Blair v. Chicago/Opinion of the Court
United States Supreme Court
Blair v. Chicago
Argued: January 11, 12, 15, 1906. --- Decided: April 2, 1906
The jurisdiction of the circuit court to render the original judgments against the companies and to maintain the ancillary bill is challenged at the outset. These objections require notice before considering the controversy upon its merits. It is insisted that the circuit court had no jurisdiction to render the judgments at law because of the provisions of the act of August 13, 1888 (25 Stat. at L. 433, 434, chap. 866, U.S.C.omp. Stat. 1901, p. 508), providing that no circuit court shall have cognizance of any suit to recover the contents of any promissory note in favor of any assignee or subsequent holder if such instrument be payable to bearer, unless such suit might have been prosecuted in such court to recover, if an assignment or transfer had not been made. As the notes were made payable to the order of 'Markham B. Orde, Treas.,' and there is no allegation that Orde was not a citizen of the state of Illinois, of which state the defendant fendant companies were corporations and citizens, it is insisted that the jurisdiction must fail, under the provisions of the statute just referred to. Assuming, without deciding, that this question could be raised by way of defense to the ancillary bill, we think the objection must fail, for, under the allegations of the declaration, the money was furnished directly to the defendants by the Guaranty Trust Company, and that company was the first taker of the notes. In Falk v. Moebs, 127 U.S. 597, 32 L. ed. 266, 8 Sup. Ct. Rep. 1319, it was held that notes made in this form, payable to the treasurer, indorsed before delivery by him, are the notes of the company. And when it appears that the indorser is not in fact an assignee of the paper, suit may be brought in a Federal court by a holder having the requisite diverse citizenship, notwithstanding the indorser might have been a citizen of the same state with the defendant. Holmes v. Goldsmith, 147 U.S. 150, 37 L. ed. 118, 13 Sup. Ct. Rep. 288.
It is further argued that the entire proceedings were fraudulent and collusive; that no money was in fact loaned, and that they were the result of a conspiracy between corporations of Illinois, to obtain the jurisdiction of the Federal court, and its decision on the controverted rights of the parties under the statutes of the state. We have examined the supplemental records submitted since the argument in this court, on this branch of the case, and think the charges of bad faith and conspiracy are not sustained. We have no doubt that the money was loaned by the Guaranty Trust Company to these corporations, and that the original judgments were bona fide. As to the conspiracy to get the case into the Federal court, with a view to the decision of the rights of the parties therein, we are not aware of any principle which prevents parties having the requisite citizenship and a justiciable demand from seeking the Federal courts for redress, if such be their choice of a forum in which to have contested rights litigated. Having a proper cause of action and the requisite diversity of citizenship confers jurisdiction upon the Federal courts, and in such cases the motive of the creditor in seeking Federal jurisdiction is immaterial. South Dakota v. North Carolina, 192 U.S. 286, 310, 48 L. ed. 448, 457, 24 Sup. Ct. Rep. 269; Dickerman v. Northern Trust Co. 176 U.S. 181, 190, 44 L. ed. 423, 430, 20 Sup. Ct. Rep. 311; Lehigh Min. & Mfg. Co. v. Kelly, 160 U.S. 327, 336, 40 L. ed. 444, 447, 16 Sup. Ct. Rep. 307; Crawford v. Neal, 144 U.S. 585, 36 L. ed. 552, 12 Sup. Ct. Rep. 759; Cheever v. Wilson, 9 Wall. 108, 123, 19 L. ed. 604, 608; Smith v. Kernochen, 7 How. 198, 216, 12 L. ed. 666, 673.
It is true that the judgments were taken and the receivers appointed on the same day, and it is quite likely that the receiverships were in view when the judgments were taken, and that preparations had been made in that direction, but we perceive in this no legal objection to the jurisdiction of the court. It is further insisted by the counsel for the city that the ancillary bills cannot be sustained upon their merits. But we think a case was made out by the allegations of the bills, especially when considered with reference to the admissions of the answer, which showed that the extent and character of the property rights of the corporations whose rights and franchises were the subjects of the receivership were in direct and serious controversy between the company and the receiver on the one hand and the city on the other. While it may be that there would have been no interference on the part of the city with the property while it was in the hands of the court's receivers, still the record shows that the city strenuously contested the asserted rights of the corporations to the franchise to use the streets of the city for ninety-nine years, the term claimed to have been granted to them by the act of February, 1865. It was the claim of the city that as to many of the ordinances granting rights in a number of the streets, the right to the use and occupancy of them would expire July 30, 1903. The city had asserted in a number of ways its purpose to treat the rights of the companies and whatever franchises they had as terminated at that date. It declares its purpose to treat the rights of the comstreets and resort to all legal means to protect its rights against what were deemed the unfounded claims of the companies as to the extended franchises. Without going into further detail upon this branch of the case, we think that the attitude and claims of the city cast a cloud upon the title to this property which was in the hands of the receivers to be administered under the orders of the court, and that in such case the receivers may, with the authority of the court, proceed by ancillary bill to protect the jurisdiction and right to administer the property, and to determine the validity of the claims of the parties which cast a cloud upon the franchises and rights claimed by the companies and the receivers, and that in such case it was proper to grant an injunction until the rights of the parties could be determined. Detroit v. Detroit Citizens' Street R. Co. 184 U.S. 368, 46 L. ed. 592, 22 Sup. Ct. Rep. 410; Re Tyler, 149 U.S. 164, 37 L. ed. 689, 13 Sup. Ct. Rep. 785; Rouse v. Letcher, 156 U.S. 47, 39 L. ed. 341, 15 Sup. Ct. Rep. 266; White v. Ewing, 159 U.S. 36, 40 L. ed. 67, 15 Sup. Ct. Rep. 1018. We think, then, that the court had jurisdiction of the case made in the ancillary bills.
A further preliminary question is made in the contention that the leases under which the various transfers were made, and which are supposed to have vested title in the Chicago Union Traction Company, are void for want of corporate power in the companies to make or receive the same. We do not think the city of Chicago is in a position to raise that question. The corporations have undertaken to transfer the rights of the lessor companies, and the lessees have gone into possession thereof, and the same are now in possession of the receivers under authority of the court. All of the companies are parties to the suit, and the rights and franchises of all are, by order of the court, vested in the receivers. They hold the title to all these rights to be sold at judicial sale, or otherwise dealt with, as the court may direct. In this view we cannot see that it is material to inquire into the validity of the intermediate transfers between the companies. No contract is undertaken to be enforced with the city of Chicago which depends upon the validity of these transfers. The city has no power to invalidate them, and the state has not attempted to inquire into their validity by a proceeding in quo warranto. In such case, we think, the principle laid down in Fritts v. Palmer, 132 U.S. 282, 293, 33 L. ed. 317, 321, 10 Sup. Ct. Rep. 93, 96, is controlling: 'The question whether a corporation having capacity to purchase and hold real estate for certain defined purposes or in certain quantities has taken title to real estate for purposes not authorized by law, or in excess of the quantity permitted by its charter, concerns only the state within whose limits the property is situated. It cannot be raised collaterally by private persons unless there is something in the statute, expressly or by necessary implication, authorizing them to do so.'
