Minneapolis & St. Paul Suburban Railway Co. v. Manitou Forest Syndicate

LEWIS, J. Appellant company, claiming to be organized under the provisions of title 1, c. 34, G. S. 1894, commenced this proceeding in the district court of Hennepin county for the purpose of condemning, in part, certain lánds for a right of way within the corporate limits of the villages of Tonka Bay and Excelsior, in order to extend its line from Excelsior to Birch Bluff, on Rake Minnetonka. The district court denied the application upon the following ground: “It appearing that some of the lands and tracts of grounds sought to be acquired by said petitioner through these condemnation proceedings are situate within the corporate limits of the village of Excelsior, and some thereof are situate within the corporate limits of the village of Tonka Bay, and it further appearing that said petitioner has no authority by law to acquire property by right of eminent do — 142 — main within the limits of any city or village, and it further appearing that the tracts of land sought to be acquired situated outside of said villages would not be useful or necessary as a right of way, unless a right of way is acquired within said villages: Now, therefore, it is hereby ordered that said petition be, and the same is hereby denied.” The proposed improvement embraced the condemning of a right of way across the tracks of the Minneapolis & St. Louis Railroad, and that company answered, denying authority so to do. The Manitou Forest Syndicate answered, and alleged that the premises sought to be condemned were located in the village of Tonka Bay, in which village large quantities of land had been platted and the streets thereof were in use by the public, and that the proposed improvement would cross important streets and avenues of the village; that no-franchise, license, or authority of .any kind had ever been granted to the petitioner to make such improvements within the limits of the village. Respondent L. S. Gillette Company is the owner of certain tracts sought to be condemned, located in the village of Excelsior, and by its answer raised the same legal questions presented by the other respondents. As we understand the order, the learned judges of the trial court were of opinion that appellant company was a street railway company, strictly speaking, and for that reason did not, under our statutes, possess the right to exercise the power of eminent domain within the limits of cities and villages. The solution of that question calls for a consideration of two propositions: First, as originally incorporated, was the company endowed with the right of eminent domain? Second, if it was, then was the power to exercise it within the limits of cities, and villages denied by subsequent statutes? 1. The company was incorporated in June, 1899, and its general business is stated in the articles as follows: The general nature of the business of said corporation shall be to purchase, lease, build, own and operate suburban street railways, extending from the city limits of the cities of St. Paul and Minneapolis to and into outlying cities, towns and villages within the state of Minnesota; the following being among the lines of street railway which this corporation shall have — 143 — the right to either huild or acquire by purchase or lease, and to own, operate and maintain after such building or acquisition. Then follows a description of four separate lines of railway which it proposed to construct: One, from the easterly limits of the city of St. Paul, through the village of North St. Paul to Wildwood, on. White Bear Lake, and thence from Wildwood to the city of Still-water and the village of South Stillwater; another line, beginning at the southerly limits of the city of St. Paul, and extending thence in a general southeasterly direction to the city of South St. Paul; another line, beginning at Camden Place in the city of Minneapolis, and thence in a general northwesterly direction to the city of Anoka; and another line, which is the one involved in this proceeding, extending from the westerly limits of the city of Minneapolis, at or near the point where the Lake Harriet street railway line, if extended, would intersect the western city limits of the city of Minneapolis, and running in a westerly direction, along such route as shall be determined upon by the company, to the village of Hopkins, in Hennepin county, and thence through Hopkins, along and upon such route as shall be designated and determined upon, to Lake Minnetonka, and to such point or points on the lake as may be determined upon by the company. The articles also state that the company was incorporated, To lease, purchase or build, own, and operate such other line or lines of suburban street railway within the state of Minnesota as the board of directors of said company may determine upon hereafter. Also to lease, purchase, build, own and operate, by either electric or steam power, such steamboats, launches, or other boats as may be determined upon by said company, upon White Bear Lake, Lake Minnetonka, and such other lakes within the state of Minnesota as may be determined upon by the company. Also to lease, buy and own all real estate necessary for or incidentally connected with the building and operation of the street railway lines and the business herein provided for. Also to purchase and own stock or stocks of suburban or other street railway companies, and to — 144 — purchase or lease railway lines within