Citizens' Horse Railway Co. v. City of Belleville

Mr. Justice Sample. The primary questions presented in the foregoing statement of facts are as follows : First. Can a municipal corporation impose reasonable conditions on a street railivay company in its ordinance granting the right to use its streets for railway purposes, which, relate to the operation of such road after its construction, and reserve the legal right, on its own adjudication of a failure to comply with such conditions, to repeal such ordinance and thereby divest the company of its property in such grant % Second. If it can not do so, what proceedings must it institute to test the question of the violation of such conditions, and did the city of Belleville pursue the course prescribed by law. There are other incidental questions that arise: first, as to the sufficiency of the petition; second, as to the parties that should be made defendant; third, as to whether the cause should have been referred to the master; fourth, as to the right of trial by jury; fifth, as to the right of the city attorney to file the petition "without a showing of authority from the city council. In some of its features, at least, the case presents some new questions. The Citizens’ Horse Bail way Company was chartered by the sovereign power of the State. Its charter, as an instrument, evidenced its public grant of authority to do a certain thing, viz.: In the language of the statement filed with the Secretary of State, upon which the certificate of incorporation was issued, “ to construct, maintain and operate a horse railroad in the streets of the city of Belleville, in St. Clair County, Illinois.” The right to do that thing was what is called its franchise. Apparently the grant was in and of itself full and complete, yet it could not be enforced as against the will, or exercised without the consent of -the municipal corporation of Belleville, which had the control of the streets. The power of the legislature was limited by Sec. 4, Art. 11, of the Constitution of 1870, which provided that “no law shall be passed by the General Assembly, granting the right to construct and operate a street railroad within any city, without requiring the consent of the local authorities having the control of the streets proposed to be occupied by such street railroad.” Hence, in contemplation of law, the charter was granted subject to that condition. In the absence of such limitations, “the legislature has the undoubted power to authorize, at pleasure, the use of streets for railroad purposes.” Dillon on Municipal Corporations, Sec. 570. It is doubtful if the provision of the constitution, however, which operated as a limitation upon the power of the legislature itself, operated to vest the power in the municipality to grant such consent. Hence, the legislature, by Par. 24 of Sec. 1, Art. 5, of the General Incorporation Act, relating to cities, in force July 1,1872, vested municipalities with that power as follows: “ To permit, regulate, or prohibit the locating, constructing or laying a track of any horse railroad, in any street, alley or public place.” However, such power so granted by the legislature, gave at least no expi’ess authority to impose conditions. So by Sec. 3, Chap. 66, of “ An Act in regard to Horse Railroads,” in force July 1, 1874, it was provided that “ the consent of uich municipality may be granted * * * upon such terms and conditions, not inconsistent with the provisions of this act, as such corporate authorities * * * shall deem for the best interest of the public.” By Sec. 4 of said act it is provided that “ every grant to any such company of a right to use any street * * * shall be subject to the right of the proper authorities to control the use, improvement and repair of such street * * * to the same extent as if no such grant had been made, and to make all necessary police regulations concerning the management and operation of such railroad, whether such right is reserved in the grant or -not.” It is clear, therefore, that under express statutory law, the city of Belleville had the legal right and authority to impose such terms and conditions as it deemed best for the interests of the public. While the court may have the power to determine whether such terms or conditions, and the mode of their enforcement, contravene established principles of law, subject to which rule the exercise of all subordinate authority exists, yet beyond that the court can not go. This brings us to the question, first presented, Avketker the city of Belle-ville had the lawful right to adjudicate and determine for itself, xvhetker or not the conditions imposed on the company had been violated, and having determined that they had been violated, repeal the ordinance granting the rights and privileges under "which the road xvas constructed and operated. It must be held that the power granted to' the city to impose terms and conditions, presupposed that it would he exercised in accordance with and subject to those fundamental principles of right and law which protect property, one of which is, that “ no person shall be deprived of property xvitkout due process of law.” “ Due process of law ” has reference to judicial proceedings, according to the course and usage of the common laxv. Campbell v. Campbell, 68 Ill. 462. That the right and privilege to construct and operate a horse railroad in the streets of a city, for the purpose of carrying passengers for hire, is property, is unquestioned and unquestionable, if the road is constructed and completed in accordance with, the terms imposed. Such privilege constitutes the principal value of such property. The test as to whether such privileges become vested property seems to depend upon the kind of terms imposed — that is, xvhether they are of that character, as affecting such rights and privileges, as create conditions precedent or conditions subsequent. If the former, then it is said such rights and privileges do not vest as property; if the latter, they do xmst. Washburn on Real Property, Par. 11, p. 449. Without indulging in the refinements of the law as to estates on conditions precedent and conditions subsequent, practically and plainly the law seems to be that the power exists to impose terms as to the time and character of the road to be constructed, upon the fulfillment of xvhich depends the maturing of the grant, and while such conditions are being fulfilled within the time prescribed, if there is a limit, the grant remains inchoate. These are termed conditions precedent, while those terms imposed that affect the manner of operating the road and its state of repair after its proper construction, are said to be conditions subsequent, in which case such a grant becomes vested property, with all the rights attached that secure tangible property. In this case the conditions imposed, which it is claimed have been violated, were conditions subsequent—that is, conditions affecting the operation of the road after its proper construction, and the keeping in proper repair the streets and tracks ■—• so