Passing now to the merits of the case, we will first notice the objection that the acts of 1859, 1861, and 1865 are unconstitutional. The Illinois Constitution of 1848 contained the provision that no private or local law shall embrace more than one subject, and that shall be expressed in the title. The acts are attacked upon the ground that they are violations of this requirement. But we do not think that these objections are tenable. The title of the act of February 14, 1859, is 'An Act to Promote the Construction of Horse Railways in the City of Chicago;' the title of the act of February 21, 1861, is 'An Act to Authorize the Extension of Horse Railways in the City of Chicago;' the title of the act of February 6, 1895, is 'An Act Concerning Horse Railways in the City of Chicago.' In People ex rel. Deneen v. People's Gaslight & Coke Co. 205 Ill. 482, 98 Am. St. Rep. 244, 68 N. E. 950, the Illinois cases were reviewed and the conclusion reached that the purpose of the constitutional provision is accomplished if the title is comprehensive enough as reasonably to include within the general subject or the subordinate branches thereof, the several objects which the statute seeks to effect. And it was held that generality of the title is no objection to a law so long as it is not made to cover legislation incongruous in itself, and which by no fair intendment can be included as having necessary or proper connection. In the case of Montclair Twp. v. Ramsdell, 107 U.S. 147, 27 L. ed. 431, 2 Sup. Ct. Rep. 391, a statute of New Jersey was before this court which was claimed to be unconstitutional because it embraced more than one subject, not expressed in its title. The provision of the New Jersey Constitution was 'To avoid improper influences which may result from intermixing, in one and the same act, such things as have no proper relation to each other, every law shall embrace but one object, and that shall be expressed in the title.' [Art. 4, § 7.] The Montclair Twp. Case held: 1. That this provision does not require the title of an act to set forth a detailed statement or an index or abstract of its contents; nor does it prevent uniting in the same act numerous provisions having one general object, fairly indicated by its title. 2. That the powers, however varied and extended, which a township may exercise, constitute but one object, which is fairly expressed in a title showing nothing more than the legislative purpose to establish such township. In the late case of Detroit v. Detroit Citizens' Street R. Co. 184 U.S. 368, 46 L. ed. 592, 22 Sup. Ct. Rep. 410, the court had occasion to deal with a similar provision in the Constitution of Michigan. In it the language of Judge Cooley in People ex rel. Secretary of State v. State Ins. Co. 19 Mich. 392, was quoted with approval: 'We must give the constitutional provision a reasonable construction and effect. The Constitution requires no law to embrace more than one object, which shall be expressed in its title. Now, the object may be very comprehensive and still be without objection, and the one before us is of that character. But it is by no means essential that every end and means necessary or convenient for the accomplishment of the general object should be either referred to or necessarily indicated by the title. All that can reasonably be required is that the title shall not be made to cover legislation incongruous in itself, and which by no fair intendment can be considered as having a necessary or proper connection.' Applying this principle, we do not think that any of the subjects treated were so far foreign to the title of the several acts as to be open to this constitutional objection. See also upon this subject: Independent School District v. Hall, 113 U.S. 141, 28 L. ed. 956, 5 Sup. Ct. Rep. 371; Jonesboro v. Cairo & St. L. R. Co. 110 U.S. 192, 198, 28 L. ed. 116, 118, 4 Sup. Ct. Rep. 67; Otoe County v. Baldwin, 111 U.S. 1, 28 L. ed. 331, 4 Sup. Ct. Rep. 265; Mahomet v. Quackenbush, 117 U.S. 508, 29 L. ed. 982, 6 Sup. Ct. Rep. 858; Carter County v. Sinton, 120 U.S. 517, 30 L. ed. 701, 7 Sup. Ct. Rep. 650.
Without taking time to analyze the acts in this connection we pass to what we deem more important features of the case.
The principal controversy in this case turns upon the construction of the act of 1865, amending the act of 1859. On the part of the companies it is insisted that this act means to give an irrevocable grant from the state of the right to use the streets of the city of Chicago for street railway purposes for a term of ninety-nine years from the passage of the law; that the only right conferred upon the city is one of designation of the streets to be occupied and the regulation by agreement with the companies of what are termed the 'administrative' features of the occupancy. It is insisted that this broad right is derived from the public act of the state legislature, which, upon its acceptance, has become an inviolable contract between the state and the companies. Upon the part of the city it is contended that there has been no grant to the railways to occupy the streets of the city except with the authorization of the city council and upon such terms and conditions, including the term of occupancy, as that body may see fit to fix by contract with the companies; that the only legitimate effect of the act of 1865, other than the extension of the corporate life of the companies, has been to continue the control of the city over the streets, and to reaffirm the contracts theretofore made between the city and the companies. The theory that the franchise to use the streets was derived solely from the state, subject only to the right of the city to designate the streets to be occupied, and to regulate the 'administrative' features of the use, was adopted by the learned circuit court in construing the act in controversy. It is therefore important to consider the nature of the franchises, licenses, rights, and privileges dealt with in the act of 1865, to ascertain, as near as may be, in what sense its terms were used, and with what meaning they are incorporated into the act. In order to construe this act and determine, if possible, its true meaning and the extent of the powers and rights intended to be granted or confirmed, reference may appropriately be had to prior legislation upon the subject, for the act of 1865 is amendatory, and can only be understood if a correct apprehension is first had of the powers previously granted, and the extent and nature of the rights and privileges conferred and the sources from which they severally came. Whether the city charter, granted while the Constitution of 1848 was in force, gave the city the right to grant to railway companies the privilege of using the streets for street railway purposes, is a question much discussed in the briefs and the arguments at bar. The city, by the charter of 1851, and the amendment of 1863, had general power to control the use and occupation of the streets of the city and to regulate the use of horse railways therein and the laying of tracks thereon. It is insisted for the city that, independent of the acts under consideration in this case, the general powers conferred in the city charter, as construed by the supreme court of Illinois, were broad enough to empower it to grant the use of the streets for street railway surposes. See Quincy v. Bull, 106 Ill. 337, 349, and cases cited in the opinion. On the part of the companies it is contended that this right could only come from the state, and that the effect of the act in question was to confer the right upon the companies as a charter right granted by the sovereign power.
It is said to have been the settled understanding of all concerned, and in accordance with the then-existing policy of the state, that the act of 1859 was a franchise directly granted by the state, giving the full right to use the streets of the city for the term of the corporate life of the companies, subject only to the designating power of the city as to streets to be used. In this connection it may be observed that the supreme court of Illinois in Chicago Union Traction Co. v. Chicago, 199 Ill. 484, 525, 59 L. R. A. 631, 645, 65 N. E. 451, 462, distinctly stated that the act of 1859 recognized the power of the common council to pass the ordinance of August 16, 1858. 'There,' it is said in the opinion, 'was no other action of the common council, taken before the passage of the act of February 14, 1859, except the ordinance of August 16, 1858. By the use of the words, 'with such rights and privileges as the said common council has prescribed,' the legislature could not have referred to any other action of the common council than the passage of the ordinance of August 16, 1858. It thereby recognized the power of the common council to pass that ordinance, and the appellant here introduces it and relies upon it. The legislature, by thereby affirming and recognizing the passage of the ordinance of August 16, 1858, also recognized the power of the common council to pass that ordinance under clause 9 of § 4 of chapter 4, of the charter of 1851.' In the act of 1859 the legislature did not assume to fix independently the term for the use of the streets, but affirmed that which the common council had authorized the corporators to do, and gave authority to confer future rights by agreement with the corporations. In the first grants after the passage of the act of February 14, 1859, those of May 23, 1859, to the Chicago City Railway Company and the North Chicago City Railway Company, as we shall have occasion to show later, so far from acting upon the theory that the state had granted to the corporations the full right to use the streets for the corporate life of the companies, and needed no permission from the city council other than such as designated the streets and regulated administrative features, the council made and the companies accepted the ordinances which, on the north side, were for the term of twenty-five years and no longer, and on the south and west sides for the term named in the act of 1859, which had affirmed the grant from the council in the ordinance of 1858. The south and west side ordinance, as its recitals show, was not only passed in pursuance of the act of February 14, 1859, but also by virtue of the power and authority otherwise vested in the common coucil by its charter. Union Traction Co. v. Chicago, supra. Thereafter and frequently until the passage of the act of 1865, the council made and the companies accepted specific ordinances fixing the time of occupancy, as had been done in the original ordinances of May 23, 1859. And neither before nor after the passage of the act of 1865 was the ninety-nine year term recognized or acted upon in ordinances granting the use of the streets.
Under the ordinance of 1858 the council undertook to authorize the persons named to lay and operate a horse railway in certain streets of the city. This right, by the terms of the ordinance, was granted for the period of twenty-five years, and until the common council, in the manner designated, should elect to purchase and pay for the property of the railway companies. If this ordinance had been without legislative authority previous to the act of February 14, 1859, that act constituted the persons named in the ordinance of 1858, with one other, and their successors, a body politic and corporate under the name of the Chicago City Railway Company, for the term of twenty-five years, with all the powers incident to such corporations. The corporation was authorized to construct, maintain, and operate a single or double track railway in the city of Chicago, within the present or future limits of the south or west divisions of the city. But the grant did not stop there. It was immediately qualified and limited by the authority given to the common council of the city, for it provided that this right to maintain and operate street railways was upon streets, etc., 'as the common council of said city have authorized said corporators, or any of them, or shall authorize said corporation so to do in such manner and upon such terms and condition, and with such rights and privileges, as the common council has or may, by contract with said parties, or any or either of them, prescribe.' The corporation was given the right of eminent domain. Then, as to the action of the city, already taken under the ordinance of 1858, by § 7, all of the rights and privileges granted or intended so to be to the incorporators and their associates by the ordinances and amendments thereto passed by the council were approved and vested in the corporation. By § 10 of the act the North Chicago City Railway Company was incorporated. Is this act consistent with the theory that the full franchise of occupying and using the streets, without regard to authority from the city, except in designating streets, was vested by the state in the companies incorporated? This act conferred upon the railway companies, it is true, the right to use and occupy the streets of the city, but this right was upon the terms prescribed in the law. Conceding the plenary power of the legislature over the subject at that time, and that franchises, broadly speaking, are rights and privileges conferred by the state, and are derived from a grant of the sovereign power, nevertheless the state, while exercising its authority, might give to the city such measure of right and control in the manner as it saw fit. Dill. Mun. Corp. 3d ed. § 705; Richmond, F. & P. R. Co. v. Richmond, 96 U.S. 521, 24 L. ed. 734. The city is the corporate body directly interested in the use and control of the streets. By the charter of 1851 exclusive control over the streets was given to the council. That it was the intention of the legislature to give effect to the right of municipal control in the act under consideration is shown in its confirmation of terms already fixed by contract between the city and the companies. As to the future, companies were to have no right to the use and occupancy of the streets until they should obtain from the city council authority to that end, under contracts to be agreed upon as to terms and conditions. A more comprehensive plan of securing the city in the control of the use of the streets for railway purposes could hardly be devised. The company must be 'authorized' by the city council before it can lay tracts or operate railways in the streets. This is more than to designate that for which authority has already been given. To authorize is to 'cloth with authority' (Webster's dict.); 'to give legal power to' (Century dict.). It is an additional grant of right and power which the legislature requires the corporation to obtain as a condition precedent to its use and occupation of the streets. This power of the city, in the absence of language in the statute excluding the authority and reserving its exercise to the state, necessarily includes the right to fix the time for which the streets may be used. This doctrine was, we think, correctly stated by Judge Lurton, in delivering the opinion of the court of appeals in Louisville Trust Co. v. Cincinnati, 22 C. C. A. 334, 346, 47 U.S. App. 36, 59, 76 Fed. 296, 308. 'The right of the local authority thority to impose terms and conditions is clearly conferred, and no such corporation can impose itself upon the public streets or highways unless it enter into an agreement touching the occupancy of such streets, or resorts to the right of condemnation, in default of an agreement. This right to impose terms and conditions most obviously implies the right to agree upon the duration of such occupancy. The right to exclude altogether, unless resort be had to condemnation, involves the right to limit the period of the grant.' Coverdale v. Edwards, 115 Ind. 374, 381, 58 N. E. 495; Elliott, Railroads, § 1081.
