Herreid v. Ettrick & Northern Railroad

192 N.W. 54, 179 Wis. 516, 1923 Wisc. LEXIS 51

• Court: Wisconsin Supreme Court
• Decided: February 6, 1923
• Status: Published

Opinion

Vinje, C. J.

The appeal presents the question whether a town can lawfully vote bonds to aid in the operation and maintenance of a railroad already built and which has been in operation for a number of years. It is contended by the appellant that the provisions of sec. 942, Stats. 1919, authorize the town to lawfully vote and issue bonds for such purpose. The part of the section relied upon reads:

"Any county, town, village or city may, in accordance with the provisions of this chapter, issue its negotiable bonds for the purpose of paying for any authorized subscription to the stock or mortgage bonds, or b.oth, issued by any corporation or company organized for building any railroad, whether- of broad, ordinary or narrow gauge, or made of iron, steel or wooden rails, or in exchange for or compromise of any such bonds previously issued for. such purpose.”

It is well settled that the statute quoted grants to a town the right to vote bonds to aid in the construction of a railroad not yet built. Whiting v. S. & F. du L. R. Co. 25 Wis. 167, 186. It is argued by the appellant that the power exists to vote bonds to be used in the purchase of the capital stock of a railroad already completed and in operation, and it is argued that the power to subscribe for mortgage bonds must mean mortgage bonds of a road already completed because it is said such bonds are not usually issued until the road is completed, and it is further argued that the beginning of sec. 945, Stats. 1919, reading: “Whenever any railroad company shall desire a subscription to its stock or bonds, or both,” etc., indicates that the railroad may do this at any time after completion as well as before.

These arguments seem somewhat persuasive, but when we synthesize all the provisions relating to the power of towns to issue bonds in aid of railroads we find a clear intention by implication, and also by direct language, that such bonds shall be used to aid in the construction of a road to be built and not in aid of the operation of a road already constructed. The section quoted and the subsequent sections of the same act all relate to the building or construction of a road, and sec. 948 thereof specifically provides that “no such bonds shall be delivered, or be valid if delivered, 'until the road to aid in the construction of which they were voted shall have been completed and in operation by the passage of cars continuously from one terminus to such points as such company shall have agreed to construct the same in consideration thereof.”

The power given is an extra-municipal power permitting the town to engage in an enterprise not within the scope of its usual corporate powers, and therefore must be strictly construed; and when exercised must be strictly followed. 2 Elliott, Railroads (3d ed.) § 1017; Young v. Clarendon Tp. 132 U. S. 340, 10 Sup. Ct. 107; Phillips v. Albany, 28 Wis. 340; Platteville v. G. & S. W. R. Co. 43 Wis. 493. Thus in Lawson v. Schnellen, 33 Wis. 288, it was held that the leasing of an existing road for a few miles was not in compliance with the proposition to build a road, and the issuing of the bonds voted in aid of the building of a road was enjoined. The same rule was applied in Meeker & Co. v. Ashley, 56 Iowa, 188, 9 N. W. 124, where it was held that it was not in compliance with the statute for a railroad to purchase an existing railroad between certain termini where the vote of the' town was to aid in the construction of a railroad between such points; and in Minneapolis, St. P., R. & D. E. T. Co. v. Minneapolis, 124 Minn. 351, 145 N. W. 609, it was held under a statute quite similar to ours that a city could not aid an existing railroad in the construction of a bridge. That court previously, in State ex rel. Minn. M. R. Co. v. Highland, 25 Minn. 355, had held that a municipality had no power to issue bonds to aid a railroad already constructed. So it must be held, both upon the construction of our statute and upon cases decided in sister, states under similar statutes, that our statute authorizes the issuance of municipal bonds to aid in the construction of a road to be built in the future, but does not warrant the granting of aid to a railroad already completed and in operation.

The, proof shows that in the instant case the only substantial additions in the way of betterments to the road between the time of the last proposition for aid, and the time the certificate of completion was filed included only the installation of two turntables, the replacement of a few ties, and the purchase of a second-hand Ford automobile. These betterments can in no sense be termed the construction of a railroad within the meaning of the statute.

By the Court. — Judgment affirmed.