Portlanp Terminal Co. v. Boston & M. R. R.

• Decision Date: 05 January 1929
• Citation: 144 A. 390
• Parties: PORTLANP TERMINAL CO. et al. v. BOSTON & M. R. R.
• Court: Maine Supreme Court

144 A. 390

PORTLANP TERMINAL CO. et al.

v. BOSTON & M. R. R.

Supreme Judicial Court of Maine.

Jan. 5, 1929.

Report from Supreme Judicial Court, Cumberland County, at Law.

Suit by the Portland Terminal Company and another against the Boston & Maine Railroad. On report. Bill dismissed, with a single bill of costs.

Argued before WILSON, C. J., and PHILBROOK, DUNN, DEASY, STURGIS, and PATTANGALL, JJ.

Charles H. Blatchford, of Portland, for complainants.

Cook, Hutchinson & Pierce, of Portland, for respondent.

STURGIS, J. The Portland Terminal Company, originally incorporated under Private and Special Laws of 1887, c. 96, as the Portland Union Railway Station Company, by Private and Special Laws of 1911, c. 189, acquired its present corporate name, and by extension of its original charter was authorized to include within its limits and acquire by contract, purchase, or lease, any or all of the properties situated in the cities of Portland, South Portland and Westbrook, in the state of Maine, owned by the Boston & Maine Railroad, the Maine Central Railroad Company, or any other railroad using the terminal. Issuing capital stock and bonds, as authorized by the act, the terminal company purchased the properties of the Maine Central Railroad Company and the Boston & Maine Railroad, situated within the cities designated, and on July 1, 1911, began operation under its extended charter, with these two railroads as sole users of its facilities.

Section 7 of the act of 1911 provided that: "The railroad companies using the railway terminal shall pay to the terminal company for such use, in monthly payments, such amounts as may be necessary to pay the expenses of its corporate administration and of the maintenance and operation of the terminal and of the facilities connected therewith and owned by said terminal company, Including insurance and all repairs, all taxes and assessments which may be required to be paid by said terminal company, the interest upon its bonds or other obligations issued under the provisions of this act as the same shall become payable, and a dividend, not to exceed five per cent. per annum, upon its capital stock. Each of such railroad companies shall pay for such use of the terminal and its facilities in the proportion in which it has the use thereof, the same to be fixed by the written agreement of all such railroad companies, and in case they fail to agree, the board of railroad commissioners shall determine such proportions upon the application of said terminal company or of any of said railroad companies. Said proportions as so fixed, either by agreement or by decision of the board of railroad commissioners, may be revised and altered from time to time, either by the written agreement of all of the railroad companies at any time, or by the board of railroad commissioners upon like application, at intervals of not less than three years. The decisions of the board of railroad commissioners fixing said proportions of payments shall be final and binding upon all of said railroad companies, and the payments required to be made by them respectively to said terminal company either by such agreement or decisions shall be deemed part of their operating expenses, and the supreme judicial court or any justice thereof shall have jurisdiction in equity to compel such payments to be made, either by mandatory injunction or by other suitable process."

In this bill in equity, dated January 15, 1926, the Maine Central Railroad Company joins the terminal company as plaintiff, alleging that, pursuant to the provision of section 7, as above quoted, the railroads entered into an agreement fixing the proportion which each should pay for its use of the terminal facilities, which is still in force and effect; that the Boston & Maine Railroad has not paid its proportionate part of the expense of the terminal as so determined, and is indebted to the terminal company for this deficiency in payments. The bill concludes with a special prayer for mandatory process to compel payment, and a prayer for general relief.

The answer denies the existence of an agreement, in accordance with the act, with an affirmative defense that the proportions of payments due from the two railroads to the terminal company have been determined by decrees of the Public Utilities Commission of Maine (as successor of the former board of railroad commissioners) subsequent to, and inconsistent with, the agreement relied upon by the plaintiffs in their bill.