The act under consideration nowhere assumes to fix the duration of the grant, nor excludes the conclusion that it is embraced in the terms and conditions which are to be fixed by contract with the city. If the franchise to use the streets, without regard to municipal action, was fully conferred by the legislative act under consideration, then the company had only to take possession of the streets, subject to regulations as to running of cars, etc., by the city council. On the contrary, under the terms of this act, the city, by withholding its consent, could prevent the use of the streets by the corporations. No way is pointed out by which this consent could be compelled against the will of the council. That body might, for reasons sufficient to itself, under the terms of this act, by withholding assent, determine that it was undesirable to have the corporations in control of the use of the streets.
While the decisions of the supreme court of the state are not binding upon us in determining whether a contract was made which is entitled to protection under the Federal Constitution, we may notice the case of Chicago City R. Co. v. People, 73 Ill. 541. That was a proceeding in quo warranto against the Chicago City Railway Company, asking to declare a forfeiture of its franchise consent of two thirds of the owners of the avenue. The grounds relied upon were that the railway company had not obtained the consent of two third of the owners of the property fronting on the avenue within fifteen months from the passage of the ordinance of August 22, 1864, the time limited for construction in the ordinance of that date. The respondent, the Chicago City Railway Company, relied upon an ordinance passed November 13, 1871, amendatory of the ordinance of August 22, 1864, extending the time to complete its railway for a period of two years from the date of the last-named ordinance. The court found that two thirds of the property owners had consented, as provided in the ordinance of August 22, 1864, but found that the company had neglected to construct its road to the city limits within fifteen months from the passage of the ordinance, as therein provided. The question turned upon the validity of the extending ordinance of November 13, 1871, passed after the Constitution of 1870 went into effect. The majority of the court-Chief Justice Walker and Justices Breese and Sheldon dissenting-held that the common council had authority, under the act of 1865, to extend the time for the building of the roads on Indiana avenue, as the time limitation was a provision in favor of the city, which it might waive, as the charter of the company was silent upon the time within which the railway might be constructed, and in this connection held that the right granted by the city to construct the railway was a license as distinguished from a franchise derivable from the state, and, therefore, not within the constitutional prohibition against the passage of local or special laws granting to any corporation, association, or individual the right to lay down railroad tracks, or amending existing charters for that purpose, or granting to any corporation, association, or individual any special or exclusive privilege, immunity, or franchise whatever. The minority of the court were of opinion that the Constitution of 1870 made the extending ordinance invalid. In neither the majority nor the dissenting opinions is there any intimation that the railway company could occupy or use a street of the city of Chicago without the permission of the city. In discussing how far the charter authorized the company to act without the consent of the city, Mr. Justice Sheldon, in the course of an able dissenting opinion, concurred in by the Chief Justice and Mr. Justice Breese, is careful to point out that the right to occupy the streets is not complete in the grant of the charter from the state, and is only capable of being exercised when supplemented by the authorization of the city. And see People's Pass. R. Co. v. Memphis City R. Co. 10 Wall. 38, 55, 19 L. ed. 844, 850. In that case this court held that a charter authorizing a street railroad company to operate street railroads in all the streets of the city 'with the consent of the city' was unavailing until the consent of the city was first had, which consent was a condition precedent to the use of the streets.
What, then, was conferred in the franchise granted by the state? It was the right to be a corporation for the period named, and to acquire from the city the right to use the streets upon contract terms and conditions to be agreed upon. The franchise conferred by the state is of no practical value until supplemented by the consent and authority of the council of the city. After the passage of the act of 1859 the common council of the city, on May 23, 1859, passed an ordinance authorizing the extension and operation of certain horse railways in the streets of the south and west divisions of the city, and granting the use thereof to the Chicago City Railway Company. The city purported to act under authority of the act of 1859, and by virtue of the powers and authority otherwise vested in the common council by law. By this ordinance the term of use and occupation was fixed at 'during all the term in the said act of the 14th of February, A. D. 1859, specified and prescribed.' On the same day the council passed an ordinance granting rights in certain streets to the North Chicago City Railway Company. This ordinance contained this language: 'The rights and privileges granted to the said company by this ordinance, or intended to be, shall continue and be in force for the benefit of said company for the full term of twenty-five years from the passage of this ordinance, and no longer.' On February 21, 1861, the legislature passed an act incorporating the Chicago West Division Railway Company for the term of twenty-five years, the corporation to possess the powers enumerated in the 2d, 3d, 5th, and 6th sections of the act of February 14, 1859. By § 4 of the act the corporation was authorized to acquire from the Chicago City Railway Company the powers, franchises, privileges, and immunities conferred upon that company, and the consent of the directors of said company was made a condition precedent to the exercise of the powers conferred as to any streets of the south and west divisions of the city of Chicago.
Before the passage of the act of 1865 a number of ordinances were passed, conferring the privilege of using streets, in most cases with a time limit definite in character. The record discloses that by an agreement of July 29, 1863, the Chicago City Railway Company had agreed to convey to the Chicago West Division Railway Company certain rolling stock, equipment, etc., together with 'all and singular the franchises, rights, privileges, and immunities' of the Chicago City Railway Company in the upon certain streets, 'conferred, given, or granted by or under any or all acts of the general assembly of the state of Illinois, and any and all ordinances of the city of Chicago, or contracts with the common council.' In this contract it was also provided that if at any time it should be adjudged that consent to the sale by the council of the city of Chicago is or was necessary to secure to the grantee company the rights and privileges embraced in the contract, the grantor company would do all in its power by reasonable and proper effort to secure such consent of the common council. By the deed of transfer of July 30, 1863, the grantor company conveyed its rights, privileges, and franchises in the use and occupation of certain streets, 'to have and to hold the above bargained and granted premises and property to the party of the second part, etc., for and during all the time which the said party of the first part might hold, exercise, and enjoy the same under its present charter and any and all extensions thereof.' On December 13, 1859, the Chicago City Railway Company by agreement gave to the North Chicago City Railway Company permission and authority to make, construct, and use for twenty-four years, tracks, etc., as might be necessary to extend its railway southerly to such points in the south and west divisions along certain streets, 'as the party of the first part (Chicago City Railway Company) has been or may be authorized to make and have the same.'
It thus clearly appears, at least up to the passage of the act of 1865, that legislation upon the subject recognized and enforced the right and authority of the city to fix the term during which the streets might be occupied by street railway companies. The legislature had confirmed the ordinance of the city fixing the term at twenty-five years and until the city should see fit to purchase the property of the railway company. It had required the companies to obtain the authority of the city before using the streets, such use to be upon terms and conditions, and with such rights and privileges, as the city had or might thereafter prescribe by contract with the companies. We find no intention evidenced in legislative action thus far to prevent the municipal authorities from exercising the important and far-reaching authority of fixing by contract with the persons or corporations to whom franchises are granted by the state the term during which the occupancy shall continue. This feature of the right to use the streets, it need hardly be said, is of most vital importance to both parties. Some latitude of time is essential to the value and stability of the investment to be made. An unduly long period might conclude municipal action when changing conditions and growing population demanded it in the public interest.
