeking, through delegated power, to exercise the right of eminent domain to show:

"(1) That such party is within the class to whom the power has been delegated. (2) That all conditions precedent have been complied with, (3) That the purpose for which the property is to be taken is one of the purposes enumerated in the statute. (4) That the property is to be taken for a public use. (5) That the particular property sought to be taken is necessary to the accomplishment of the public purpose intended."

Appellants contend: (1) That the respondent does not possess the power to take private property for the purpose of building a branch to the road of its lessor, because it has not complied with the statutory conditions precedent to the exercise of such power in such case. (2) That respondent does not possess the power to take the land of appellants for the branch road in question, because its board of directors did not adopt a resolution designating the route of such proposed extension or branch, and file a copy thereof in the office of the secretary of state; that it could not proceed under the resolution adopted by the grantor of its lessor because (a) that resolution was for the main line, and did not include the branch in question; (b) the lease of such road by respondent could not transfer to it any franchise acquired by the grantor of its lessor, authorizing it to take private property for railway purposes. (3) That the statutes of this state do not empower a railway company to condemn land for a spur or industrial track from a main line to a private establishment. (4) That the evidence in this case shows that it was sought to take appellants' land for the private use of respondent and Lowe, and not for any public use or purpose, and that there is no public necessity for taking the same.

Has respondent complied with the statutory conditions precedent to the exercise of the power of eminent domain in this case? The power of eminent domain being a power which is possessed by a railway corporation solely by being delegated to such corporation by the sovereign power of the state, its existence depends upon a strict compliance with each and every condition prescribed by such sovereign power. 1 Lewis, Eminent Domain (3d Ed.) s. 388; 15 Cyc, 812, 815; Chestatee, etc., Co. v. Cavenders Creek Co., 119 Ga. 354, 46 S.E. 422, 100 Am.St.Rep. 174.

It is conceded by appellants that a lessee operating a railroad belongs to a class to whom is delegated the power of eminent domain; it is also conceded that respondent is authorized to exercise such power for various purposes, but appellants contend that this authority comes from section 494, C. C., which provides among other things, that, before a foreign railroad corporation shall be permitted to avail itself of the provisions of such act, it "shall file with the secretary of state a duly certified copy of its charter or articles of incorporation, and comply with all other provisions of the laws of this state relating to foreign corporations," and appellants contend that respondent has not complied with the provisions of section 551, C. C., which provides:

"Every railroad corporation organized or doing business in this state under the laws or authority thereof shall have and maintain a public office or place within the state for the transaction of its business and where shall be kept for public inspection, books, in which shall be recorded the amount of capital stock subscribed and by whom, the names of the owners of its stock and the amount owned by them respectively, the amount of stock paid in and by whom, the transfer of stock, the amount of the assets and liabilities of the corporation, and the names and places of residence of its officers."'

This section was enacted pursuant to and for the purpose of carrying into effect section 12, art. 17, Const., which, after reciting almost verbatim what was afterward enacted in said section 551, provides: "And the Legislature shall pass laws enforcing by suitable penalties the provisions of this section." It is conceded that respondent has never complied with the above provisions of the Constitution and of said section 551; but respondent contends, and we think correctly, that a compliance therewith is not prerequisite to its right to exercise the right of eminent domain. It will be noted that the Constitution provides that the Legislature should pass laws enforcing, by suitable penalties, the said provisions of the Constitution. In compliance therewith the Legislature, by section 552, C. C., specifically provided for a penalty in the nature of a financial forfeiture. This certainly precludes any presumption that any other penalty was to be visited upon a corporation for a failure to comply with such provisions. It will also be observed that these constitutional and statutory provisions relate to railroad corporations only, while the proviso in section 494 recited that the corporation should "comply with all other provisions of the laws of this state relating to foreign corporations"--not with all other laws relating to railroad corporations. It is clear to our minds that this law requires that the foreign railroad corporation shall comply with those provisions of the statute only which impose duties upon foreign corporations as distinguished from domestic corporations, such as laws requiring filing of articles of incorporation, appointing of resident agents for purpose of service of process, etc. No claim is made but that respondent has complied with all the laws relating to foreign corporations generally. It will be noted that neither the Constitution nor section 551, C. C., provides that the right on the part of a foreign corporation to exercise the power of eminent. domain depends in any manner upon a compliance with the provisions therein contained.

Was it incumbent upon respondent to plead and prove that its board of directors bad passed and filed with the Secretary of State a resolution, designating the route of the proposed spur or industrial track? Section 506, C. C., authorizes the building of extensions and branches, but further provides:

"Before making such extension or building any such branch road, such corporation shall, by resolution of its directors, to be entered in the record of its proceedings, designate the route of such proposed extension or branch in the manner provided in section 480, and file a copy of such record, certified by the president and secretary, in the office of the secretary of state, and cause the same to be recorded as provided in section 480."

Said section 480, C. C., authorizes the incorporating of a company for the constructing, maintaining, and operating of a railroad, and provides for the making and adopting of articles of incorporation, which articles are to be filed with the Secretary of State, and shall recite, among other things: "The place from and to which such railroad is to be constructed, or maintained and operated" as the case may be." It seems clear to us that the term "branch road" as used in said section 506 especially when we read the same in connection with and in the light of section 480--does not include a spur or industrial track. Certainly a railroad corporation need, not, in its articles of incorporation, set forth each and every spur, switch, or side track it contemplates constructing, but need only, in general terms, describe the line of railroad it contemplates constructing or maintaining. In the case of Akers v. United N. J. R.R. Co., 43 N.J. Law, 110, in speaking of the term "branch railroad," the court said:

"The branch railroad here designated means more than these side tracks. It denotes a road, connected indeed with the main line, but not a mere incident of it, not constructed simply to facilitate the business of the chief railway, but designed to have a business of its own, for the transportation of persons or property to and from places not reached by the principal route."

We think the above a clear and excellent definition of what is meant by a "branch railroad" and it is in full accord with the classification made by the Interstate Commerce Commission:

"Branch lines are defined as lines serving one or more stations beyond the point of junction with the main line or another branch line, and to or from which stations regular tariff rates are in effect. Spur tracks are defined as lines constructed to reach or serve industries, such as mills, mines, smelters, factories, etc., over which regular scheduled passenger or freight train service is not performed, and for transportation over which only a switching charge, if any, is made."

The proposed spur or industrial track would, not constitute a "branch" road, and therefore does not come under the provisions of section 480 and 506,...