the state of Minnesota. Also to lease, construct, own and operate electric or other power stations, electric lighting plants or stations, and in connection therewith to construct, maintain and operate electric lighting plants, and to furnish electric light or power to either persons, corporations, cities, towns or villages; and, generally, to do any and all things necessarily connected with or incidental to the business herein authorized and provided for. Title 1, c. 34, § 2592, G. S. 1894, in part, reads as follows: Any number of persons, not less than five, may associate for incorporation and become incorporated under and according to this title for the construction, maintenance and operation of any work or works of internal improvement requiring the taking of prívate property, or any easement therein, for public use, including railways, telegraph lines, etc., * * * But no corporation formed under this title shall have any right to construct, maintain or operate upon or within any street, alleys or other highway of any city or village, a railway of any kind * * * without first obtaining a franchise therefor from such city or village, according to the terms of its charter and without first making just compensation therefor, as herein provided. If appellant was in fact incorporated for the construction, maintenance, and operation of a work of internal improvement, as provided by title 1, then it possessed the right of eminent domain, unless otherwise restricted. Respondents insist that appellant is foreclosed from raising the question by the very declarations of the articles of incorporation; that in the preamble it is declared that the incorporators associate themselves for the purpose of becoming a body corporate under and pursuant to the provisions of title 2; that the general nature of its business is to purchase, lease, build, own and operate street railways; that the company is operating between the city of Minneapolis and Excelsior a street railway, and its proposed extension from the latter point to Birch Bluff is also to be a — 145 — street railway; that, being a street railway, incorporated under title 2, the company never possessed the right of eminent domain, except without the limits of cities and villages, as authorized by chapter 350, p. 461, Laws 1899, approved April 20, 1899; and that even such right was extinguished by the express repeal of chapter 350, p. 461, Laws 1899, by the Revised Laws of 1905. So far as the formal acts of incorporation are concerned, the incorporators complied with the provisions of title 1, as well as with those of title 2. The articles contain all the requisites of sections 2593, 2594, tit. 1. The provisions of that title did not require the articles to state specifically that it was the purpose of the company to exercise the right of eminent domain. It was no less a common carrier because the articles did not state that its purpose was to carry freight. A common carrier is a corporation engaged in the transportation of persons or property within this state, etc. R. L. 1905, § 1990; G. S. 1894, § 379. It is clearly expressed in the articles that its business is to transport persons from place to place, and we need not now inquire whether the power and duty to carry freight is implied. It is not controlling that the incorporators declared they proposed to incorporate under title 2, if in fact they did comply with and are incorporated under the provisions of title 1. In International Boom Co. v. Rainy Lake River Boom Corporation, 97 Minn. 513, 107 N. W. 735, it was held that a corporation cannot be made merely by being labeled as such, if its declared objects show it to be something else; that the real character of a corporation must be determined from those portions of its articles of association expressing the nature and scope of its business. State v. Minnnesota Thresher Mnfg. Co., 40 Minn. 213, 41 N. W. 1020, 3 L. R. A. 510. Although the articles state that it is the purpose of the company to purchase, lease, build, own and operate street railways, the word “street” is not significant, because the context shows that the articles do not refer to that class of railways. The railways described in the articles are suburban railways, extending from the city limits of St. Paul and Minneapolis to and into outlying cities, towns, and villages within the state of Minnesota, viz.: From St. Paul to North St. Paul, White Bear, and Stillwater; from St. Paul to South St. Paul; from Minneapolis to Anoka; and from Minneapolis to Lake — 146 — Minnetonka. That district which lies adjacent to and outside the city limits is “suburban.” The proposed railways are to run from the limits of the cities to distant cities and villages, through land where there are no streets; and hence the word “street” was not used in the articles for the purpose of limiting the corporation to the provisions of title 2. This becomes more apparent when we consider the characteristics of the two classes, commercial and street railways. What is a street railway? The Century Dictionary defines it as a railroad constructed upon the surface of a public street in towns and cities. 