We come now to the act of 1865. Does its interpretation justify the contention that by its terms the state took from the local authorities the control which had been theretofore recognized, the right and authority to determine upon what terms and for what length of time the railways might occupy the streets, and without other consideration than the building, equipment, and operation of the roads, conferred upon the companies the right to use and occupy for ninety-nine years to come the streets of the city which might thereafter be designated by the city council, and confirmed without qualification for that term the right to use and occupy the streets covered in contracts already made with the city? We may premise, before taking up this act for more detailed consideration, that it is a firmly established rule, which we shall have occasion to refer to later on in this discussion, but which must be borne in mind as we enter upon the consideration of this act, that one who asserts private rights in public property under grants of the character of those under consideration, must, if he would establish them, come prepared to show that they have been conferred in plain terms, for nothing passes by the grant except it be clearly stated or necessarily implied. The 1st section of the act of 1865 was effectual to extend the corporate life of the two companies, created by the acts of 1859 and 1861, from twenty-five to ninety-nine years each. The 2d section authorizes the construction and maintenance of street railways in the city of Chicago upon such streets, etc., within the limits named, as the common council have authorized or shall from time to time authorize, the rights, privileges, and immunities and exemptions to be such as the common council has prescribed, or may, by contracts with said parties, or either of them, prescribe. In the first clause of that section, then, there is shown no disposition to depart from the policy of the state as indicated by the act of 1859, and the action of the companies thereunder, which required the street railway companies, before entering upon the occupation or use of the streets, to obtain, by agreement with the city, its sanction and authority for the right and privilege of so doing. Then comes the clause which, it is contended, works a revolution of former policies and extends former franchises and rights to the full term of ninety-nine years, and withholds from the city the power of granting any further use of the streets to the railway companies, except upon terms of extending the right for the like period. While we have no right to consider this act by segregating its clauses as though they were separate enactments, for the purpose of having its provisions clearly in view, we insert this clause:
'And any and all acts or deeds of transfer of rights, privileges, or franchises, between the corporations in said several acts named, or any two of them, and all contracts, tracts, stipulations, licenses, and undertakings made, entered into, or given, and as made or amended by and between the said common council and any one or more of the said corporations, respecting the location, use, or exclusion of railways in or upon the streets, or any of them, of said city, shall be deemed and held and continued in force during the life hereof, as valid and effectual, to all intents and purposes, as if made a part, and the same are hereby made a part, of said several acts.'
Does a fair interpretation of this clause of the act extend all the franchises, privileges, and contracts theretofore made for the term of ninety-nine years? This clause deals with:
1. The transfers of rights, privileges, or franchises between the corporations.
2. Comprehensively speaking, the contracts made between the city and the companies.
The definition of 'rights and privileges,' as the terms are used in this act, is not difficult to find. It is contained in the context of the act confirming 'such rights and privileges, immunities and exemptions, as the common council has [prescribed], or may, by contract with said parties, or any or either of them, prescribe.' This definition conforms to the use of the terms in prior acts of the legislature on the subject as well as to ordinances of the city granting the use of the streets. The rights and privileges intended are such as have been derived from contracts with the city. Franchises in the sense we have stated have been the grants of the state. Licenses and all other privileges have been obtained from the city, acting under the authority of the acts of the legislature in the manner outlined earlier in this discussion. As to the deeds and acts of transfer of rights, privileges, and franchises, as well as the contract rights secured from the city, the act declares they 'shall be deemed and held and continued in force during the life hereof, as valid and effectual, to all intents and purposes, as if made a part, and the same are hereby made a part, of said several acts.'
What does this mean? It cannot operate to extend the contract rights and privileges, obtained directly from the city before or after the transfer by one company to the other, ninety-nine years, for as to these the act distinctly declares that the contracts, stipulations, licenses, and undertakings, between the council and the companies, shall stand 'as made or amended.' This declaration is in the past tense, and can have no reference, by any fair construction, to future engagements.
The contracts, by this clause, in all their terms, including time limits, are written into the original acts of 1859 and 1861, as if made a part thereof. Much discussion has been had as to the proper interpretation of the ambiguous expression 'during the life hereof.' For the companies it is insisted that its meaning is to extend all franchises and contracts, and whether the latter have been or may thereafter be made, to the end of the ninety-nine years, so as to give the railways the franchise to use the streets for that period by an irrevocable grant, irrespective of any limitations by state or municipal action subsequently undertaken. To give this act the construction insisted on by the companies is inconsistent with the policy of the state, declared in the act of 1859, which ratified the ordinance of 1858, and gave additional rights in the streets only upon obtaining the consent of the city. It practically reads out of the act the preceding clause of the very section under consideration, which expressly recognizes the authority of the city council to control the use of the streets by contracts which it has made or may make in the future. To say that contracts, the terms and conditions of which are left to agreement with the city, could only be made upon terms of extension to ninety-nine years, is to nullify in an important particular the powers conferred in the act. The construction contended for requires us to ignore or entirely change the sense of terms establishing the contracts as made, and requires an interpretation which applies to the future what is specifically stated to be meant for the past. It does violence to the rule contended for by counsel for the companies,-that words are to be considered in their ordinary signification, and every part of the statute, if practicable, given meaning in harmony with its other provisions upon the subject. It is urged that the words 'as made or amended' must have reference to the future, and were intended to give a prospective operation to the act, and to read into all contracts thereafter to be made, as well as theretofore made, a right to use the streets without the consent of the city for the extended period. And it is said that this is particularly shown by the use of the words 'as amended.' But this expression was used in the seventh paragraph of the act of 1859, vesting in the corporations the rights and privileges granted by the ordinances of the common council 'and the amendments thereto.' The ordinance of August 16, 1858, was itself an amendment of prior municipal legislation. The purpose of the act of 1865 was to continue, as made, the former contracts, with their amendments. If it was intended to extend all past contracts and licenses for the use of the streets to the term of ninety-nine years, and to require the city council to enter into no new engagements for terms and conditions which should not extend to that period, it would have been easy to give expression to such purpose in plain words, and not resort to language which, as stated in one of the briefs of the learned counsel for the companies, is 'unusual and more or less figurative.' If the words used have no effect to control the right of future contract, but do extend the term of the contracts made to nenety-nine years, then we may have the anomalous situation of some contracts for short and some for long terms in the same system of railroads. It is true that we are to consider the situation as it was when the act was passed, and not in the light of the subsequent growth and development of the city. But in 1865 the policy of local control of the streets for railway purposes had been declared and acted upon. So radical a departure as is contended for must be found in terms plainly stated and clearly defined. It is contended that unless the construction insisted upon for the companies is given to the act, no force or effect is given to the expression 'during the life hereof,' and a well-recognized rule is invoked that all parts of this law must be given force and effect in interpreting its meaning. While it is incumbent upon those claiming under a public grant, as we have already stated, to make out the rights contended for by terms which clearly and unequivocally convey them, and it is enough to deny the privileges contended for if, upon considering the act, the mind rests in doubt and uncertainty as to whether they are intended to be conferred, we think this act can be given a construction which shall give some meaning and effect to the words 'during the life hereof.' Literally construed, the phrase would mean for the life of the act. It has been suggested that it may mean until the corporations, by forfeiture or otherwise, go out of existence. But these meanings do not seem to aid the purpose manifested in the law, and meaningless phrases are not supposed to be used to express the legislative will. Bearing in mind that the franchises granted came from the state, the nature and extent of the rights included in those franchises, that the franchise to be a corporation was extended by the 1st section of the act, and that the franchise, the transfer of which was intended to be confirmed in the clause now before us, embraced the right granted by the state to use the streets with the authority of the city, and that the rights and privileges were obtained from the city, let us see if some meaning can be found consistent with the other parts of the act and recognized rules of construction. Conceding for this purpose the contention on behalf of the companies that the phrase, 'during the life hereof,' may mean for the term of ninety-nine years, for that period the act provides that certain things 'shall be deemed and held and continued in force.' What are they? 1. 'Any and all acts or deeds of transfer of rights, privileges, or franchises between the corporations in said several acts named or any two of them.' 2. 'All contracts, stipulations, licenses, and undertakings, made, entered into, or given, and as made or amended by and between the said common council and any one or more of the said corporations, respecting the location, use, or exclusion of the railways in or upon the streets or any of them of said city.' The context of the act, as we have seen, defines rights and privileges to be such as are derived from the contracts with the city. It recognizes, as do the ordinances previously passed, in the use made of the same phrase, that the city is the source from whence they came. Franchises, as we have said, came from the state. The phrase, 'during the life hereof,' cannot be held to extend contract rights to ninety-nine years without doing violence to the terms which just precede this phrase and are found in the same sentence, confirming all contracts, stipulations, licenses, and undertakings 'as made or amended.' The vital part of such contracts is the duration of the occupancy of the streets, expressly limited to twenty-five years, and in some cases twenty-five years and until purchase by the city. To say that 'during the life hereof,' in the sense that it means ninety-nine years, is to be the life of the contracts, permits that part of the sentence to repeal the provision of the clause which reads them into the original act in all respects as made or amended. Rejecting, therefore, such impossible construction as doing violence to the very terms of the law, there is only left of the things provided for which can be consistently extended for ninety-nine years, the acts or deeds of transfer between the corporations so far as they relate to franchises which are not subject to the express limitations of the act,-that they shall stand as made. These franchises as conveyed were necessarily limited to twenty-five years, the then life of the companies. The first part of this act has prolonged the corporate life to ninety-nine years. In the sense which we have already defined the franchise granted by the state, as conferring the right to use and occupy the streets with permission from the city, the act may be consistently held to extend and validate the deeds of transfer as conveying a continued right to such franchise for the extended period of the lives of the corporations. This construction gives some weight and force to this ambiguous expression, and, taking the entire act together, is more consistent with the legislative purpose expressed than is the one put forward, which ignores the reference to the contracts in their original form and extends them all for ninety-nine years, while the act declares they shall not be disturbed as made. It is not to be understood that the interpretation herein suggested frees the judicial mind from doubt as to the meaning of this act, any more than its ambiguous and contradictory phrases could have impressed upon the legislative understanding the meaning now contended for by the companies. It is the application of the settled rule of interpretation to such grants which invalidates the claims made for it, rather than any clear and satisfactory interpretation which has been suggested by counsel or arrived at by the court.
