Union Trust Co. of N.Y. v. Atchison

• Decision Date: 20 December 1895
• Court: New Mexico Supreme Court
• Parties: UNION TRUST CO. OF NEW YORKv.ATCHISON, T. & S. F. R. CO. POSTAL TELEGRAPH CABLE CO., Intervener.

8 N.M. 327

43 P. 701

UNION TRUST CO. OF NEW YORK

v.ATCHISON, T. & S. F. R. CO. POSTAL TELEGRAPH CABLE CO., Intervener.

Supreme Court of the Territory of New Mexico.

Dec. 20, 1895.

Appeal from First judicial district court; before Justice Edward P. Seeds.

Bill by the Union Trust Company of the State of New York against the Atchison, Topeka & Santa Fé Railroad Company, for foreclosure of a mortgage and the appointment of receivers. The Postal Telegraph Cable Company intervened, and a demurrer to the intervening petition was filed on behalf of the Western Union Telegraph Company. From an order sustaining said demurrer, the intervener appeals. Reversed. This is an action on an intervening petition in the above cause, brought by the Postal Telegraph Cable Company, for an order on the receivers of the Atchison, Topeka & Santa Fé Railroad Company, requiring them to grant to the intervening petitioner leave to construct a line of telegraph poles, wires, etc., over and along the right of way of said railroad company, and to attach the same to the bridges along said right of way, and for aid and assistance in transporting and distributing its men, materials, supplies, etc., along the same, from the southern boundary line of the state of Colorado, through New Mexico, to the city of Albuquerque, and for such other rights, privileges, and facilities as may be necessary and convenient in the construction, operation, and maintenance of such line of telegraph by the Postal Telegraph Cable Company, and as set out and prayed for in said intervening petition. During January, 1894, the Union Trust Company of the state of New York filed its bill in chancery, in the district court in and for the county of Santa Fé, against the Atchison, Topeka & Santa Fé Railroad Company (which, for brevity, will hereafter be styled the “Santa Fé Company”), for a foreclosure of a mortgage, and for the appointment of receivers to take into custody all the property belonging to the Santa Fé Company, and to operate and manage the same pendente lite; and on the same date receivers were appointed by the court, and thereupon assumed and took full control of the operation and management of all the property of the Santa Fé Company. On June 11, 1894, the Postal Telegraph Cable Company (which is, for brevity, hereafter styled the “Postal Company”), filed in said district court an intervening petition in the cause, then pending, of the Union Trust Company against the Santa Fé Company. In the intervening petition, the appellant alleged in substance that it was incorporated under the laws of the state of New York, for the purpose of constructing, operating, and maintaining a general system of telegraph lines between each and every postoffice, village, town, and city in the United States; that it had accepted the condition prescribed by section 5263 of the Revised Statutes of the United States, and had thereby acquired the right to construct, maintain, and operate lines of telegraph over the public domain of the United States, and over and along any of the military and post roads of the United States; and that it had obligated itself to transmit all government telegrams at such rates as might be fixed annually by the postmaster general of the United States, and to transfer its lines to the United States, as provided by law, above cited; that it owns, and has constructed, and now uses and maintains, lines of telegraph in the United States, connecting nearly all the principal cities east of the Rocky Mountains with each other, and has opened and maintains over 3,000 telegraph offices, between all of which offices, when required, it transmits government telegrams at rates annually fixed by the postmaster general, such rates for the current year being far below the general rate to the public for like services; that it is now engaged in constructing a main or trunk telegraph line from La Junta, in the state of Colorado, via Albuquerque, N. M., over and along the line of the Atchison, Topeka & Santa Fé Railroad Company, from the northerly line of the territory to a point near Albuquerque, thence along the right of way of the Atlantic & Pacific Railroad in New Mexico and Arizona, and into the state of California, to Mojave, where it is to connect with the Pacific Postal Telegraph Company's lines; that the Santa Fé Company's system in New Mexico was constructed by the New Mexico & Southern Pacific Railroad Company, the Rio Grande, Mexican & Pacific Railroad Company, and the Silver City, Deming & Pacific Railroad Company, all chartered under the laws of this territory, which were, after construction, leased and operated by the said Santa Fé Company, and that all of said railroad companies are land-grant railroads, and have accepted and complied with the terms and provisions of the act of congress approved March 3, 1875, and, as such, are entitled