Blue Ridge Hotel Co. v. Western Maryland Railroad

2 Balt. C. Rep. 344

• Court: Baltimore City Court
• Decided: March 22, 1905
• Status: Published

Opinion

DOBLER, J.—

Upon a careful consideration of the pleadings in this case and of the argument of counsel, I am of opinion that the performance of the contract dated October 23, 1883, set forth in the declaration, by the Western Maryland Railroad Company, does not involve said company in the business of owning or operating a public hotel of the character maintained by the plaintiff; and that the payments of the sums therein stipulated to be paid to the plaintiff, although the same are to be used for the purpose of securing to the stockholders and the holders of the designated bonds of the plaintiff the dividends and interest in said contract mentioned have from time to time been made in discharge of an original obligation of the defendant as compensation for legitimate railroad benefits contracted for and not in the nature of guaranteed payments of the debts of another. The fact that the compensation to the plaintiff is variable determined by the needs of the plaintiff and the revenues of the defendant at the two points where the operations of the respective parties coincide to their mutual advantage, does not alter the character nor affect the obligation of the contract. ,

In view, moreover, of the almost unlimited power of making contracts (subject to the sanction of the Mayor and City Council of Baltimore) conferred upon the defendant by Section 8 of the Act of 1872, chapter. 71, the court cannot favorably regard an attempt ’by the defendant to avail of its own failure to secure the sanction of the Mayor and City Council of Baltimore, after it has performed a contract for twenty years, during all which time the stockholders and bondholders beneficially interested therein have had reason to rely upon the full compliance by the defendant with the terms of the contract in suit. The demurrer will, therefore, be sustained.