This construction is in harmony with the policy of the state, as evidenced in its prior legislation on the subject, and, in the earlier part of the section under consideration, it gives some meaning to all parts of the act, and makes its provisions consistent with each other. It preserves local control of streets for railway purposes, which the legislature, in all of the acts under consideration, has sought to protect. Considering the act as a whole, it has the effect to extend the life of the corporations to ninety-nine years and to authorize the use of the streets of Chicago, with the consent and upon terms agreed upon with the council, and this right may be acquired in like manner during the extended life of the corporations for such periods as may be contracted for. Contracts already made are affirmed as made. The transfers between the companies are validated.
Further contracts may be entered into and amendments made without resort to new legislation empowering the corporations, as the right of amendment is given, reserving the right of modification or repeal, by a majority of the aldermen elected or act of the general assembly, of the right to charge a higher rate than 5 cents.
While it is true that if, by the act, the state had conferred a grant of the right to use the streets for the period of ninety-nine years, entitled to the protection of the contract clause of the Constitution, such right could not be impaired by any subsequent legislation, it is worthy of note, as showing the continuous legislative policy of the state, that in the act of March, 1867, amending the charter of the city of Chicago, it was provided that no grant of the right to use the streets should be given, or those already given extended, unless by a vote of three fourths of all the aldermen elected, and that no grant, consent, or permission theretofore given or made, or thereafter given, should in any case be extended until within one year of the expiration of the grant, consent, or permission, and in case of veto by the mayor such grant or permission should receive the vote of three fourths of all the aldermen. This act shows a consistent policy of local control, and is inconsistent with the theory of a grant already made for the use of the streets for ninety-nine years.
In reaching the conclusions herein stated as to the proper construction of the act of 1865, amending the act of 1859, we are not unmindful of the fact that much can be said in favor of the view contended for by the learned counsel for the companies. The construction of this act, as we have said, is by no means free from difficulty.
It is true that Governor Oglesby, in his message returning this act with his veto, gave it a construction which would maintain the right to use the streets for the period of ninety-nine years. While his construction was assumed rather than demonstrated, and the stress of his argument was upon the impropriety and constitutional invalidity of thus postponing the right of the city to purchase, it may be admitted that his interpretation of the act sustains the view contended for by the companies. But, as we have said, the act upon its face is ambiguous and uncertain. We must judge of it by the terms in which it is expressed. A construction can be given it which would extend all the contracts with the city for the term of ninety-nine years. On the other hand, it can be maintained, with at least equal force, that, notwithstanding the Governor's view, it affirmed the contracts as made, thus distinctly recognizing the comparatively short term of twenty-five years, for which they expressly stipulated. It must be, therefore uncertain whether the legislators voted for this act upon one construction or the other. It may be that the very ambiguity of the act was the means of securing its passage. Legislative grants of this character should be in such unequivocal form of expression that the legislative mind may be distinctly impressed with their character and import, in order that the privileges may be intelligently granted or purposely withheld. It is matter of common knowledge that grants of this character are usually prepared by those interested in them, and submitted to the legislature with a view to obtain from such bodies the most liberal grant of privileges which they are willing to give. This is one among many reasons why they are to be strictly construed. Pierce, Railroads, 491; New Orleans & C. R. Co. v. New Orleans, 34 La. Ann. 447. 'Words of equivocal import,' said Mr. Chief Justice Black, in Pennsylvania R. Co. v. Canal Comrs. 21 Pa. 9, 22, 'are so easily inserted by mistake or fraud that every consideration of justice and policy requires that they should be treated as nugatory when they do find their way into the enactments of the legislature.' 'The just presumption,' says Cooley, in his work on Constitutional Limitations, 7th ed. p. 565, 'in every such case is, that the state has granted in express terms all that it designed to grant at all; 'and, after quoting from the supreme court of Pennsylvania to the same effect, the learned author observes: 'This is sound doctrine, and should be vigilantly observed and enforced.'
Since the decision in Dartmouth College v. Woodward, 4 Wheat. 518, 4 L. ed. 629, this court has had frequent occasion to apply and enforce the doctrine that a grant of rights in public property accepted by the beneficiary will amount to a contract entitled to protection against impairment by action of the state, or municipalities acting under state authority. Concurrent with this principle, and to be considered when construing an alleged grant of this character, is the equally well established rule, which requires such grants to be made in plain terms in order to convey private rights in respect to public property, and to prevent future control of such privileges in the public interest. The rule as laid down with clearness by Chief Justice Taney in the often-cited case of Charles River Bridge v. Warren Bridge, 11 Pet. 420, 9 L. ed. 773, and has been uniformly applied in many subsequent cases in this court. In Perrine v. Chesapeake & D. Canal Co. 9 How. 172-192, 13 L. ed. 92-100, the same eminent Chief Justice, speaking for the court, said: 'The rule of construction in cases of this description . . . is this,-that any ambiguity in the terms of the grant must operate against the corporation, and in favor of the public, and the corporation can claim nothing that is not clearly given by the law. We do not mean to say that the charter is to receive a strained and unreasonable interpretation, contrary to the obvious intention of the grant. It must be fairly examined and considered, and reasonably and justly expounded.' In the case of The Binghamton Bridge (Chenango Bridge Co. v. Binghamton Bridge Co.) 3 Wall. 51, 75, 18 L. ed. 137, 143, it was said: 'The principle is this: That all rights which are asserted against the state must be clearly defined, and not raised by inference or presumption; and if the charter is silent about a power, it does not exist. If, on a fair reading of the instrument, reasonable doubts arise as to the proper interpretation to be given to it, those doubts are to be solved in favor of the state; and where it is susceptible of two meanings, the one restricting and the other extending the powers of the corporation, that construction is to be adopted which works the least harm to the state.'
This principle has been declared axiomatic as a doctrine of this court. Northwestern Fertilizing Co. v. Hyde Park, 97 U.S. 659, 666, 24 L. ed. 1036, 1038. In Slidell v. Grandjean, 111 U.S. 412, 438, 28 L. ed. 321, 330, 4 Sup. Ct. Rep. 475, it is declared a wise doctrine; 'It serves to defeat any purpose concealed by the skilful use of terms to accomplish something not apparent on the face of the act, and thus sanctions only open dealing with legislative bodies.' Among other cases affirming the principle in this court is Coosaw Mining Co. v. South Carolina, 144 U.S. 550, 36 L. ed. 537, 12 Sup. Ct. Rep. 689, in which it was applied in adopting, of two doubtful constructions, the one more favorable to the state. Many of the cases are cited in a note to Knoxville Water Co. v. Knoxville, decided at this term. 200 U.S. 22, 34, 50 L. ed. --, --., 26 Sup. Ct. Rep. 224, 227. Applying the principle so frequently asserted and uniformly maintained, we think it cannot be successfully maintained that the act of 1865 contains a clear expression of legislative intention to extend the franchise of these companies to use the streets of Chicago, without reference to the assent of the city, for the long term of ninety-nine years, and for that time preventing other and different legislation restricting this grant of a practically exclusive right. So enormous a grant of privileges, including an exclusion from some streets of any railway system, ought not to be presumed or held to be conferred in doubtful and ambiguous words. Grants of this character are not to be destroyed by an unreasonable or narrow interpretation. But if ambiguity is fatal to such claim of rights as against the public, for the stronger reason must such grants of far-reaching and exclusive privileges as are here asserted fail when they can only be maintained by strained construction in their favor.
