Gardner v. Mobile & Northwestern Railroad

102 Ala. 635

• Court: Supreme Court of Alabama
• Decided: November 15, 1893
• Status: Published

Opinion

STONE, C. J.

The bill was filed to vacate a sale of lands made by the sheriff of Mobile county, under executions which were issued from the circuit court of that county, founded on judgments rendered against the appellee . It seeks a cancellation of the conveyance made by the sheriff to the purchaser, and of subsequent conveyances dependent on it, and prays an injunction to prevent alleged trespasses on the lands. The validity of the sale by the sheriff is impeached on the ground of alleged irregularities in the issue of the executions ; the payment of one of the judgments; and because the lands wore the right-of-way of the appellee, and, as is asserted, not the subject of levy and sale under executions at law.

Prior to the issue of the executions under which the sales were made, the judgments had been assigned. The assignments were not made in the mode prescribed by the statute; (Code, § 2927) ; and the mandate of the executions was, that the moneys made should be accounted for to the assignee of the judgments. In all other respects the executions corresponded to the judgments. Judgments have the assignable qualities of choses in action, and may be transferred by parol or in writing. If a statutory mode of assignment is provided, it is cumulative, in the absence of express words inhibiting other modes of assignment. — 2 Freeman on Judgments, § 422. The assignment, however made, passes an equity which courts will recognize and protect. It entitles the assignee to sue on the judgment or to issue execution thereon in the name of the assignor, and is beyond his control or interference. — 2 Brick. Dig. 153, §§ 308-17. The statute to which we have referred does not lessen the assignable quality of judgments, nor limit the mode of assignment. It is cumulative, entitling the assignee, if the assignment is made in the mode provided, to sue on the judgment, or to the issue of execution thereon for his use, in the name of the plaintiff whether living or dead. It in this way dispenses with the necessity of revivor in the event of the death of the plaintiff; and, under the operation of section 2595 of the Code, he may make himself the sole party on the record. The error in the mandate of the executions is, at most, a mere irregularity, incapable of injury to the appellee, and because of such irregularity, a court of equity will not interfere to vacate a sale made by the sheriff. — 2 Freeman on Executions, § 310; Ray v. Womble, 56 Ala. 32; Lockett v. Hurt, 57 Ala. 198.

One of the judgments, the one, it is asserted, that was paid prior to the issue of execution thereon, seems to have been assigned'by the attorney of the plaintiff therein. Without special authority, an attorney at law can not assign a judgment he may have obtained for his client. The authority, or a ratification by the client, may be inferred from circumstances. The assignment was made many years before the issue of the last execution, and so far as is now shown, its validity has never been questioned by the client. The silent acquiescence for years by the client is evidence that the attorney had authority to make it, or of a subsequent ratification. The contention of payment of this judgment was not ascertained by the chancellor to be true, and we find no reason to doubt the correctness of his conclusion.

The other judgment, rendered in favor of Burgess, prior to the issue of the execution under which the levy and sale were made, had become dormant; more than ten years having elapsed after the test of the last preceding execution. The execution was irregularly issued and was voidable, but it was not void. — 1 Freeman on Executions, § 2830; Sandlin v. Anderson, 76 Ala. 405; Steele v. Tutwiler, 68 Ala. 107. On a proper application, seasonably made, the court of law would have quashed it. — McCall v. Rickarby, 85 Ala. 152. Such an application must have been made with reasonable diligence; unexplained laches would have been fatal to it. — Bank of Genesee v. Spencer, 18 N. Y. 150; Cowan v. Sapp, 74 Ala. 44; Ponder v. Cheeves, 90 Ala. 117.

More than two years elapsed after the issue of the execution and the levy and sale, before the filing of the present bill. Whether the court of law would, at that day, have entertained an application to vacate the sale, because of the irregularity in the issue of the execution, it is not necessary to consider. Conceding that court would have intervened, the jurisdiction was exclusive. The rule is very general, that a court of equity will not interfere to vacate a sale under legal process, on account of irregularity in the issue of process, or in its execution; but, as is properly said, “the application ought to be made to the court issuing the writ, and if made elsewhere ought not to be entertained.” There must be accident, surprise, mistake, or fraud, or some fact or circumstance affecting the sale itself, and not resting on the irregularity of the process, or irregularity in its execution, before a court of equity will take jurisdiction to vacate it. There is not in this case averment or evidence of either of these conditions. — 2 Freeman on Executions, § 310; Ray v. Womble, 56 Ala. 32; Lockett v. Hurt, 57 Ala. 198; Cowan v. Sapp, 74 Ala. 44.

