Denison & Sherman Railway Co. v. St. Louis Southwestern Railway Co.

[241] OPINION OP COURT OP CIVIL APPEALS. Templeton, Associate Justice. In 1887 the St. Louis, Arkansas & Texas Railway Company of Texas, a corporation duly incorporated under the laws of this State, constructed a branch line of road from Commerce, in Hunt County, to Sherman, in Grayson County. On February 21, 1887, and before the road was built into Sherman/ it applied for and formally obtained from the corporation of the city of Sherman the assent of said city to the construction of its road upon and over East street, one of the public streets of the city, from the points where the line of the Texas & Pacific Railway Company crossed said street to the southern terminus thereof. The assent was unconditional. East street runs north and south and extends from the north boundary line of the city to or near the south boundary thereof, and the Texas & Pacific Railway, which rims east and west, crosses the said street about one-half mile from its northern terminus. The first street south of the Texas & Pacific Railway, running parallel with the railway, is Mulberry; the next is Pecan; the next is Houston; the next is Lamar, and the next is Cherry. The said branch line from Commerce to Sherman was completed to Sherman in the summer of 1887. The depot was located on East street, north of Cherry and just south of and adjoining Lamar. The track of the road was laid in the center of East street and extended from the southern terminus of said street to a point just south of and adjoining Houston street. Ho further extension was made until 1892. In 1890, a mortgage theretofore given by the St. Louis, Arkansas & Texas Company was duly foreclosed in the Circuit Court of the United States for the Eastern District of Texas against all the properties, rights, privileges and franchises of the said company. The sale under foreclosure took place in October, 1890, and was confirmed in December following. Conveyance was duly made to the purchaser, the St. Louis Southwestern Railway Company, and in Hovember, 1891, that company took possession of the railway system it had purchased, and has, ever since that time, operated the same. The said purchasing company was chartered in 1890 and succeeded to the rights, powers, privileges and franchises of the sold-out company, and by virtue of its purchase acquired all the properties, rights, privileges and franchises of its predecessor. In 1892 the new company extended its line of road up East street about 200 feet, to a point north of Houston street, about 100 yards south of Pecan street. The Denison & Sherman Railway Company was duly and legally incorporated as a local and suburban railway, under sec. 2, art. 4352, chap. 1, title 94, Sayles’ Civ. Stats., with authority to construct and maintain a local suburban, railway from the southern boundary of the city of Denison to the northern and eastern boundary of the city of [242] Sherman, a distance of less than ten miles, and in addition thereto five miles in each of said cities. In 1900, the council of the city of Sherman granted to John Crerar, his heirs and assigns, the right to construct and operate an electric railway over that portion of East street lying between Mulberry and Pecan streets. Soon thereafter the franchise was assigned to the Denison & Sherman Railway Company. In 1901 the said company set its poles and strung its wires on East street between Mulberry and Pecan streets, but before it could lay its ties and rails, the St. Louis Southwestern Company extended its track up East street beyond Pecan, and was in the act of building to and across Mulberry, when the Denison & Sherman Company brought this suit against it to enjoin the completion of the work. A temporary injunction was granted, but on final trial the same was dissolved and all relief denied. The Denison & Sherman Company has appealed by writ of error. The matter in controversy is the right claimed by the St. Louis Southwestern Company to build its road over East street, between Pecan and Mulberry. The principal question in the case is whether the right possessed by the St. Louis, Arkansas & Texas Company to build on East street has been acquired by the defendant in error. Our laws provide that railway companies may build across and upon the streets of a city, but only on condition of obtaining the assent of the city thereto. Rev. Stats., arts. 4426, 4438. When the consent of the city has been secured, the right of the company to build over and upon the streets named in the concession is complete. Eo further action is necessary as a prerequisite to a lawful appropriation. When the assent of the city has been given and acted upon, it can not be recalled. When the city consents, in due form, to the use of any particular street or streets by a railway company for right of way purposes and the company accepts the privilege, the right becomes vested, fixed and certain, and can only be revoked in an action to forfeit brought by authority of the State. Railway Co. v. Brownsville, 45 Texas, 96; Street Railway Co. v. Street Railway Co., 68 Texas, 169; Railway Co. v. Galveston, 90 Texas, 398; Arcata v. Railway Co., 28 Pac. Rep. (Cal.), 676. Our laws further provide for the sale, under foreclosure, of the entire