The effect of the act of 1865 was to affirm the contracts as made between the council and the companies; these contracts must stand as concluded, unless changed by subsequent agreement between the parties. As we have said, the principal question in the case concerns the construction of the act of February 14, 1859, as amended by the act of February 6, 1865. The learned circuit court, holding the opinion that the right to use the streets was extended for the prolonged term of the corporate life of the companies, also held that the adoption of the cities and villages act by the city of Chicago, in May, 1875, which act was passed under the Constitution of Illinois, taking effect in 1870, put an end to the right of the city of Chicago to thereafter designate streets under the former acts, and that contracts subsequently made were subject to the limitation of twenty years, as provided in the cities and villages act of 1872. The court applied the principles upon which it construed the acts in question, and gave it effects as to numerous streets which were the subject of contracts between the city and the companies. Under our conclusions the decree must be reversed, and the construction we have given the act may require a decree differing from that rendered in the circuit court, when applied to particular streets. But we shall not take up all these controversies in detail, and shall leave to the circuit court a readjustment of the decree upon the lines of this opinion. There are, however, certain matters in the case which have been fully argued and should be determined before the case is again considered in the circuit court. On these features of the case we will not enter upon extended discussion, but briefly indicate our views upon them.
It was held by the learned circuit court that the amending act of 1865 had application to the North Chicago City Railway Company, and had the effect to extend the corporate life of that company. We think this is a correct view. By the 10th section of the act of 1859 all the grants, powers, privileges, immunities, and franchises conferred upon Parmalee and others, by the act for the south and west divisions of the city of Chicago, were conferred upon certain persons by the corporate name of the North Chicago City Railway Company, for the north division of the city, in the county of Cook, as fully and effectually as if they had been by a separate act incorporated, with all of said grants, powers, immunities, privileges, and franchises. By the 1st section of the act of 1865 the corporate lives of the Chicago City Railway Company, created by the 1st section of the act of 1859, and the Chicago West Division Railway Company, created by the 1st section of the act of 1861, were expressly extended for ninety-nine years. While nothing was specifically said of the North Chicago City Railway Company in this connection, the 10th section of the act, after this amendment, we think, should be read in connection with the amended act, so that the act of 1859 is to be read as if it had originally been in the amended form. In this view the extended life of the corporations created by the 1st section must be read into the charter of the North Chicago City Railway Company, created by the 10th section.
We believe this view is sustained by reason and authority. Holbrook v. Nichol, 36 Ill. 161. The rule was thus stated in Farrell v. State, 54 N. J. L. 421, 24 Atl. 725: 'As a rule of construction, a statute amended is to be understood in the same sense exactly as if it had read from the beginning as it does amended. People ex rel. Parsons v. Circuit Judge, 37 Mich. 287. In Conrad v. Nall, 24 Mich. 275, a section in a chapter of the Code was amended, and it was held that it was not intended to operate independently of the other provisions of the chapter, but that the whole chapter, in its present form, must be read as one act.
'The rule is correctly stated in Endlich on Interpretation of Statutes, § 294, as follows: 'A statute which is amended is thereafter, and as to all acts subsequently done, to be construed as if the amendment had always been there, and the amendment itself so thoroughly becomes a part of the original statute that it must be construed in view of the original statute as it stands after the amendments are introduced and the matters superseded by the amendments eliminated." This view is strengthened by the language of the 2d section, which speaks of the deeds of transfer of rights between the corporations, in said several acts, or 'any two of them.'
The city of Chicago has constantly recognized the corporate existence of this company and has made numerous agreements with it as such corporation. In Chicago v. Sheldon, 9 Wall. 50, 19 L. ed. 594, in considering a contract between the North Chicago City Railway Company and the city as to the extent of street improvement by way of paving, etc., which could be required of the company under the ordinance of May 23, 1859, granting it rights and privileges in the streets, this court, speaking through Mr. Justice Nelson, concluded its opinion as follows: 'A point is made that the legislature have not conferred or intended to confer authority upon the city to make this contract. We need only say that full power was not only conferred, but that the contract itself has been since ratified by this body.' The learned justice, speaking of the contract, obviously referred to the ordinance of May 23, 1859, passed under the authority conferred by the act of February 14, 1859, and the ratification by the legislature under the act of February 6, 1865. We have no doubt that this act was intended to apply to the North Chicago City Railway Company as well as to the companies specifically covered in the 1st section of the act. The ordinance of 1858 in its 10th section gave the right to operate the 'said railways for twenty-five years, and thereafter to parties operating said railways the enjoyment of all privileges granted until the common council shall elect, by order for that purpose, to purchase the tracks, railway cars, carriages, station houses, station grounds, furniture, and implements of every kind and description used in the construction and operation of said railways or the appurtenances in and about the same.' By § 7 of the act of February 14, 1859, all of the rights and privileges granted or intended so to be to Parmalee and others, by the ordinances and amendments, were confirmed and vested in the corporations. The affirmance of these rights and privileges gave them the sanction and made them part of the legislative act. Afterwards certain of the rights and privileges of the Chicago City Railway Company were transferred by the deed of July 30, 1863, as stated in said conveyance, to the Chicago West Division Railway Company. This deed of transfer is confirmed by the act of 1865. Later the system of railways was extended under ordinances of the city and with the assent of village boards of trustees. It is the contention of the receivers that by reason of the premises the railway companies became entitled to operate the entire system for the extended period of the act of 1865-for ninety-nine years-and thereafter until the city of Chicago shall lawfully purchase all of the said railways, property, equipment, and appurtenances, and pay for the same in cash at its then appraised value. It is the contention of the city that this extension of the right to purchase by virtue of the ordinance of 1858, affirmed in the act of 1859 and the amendment of 1865, must be confined to the streets covered by the ordinance of 1858. That the right to use the streets under the ordinance of 1858 was extended to all subsequently acquired rights to use the streets under the new contracts, so that the right would continue until purchase be made of the entire property of both systems of railway, we cannot concede. It does violence to the language of the ordinance of 1858, which, by its terms, is limited to the railways therein and thereby provided for, and would be an extension of corporate privileges by implication, in violence of the settled rule to which we have had occasion to refer in the principal discussion.
While not conceding the soundness of the contention that the right of purchase is extended to all the property of the railway companies by reason of the unity of the system, there are certain ordinances confirmed by the act of 1865 which require special attention. As we have seen, by the ordinance of May 23, 1859, permission was given to lay a street railway on and along certain streets and bridges in the south and west divisons of the city of Chicago, 'and the same to keep, maintain, and use and to operate thereon railway cars and carriages during all the term of the said act of February 14, 1859, specified and prescribed, in the manner and upon the conditions hereinafter designated.' On the same day, May 23, 1859, a grant was made to the North Chicago City Railway Company of the right to use certain streets, the rights and privileges granted to be in force for the benefit of the company for the full term of twenty-five years from the passage of the ordinance, and no longer. This difference in the grants to the two railway companies is significant. In the ordinance of 1858 the grant to Parmalee and others was for the term of twenty-five years, with the right of the parties operating the railways to enjoy all the said privileges until the common council elect, by order for that purpose, to purchase the tracks and other property used in the construction and operation of said railways and appurtenances, and pay for the same in the manner designated in the ordinance. This grant was expressly confirmed by the act of 1859, in § 7 thereof. Otherwise there was no specific grant in that act fixing the time for which the railway company might operate in the streets. As we have seen, in that law there was a distinct affirmation of what the common council had authorized the corporators to do, and might thereafter authorize the corporation to do by contract. The North Chicago City Railway Company, prior to the act of 1859, had no agreement as to streets. The reason for the grant of different terms to the different compaines, we think, is apparent. On the west side reference was made to the term granted in the act of February 14, 1859, for the purpose of giving the Chicago City Railway Company the same term as had been granted and confirmed therein as to the streets named in the ordinance of August, 1858, and, in our judgment, gave to that company a grant in the same terms, that is, for twenty-five years, and until the city purchase in the manner designated. On the north side, there being no such legislative confirmation of rights already undertaken to be conferred by the council, the grant was specifically limited to a period of twenty-five years, 'and no longer.'
In considering the effect of the ordinances passed by the common council of the city of Chicago in the period from February, 1859, to May 3, 1875, it may be well to briefly summarize the terms of these ordinances. The will be found in the margin. [1]
After the passage of the cities and villages act of 1872, accepted by the city of Chicago in May, 1875, the following ordinance was passed, being the so-called 'compromise ordinance:' 'July 10, 1883 (amended August 6, 1883)--
'Extending the Term for Twenty Years from This Date. Accepted by North Chicago City Railway Company, August 8, 1883; by the Chicago City Railway Company and the Chicago West Division Railway Company, August 10, 1883.'
This ordinance contained this proviso: 'But nothing in this section contained, or the acceptance hereof, shall in any manner impair, change, or alter the existing rights, duties, and obligations of the city or of said companies, respectively, from and after the said term of years hereinbefore mentioned.'
