The Cent. R.R. & Banking Co. v. The Mayor And Council Of Macon

• Decision Date: 31 July 1871
• Citation: 43 Ga. 605
• Court: Georgia Supreme Court
• Parties: THE CENTRAL RAILROAD & BANKING COMPANY et al.,plaintiffs in error. v. THE MAYOR AND COUNCIL OF MACON et al., defendants in error, an the same parties vice versa.

43 Ga. 605

THE CENTRAL RAILROAD & BANKING COMPANY et al., plaintiffs in error. v. THE MAYOR AND COUNCIL OF MACON et al., defendants in error, an the same parties vice versa.

Supreme Court of the State of Georgia

(Atlanta, July Term, 1871.)

Corporations. State as party. Before Judge Alexander. Chambers. Bibb county. June, 1871.

*On the 25th of May, 1871, at Macon, Georgia, there was a meeting of the board of directors of the Macon & Western Railroad Company. A. J. White, its President, stated to the board that the meeting was touching the leasing of said road, and submitted for their action a paper in the following words:

"Georgia—

"This indenture, made the ——day of——, eighteen hundred and seventy-one, between the Macon & Western Railroad Company of the first part, and the Central Railroad & Banking Company of Georgia of the second part, both of said parties being corporations under the laws of the said State of Georgia.

"Whereas, by an Act of the Legislature of the State of Georgia, approved the twenty-second day of January, A. D., eighteen hundred and fifty-two, the said the Central Railroad & Banking Company of Georgia, was authorized to lease and work for such time, and on such terms as might be agreed on by the parties interested, the Southwestern Railroad and such other railroads as then connected or might hereafter connect with the Central Railroad, and the said the railroad companies, having or which might hereafter have railroads connecting with the Central Railroad, were authorized to lease their respective railroads to the said the Central Railroad & Banking Company of Georgia, for such term of time and on such other terms as they might deem best;

"And, whereas, the said the Macon & Western Railroad Company is one of the companies having a road which connects with the said the Central Railroad, and included in the terms of said Act;

"And, whereas, also, by the terms of the charter of the said the Macon & Western Railroad Company granted by the State of Georgia, said company is authorized and empowered to rent or farm out anypart or the whole of its exclusive right of transportation on said railroad with the privileges *thereof to any individual or individuals or other company.

"Now this indenture witnesseth, that the said the Macon & Western Railroad Company, for and in consideration of the covenants, conditions and agreements hereinafter set forth, on the part of the said the Central Railroad & Banking Company of Georgia, to be performed and kept, hath demised, leased and to farm let, and by these presents, doth demise, lease and to farm let all the railroad of the said the Macon & Western Railroad Company, leading and running from Macon to Atlanta, in the said State of Georgia, in all its branches, as the same is now constructed, and with all the extensions thereof to other points which may hereafter be constructed, including the right of way, roadbed, depots, stations, warehouses, wells, cisterns, engines, cars, fixtures, machinery, and all property whatsoever, real and personal, connected with and appertaining to the said the Macon & Western Railroad, and owned by the said party of the first part, together with the rights, members and appurtenances to the same belonging, or in any manner appertaining unto the said the Central Railroad & Bank-ing Company of Georgia, and doth hereby transfer, assign and deliver to the said the Central Railroad & Banking Company of Georgia, all the property, assets, rights and credits of every description of the said Macon & Western Railroad Company, to have and to hold the same, and every part thereof, with the appurtenances unto the said party of the second part from the—— day of ——, eighteen hundred and seventy-one, for and during the entire continuance of the corporate existence of the said the Macon & Western Railroad Company under its present charter or under any amendments or extensions thereof that may hereafter be made.