In so far only as the allegations of the bill and the evidence entitle the plaintiffs to equitable relief, can a decree therefor be rendered, Singhi v. Dean, 119 Me. 287, 291, 110 A. 865; Glover v. Jones, 95 Me. 303, 307, 49 A. 1104, and this within the jurisdiction conferred upon this court by section 7 of the act. The plaintiffs declare upon an "agreement" alleged to be within the provisions of the act. Hence, upon this bill this court has jurisdiction only to compel payment by the defendant railroad as due under, and by virtue of, such an agreement.

Turning back to the early history of the terminal company, we find that, prior to the beginning of operations under the new charter, the terminal company, under the name of the Portland Union Railway Station Company, operated the terminal facilities at Portland, Me., used by the Boston & Maine Railroad and the Maine Central Railroad Company. Originally it was operated only as a passenger terminal. On May 1, 1910, however, a terminal division was established, bringing both passenger and freight terminals within its operations. An arrangement was then made between the roads for the determination of the proportionate division of the cost of the operation of the terminal division chargeable to each. For the first six months' period the percentage of cost thus determined was 50.9 for the Maine Central and 49.1 for the Boston & Maine, and for the second six months 52 for the Maine Central and 48 for the Boston & Maine. Settlements between the roads for these periods were made on these percentages.

July 1, 1911, the act of 1911 became effective. Under it the terminal company extended the limits of the terminal, and included within its holdings properties of both roads previously operated outside the terminal division. In passing it may be noted that the capital stock of the terminal company, under its original charter, was owned in equal shares by the Boston & Maine Railroad and the Maine Central Railroad Company, and this equality of ownership of stock continued when the terminal company began its extended operations. The details of this stock ownership and its subsequent history, however, are not important in the determination of this case. The railway station company and its facilities was the terminal for the two roads here involved, and used by them only. Its affairs were managed and controlled from their offices, 'and its official personnel included members of their executive boards. Charles S. Mellen was president of the Boston & Maine Railroad, president of the Maine Central Railroad Company, and president of the Portland Terminal Company, and, to use his expression in reference to the roads and the terminal, they were "all in one family." The vice president and general manager of the Boston & Maine was Mr. Frank Barr. Mr. Morris McDonald, of Portland, occupied a similar position with the Maine Central.

Just previous to July 1, 1911, the effective date of the operation of the terminal by the terminal company, Mr. Mellen, the president of the three corporations, discussed terminal operations with Mr. McDonald, who tells us that this meeting was on the morning of June 19, 1911, at Portland, and says: "Mr. Mellen represented the Portland Terminal Company, and he also represented the Maine Central Railroad Company and the Boston ft Maine." For the Maine Central Railroad, Mr. McDonald "was discussing the Maine Central interests, and called his attention to the percentages that we had used during the terminal company's operations, and other matters in connection with it, until I built up a picture that seemed to me to be pretty satisfactory in the matter which I was going to recommend, which was for simplification and other reasons, that I had thought we had better make the percentages 50 to each company; and as I remember it, he thought it over and he said 'That is very fair, and you are very close to it now; there are a lot of benefits the two roads get, and we are all in one family and its seems to me that is perfectly fair and proper, and that will be agreed to as far as I am concerned on the Boston & Maine. * * * I think he said 'You write to Frank Barr, and I will do whatever is necessary at Boston to have the matter understood.'"

Following this conversation Mr. McDonald says he wrote on the same day the following letter:

"Mr. Frank Barr, Vice President & General Manager, Boston and Maine Railroad, Boston, Mass. "Dear Sir: As you know, the operation of the Terminal Division which expires midnight of June 30th, has been operated on a percentage basis, arrived at according to the traffic conditions, and it is intended that the operations by the Portland Terminal Company thereafter to put the Boston and Maine and Maine Central operations on a fifty per cent. basis to each line.

"This for your information. "Yours truly,

"[Signed] Morris McDonald, "Vice President and General Manager."

Mr. McDonald continues: "I heard nothing further from it, but I remember shortly after that I had a talk with Frank Barr on the telephone, and he said he had got my letter, as I remember it, and that he hadn't had a chance to talk with Mr. Mellen, but as far as he was concerned it was all right. * * * "

Apparently this discussion of the apportionment of terminal expense by Mr. Mellen and Mr. McDonald, with the letter to Mr. Barr and his conversation with Mr. McDonald over the telephone, concluded the discussion of this matter by the responsible...