State ex rel. Hahn v. Minnesota Central Railway Company
| Decision Date | 22 December 1886 |
| Citation | 30 N.W. 816,36 Minn. 246 |
| Parties | State ex rel. William J. Hahn, Attorney General, v. Minnesota Central Railway Company. State ex rel. William J. Hahn, Attorney General, v. Hastings & Dakota Railway Company |
| Court | Minnesota Supreme Court |
These were two proceedings in quo warranto, instituted in this court by the attorney general. Before answering, the respondent in each case moved to quash the writ for want of jurisdiction, on the ground that the writ showed that the state had a plain, adequate, and complete remedy by civil action in the district court. The motions were denied. The respondents thereupon answered, and the cases were heard together upon demurrers to the answers. The facts appearing in the pleadings are substantially as follows:
1.
In the Minnesota Central Case: This respondent acquired on March 6 1863, by grant from the state, (Sp. Laws 1863, c. 2,) all the rights, franchises, and property of the Minneapolis & Cedar Valley Railroad Company, which was incorporated by act of the territorial legislature March 1, 1856, (Laws 1856, c. 166,) by which act it was authorized to construct and operate a railway from Minneapolis, via Faribault, to the south line of the state, west of range 16; and by the act of May 22, 1857 the company was endowed with the lands granted by the act of congress of March 3, 1857, to aid in the construction of the line of railroad which, by its charter, it was authorized to build. This corporation was one of the land-grant companies which received aid from the state pursuant to the loan amendment to the constitution, and its property and franchises, upon foreclosure of the securities taken by the state, became vested in the state, and were held without merger or extinguishment until regranted to the respondent as before stated.
By the act of May 22, 1857, making the land grant, it was provided that "said lands so granted shall be and are exempt from taxation until the same shall have been sold and conveyed by said companies." By the same act the same exemption from taxation was made in regard to the company's railroad and the property used in connection with it, and the company was required to pay to the state, in lieu of other taxes, a percentage of its gross earnings, and to make annual reports of such earnings. By the act of March 1, 1856, the original company was also authorized to unite its railroad with any other railroad then or thereafter constructed in the territory or any adjoining state or territory, upon such terms as should be satisfactory to the connecting companies and for that purpose was given full power to make and execute such contracts with any other company as would secure the object of such connection. By the act of March 6, 1863 granting to the respondent the franchises of the former company, the time limited for the completion of its railroad was extended to January 1, 1866, and the exemption of its property and land grant was reaffirmed, with the modification that the lands should become taxable when contracted to be sold.
By acts approved February 1, 1864, (Sp. Laws 1864, c. 2,) and March 4, 1865, (Sp. Laws 1865, c. 5,) the act of March 6, 1863, was amended, and the time for completing respondent's line extended. By the former act respondent was given its present name, and was vested with whatever lands congress should afterwards grant to the state in aid of its line. And in the latter act it was further provided that whenever respondent should contract to sell or lease any of its granted lands, such lands should be placed on the tax list for taxation like other lands, but in enforcing collection of the taxes the title or interest of the respondent, or its trustees or mortgagees, should be in nowise affected; but the improvements on the land and the purchaser's or lessee's interest should be sold on default in payment of the taxes. By the act of February 28, 1866, (Sp. Laws 1866, c. 4,) the time for the completion of the road was further extended.
In 1866, and within the time limited by the acts above cited, the respondent had completed or nearly so that part of its line between Minneapolis and Austin, in the county of Mower. In that year the railway of the McGregor Western Railway Company (an Iowa corporation) was in course of construction from McGregor, in Iowa, to the Minnesota state line, and it was desired that such railway should be connected with that of respondent at Austin; and, to enable such connection to be made, the legislature, by act of February 24, 1866, (Sp. Laws 1866, c. 8,) empowered "any company owning or controlling, by lease or other contract, the McGregor Western Railway," to make such connection at Austin, and conferred on "said railway company" all the powers, rights and privileges of railway corporations of this state, upon its filing a copy of its charter or articles of association with the secretary of state, which was accordingly done. By act of March 7, 1867, (Sp. Laws 1867, c. 8,) it was provided that the McGregor Western Company, "having acquired by purchase or otherwise the capital stock of the Minnesota Central Railway Company, may exercise, within this state, all the rights, privileges, and franchises which have heretofore been or which shall hereafter be conferred upon the Minnesota Central Railway Company, and shall be subject to all the duties and liabilities incurred by or imposed upon said company."