We thus perceive a consistent purpose running through the grants to the north side company to adhere to the term of the original ordinance of May 23, 1859, limiting the right to use the streets to the period of twenty-five years, 'and no longer,' by reference in subsequent ordinances to the prior ordinance. We do not regard the exceptional character of the ordinance of October 26, 1874, amended April 26, 1875, as overcoming, as to other ordinances, the general purpose reflected in them. That ordinance was a grant in part to the North Chicago Company as the lessee of the Chicago City Company, and was doubtless changed in terms to make it comply with the grant of the latter company as to streets in which it operated.
As to the west side companies we find running through the ordinances making grants in the divisions covered by that system a purpose to preserve the original permission of the ordinance of August 16, 1858, which granted the use of the streets for the term of twenty-five years and until purchase by the city. The language used in the ordinance of May 23, 1859, granting the use of the streets, is 'during all the term in said act of the 14th of February, A. D. 1859, specified and prescribed.' This ordinance and similar ones passed prior to the act of February 6, 1865, were confirmed by that act, and rights under them were reserved by the compromise ordinance of July 10, 1883. We hold that when streets were occupied under the authority of these ordinances the company has the right to the use of the streets until the city shall purchase under the contracts thus made.
In the west side system, the ordinance of August 17, 1864, is silent as to the term of the grant. We do not think this indicates any intention on the part of the city, even if it had the power under legislative acts then in existence, to confer the right in perpetuity to the occupancy of the streets, a point which we do not feel called upon to decide. The other ordinances by direct terms or references to prior ordinances have made the grants for the west side system for the term of twenty-five years, and until purchase by the city, in the manner stated, and we do not think there was any intention to depart from the plan in this one ordinance omitting specifically to name a definite time of occupancy. At this time there had been no extension of the life of the corporation, and it was specifically limited to twenty-five years.
In reaching this conclusion we are not unmindful of the decision of this court in Detroit v. Detroit Citizens' Street R. Co. 184 U.S. 368, 395, 46 L. ed. 592, 610, 22 Sup. Ct. Rep. 410, holding that although a corporation be organized for a limited period by the terms of its charter, it may receive a grant which would inure to the benefit of those lawfully entitled to succeed to the rights of the corporation, although for a period of years beyond the corporate life. But in the present case the right granted must be construed with reference to the system of which it was made a part, and where the terms of the grant were limited to twenty-five years, and until purchase, we can find no intention to grant or receive a perpetuity simply because no term of years was named in the one ordinance under consideration.
It is contended that whatever rights would otherwise be included in contracts confirmed by the act of 1865, they were lost to the companies by accepting the privileges conferred in the 'power ordinances' of June 7, 1886, and March 30, 1888. But prior to the passage of those ordinances was the so-called 'compromise ordinance' of July 10, 1883, as amended August 6, 1883, settling certain controversies as to license fees and street paving, and extending the time of operation for twenty years, and further providing: 'But nothing in this section contained, or the acceptance hereof, shall in any manner impair, change, or alter the existing rights, duties, and obligations of the city, or of said companies, respectively, from and after the expiration of the said term of years hereinbefore mentioned.' In the North Chicago City Railway ordinance and the West Chicago City Railway Company ordinance clauses are inserted to the effect that privileges as to time after the expiration of the term of twenty years are to be governed by ordinances theretofore passed. In view of this reservation we are of opinion that whatever rights and privileges the company had in the streets after the expiration of the time limitation in the 'power ordinances' were not lost by the acceptance of privileges conferred in those ordinances.
It is contended that the railway companies had no power to accept ordinances for the use of other than animal power in the operation of railways, because of the titles of the various acts which constituted the charter of the companies, limiting them to the use of animal power, and because of the constitutional provision, which we have referred to earlier in this opinion, providing that no private or local law shall embrace more than one subject, which shall be expressed in its title. We think the intention of the legislature in this respect was not to confine the operation of the road to animal power, but to incorporate street railway companies as distinguished from steam railways, and to endow them with the rights and privileges named in the acts. Section two of the law (act of 1865) expressly gives the power of amendment, in providing that 'it shall be competent for the said common council, with the written consent or concurrence of the other party or parties or their assigns to any of said contracts, stipulations, licenses, or undertakings, to amend, modify, or annul the same.' We think this grant of power was broad enough to authorize the city to grant, and the railway company to accept, a changed method of operation of the railways by applying thereto a new and more efficient and economical power. It is true that the supreme court of Illinois in North Chicago City R. Co. v. Lake View, 105 Ill. 207, 44 Am. Rep. 788, held that the charter of the North Chicago City Railway Company had not authorized a steam railway, but that court has held in later decisions that an electric railway, incorporated under the general incorporation acts to build horse and dummy railways, might organize a street railway company to be operated by electricity or by any motive power other than steam, and might appropriate private property for this purpose. Harvey v. Aurora & G. R. Co. 174 Ill. 299, 51 N. E. 163. The court has also held that the provisions of the horse and dummy act applied to electric railway companies, as did a paragraph of the generl incorporation act in regard to horse railways. We think the Illinois cases recognize the distinction in legislation in that state between railways intended to be operated upon the streets of the city of Chicago and other cities for local accommodation, and steam railways, as such are generally understood. And the declaration inserted in the title of the acts, that they concern horse railways, will not, because of the constitutional provision, prevent the exercise of the power of amendment conferred by law upon the city and the companies in such manner as to authorize the use of such power as electricity and cable. We agree with the learned circuit court that these grants as to changed methods of operation were within the powers legally conferred by the act of 1865. Furthermore, on June 9, 1897, the legislature passed an act having application to companies organized under general or special laws, which provided: 'Every such street railway may be operated by animal, cable, electric, or any other motive power that may have been or shall hereafter be granted to it by the public officers or authorities, except steam locomotive engines.' It is true that this statute was repealed by the act of March 7, 1899, but we do not perceive how this could destroy its effect to ratify the contracts which were in existence when the act was passed. This view renders it unnecessary to pass upon the question whether the city of Chicago, having undertaken to authorize the use of new power, upon the faith of which authority large sums of money have been expended and extensive changes made, can now be heard to say that it had no authority to grant such right.
The learned circuit court held that privileges granted under ordinances of the town of Jefferson were limited to twenty years. This ruling, it is contended by the Chicago West Division Railway Company, is erroneous, because of the act of 1859, which provided: 'Section 5. The said corporation is hereby authorized to extend the said several railways herein authorized to be built in the manner aforesaid to any point or points within the county of Cook in this state; and to enable said corporation to construct any or all of the railways herein authorized, or their appendages, the said corporation is hereby vested with power to take and apply private property for the purposes and in the manner prescribed,' etc. Section 6: 'The said corporation is hereby authorized with the assent of the supervisor of any township, to lay down and maintain its said railway or railways in, upon, over, and along any common highway in said township, but in such manner as not to obstruct the common travel of the public over the same.' The town of Jefferson was one of the townships of Cook county, adjoining the city of Chicago on the northwest. So far as the record discloses, no effort was made to extend the lines of the Chicago West Division Railway Company into the town of Jefferson until 1877. Before that year the town of Jefferson had adopted the provisions of the cities and villages act of 1872, in which the power to grant the use of the streets for street railway purposes was limited to twenty years. On January 28, 1878, the village passed the ordinance granting to the Chicago West Division Railway Company and its successors the right to maintain and operate a street railway in Milwaukee avenue and Armitage road, in said village, the rights and privileges thereby granted to extend for the term of eighty-one years. Under the act of 1859 the right to lay down tracks and maintain railways over and along the common highways in the townships in Cook county required the consent of the supervisor in the township. This does not appear to have been obtained, and when the authority was given by the president and board of trustees of the village, it was subject to the limitation already referred to. We cannot assent to the soundness of the argument that the act of 1859, in the event of the abolition of the office of supervisor, during the life of the corporation, would authorize the extension to these adjoining townships of the system of railways intended to be constructed, without official consent.
Before the passage of the act of 1865, incorporating the board of trustees of the town of Lake View, the supervisors granted permits to use some of the highways of Lake township. This authority was exercised under §§ 5 and 6 of the act of February 14, 1859. We cannot agree that the duration of these permits would be in perpetuity, because of the fact that no time was specifically named in them. The extension into Lake View was part of the north side railway system, which, by the terms of the grants from the city, were limited to twenty-five years, and no longer. There certainly could be no intention in granting these permits from the supervisors as extensions of the system to make perpetual grants, when the right of user of the main part of the line was expressly limited to twenty-five years. A fair inference would be that, in extending this part of the system so as to make a portion of that already granted, such grants were to be for the same term as those already made. As to extensions in the town of Lake View, obtained otherwise than from the supervisors, it appears that on February 16, 1865, an act was passed entitled 'An Act to Incorporate a Board of Trustees for the Town of Lake View, in Cook County,' and it was provided that the supervisors, assessors, and commissioners of highways and their successors in office should be constituted and incorporated, ex officio, a board of trustees for said town of Lake View. On March 5, 1867, an amendatory act was passed entitled 'An Act to Incorporate a Board of Trustees for the Town of Lake View, in Cook County,' which provided (§ 7) that the board of trustees should have the control and supervision of the highways, streets, alleys, and public parks in said town. This board afterwards passed ordinances consenting to the laying down of tracks in the town of Lake View, on a number of avenues and streets named in the ordinances.
