Opinion of the Justices To the Senate

• Decision Date: 15 April 1927
• Citation: 261 Mass. 523
• Parties: OPINION OF THE JUSTICES TO THE SENATE.(Opinions of the Justices.)
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

261 Mass. 523

OPINION OF THE JUSTICES TO THE SENATE.(Opinions of the Justices.)

Supreme Judicial Court of Massachusetts.

April 15, 1927

If the period of the lease of the property and franchises of the Boston

Elevated Railway Company to the Commonwealth, as provided in Spec. St. 1918 c. 159, is extended for a term of years, the General Court may provide that the Commonwealth shall guarantee the payment of principal and interest of any securities of the company that the public trustees may be authorized to issue for the purpose of effecting economies in the fiscal management of the company and of promoting more efficient service by it. Such guarantee would not violate art. 62 of the Amendments to the

Constitution of the Commonwealth or any other constitutional provision. The fact that such securities might be outstanding after the termination of the period of public operation and management would not render such a guarantee inconsistent with art. 62 of the Amendments to the

Constitution or with any other constitutional provision.

It is constitutionally competent for the General Court to exempt such securities in the hands of their holders from taxes levied under authority of the Commonwealth.

It is constitutionally competent for the General Court to effect the retirement of preferred stock of the company issued under and in accordance with St. 1911, c. 740, Section 2, and of any other class or classes of the company's stock without the consent of the holders thereof by the exercise of the power of eminent domain; and provisions of a certain bill proposed in the Senate looking toward that end were stated in an Opinion of the Justices to be constitutional.

Certain sections of such a proposed bill providing for the retirement of the corporation's preferred stock would not be repugnant to the provisions of the Federal Constitution or of the Constitution of this

Commonwealth.

Under any extension of the lease of the property and franchises of the company provided in Spec. St. 1918, c. 159, or of the present system of public operation and management of the company, the provisions of art.

63 of the Amendments to the Constitution of the Commonwealth would not apply to receipts of the company during the period of such lease or of such system of operation and management, moneys received during that period in the management of the corporation not being "received on account of the commonwealth."

Any such extension of the lease or of the system of public operation and management would not be repugnant to the provisions of art 59 of the

Amendments to the Constitution of the Commonwealth or to any provision thereof.

If provisions of a proposed bill pending in the Senate and entitled "An Act extending the term of the lease to the Commonwealth of the properties of the Boston Elevated Railway Company and continuing public management and operation thereof," and containing provisions for the retirement of the company's preferred stock, were enacted into law, the General Court thereafter could not, by virtue of art. 59 of the Amendments to the

Constitution of the Commonwealth, amend, alter or repeal any provisions of the bill as were declared thereby and by Spec. St. 1918, c. 159 to constitute a contract binding upon the Commonwealth. If the bill of the character above described were enacted by the General

Court, it would not be subject to the referendum provisions of art. 48 of the Amendments to the Constitution of the Commonwealth.

Having given their opinions under c. 3, art. 2 of the Constitution upon specific questions relating to the constitutional power of the General

Court to enact a bill covering over fourteen pages of the printed record and of the character above described, the Justices respectfully asked to be excused from answering the question, "Would any provision of said bill be unconstitutional if enacted into law?"

THE following order was passed by the Senate on April 15, 1927, and was transmitted to the Justices of the Supreme Judicial Court on April 20, 1927:

WHEREAS, There is pending before the General Court a bill entitled "An Act extending the term of the lease to the Commonwealth of the properties of the Boston Elevated Railway Company and continuing public management and operation thereof" (printed as Senate, No. 276, as amended), a copy of which is hereto annexed, relating to the policy to be pursued by the Commonwealth in regard to the continuance of the public operation and management of the Boston Elevated Railway Company; and

WHEREAS, The Senate is of the opinion that the General Court ought not to proceed further in its consideration of the issues involved until certain grave constitutional questions arising therein are disposed of; therefore be it

ORDERED, That the opinions of the Honorable the Justices of the Supreme Judicial Court be required on the following important questions of law: --

1. If the period of the lease of the property and franchises of said company to the Commonwealth, as provided in chapter one hundred and fifty-nine of the Special Acts of nineteen hundred and eighteen, is extended for a term of years, may the General Court provide that the Commonwealth shall guarantee the payment of principal and interest of any securities of the company that the public trustees may be authorized to issue for the purpose of effecting economies in the fiscal management of the company and of promoting more efficient service by said company?

2. Would such guarantee violate the sixty-second article of the Amendments to the Constitution of the Commonwealth or any other provision thereof?

3. Would the fact that such securities might be outstanding after the termination of said period of public operation and management render such a guarantee inconsistent with said sixty-second article or with any other constitutional provision?

4. Is it constitutionally competent for the General Court to exempt such securities in the hands of their holders from all taxes levied under State authority?

5. Is it constitutionally competent for the General Court to effect the retirement of preferred stock of the company issued under and in accordance with section two of chapter seven hundred and forty of the acts of nineteen hundred and eleven and of any other class or classes of the company's stock, without the consent of the holders thereof, by the exercise of the power of eminent domain or otherwise?

6. Would sections twelve to fourteen, inclusive, of said bill, providing for the retirement of the company's preferred stock, be repugnant to the provisions of the Constitution of the United States prohibiting a State from passing any law impairing the obligation of a contract or to any other provision of said Constitution or of the Constitution of the Commonwealth?

7. Under any extension of the said lease or of the present system of public operation and management of said company, would the provisions of the sixty-second article of the Amendments to the Constitution of the Commonwealth apply to the receipts of the company during the period of such lease or of such system of operation and management?

8. Would any such extension be repugnant to the provisions of the fifty-ninth article of the Amendments to the

Constitution of the Commonwealth or to any other provision thereof?

9. If said bill were enacted into law could the General Court thereafter, by virtue of the said fifty-ninth article, constitutionally amend, alter or repeal such provisions of said bill as are declared thereby and by said chapter one hundred and fifty-nine to constitute a contract binding upon the Commonwealth, or any of them?

10. If said bill were enacted by the General Court would it be subject to the referendum provisions of article forty-eight of the Amendments to the Constitution?

11. Would any provision of said bill be unconstitutional if enacted into law?

The proposed statute referred to in the above order as "Senate, No. 276 as amended" read as follows:

An Act extending the term of the lease to the Commonwealth of the properties of the Boston Elevated Railway Company and continuing public management and operation thereof.

Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority of the same, as follows:

SECTION 1. Section one of chapter one hundred and fifty-nine of the Special Acts of nineteen hundred and eighteen is hereby amended by striking out, in the eighth to tenth lines, inclusive, the words "for the term of ten years from the date when they assume the management of the company as hereinafter provided" and inserting in place thereof the words: -- until July first, nineteen hundred and twenty-eight, -- by striking out, in the twenty-first and twenty-second lines the words "twenty-five of chapter five hundred and fourteen of the acts of nineteen hundred and nine" and inserting in place thereof the words: -- forty of chapter two hundred and seventy-one of the General Laws, -- by striking out, in the twenty-seventh and twenty-eighth lines, the words "one of chapter seven of the Revised" and inserting in place thereof the words: -- three of chapter twelve of the General, -- and by striking out the last paragraph and inserting in place thereof the following: -- On July first, nineteen hundred and twenty-eight, or, if this act is not accepted until after said date, as soon after said acceptance as practicable, the governor, with the advice and consent of the council, shall appoint five trustees for terms of two, four, six, eight and ten years, respectively, from July first, nineteen hundred and twenty-eight, and thereafter, as the terms of the members so appointed expire, their successors shall be appointed in like manner for terms of ten years...