South Side Passenger Railway Co. v. Second Avenue Passenger Railway Co.

Opinion by Mr. Justice Mitchell, This is a bill by the South Side Passenger Railway Company against several respondents, and a cross-bill by one of the respondents against the complainant and the other respondents. The appellants, complainants in the bill and cross-bill respectively, though upon opposite sides of the record in both cases, have the same interest, and are seeking the same relief, and the substantial defendant is the Second Avenue Traction Company. The subject of controversy is the right of the Second Avenue Traction Company to use the tracks of the South Side [509] Passenger Railway on certain streets in the city of Pittsburg, under an agreement made in 1891 between the Pittsburg and Birmingham Traction Company and .the Second Avenue Passenger Railway Company. The court below heard the bill and cross-bill together and delivered one opinion covering both. For convenience we follow the same course. The court below held, first, that the South Side Passenger Railway Company had no substantial interest in the subject which would justify a court of equity, in view of the delay and other circumstances, in interposing; secondly, that the Pitts-burg and Birmingham Traction Company was estopped from contesting the validity of the contract of 1891; thirdly, that the Second Avenue Traction Company was an “ assign ” of the Second Avenue Passenger Railway Company, within the terms of the contract of 1891. In these three findings on the facts and the law we concur, and as to them the decree will be affirmed on the opinion of the court below. The court further found that the agreement of 1891 was “ evidently based on the idea that the two companies had an equal interest, and would run about the same number of cars or make about the same number of trips on the tracks in dispute,” but as the Second Avenue Company, by reason of its numerous leases of other roads, was now running more cars than the Pitts-burg and Birmingham Company, he decreed a “ just and equitable arrangement” by which the expenses, should be paid by each in proportion to the number of its cars. In this, however, the court fell into the serious error of making an arrangement which, however just or equitable as matters would now stand if they were starting de novo, was not at all what was called for by the contract as actually made by the parties. The interest of the parties was not equal, nor was the contract based on any such idea. On the contrary the Pitts-burg and Birmingham Company was the owner of the tracks (de facto at least for the term of years) and the Second Avemte Passenger Railway Company was a licensee, or at most a sub-lessee. The latter had no rights but those the agreement gave it, the former had all the rights of ownership that the agreement did not part with. This is explicitly recognized in the provision that if it should allow any other company as licensee to use [510] its tracks a proportionate credit should be allowed the Second Avenue Company. The allowance of another company to come in as a licensee was by virtue of the lights of ownership. The latter company had no such rights, and could not divide or share or part with its privileges, except to an assign within the terms of the agreement. No doubt the idea of an equal amount of use was the basis of the proportions of the expense of maintenance the two parties were to bear, but their interests in the corpus of the thing were entirely different. Had the business of the Second Avenue Railway Company, by natural growth, led to more than equal use of the tracks, there could have been no ground of complaint, for however much the idea of equality of use may have influenced the rent to be paid, the license to use was unrestricted as to amount. This brings us to the really vital question in the case. The use by the Second Avenue'Railway Company was without limit as to amount, but it was a use for itself and its own cars. It had a power of growth, but it had no general power of expansion into other fields, or of increase by the absorption of other roads. When it was itself absorbed by the Second Avenue Traction Company, the latter became, as already held, a practical “ assign,” and as such entitled to the continuance of all the rights and privileges given to its assignor by the agreement of 1891, but to nothing more. It did not thereby step into the agreement as an independent party in its own right, with all its own corporate privileges. As to all those it was still a stranger, and its only place in the agreement was as the locum tenens of its assignor, with only the latter’s contract rights. The use of the tracks therefore by the Second Avenue Traction Company for cars which it hauls in the operation of its leased or consolidated lines, other than the Second Avenue Passenger Railway Company, is not merely an increased, use of the latter’s privilege, but a distinct and independent use outside of the agreement of 1891, and without legal right. Notwithstanding this conclusion, a court of equity would hesitate to enforce the strict legal rights of the Pittsburg and Birmingham Company to their full extent, after the lapse of time and that company’s acquiescence in the use of its tracks and the expenditure of money by the Second Avenue Traction Company. But we are saved any difficulty on that point by [511] the offer of the Pittsburg and Birmingham Company in its cross-bill to accept “ any reasonable arrangement,” and the disclaimer by counsel at the argument of any relief sought, beyond a recognition of its rights and adequate compensation for the use of its property. What the measure of that shall be we have no facts before us to indicate, and all we decide now is that the measure of compensation fixed by the court below was not based on the proper recognition of the rights of the complainant. So much of the decree as dismisses the bill of the South Side Passenger Railway Company, holds the Pittsburg and Birmingham Traction Company estopped from contesting the validity of the agreement of 1891, and adjudges the Second Avenue Traction Company an assign of the Second Avenue Passenger Railway Company, is affirmed on the opinion of the court below ; but the rest of the decree is reversed and a decree directed to be entered in favor of the Pittsburg and Birmingham Traction Company upon its cross-bill against the Second Avenue Traction Company upon the principles indicated in this opinion ; costs up to this point to be paid by the Second Avenue Traction Company.