The cases in the state courts are much divided as to the right of a municipal corporation, because of its charter power of controlling the streets, to grant the use thereof to a street railway company. Some of the cases are collected in Detroit Citizens' Street R. Co. v. Detroit, 26 L. R. A. 667, 12 C. C. A. 365, 22 U.S. App. 570, 64 Fed. 628, 637.
The act of 1859, § 6, required the consent of the supervisor to the extension of the railways into townships of Cook county outside of Chicago. When the supervisor became a member of the township board of trustees, and that board gave its consent, we think this satisfied the requirement of the act in that respect. The legislature might have given the railway company the right to extend its lines in Cook county without the consent of any local authority. We are not concerned with the general powers of the supervisor. When the legislature designated him as the official whose assent should be obtained, it empowered him to give such assent, and when given in any substantial way, that satisfied the requirements of the act of 1859.
As we understand the decisions of the supreme court of Illinois, the power to control the streets and highways by the township trustees, given by the act of March 5, 1867, would include the right to authorize their use for street railway purposes. In Chicago Municipal Gaslight & Fuel Co. v. Lake, 130 Ill. 54, 22 N. E. 616, the court held: 'The power to control and regulate the streets, alleys, and other public places within the limits of the town of Lake, and abate any obstructions, encroachments, or nuisances thereon, was given, in its charter, to the corporate authorities of the town. Under this power the town could lawfully permit any use of such streets and alleys that is consistent with the public objects for which they are held, and could make a grant of a right of way for the purpose of laying gas pipes and mains under the surface.' In People ex rel. Rinne v. Blocki, 203 Ill. 363, 368, 67 N. E. 809, 810, the same court said, having reference to a grant of the right to lay switch tracks in the street: 'The street, at the time said permits were granted, was under the control of the board of trustees of the town of Lake, and, under the power conferred upon that municipality by law, it was authorized to allow the use of said street for any purpose not incompatible with the purpose for which it was established, and to allow a railroad track to be laid therein was not a use incompatible with the purpose for which it was established.' In Quincy v. Bull, 106 Ill. 337, on page 349, it was said: 'In this state there is vested in municipal corporations a fee-simple title to the streets. Under the power of exclusive control over streets it is very well settled by decisions of this court that the municipal authorities may do anything with, or allow any use of streets, which is not incompatible with the ends for which streets are established, and that it is a legitimate use of a street to allow a railroad track to be laid down in it. Moses v. Pittsburgh, Ft. W. & C. R. Co. 21 Ill. 516; Murphy v. Chicago, 29 Ill. 279, 81 Am. Dec. 307; Chicago & N. W. R. Co. v. People, 91 Ill. 251.' In view of these Illinois decisions, construing the legislative acts of the state, we think the learned circuit court erred in holding that the trustees of the town of Lake had no power to grant the railway the use of the streets for street railway purposes.
The question remains as to the term for which the rights granted by the trustees and the municipality of Lake View were to be held. The ordinances making these grants required the company to perform certain duties to the municipalities, such as the laying of pavement, subject to the approval of the trustees. On April 16, 1887, the incorporated town of Lake View became incorporated as the city of Lake View under the cities and villages act of 1872. On July 15, 1889, the territory included in the city of Lake View was annexed to the city of Chicago. We think in such case that the terms granted would not extend beyond the life of the corporation conferring them, where there was no attempt to confer a definite term, assuming, without deciding, that it was within the authority of the municipality to grant a perpetuity. Our attention has been called to a late case decided in the supreme court of Illinois (People ex rel. v. Chicago Telephone Co., not officially reported) 77 N. E. 245, in which it was held that where trustees of villages and towns have granted rights extending telephone privileges, not for a definite period, that such grants could not be construed to be perpetuities, and did not extend beyond the lives of the corporations granting them. The court says: 'The ground of the defendant's claim that the ordinance does not limit its charges in the annexed territory is that, before the annexation, the minor municipalities had granted to it the right to occupy the streets therein for its business, without any limits as to time. If the grants had been for terms of years under legislative authority authorizing them, and the term had extended beyond the existence of the corporations granting the privileges, there might be ground for saying that the grants were binding upon the city, because they had become binding contracts, under which the defendants had vested contract rights for such term; but they were not for definite periods, and the grants were in consideration of furnishing something to the town or village, such as telephone service to the town or village hall or the village authorities, free or for some reduced rate. Such grants cannot be construed to be perpetual, and, at most, cannot extend beyond the lives of the corporations granting them. Upon annexation there ceased to be any town or village authorities entitled to the benefits of the contract or authorized to demand or receive them, and it could not have been understood that the grant could continue, discharged of the obligation annexed to it. . . . The ordinances of the city extended over the annexed territory immediately upon annexation (Illinois C. R. Co. v. Chicago, 176 U.S. 646, 44 L. ed. 622, 20 Sup. Ct. Rep. 509) and the limitations of the ordinance applied to the annexed territory.'
This seems to us a reasonable view, and, being the construction of the highest court of the state of Illinois, we are willing to accept it. Furthermore, these grants in Lake View were mere extensions of the old system, which, as we have seen, was limited in its rights to use the streets received from the city to the term of twenty-five years, extended twenty years by the compromise ordinance. In the absence of express language conferring a longer term, we do not think it was intended to extend the grant beyond the period already permitted to the system by grants from the city.
As we have said, we do not deem it necessary to take up all the questions which were raised and determined by the circuit court in considering the case and settling the decree in that court. Upon further proceedings the judgment of this court is only to be held conclusive upon matters specifically stated in this opinion.
The decree is reversed and the cause remanded to the Circuit Court for further proceedings in accordance with the views herein expressed.
Mr. Justice McKenna, with whom concur Mr. Justice Brewer and Mr. Justice Brown, dissenting:
Notes[edit]
- ↑ On the west side we find the following:
May 23, 1859—
'A grant during all the term in the said act of February 14, 1859, specified and prescribed.' Streets are designated and the time
for completion of the railways thereon is limited, for some at three months, others at five, one year and eighteen months, and still others 'as soon as practicable.'
February 13, 1860—
Amendatory of the above last-mentioned ordinance. Extends the time for completion to ten years for some, and five years for others. Certain lines mentioned must be completed in two years.
November 18, 1861—
Exempting certain streets and substituting others. Ordinance of May 23, 1859, in force except as amended, and time for completion of certain railways named is extended to five years.
November 16, 1863—
Excluding railways from certain streets named.
March 14, 1864—
Releasing one street and substituting another.
March 28, 1864—
Authority to remove from one street to another.
March 28, 1864—
Authorizing temporary tracks while a bridge is being constructed.
July 11, 1864—
Amending ordinances of March 28, 1864, repealing the temporary use of certain streets.
August 17, 1864—
Creating new lines, extending others, and regulating the use thereof. Times for completion fixed at ninety days and fifteen months. No time or duration stated by reference or directly.
November 13, 1871—
Extension of tracks on certain streets named.
March 8, 1875—
Authorizing the construction and operation of a new line. To be completed by October 1, 1876, and the term to extend to October 1, 1894, and thereafter until purchased by the city.
April 19, 1875—
Amending last-mentioned ordinance as to certain uses and legal claims arising from the operation of the lines.
On the north side we find the following:
May 23, 1859—
Term 'twenty-five years and no longer.' Times for completion fixed at January, 1860, and July, 1862, different for some than others.
January 18, 1864—
Term 'subject to all the rules and limitations and restrictions'
prescribed in the ordinance of May 23, 1859. Authorizes connection of tracks.
August 11, 1864—
Term 'subject to all the restrictions and conditions, the rights and privileges, mentioned' in ordinance of May 23, 1859. Time for completion fixed at sixty days, unless restricted, etc.
May 8, 1871—
Same term. Time for completion fixed at June 1, 1872, for the street railway named.
November 20, 1871—
Term 'subject to all rules and limitations and restrictions' prescribed in ordinance of May 23, 1859. Rights and privileges granted shall continue for a term of _____ years.
October 26, 1874—
Term until October 1, 1894, and thereafter until purchased by the city. To be completed July 1, 1875. As lessee of Chicago City Railway Company as to certain portion.
April 26, 1875—
Amending the last-mentioned ordinance, and otherwise similar to it as to terms and conditions.
This work is in the public domain in the United States because it is a work of the United States federal government (see 17 U.S.C. 105).
Public domainPublic domainfalsefalse