Afterwards, and in the year 1867, pursuant to these acts and to the power granted in the original charter to make and execute such contracts with any other company as would secure the object of a connection, the respondent conveyed to the McGregor Western Company its line of railway from Minneapolis to Austin, with its rolling stock, equipment, and appurtenances, and with the franchises appertaining to that portion of its road, but did not convey its franchise to be a corporation nor any part of its land grant. Soon afterwards, and in the same year, the Milwaukee & St. Paul Railway Company (now the Chicago, Milwaukee & St. Paul Railway Company) became the owner of the McGregor Western Railway Company's line, including the road from Minneapolis to Austin, and on August 7, 1867, all of the companies joined in a deed of trust of the property formerly owned by the McGregor Western Company, which recited the above-mentioned sale by respondent and the then ownership of the line by the Milwaukee & St. Paul Railway Company; which deed was at once filed and recorded in the office of the secretary of state. The Milwaukee & St. Paul Company entered into the possession and management of the line from Minneapolis to Austin, which it has ever since operated. At the beginning of the next session of the legislature, that company issued annual passes over the road from Minneapolis to Austin, naming itself as the owner thereof, and delivered them to every member and officer of the legislature. By the act of March 5, 1868, (Sp. Laws 1868, c. 4,) amending the act of 1864, the legislature recognized the continued existence of respondent as a corporation, and conferred upon it additional franchises in respect to condemnation of land. The same legislature, by an act approved February 29, 1868, (Sp. Laws 1868, c. 5,) entitled "An act authorizing the conveyance of lands to the Minnesota Central Railway Company, and extending the time for the completion of that portion of the original line of said company from Austin to the Iowa state line west of range 16," authorized conveyances to respondent by the governor of such of the granted lands as pertained to the completed portion of the road, and the execution to the respondent of a deed in fee-simple of the residue of the granted lands, whenever such conveyance should be authorized by congress. By the same act the time for the completion of the road from Austin to the state line was extended for two years, and provision made for its connection with "a connecting road in the state of Iowa."
By act of congress of March 3, 1865, the land grant for respondent's line was increased from six to ten sections per mile, all which lands were by the governor, pursuant to the above-mentioned legislation, afterwards conveyed to the respondent, a portion of which are still held undisposed of by respondent, which claims to hold them as a corporation exempt from taxation, and to have a right to dispose of them as a corporation, pursuant to the franchise before mentioned.
Relying on these acts in continued recognition of its corporate existence by the legislature, as well as on the power to dispose of its road to a connecting line conferred upon it in the various acts above mentioned, the respondent proceeded to complete the remainder of its road from Austin to the state line, and on the 15th of February, 1870, having completed its entire line from Minneapolis to the state line, and the Milwaukee & St. Paul Railway Company having acquired control of the Iowa road connecting with that of respondent at the state line, the respondent, under the power in the original charter to make and execute such contracts with any other company as would insure such connection, conveyed that part of its road from Austin to the state line to the Milwaukee & St. Paul Company, in the belief that it had the approval of the state in so doing. In December, 1870, the state treasurer reported to the legislature the receipt from the Milwaukee & St. Paul Company of 2 per cent. of its gross earnings, at which time the road so conveyed by the respondent was the only one operated by the Milwaukee & St. Paul Company in this state. In that report no taxes are reported as received from this respondent.
After this completion and transfer of its railway, the governor conveyed to respondent the residue of the...
To continue reading
Request your trial