"And the said the Central Railroad & Banking Company of Georgia hereby covenants and agrees to and with the said the Macon & Western Railroad Company, that during the continuance of the term hereby granted, it will declare and *pay to the stockholders of the said the Macon & Western Railroad Company dividends equal in amount and character, at the same time, and terms as shall be paid to the stockholders of said the Central Railroad & Banking Company of Georgia. But such payments of dividends shall be made on the basis of the present capital stock of the Macon & Western Railroad Company of two millions five hundred thousand ($2,500, 000 00) dollars, and the capital stock of the Central Railroad Company of five millions ($5,000, 000) dollars, to which sum it is hereby agreed and understood that the same shall be increased before the taking effect of this lease. And that after the capital stock of the Central Railroad & Banking Company of Georgia shall have been raised to five millions ($5,000, 000) dollars, whenever any stock dividend, or division of assets or accumulations, shall be declared, paid or made to the stockholders of the said the Central Railroad & Banking Company of Georgia, a similar dividend or distribution in amount and quality shall be paid and made to the stockholders of the Macon & Western Railroad, and that all such dividends and distributions of every sort shall be paid to the stockholders of the Macon and Western Railroad Company, as the said Company has heretofore paid its dividends, and be free of all taxes to the stockholders.

"And the said the Central Railroad & Banking Company of Georgia hereby further covenants and agrees to and with the said the Macon & Western Railroad Company, that from and after the taking effect of this lease it will pay the current expenses incident to the working and management of the said Macon & Western Railroad, and all debts and claims against the said the Macon & Western Railroad Company, and all bonds and interest upon bonds of the said Company; which said bonds and interest upon bonds shall be paid on presentation of thesaid bonds and coupons at the times and places specified therein.

"And the said the Central Railroad & Banking Company *of Georgia hereby further covenants and agrees to pay the salaries of the President and of the Secretary and Treasurer of the said Macon & Western Railroad Company during the continuance of the said lease, reserving to itself the right to fix the amount of the said salaries, with the restriction that the aggregate amount thereof shall not be less than four thousand ($4,000 00) dollars per annum; and that it will also provide and furnish, at its own expense, all necessary stock, account andtransfer books, and all necessary stationery and offices for the said President and Secretary and Treasurer, and pay all proper expenses incident to the meetings of the board of directors of the said the Macon & Western Railroad Company, and permit the president and directors and the secretary and treasurer of the said company to travel on both roads free of charge, in the same manner as the corresponding officers of the said the Central Railroad & Banking Company of Georgia, and that it will provide for the transfer of stock in the said the Macon & Western Railroad Company as that company has heretofore done.

"And the said the Central Railroad Company of Georgia further covenants and agrees to keep in as good order and repairs, as when it shall receive possession and control of the same, the said Macon & Western Railroad and its rolling stock and other appurtenances and to pay all taxes on the property of the said the Macon & Western Railroad Company during the continuance of this lease; and that, in case it shall fail to pay any dividend to the stockholders of the Macon & Western Railroad Company, or any bond, or the interest upon any bond, within six months after the same shall become due and payable, as hereinbefore provided, and be demanded by the person or persons entitled to receive the same, it shall be then lawful for the board of directors of the said the Macon & Western Railroad Company to terminate this lease and to enter upon and resume possession of its said railroad, with the appurtenances and all other its property, hereby demised; and from thenceforth this indenture *and the estate, rights and privileges hereby granted, and every clause and article herein contained shall cease, determine and be void.

"And the said the Central Railroad & Banking Company of Georgia will thereupon deliver immediate and peaceable possession of the said Macon & Western Railroad, its rolling stock and appurtenances, and other property hereby demised, in as good order as it received the same, replacing such as shall have been consumed by use or otherwise disposed of, with other similar property of equal value.

"And the said parties hereby mutually covenant and agree to and with each other that, during the continuance of this lease, neither railroad company will undertake the construction of any new road, or lend credit for that purpose, without the assent of the board of directors of the other company.

"It is mutually understood that nothing herein contained is in any wise to affect the corporate character or existence of the said the Macon & Western Railroad Company during the continuance of the lease; but that it is to maintain its corporate organization, at all times, during the continuance of its charter, whether as now framed, or as it may be hereafter extended or amended to the fullest extent necessary to preserve its said charter and protect the rights of its stockholders.

"And it is further covenanted, agreed and understood between the parties to these presents that so soon as the necessary legislation for that purpose can be secured, there shall be an amalgamation under the charter of the Central Railroad & Banking Company of Georgia, of the capital stock of the two companies, parties of the first and second part, on the basis of two millions five hundred...