The more important question is, whether the lands were the subject of levy and sale under the executions; and this depends, materially, upon the quality of the estate residing in the appellee. The allegation of theoriginal bill is, that they were acquired for a right-of-way, under the charter of the appellee, “by purchase, condemnation and otherwise.”

The general law providing for the creation and regulation of railroad corporations, approved December 29, 1868, under which the appellee was incorporated and organized, contains the grant from the State of the franchises and powers it claims to have acquired. It did not confer the power of acquiring lands by proceedings in condemnation, or otherwise than by gift or purchase; and did not limit the estate or interest which could be acquired. The act of March 1, 1871, passed after the creation and organization of the appellee, conferred the power to resort to compulsory proceedings in condemnation for the taking of lands. — Acts, 1870-71, pp. 55-60.

There is no written evidence of the title of the appellee introduced; no other than vague and indefinite parol evidence, which seems to have been received without objection, indicating that parts of the lands were acquired by condemnation, and other parts by gift or purchase, not distinguishing between them. The grant of power to acquire, hold and convey lands for a right-of-way, or other uses, by the law of 1868, is general and extensive. The third section confers power to “acquire and convey at pleasure, all such real and personal estate, as may bo necessary and convenient to carry into effect the objects for which it was created;” and the 15th section provides for the acquisition, bj»' purchase or gift, of any lands in the vicinity of the road, or through which it may pass, so far as may be deemed convenient or necessary to secure the right-of-way, or such as may be granted to aid in the construction of the road, and to hold and convey the same in such manner as the board of directors may prescribe. Acts, 1868, pp. 462 — 466.

It is an incidental power of every corporation, unless restrained by statute, to purchase and alien lands necessary for the exercise of its corporate powers-, and this, “independent of.positive law” conferring such power. Says Oh. Kent: “All corporations have an absolute jus disponendi of lands and chattels, neither limited as to objects or circumscribed as to quantity.” — 2 Kent, 281. And railroad corporations may take a fee in lands although corporate existence is limited to a term of years. 1 Morawetz Corp., § 330; Davis v. M. & C. R. R. Co., 87 Ala. 633; Nicoll v. N. Y. & E. R. R. Co, 12 N. Y. (2 Kernan) 121.

What was the quantity and quality of the estate the appellee had in the lauds? The power to acquire an estate in fee, by purchase or gift, for a right-of-way, or for other uses, was very broad and general, and, according to the allegations of the bill and the scant evidence introduced, the lands were acquired, certainly in part, by the exercise of this power. If an easement only — the right to construct, maintain and operate a railroad in and upon them — was acquired, it is not possible to ascertain the parts subject to the easement, distinguished from the parts in which a fee was acquired. As the case is presented, the more probable inference is, that the appellee had an estate in fee in the lands, and not a mere easement. If the latter is the nature or character of its estate or interest, entitling it to hold in exemption from levy and sale, the fact should have been shown by certainty of pleading and satisfactory evidence.

As a general rule, the property of all private corporations is as subject to legal process for the satisfaction of debt as is the property of natural persons. An exception obtains, however, when the corporation is created to serve public purposes charged with public duties, and is in the exercise of its franchise and in the performance of its duties, Then, on considerations of public policy, without regard to the nature or quality of the estate or interest of the corporation, according to the weight of authority, such property as is necessary to enable it to discharge its duties to the public, and effectuate the objects of its incorporation, is not subject to execution at law. The only remedy of a judgment creditor is to obtain the appointment of a receiver, and the sequestration of its income or earnings. — 1 Freeman on Executions, §179, and authorities collected in notes; 2 Morawetz Corp., § 1125; Gue v. Tidewater Co. 24 How. 257; Overton Bridge Co. v. Means, 33 Neb. 857; s. c. 29 Am. St. 514, and authorities cited.

