Royal Bank of Liverpool v. Grand Junction Railroad And Depot Co.

• Decision Date: 19 October 1878
• Citation: 125 Mass. 490
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court
• Parties: Royal Bank of Liverpool v. Grand Junction Railroad and Depot Company & others

125 Mass. 490

Royal Bank of Liverpool v. Grand Junction Railroad and Depot Company & others

Supreme Court of Massachusetts

October 19, 1878

Argued March 27, 1877; March 28, 1877

Suffolk. Bill in equity, filed January 23, 1869, against the Grand Junction Railroad and Depot Company, the East Boston Freight Railroad Company, the Boston and Worcester Railroad Company, the Boston and Albany Railroad Company, Samuel S Lewis and George W. Gordon, to reach and apply a sum of money in the possession of the two corporations last named, and alleged to belong to the first named corporation, in payment of a debt due from it to the plaintiff. Hearing on the pleadings and proofs, and an agreed statement of facts before Ames, J., who reserved the case for the consideration of the full court. The material facts appear in the opinion.

Bill dismissed.

G. G Hubbard & C. E. Hubbard, for the plaintiff.

J. G. Abbott & B. Dean, for the defendants.

Ames J. Colt & Soule, JJ., did not sit.

OPINION

Ames, J.

The Grand Junction Railroad and Depot Company became embarrassed, and ceased to pay the coupons on its bonds, in the latter part of the year 1856. Its property was incumbered bye mortgages of a large amount, and it was understood to be hopelessly insolvent. The plaintiff held fifty of its bonds, dated January 1, 1850, unsecured by any mortgage, amounting to $ 25,000, (besides interest in arrear,) which had become due on July 1, 1855, and were not paid. Upon these bonds it commenced a suit in August, 1865, in which an attachment upon all of the debtor corporation's real estate was returned upon the writ, which suit was pending at the date of the filing of the plaintiff's bill. No part of the debt has ever been paid.

At a term of the Superior Court for the county of Suffolk, held in April, 1862, George W. Gordon, one of the defendants, then the treasurer of the corporation, obtained a judgment against it for about $ 26,000, upon which an execution was issued; and the execution so issued was levied upon and satisfied by the sale of its franchise, with all the rights and privileges thereof, "so far as relates to the receiving of toll," to the East Boston Freight Railroad Company, for the term of ninety-nine years. This last named corporation was chartered by the Legislature of this Commonwealth in March, 1862, Gordon and Lewis being stockholders therein, and Gordon owning, at the first issue of the stock, nearly all the shares. In July, 1862, Lewis, professing to act on the behalf and with the authority of the Grand Junction Railroad and Depot Company, of which he was a director, executed a deed purporting to convey, in consideration of $ 13,085.56, all the real estate of that corporation, with its railroad and franchise, and all its rights and privileges, and the right of redeeming the same or any part thereof, to the East Boston Freight Railroad Company. At the annual meeting of the stockholders of the Grand Junction Railroad and Depot Company, held on May 31, 1862, a vote had been passed which in terms authorized Lewis to make this conveyance; and at a subsequent annual meeting, held on May 23, 1865, a vote was passed unanimously, to approve, ratify and confirm the above described conveyance, as the free act and deed of the corporation. In all these votes and acts of the corporation we find no apparent informality of any kind, and, so far as the title can be judged of by the papers alone, the franchise, property and rights of the Grand Junction Railroad and Depot Company were effectually transferred to the new corporation. This new corporation accordingly held the property and continued to exercise the franchise without interruption until November, 1866.

Under the authority given by the St. of 1866, c. 278, the Boston and Worcester Railroad Corporation, in November, 1866, took the railroad property known as the Union and Grand Junction Railroad, including all the railroad franchises and lands, "being all the property of the East Boston Freight Railroad Company," subject to the condition of paying to the owners such damages as should be awarded to them by the verdict of a jury upon proper proceedings. A hearing was accordingly had before a jury in December, 1867, and those damages were assessed at $ 536,260.20, and a verdict was rendered for that amount. At a term of the Superior Court in March, 1869, (viz.: June 8, 1869,) by agreement of the parties, judgment was rendered in favor of the East Boston Freight Railroad Company for the sum of $ 235,566.33, that being the amount of the verdict after deducting the amount of certain incumbrances assumed by the respondent in that case. And, in addition to this proceeding, the stockholders of the East Boston Freight Railroad Company, by vote passed May 19, 1869, authorized the conveyance of all the corporate property to the Boston and Albany Railroad Company, the successor of the Boston and Worcester Railroad Company, and such a conveyance has since been duly executed.

In its bill, the plaintiff insists that, however formal and regular the incorporation of the East Boston Freight Railroad Company, and its acquisition of the franchise and property of the Grand Junction Railroad and Depot Company, may appear on...