roadbed, track, franchises and chartered rights of a railroad company and prescribe the rights of the purchasers at such sale. Rev. Stats., arts. 4549, 4550. The purchasers are vested with all the rights, privileges and franchises of the foreclosed company, and are given the option of continuing the business in the name of the old corporation or of organizing a new- corporation for that purpose. The right of way in controversy was part of the railway system of the St. Louis, Arkansas & Texas Company and, as such, was covered by the lien of the mortgage creditors. It could be legally sold under foreclosure as a part of the said railway system. The fact that the purchasers elected, in the exercise of the option given by the statute, to form a new corporation to take the property, did not have the effect to destroy the title to the right of way which they acquired by their purchase. [243] The St. Louis Southwestern Company was organized as the successor of the foreclosed company. It began business with no other properties, rights, privileges and franchises than those acquired by its purchase and those conferred by its charter. Every duty of a public nature which lay upon its predecessor was assumed by it and no obligation in conflict therewith rested upon it. No reason, affecting the public, existed why the said company should not have been permitted to acquire the right of way in controversy together with the other parts of the railway system to which it belonged. When acquired by the purchasing company, it was held upon exactly the same terms and conditions as those which accompanied the right and title of the foreclosed company. The concession of the right of way to the original company was not personal in a sense which would preclude the transfer thereof to the successor of that company. The grant was to the company owning and operating the railway system in question and made the right of way over East street a part of such system. Any company capable under our laws of taking the whole system could take every part thereof, including the said right of way. It is doubtless true that the concession could not have been legally segregated from the system and assigned to an independent company; that, in this sense, the grant was personal to the company receiving it. But there has been no attempt to make such disposition of the concession or to use the same for any purpose other than those for which it was granted. The charter of the St. Louis Southwestern Company conferred upon it the general power to occupy the streets of the city of Sherman for right of way purposes, subject to the condition precedent that it obtained the assent of the city, but that fact did not require it to surrender the right of way over East street which it had acquired by its purchase, and reacquire the same by the exercise of its charter powers. There is no question that the assent of the city to the use of East street was accepted. The old company built upon and occupied a portion of the street, and the new company, after its purchase, assumed possession of the track which had been placed in the street by its predecessor and extended the track some distance farther toward the point destined for its terminus. If it has not used reasonable diligence in completing the extension, the State or the city, and not the plaintiff in error, is the proper party to insist on a forfeiture. The evidence relating to the foreclosure and the sale thereunder is not contained in the statement of facts, the trial judge’s conclusions on those issues being accepted by both parties. The judge found 'that all the properties, rights, privileges, and franchises of the St. Louis, Arkansas & Texas Company passed to and vested in the St. Louis Southwestern Company. The list is certainly comprehensive enough to include the right of way in controversy, and we must assume that the finding is supported by the evidence. It will be further assumed that the St. Louis Southwestern Company was organized for the [244] purpose of taking over the said properties, rights, privileges and franchises in the manner prescribed by law. Our conclusion is that the trial court did not err in holding that the plaintiff in error was not entitled to an injunction restraining the defendant in error from, building its road on East street to a junction with the track of the Texas & Pacific Company. The trial judge found as a matter of fact that, if the plaintiff in error was permitted to lay its track in the center of East street, it would be impracticable for the defendant in error to exercise its right to build on said street by placing its track between the track of the plaintiff in error and the edge of the street. Complaint is made that the evidence is not sufficient to warrant this finding. After a consideration of the evidence we have concluded that the finding was justified and that the complaint is without merit. The defendant in error has the right to construct and operate its road over East street to a junction with the Texas & Pacific road, and the city of Sherman can not deprive it of the right by authorizing the plaintiff in error to lay its track at such place in said street as will render impracticable the exercise of the right. The judgment is affirmed. Delivered November 22, 1902.