The exemption from levy is maintainable, however, only upon the theory that the corporation is created for the furtherance of public purposes, of such importance to the public that there must not be private interference with such of the corporate property as is essential to effectuate these purposes; and presupposes that to these purposes, the property is being applied. Property not necessary to effectuate these purposes, if acquired by gift or purchase, may be taken by legal process for the satisfaction of debts. — 2 Morawetz Corp., §1125. And so may personal property employed, and necessarily employed, in the exercise of corporate franchises. — 1 Freeman on Executions, § 179. When the lands were levied and sold, the appellee as a corporation had become inert, and had life in a name only. By non-user it had subjected itself to the penalty of forfeiture by a direct proceeding at instance of the State, while only in the absence of such forfeiture, it could retain the capacity to exist as a corporation. It was an existence in name only. It was not, and had not been for a period of 13 or 14 years, in the exercise of its corporate franchises. The line of railroad had been graded, embankments, bridges and trestles had been erected and constructed on the lands in controversey. The work was incomplete, and, for more than sixteen years prior to the levy and sale, had been abandoned. Prom the only part of the road which was completed, more than fourteen years before the levy and sale, the rails and cross-ties were removed and sold to a street railway company; and the locomotive and flat cars, the only rolling stock it seems to have ever possessed, and which had been utilized solely to aid in construction, were sold and carried away. Now, conceding that the property of the appellee, essential to the exercise of its franchises and to effect the public purposes contemplated in its creation, maybe exempt from levy and sale under legal process, can the exemption continue after the franchises have been abandoned? Can it exist when the necessity for its existence has terminated? We think it is co-extensive with the performance of the public purposes the corporation was intended to promote, and when these purposes are abandoned the exemption ceases, and the property stands in the condition of property not necessary to enable the corporation to perform its duties to the public. — 1 Freeman on Executions, § 179.

In Benedict v. Heinberger, 43 Vt. 231, a railroad company had ceased to use a portion of its road, and was removing the rails necessary to its operation. The company owning in fee the part of the road so abandoned, it was held such part was subject to levy and sale under execution at law. The decision, rests upon the proposition, that thedand so abandoned was not being held for public uses, or for use as a railroad. In that case, there was an abandonment in fact and intent of the public uses. Here, there was an abandonment in fact. There may have been a lingering hope that, at some indefinite time in the future, the corporation might resume activity, and apply the lands to the uses for which they were acquired. Or that they ■ could be sold to some other company having the means or credit to complete the construction of a line of railroad. However this may be, the fact remains that there was not an exercise of corpo■rate franchises for years, and the lands were not applied to public uses. Practically there was no pretense that they were held to enable the company to discharge its public duties. We are of opinion they were subject to levy and sale under the executions ; that the sale was valid passing to the purchaser the fee vested in the appellee. If the lands were not subject to execution, what remedy could the judgment creditors have? There was no income or earnings to be sequestered. The result of the contention would be that the lands were placed beyond the reach of creditors, and yet the appellee held the fee, having power and capacity to sell and convey it, but applying it to no public uses, and earning no income.

Tho question we have considered, the right to levy an execution at law, on lands owned and held in fee, as the right-of-way of a railroad corporation, the corporation having become inert and having ceased all user of its franchises and all performance of its public duties, was not considered in East Ala. Railway Co. v. Visscher, 114 U. S. 340. All that was considered and decided in that case was, whether the mere right-of-way of a railroad company, i!a mere easement in the land, to enable it to discharge its'functions of making and maintaining a public highway, the fee of the soil remaining in the grantor,” was the subject of levy and sale under execution at law. The court expressly declared that it was “not necessary to discuss the general question as to the right to levy an execution at law on property owned by a railroad company in fee.” Nor is it now necessary to express an opinion whether under any circumstances, -the easement of a railroad company may or may not be the subject of levy and sale under execution at law.

The assignments of error are numerous, presenting many questions which have been discussed by the respective counsel. The conclusion we have reached renders it unnecessary to consider them in detail. The result is, the decree of the chancellor must be reversed, the injunction dissolved, and the bill dismissed at the' cost of the appellee in this court and in the court of chancery.

Reversed and rendered.