Louisville & N.R. Co. v. City of Henderson

• Decision Date: 20 June 1913
• Citation: Louisville & N.R. Co. v. City of Henderson, 157 S.W. 1105, 154 Ky. 575 (Ky. Ct. App. 1913)
• Parties: LOUISVILLE & N. R. CO. et al. v. CITY OF HENDERSON. [d]
• Court: Kentucky Court of Appeals

157 S.W. 1105

154 Ky. 575

LOUISVILLE & N. R. CO. et al. v. CITY OF HENDERSON. ^[d]

Court of Appeals of Kentucky.

June 20, 1913

Appeal from Circuit Court, Henderson County.

Action by the City of Henderson against the Louisville & Nashville Railroad Company and others. Judgment for plaintiff, and the Louisville & Nashville Railroad Company appeals. Reversed and remanded for judgment.

Turner J., dissenting.

Chas H. Moorman and Benjamin D. Warfield, both of Louisville Yeaman & Yeaman, of Henderson, and H. L. Stone, of Louisville, for appellant.

John C Worsham, of Henderson, for appellee.

HOBSON C.J.

By an act approved February 9, 1872 (Loc. & Priv. Acts 1871-72, c. 264), the General Assembly incorporated the Henderson Bridge Company, giving it authority to construct a bridge across the Ohio river extending from some convenient point within the corporate limits of the city of Henderson to some convenient point on the Indiana side of the river opposite the city of Henderson, with power to purchase or take by condemnation such real estate as was necessary for the site of the bridge, piers, abutments, toll houses, and such other purpose as might be necessary, and to extend a railroad over the bridge with as many sets of tracks as were deemed expedient. The company was organized under the charter. The city of Henderson enacted an ordinance granting the company certain rights and privileges. Sections 1 and 4 of this ordinance are as follows:

"1. That the Henderson Bridge Company organized under the act of the General Assembly of the commonwealth of Kentucky, approved February 9, 1872, be and they are hereby granted the right to construct on or over the center of Fourth street in the city of Henderson and on the line thereof extended to low water mark on the Indiana side of the Ohio river such approaches, avenues, piers, trestles, abutments, toll houses and other appurtenances necessary in the erection of and for the business of a bridge over the Ohio river from a point in the city of Henderson to some convenient point on the Indiana side of said river and for such purposes the use of said Fourth street is hereby granted subject to the terms and conditions hereinafter expressed."

"4. That nothing herein shall be construed as waiving the right of the city of Henderson to levy and collect taxes on the approaches to said bridge or any building erected by said bridge company within the corporate limits of said city, the bridge itself and all appurtenances thereto within the limits of said city."

The bridge was built and was maintained by the Henderson Bridge Company from the year 1885 to the 26th of June, 1906, and the bridge company paid to the city of Henderson taxes on its physical properties, and for many years also paid to the city a franchise tax, under section 4077, Ky. St. On the 26th day of June, 1906, the Henderson Bridge Company filed in the office of the county court of Jefferson county and in the office of the Secretary of State of Kentucky and amendment to its charter by the terms of which its name was changed to the Henderson Bridge & Railroad Company, and it was authorized in addition to the rights conferred upon it by its original charter to build, construct, and operate a line of railroad from the termination of its bridge approach in the city of Henderson through the city and other places in Kentucky to a point opposite Shawneetown, Ill., and it was further authorized to transfer and convey its property to any other railroad company. By deed of date June 30, 1906, the Henderson Bridge & Railroad Company conveyed to the Louisville & Nashville Railroad Company all of its property of every kind tangible and intangible, including the bridge and all the rights, privileges, and franchises of the Henderson Bridge & Railroad Company. After this deed was made the Louisville & Nashville Railroad Company paid to the city of Henderson taxes on the physical properties in the city and also paid to it such part of its franchise tax as fell to the city under sections 4077-4081, Ky. St. On November 3, 1908 the city brought this suit against the Louisville & Nashville Railroad Company in which it set up the facts above stated, charging that the amended articles of incorporation were void in so far as they affected the right of the city to collect a franchise tax from the Henderson Bridge Company; that the whole arrangement was simply a device to defeat the city in the collection of this tax, and that under the ordinance of the city under which the bridge was constructed the city had a contract right to collect the franchise tax from the Henderson Bridge Company. It prayed that the amended articles of incorporation and the deed to the Louisville & Nashville Railroad Company be set aside in so far as they affected the right of the city to collect the franchise tax. The court on final hearing entered this judgment: "This cause coming on to be heard on the pleadings and the proof, and the court being advised, adjudges that by virtue of the ordinance of the city of Henderson of ___, 1882, the provisions of which were approved and accepted by the defendant the Henderson Bridge Company, and under the terms of which certain franchises and privileges were granted to the said defendant by said city, and the right reserved to plaintiff to levy and collect taxes on the property of said bridge company within the corporate limits of the city of Henderson, the plaintiff has the contract right to have the franchise of said Henderson Bridge Company valued and assessed by the State Board of Valuation and Assessment, or the proper authority, and to levy and collect taxes on said franchise assessment for such purposes as plaintiff is, by law, authorized to levy and collect taxes." The court further adjudged that the amended articles of incorporation and the deed to the Louisville & Nashville Railroad Company be set aside so far...