Kentucky Imp. Co. v. Slack

14 F. Cas. 349, 22 Int. Rev. Rec. 246

• Court: U.S. Circuit Court for the District of Massachusetts
• Decided: July 15, 1876
• Status: Published

Opinion

CLARK, District Judge.

The question is whether the Kentucky Improvement Company was a railroad company so as to be liable to the tax imposed. At the hearing I was at first under the impression that it was not, and that the construction and use of its railroad was only incidental and subsidiary to its other objects, and designed to take the place of locking and damming the Little Sandy river, as provided in its first charter, under the name of the ‘‘Argilite Mining and Manufacturing Company.” But upon further examination and reflection I am satisfied that such impression was not correct.

1st. Because the power to build a railroad, “or one or more rail-tracks, from any lands owned or improved by said corporation, to convenient points on the Ohio or Little Sandy river, or both, or to connect with other railways, and to maintain said tracks and draw cars over the same by suitable motive power,” is a very much more extensive grant than the power to “lock and dam the Little Sandy” up to their mines and property. Under the amended charter a Briarean Railroad Company might have been built up. It might have netted the state of Kentucky all over with tracks, from the mouth of the Ohio to its source, and all along the Little Sandy, and to every other railroad in the state, and at any convenient point. It could build a road from any land owned or improved by it, to any of these points in any direction convenient, and condemn the lands taken by it. It is doubtful if any other charter of such extensive powers to a railroad company can any where be found.

2d. Because said company, after building their road, used it not only to convey their own products and manufactures, but as a public road for freight and passengers. It is true the amount thus received was not large, but the company accommodated “all comers.” It is contended there was no provision 'in the charter in terms authorizing the company to convey freight or passengers other than its own. But the power to build a road must be construed as a power to use it, when built, in a legitimate way, for such are the object and purpose of building a road; and there is nothing in the charter restricting the road to carrying its own passenger’s and freight. Again, the company having carried freight and passengers other than their own, cannot now be heard to say they had no right to do so. They have by their acts put a construction upon the extent of their grant.

3d. Because it is not certain that the grant to build a railroad or railroads was in lieu of the power “to lock and dam the Little Sandy river,” but was in addition to it. The amended charter provides “that should said company lock and dam the Little Sandy river they shall build two bridges,” etc., showing pretty conclusively that both powers, to build a railroad or railroads, and to lock and dam the Little Sandy river, were included in the charter.

I think, therefore, that the Kentucky Improvement Company was a railroad company within the purview of the statute, and liable to the tax assessed. There must be judgment for the defendant and for his costs.

[NOTE. A writ of error was then taken by the plaintifE to the supreme court, where the judgment was affirmed in an opinion by Mr. Justice Clifford, who said that, under the enlarged powers conferred by the new statute, the company not only had a right to lay tracks, but could condemn lands and do other acts which clearly showed it to be m fact a railroad company, and, being such, the coupons attached to the bonds were liable to be taxed. Mr. Chief Justice Waite. Mr. Justice Field, and Mr. Justice Harlan dissented on the ground that the construction of the short railway by the improvement company for its own use did not convert it into a railroad company. 100 U. S. 648. See. also. Eastern Ky. It. Co. v. Slack, Case No. 4,253.]