to a right of way, over and through the public domain, of 100 feet on each side from the center of the track, and that all of said right of way has been occupied and used by each, for railroad and station purposes, and was taken substantially from the public lands of the United States; and that said Postal Company proposes to construct its line of telegraph upon and along the right of way in New Mexico, of all three of said railroads; that the said Santa Fé Company and the other railroads named are, by virtue of the laws of the United States, military and post roads, and that it, the Postal Company, is, by virtue of the laws of the United States, entitled to, and has the right to, construct its telegraph line over and along all military and post roads of the United States; that it applied to the receivers of the Santa Fé Company for the right to so construct, maintain, and operate its main and branch lines of telegraph, upon the right of way of the Santa Fé Company's System, and for the usual aid in distributing its poles, materials, supplies, and water for its men, while so constructing its lines, and offered to pay the usual and customary prices to said receivers for the transportation of the same, and to pay to said receivers a just compensation for any damages or injuries sustained for its use and occupation of the right of way, but that said receivers declined and refused to allow it to construct its telegraph line upon the right of way, and refused and declined to furnish the necessary aid and facilities for the same, alleging as a reason that a contract had previously been entered into between the Santa Fé Company and the Western Union Telegraph Company (which is hereafter called the “Western Union Company”), one clause of which they consider conflicted with the request of the Postal Company, and which the receivers felt bound to respect, until the court should hold to the contrary; otherwise the receivers would be willing to grant the request of the Postal Company, on the payment of a proper compensation; that facilities are granted by the Santa Fé Company to the Western Union Company which are denied to the Postal Company, and that such denial by said receivers is grounded on the clause in said contract now existing between said Santa Fé Company and said Western Union Company, and that said clause in said contract is contrary to law and public policy, and therefore void; with a prayer for the relief sought. The receivers answered, and, among other things, show that they declined and refused to comply with the request of the Postal Company, on the ground that the Western Union Company insists on the validity and binding force of clause 12 in the contract between the Santa Fé Company and the Western Union Company, but, were it not for that clause, the receivers would grant the request of the Postal Company; that the construction of the main and branch lines of telegraph, by the Postal Company proposed, would increase the revenues, and add to the conveniences and facilities, of the property of the Santa Fé Company, in their hands as such receivers; that the receivers are advised and believe that the said twelfth clause in said contract, in so far as it relates to the right of way of the Santa Fé Company, and granting the same to the Postal Company, is void and of no binding force, but, owing to the demand made on them by the Western Union Company, they feel bound to respect it until the court shall have held it void, and submit to the court the question as to the validity of the said twelfth clause, and as to whether or not the Western Union Company was a necessary party to this proceeding. The contract referred to was entered into between the Santa Fé Company and the Western Union Company on the 21st day of November, 1888, and the twelfth clause referred to in that contract reads as follows, to wit: “Twelfth. The railroad company, so far as it legally may, hereby grants and agrees to assure to the Western Union Telegraph Company the exclusive right of way on, along, and under the line, lands, and bridges of the railroad company, and all extensions and branches thereof, and of railroads owned, leased, operated, or controlled by it, or by corporations owned, leased, operated, or controlled by it, for the construction, maintenance, operation, and use of lines and poles and wires, and underground or other lines, for commercial or public uses or business, with the right to put up or construct, or cause to be put up or constructed, from time to time, in accordance with the provisions of this agreement, such additional wires and such additional lines of poles and wires, and underground or other lines, as the telegraph company may deem expedient; and the railroad company will not, except as legally required, transport men or materials for the construction, maintenance, or operation of a line of poles and wire, or wires, underground or otherwise, in competition with the lines of the telegraph company, party hereto, except at and for the railroad company's regular local rates, nor will it furnish,...