Brook'n Steam Transit Co. v. . City of Brook'n

78 N.Y. 524, 1879 N.Y. LEXIS 946
CourtNew York Court of Appeals
DecidedNovember 11, 1879
StatusPublished
Cited by34 cases

This text of 78 N.Y. 524 (Brook'n Steam Transit Co. v. . City of Brook'n) is published on Counsel Stack Legal Research, covering New York Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Brook'n Steam Transit Co. v. . City of Brook'n, 78 N.Y. 524, 1879 N.Y. LEXIS 946 (N.Y. 1879).

Opinion

Earl, J.

This action was commenced August 31, 1878, to restrain the defendant from interfering with the plaintiff in the construction of its road.

The action was defended upon the sole ground that the plaintiff did not have such corporate existence as authorized it to construct its road in the streets of the city, and whether it did have such existence, is the sole question for our determination.

The plaintiff was incorporated under the act chapter 940, of the Laws of 1871, entitled “An act to incorporate the *528 Brooklyn Steam Transit Company.” The first section of the act provides that Samuel McLean and fifty-six other persons named shall be constituted a body politic and corporate, by the name of the Brooklyn Steam Transit Company, with authority to construct an underground and elevated railroad under or over the streets of that city in the manner specified in the act.

By section sixteen, the company was authorized to exténd its road in and through any of the towns of the county of Kings.

Section seventeen provides as follows : “ This act shall take effect sixty days after the passage thereof; but unless said Brooklyn Steam Transit Company be organized, and at least one mile of such railroad, as it is authorized and empowered to construct under this act, be laid within three years thereafter, then and in that case this act and all the powers, rights and franchises herein and hereby granted, shall be deemed forfeited and terminated.”

Under that act plaintiff was in some way organized, and then on the 23d day of May, 1873, an act was passed to amend the prior act, section one of which declares the corporation created by that act to be duly organized whenever the ten per cent required by section eleven of that act shall have been paid in; and thereafter $500,000 of plaintiff’s stock was subscribed and ten per cent thereof was paid in, as required by the section eleven. Section three of the amendatory act authorizes the plaintiff to construct, operate and maintain its railroad as provided in the original act, with power to "construct, operate and maintain the same over, under or upon any land not in any street or avenue necessary to connect the railroad with any street or avenue, and makes provision for compensation for land taken.. Section four provides as follows : “ The time for the construction of the one mile of railroad by the said corporation required by said first mentioned act is hereby extended to the fourth day of July, one thousand eight hundred and seventy-six.”

From the time of its .organization the plaintiff kept an .office, transacted business, made by-laws, procured surveys, *529 plans and estimates for an elevated railroad, and made annual reports to the State engineer, which were by him reported to the Legislature. But it did not build or lay any portion of its railroad until June, 1878, when it built a mile of railroad by laying a mile of track upon the surface of a portion of its route outside of the city of Brooklyn ; and about the same time it commenced to lay down certain foundations for an elevated railroad within the city limits, when it was prevented from proceeding further by the defendant.

The claim of the defendant is that the plaintiff lost its corporate existence by not building one mile of its road before the expiration of the time limited, to wit, July 4, 1876.

The general principle is not disputed that a corporation, by omitting to perform a duty imposed by its charter or to comply with its provisions does not ipso facto lose its corporate character or cease to be a corporation, but simply exposes itself to the hazard of being deprived of its corporate character and franchises by the judgment of the court in an action instituted for that purpose by the attorney-general in behalf of the people ; but it cannot be denied that the Legislature has the power to provide that a corporation may lose its corporate existence without the intervention of the courts by any omission of duty or violation of its charter or default as to limitations imposed, and whether the Legislature has intended so to provide in any case depends upon the construction of the language used. Here the language - used shows that the Legislature intended to make the continued existence of the plaintiff as a corporation depend upon its compliance with the requirements of section seventeen of the original act. In case of non-compliance the act itself ’ was to cease to have any operation, and all the powers, rights and franchises thereby granted were to be “ deemed forfeited and terminated.” There was to be not merely a ■ cause of forfeiture which could be enforced in an action instituted by the attorney-general, but the powers, rights and *530 franchises were to be taken and treated as forfeited and terminated. At the end of the time limited the corporation was to come to an end, as if that were the time limited in its charter for its corporate existence. A precise authority for this construction of this statute is found in the case of the Brooklyn, Winfield and Newton Railroad Company (72 N. Y., 245). That company was organized under the general railroad act of 1850, as amended by the act, chapter 775 of the Law of 1867. By the last named act it is provided that “ if any corporation formed under the general act shall not, within five years after its articles of association are filed and recorded, begin the construction of its road and expend thereon ten per cent on the amount of its capital, or shall not finish its road and put it in operation in ten years from-the time of filing its articles of association, as aforesaid, its corporate existence and powers shall cease.” That company had not begun the construction of its road within the time limited, and it was held that it had lost its corporate existence, and the same view was emphatically reiterated when a similar case of the same company was again before this court (75 N. Y., 385). It was held that the statute executed itself, and that the intervention of the courts in an action instituted by the attorney-general was not necessary. The language of limitation used in section seventeen of the act of 1871, more plainly, if possible, indicates the legislative-intention, that a failure to comply with the limitations should put an absolute end to the corporation, than the language used in the act of 1867.

An effort was made upon the argument of this case by the learned counsel for the appellant to distinguish this case from the one cited, but we can perceive no material difference between the two cases. In that case the company was fully organized, as it was in this. That company had a corporate existence to lose, and so had this. It is probably true, that this company in making surveys and plans within the three years may have done more than that company did, but that is immaterial, so long as it failed to do the precise thing *531 required by the statute. In that ease the proceeding was to interfere with private property by the right of eminent domain. Here this company was proceeding to occupy the public streets which were under the charge and control of the city. In the one case, as in the other, corporate existence and right were necessary to justify the act.

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Bluebook (online)
78 N.Y. 524, 1879 N.Y. LEXIS 946, Counsel Stack Legal Research, https://law.counselstack.com/opinion/brookn-steam-transit-co-v-city-of-brookn-ny-1879.