Commonwealth v. Central Passenger Railway

52 Pa. 506, 1866 Pa. LEXIS 155
CourtSupreme Court of Pennsylvania
DecidedJune 25, 1866
StatusPublished
Cited by4 cases

This text of 52 Pa. 506 (Commonwealth v. Central Passenger Railway) is published on Counsel Stack Legal Research, covering Supreme Court of Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Commonwealth v. Central Passenger Railway, 52 Pa. 506, 1866 Pa. LEXIS 155 (Pa. 1866).

Opinion

The opinion of the court was delivered, June 25th 1866, by

Strong, J.

It is of no importance to the present case that we should inquire whether the information, filed as it has been against the Central Passenger Railway Company by its corporate name, admits of record that it is a corporation de jure, for we are all of opinion that the plea sets forth sufficiently its corporate existence.

It is made to appear beyond doubt, that prior to the 28th day of July 1859, there was a corporation, created under the law, [511]*511and authorized to construct and use an artificial road, at first a plank-road, and afterwards a passenger railway. On the 28th day of July 1859, this corporation duly mortgaged its road, property and franchises to John Welsh and William L. Schaffer, to secure bonds issued by it, amounting to $100,000. The mortgagees were trustees for the bond-holders, with a power of sale. In pursuance of the power there was a sale, under the mortgage, of the road, property and corporate rights and franchises of the mortgagors to John Loutey, on the 14th day of January 1863. Though not a judicial sale, its effect was, by the Act of March 14th 1863, declared to be the same as by the Act of April 8th 1861 it had been enacted should be the effect of a sale of any railroad, canal, bridge or plank-road of any corporation, sold and conveyed under and by virtue of any process or decree of any court in this state. That act declares, that the person or persons for or on whose account such railroad, canal, turnpike, bridge or plank-road may have been purchased shall be, and they are by the act constituted a body politic and corporate, invested with the right, title and interest of the former corporation in the property purchased, and also with the corporate franchises existing at the time of the sale. The act also'makes provision for the organization of the new corporation. The Act of March 14th 1863 was an attempt to apply the provisions of the Act of 1861 to the sale made by the trustees to John Loutey. It directed him to do, respecting an organization of a new company, what under the first act it was made the duty of purchasers at a judicial sale to do, with a single exception. It required him to organize the new corporation, under the name of The Central Passenger Railway Company of the city of Philadelphia, to select a president and a board of directors, and to do and perform all and singular the matters and things in the said act specified, with like effect as though the sale and conveyance had been made to two or more persons.

The plea avers the sale to John Loutey, the Enabling Act of 1863, the facts that he did organize the new corporation with the name prescribed by the Act of Assembly, did select a president and a board of directors, and that the corporation thus organized did adopt a corporate seal, determine the amount of the capital stock, and issue certificates therefor to the persons who had united in the purchase with him, the said John Loutey, and for whose account he had purchased to the amount of their respective interests therein, or to such persons as they requested. The plea also avers, that a certificate of the organization was made by the corporation, under its common seal, attested by its president, and transmitted to the secretary of state, to be filed in his office, there to remain of record. This certificate was filed on the 7th day of March, A. D. 1863. It sets forth the date of the organiza[512]*512tion, the corporate name, the amount of capital stock, and the names of the president and directors.

To this plea the Commonwealth has demurred, and several reasons have been assigned why it should be held insufficient. It is to be observed of them all, with perhaps one exception, that they relate to alleged errors in the organization of the new company. They do not touch its corporate existence. And yet the existence of the company, and not its regular organization, is what is called into question by the information. It is obvious that irregularities in the organization of a corporation are not necessarily fatal to its being. Organization is but the creation of an agency by which the corporate body can act. It presupposes the existence of the artificial person. The Act of April 8th 1861, supplemented by the Act of March 14th 1863, created the new corporation. It declares in express terms that the purchasers, or the person or persons for or on whose account a railroad of a corporation, or a canal, turnpike, bridge or plank-road may be purchased, shall be and they are by that act itself constituted a body politic or corporate. Provision is then made for subsequent organization, for adopting a corporate name, a common seal, &c. This case is not, therefore, to he confounded with the case of an original grant of corporate rights, when the grantee must take on the terms on which the franchise is offered. Such a grantee must comply strictly with all the conditions precedent to the taking effect of the grant, and there are usually precedent conditions. But in this case the corporate franchise was in exist- ' ence when the sale was made to John Loutey. As declared by the Act of 1861, the sale did not work its extinguishment, and the Commonwealth did not seize it. On the contrary, that act declares that the franchises shall vest in the purchaser or purchasers, and that he or they shall be a body corporate, and seised of all the rights, powers, privileges and franchises of the corporaItion of whose property they become the purchasers. The directions in regard to subsequent reorganization, therefore, are not conditions of being, as possibly they might be if the purchasers did not take by succession. The utmost effect of not folloiving those directions strictly can be no more than to work a forfeiture, and enable the Commonwealth to retake the franchise. It cannot entitle her to a judgment that the franchise has no existence.

The first objection to the plea is that it alleges John Loutey, the purchaser, became, in virtue of the Acts of Assembly set forth, himself a body politic or corporate. Eor this averment it is contended there is no warrant in the law. When it is considered that the question raised by the information and plea with the demurrer is, whether the defendants have shown that they are of themselves a body politic and corporate, by the name of The Central Passenger Railway Company of the city of Philadelphia, [513]*513it is manifest that both the averment objected to and the objection are of no importance. Whether Loutey became a corporation or not by his purchase does not affect the inquiry whether the defendants have corporate rights. At the worst, this averment of the plea is surplusage. If it be conceded that he did not become a body corporate, but only an agent designated by the law to organize a new corporation, it still remains to be seen whether the plea does not sufficiently aver the existence of the defendants by the name prescribed by the Act of Assembly, and whether, therefore, the demand of the writ is not in this particular fully answered. It is averred that he did organize the company with the name given to it by the Act of 1863, and did select a president and directors. It is also set forth that the corporation so authorized did adopt a common seal, determine the amount of the capital stock and issue certificates to the persons who had united with him in the purchase of the road, and for whose account he had purchased, or to such persons as they requested. If this was what the Acts of Assembly required, the averment that John Loutey became a corporation was merely superfluous and impertinent.

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Cite This Page — Counsel Stack

Bluebook (online)
52 Pa. 506, 1866 Pa. LEXIS 155, Counsel Stack Legal Research, https://law.counselstack.com/opinion/commonwealth-v-central-passenger-railway-pa-1866.