27 Am. & Eng. Enc. (2d Ed.) 5, states: “The distinctive and essential features of a street railway, as distinguished from other railroads, are the location of the road upon-the surface of streets and highways, its mode of operation, and its use for the carriage of passengers.” In Carli v. Stillwater St. Ry. & T. Co., 28 Minn. 373, 10 N. W. 205, 41 Am. 290, it was held that the construction and maintenance of a railroad operated by animal power upon a public street, for the main purpose of transferring freight cars between the termini of railroads, is the imposition of an additional servitude upon the street, so as to entitle the owner of a servient estate to compensation. The court held that it was not a street railroad, because its primary purpose was not for the accommodation of the public in that locality for the reception of passengers and freight along its line at any point on the street or alley, that the railroad was not located upon the street for the purpose of receiving business from the street, and that it was not in aid of the public travel for which the street was created; and attention was called to the fact that it was immaterial that the power employed was the same as generally in use by street railway companies at that time. In Newell v. Minneapolis L. & M. Ry. Co., 35 Minn. 112, 27 N. W. 839, 59 Am. 303, the court distinguished Carli v. Stillwater St. Ry. & T. Co., supra, upon the ground that in that case the railroad in question was merely a connecting link between the termini of ordinary commercial railroads, and in no sense in aid of the street; whereas, in the Newell case, although the cars were propelled by steam motors, passengers were taken on or let off at any street crossing upon its line, the same as if it had been an ordinary horse railway, and — 147 — was operated in aid of the street and accommodating persons over the same. Upon this ground it was held that the railway was, within the city proper, a street railway, and consequently did not impose an additional burden upon the servient estate, and that it was immaterial that outside the city it ran upon its own track, the same as an ordinary steam railroad. In Funk v. St. Paul C. Ry. Co., 61 Minn. 435, 63 N. W. 1099, 29 L. R. A. 208, 53 Am. St. 608, the same rule was applied, and it was held that the street railway company was not within the provisions of the fellow servant act. In that case the difference between “railroad” and “street railroad” was discussed, and it was stated that street railways get their business from the street,' where passenger travel is the only business carried on. Again, in State v. Duluth G. & W. Co., 76 Minn. 96, 78 N. W. 1032, 57 L. R. A. 63, the court called special attention to the fact that a street railway is local, and derives its business from the street along which it is operated, while a commercial railway usually derives its business either directly or indirectly through connecting roads from a large area of territory, and not from the travel on the streets. These cases, and the authorities generally, clearly show that, while the reasoning varies somewhat according to the statutes in force in the different states, the distinction between the two classes of roads is well defined. The difference does not depend upon the motive power employed, nor alone upon the character of the cars, rails, or equipment. The essential and predominant distinction is that a street-railway is operated upon the street in aid of the street as a highway. A street railway is an improvement on the coach or omnibus, and is operated for the use and benefit of persons desiring to be transported along the street. It is local, and under the special control of the municipality. A commercial railroad gathers its business at termini and operates from place to place. See Nichols v. Ann Arbor, 87 Mich. 361, 49 N. W. 538, 16 L. R. A. 371; Pennsylvania v. Montgomery, 167 Pa. St. 62, 31 Atl. 468, 27 L. R. A. 766, 46 Am. St. 659; Heilman v. Lebanon, 180 Pa. St. 627, 37 Atl. 119; Harvey v. Aurora, 174 Ill. 295, 51 N. E. 163; Hannah v. Metropolitan, 81 Mo. App. 78; 1 Lewis, Em. Dom. § 115h. — 148 — Reverting to the articles of incorporation, it will be noticed that among its purposes is the ownership and operation of other suburban railway lines within the state; to acquire, construct, own and operate, by electric or steam power, steamboats, launches, etc., upon the lakes in Minnesota, as may be determined upon; to purchase and own the stock of suburban or other street railway companies, and to purchase or lease railway lines within the state; to lease, construct, own, and operate electric or other power stations, electric lighting plants or stations, and in connection therewith to construct, maintain, and operate electric lighting plants, and to furnish electric light or power to either persons, corporations, cities, towns, or villages. While no doubt the construction and operation of electric and lighting plants is a business which might be organized under the provisions of title 2, and conceding there was no statutory authority for the purchasing by one corporation of another line of street-railway, or stock therein, yet these purposes seem to be merely incidental to the main purpose, as expressed in the articles considered as a whole. At that time, however, so far as we are informed, the only authority conferred upon corporations to purchase or lease railroads, or the stock of other corporations, was as provided by sections 2714, 2715, tit. 1, c. 34, G. S. 1894, as amended. The question now before the court receives no enlightenment from the fact that the cars of appellant company are operated beyond the terminus of.its line of the city limits, and by some arrangement are operated within the city upon the street railway tracks of some other corporation. It is of no rpaterial importance that, in operating its present line from Minneapolis to Excelsior, appellant uses the same equipment usually employed in operating street railways upon streets in villages and cities, and that it has not established depots or way stations, put up fences and signs at crossings, or, generally speaking, declared itself a railway within the provisions of the railroad and warehouse commission act. We are clearly of the opinion that appellant company was incorporated under title 1, possessing the right of eminent domain; but whether it has in all respects complied with the law as a common carrier is not involved in this proceeding. 