that the grant had vested as property and could only be divested by due process of law. It is said, however, that the ordinance in question, when accepted by the railway company, became a contract subject to revocation at the will of the city, that right having been reserved. This seems plausible, and is the law, while the contract remained executory — that is, until the road was constructed in accordance with the terms prescribed. After that time, even if the ordinance is considered merely as a contract, it then becomes an executed contract ripened into a perfected grant—vested property — notwithstanding the terms imposed therein, upon which, as vested property, the subsequent conditions continued to operate under the law as applicable to such conditions. Under that law, it is not left to one of the parties to the original contract to enter judgment of forfeiture of the property of the other party to the contract, and thereby divest him of his rights. It is a question of fact whether the cause of forfeiture exists. The determination of that question would be for the courts and not the city of Belleville. There would have to be a legal investigation where both parties could be heard, and a judicial determination upon the facts so developed. That would be due process of law. Booth’s Street Bail way Law, Sec. 49, p. 66, and notes. It is said, however, that there was such hearing and judicial determination in this case. This brings us to a consideration of the remedy that should be pursued. The forfeiture here claimed is of all the rights and privileges granted by the ordinances to the Citizens’ Horse Bail-way Company the effect of which would be, not to annul the charter and dissolve the corporation, but to render the charter and the franchise inoperative. It would be tantamount to an ouster from the franchise; that is, the right to do that thing evidenced by the charter, viz., “ operate a horse railway in the streets of the city of Belleville.” It would seem, in a sense, that the rights and privileges granted by the city of Belleville are a part of the franchise, and a vital part. A municipality does not stand in the same relation to such a charter and franchise' merely because it has control of the streets, that an individual does who owns lands within the line of the right of way of an ordinarily incorporated railroad company. In the latter case the charter is complete when granted by the State, and carries with it under the law of eminent domain the power to execute, with or without consent of such owner of land, the franchise. In the former case, the municipality is related to the State as its agent, invested with constitutional rights as well as delegated power in regard to the right to operate in its streets horse railways, without whose action, and by incorporating its consent in the charter granted by the State, the franchise is a nullity. How can it, then, be legally and logically said that that consent which is absolutely necessary to the vitality and execution of the franchise is no part of the franchise itself ? Since the constitution of 1870, it is believed that the right to create and perfect such a franchise as is involved in this case rests both in the State and the municipality, and that the consent of the municipality, when granted, is a part of the franchise. The fact that the ordinance when accepted by the company created a contract between the parties does not affect this view. The charter of the appellant is in a sense just as much a contract with the State, as is the ordinance Avith the municipality. The contract feature, hoAvever, is limited to those provisions of the charter or ordinance relating to the dealings between the incorporated company and the State or municipality as such, and does not extend to those provisions relating to the dealing of such incorporated company with the public. If these views are correct, then in a limited, if not in the full sense of the term, the franchise of the appellant was attempted to be involved, in which case it follows that the proceedings to declare and enforce a forfeiture should have been in a direct proceeding by quo wcirranio under Chapter 112 of the Statutes. It is held in the case of The Attorney General v. The C. & E. R. R. Co., 112 Ill. 520, that a cause of forfeiture of a franchise can not be taken advantage of or enforced against a corporation collaterally or incidentally, or in any other mode than by a direct proceeding for that purpose against the corporation. Such a proceeding does not involve fraud, accident, mistake or irreparable damages, and where the remedy is complete and adequate at law, equity will not take jurisdiction. Keigwin v. Drainage Com’r, 115 Ill. 347. It is believed that the following authorities sustain our view that a franchise is involved, and that the remedy is by quo warrcunto: State ex rel. Att’y Gen’l v. Madison Street Ry. Co., 72 Wis. 612, cited in Secs. 49 and 52, Booth on Street Eailway Law. In view of what has been said it is not necessary to dwell upon the other points made in this appeal. It may not be inappropriate, however, to add that the paper filed by the City of Belleville, called in these proceedings a petition, is not and does not purport to be an intervening petition or other paper legally related to the foreclosure proceedings. Bo one is made or asked to be made a party defendant or asked to answer what is set up. It is more in the nature of an affidavit in support of a motion to the court to release from its control and custody the property of the appellant, in order, to quote the concluding part of the affidavit, that the city may “ remove the tracks, turn-outs, switches, etc., of said Citizens’ Horse Railway Company, or said street railway, from the streets of said city of Belleville.” The attitude of appellee as disclosed by its affidavit or petition is, without speaking disrespectfully, that of party, judge and sheriff, all in the same case. It, although a party, had tried the case and passed judgment, from which there was to be no appeal, involving property of the value of about $30,000, of which the court, by its receiver, had taken control in the foreclosure proceeding. The city of Belleville boldly asked that the court should release control of the property without trial, so that its officers might execute its sentence of removal and forfeiture, and thus oust the Citizens’ Horse Railway Company of its franchise. This, we hold, was but an attempt to involve a franchise in this proceeding. While this court would not have jurisdiction to consider an appeal which involved a franchise—■ that is, where its judgment would result in sustaining or ousting a franchise, yet it is considered that it has jurisdiction to determine whether or not the proceedings instituted were such as could legally involve a franchise. For the reason stated, it is considered there was error in that part of the decree from which this appeal was prosecuted. That part of the decree is reversed, with directions to strike what is called the petition from the files of the court.