2. We now come to the second division of the subject, viz.: Was the right of eminent domain conferred upon appellant by the provi — 149 — sions of title 1, c. 34, G. S. 1894, abrogated or limited by the provisions of R. L. 1905, which went into effect March 6, 1906, before the commencement of these proceedings in condemnation? Section 2838, c. 58, R. L. 1905, reads: Existing Corporations Continued. Until otherwise provided by law, all private corporations existing and doing business at the time of the taking effect of the Revised Laws shall continue to exercise and enjoy all powers and privileges possessed by them under their respective articles of incorporation, and the laws applicable thereto then in force, and shall remain subject to all the duties and liabilities to which they were then subject. 2841. Public Service Corporations. Corporations may be organized, for the construction, acquisition, maintenance, or operation of any work of internal improvement, including railways, street railways, telegraph and), telephone lines. * * * But no corporation so formed shall' construct, maintain, or operate a railway of any kind, or any subway, pipe line, or other conduit in or upon any street, alley/', or other public ground of a city or village, without first obtaining from, and compensating said city or village for a franchise conferring such right. 2842. State and Local Control — Eminent Domain. The state shall at all times have the right to- supervise and regulate the business methods and management of any such corporation, and from time to time to fix the compensations which it may charge or receive for its services; and every such corporation obtaining a franchise from a city or village shall be subject to such conditions and restrictions as from time to time may be imposed upon it by such municipality. Every such corporation may acquire, by right. of eminent domain, such private property as may be necessary or convenient for the transaction of the public business for which it was formed: Provided, that no street railway company shall have or exercise such right within the limits of any city or village. — 150 — 2926. Right of Eminent Domain in Certain Cases. Any public service corporation shall have the right to obtain by comdemnation, under the right of eminent domain, any land, or any right over, through or across the same, or any easement therein, necessary for the convenient prosecution of its enterprise. * * * Some confusion grows out of the fact that chapter 58, R. L. 1905, is a consolidation of titles 1 and 2, c. 34, G. S. 1894, but the revisers and the legislature expressly declared by section 2838 that all existing rights were continued until otherwise provided by law. Whatever powers appellant company possessed under title 1 were continued, unless the contrary appears. In section 2593, G. S. 1894, street railways were not specifically mentioned; but the right of eminent domain was conferred upon such roads outside of cities and villages by -chapter 350, p. 461, Laws 1899. This chapter was expressly repeal•ed by R. L. 1905; but the right to exercise the power was reserved ■to such companies by section 2841, where street railways are designated as works of internal improvement, and by section 2842 and •section 2926, where the right of eminent domain is expressly conferred upon all such corporations. We discover nothing significant in •.the fact that the Revised Laws add “street railways” to the list of ;public service corporations with the right of eminent domain, and at -.the same time prohibit their exercise of the right within cities and villages by the proviso in section 2842. These provisions for the exercise of the right of eminent domain by street railways without the limits of cities and villages do not warrant the inference that it was the intention to withhold the right from corporations operating in the -country lines of the street railway type; in other words, to wipe out the distinction theretofore existing between commercial and street railroads, except in cities and villages. Whether a corporation may foe organized under the Revised Laws for the purpose of operating roads of the street railway type beyond the limits of cities and villages, without being subject to state control and the railroad and warehouse commission act, we need not inquire. Appellant company does not belong to that class. It is to all intents and purposes a common car — 151 — rier, organized under title 1, and its rights and privileges have not been extinguished or limited by any subsequent statutes. 3. Respondent the Minneapolis & St. Louis Railroad Company insists there is no authority for appellant company to acquire the right ■of way over respondent’s tracks. Most of the objections urged are based upon the assumption that appellant was organized as a street railway, strictly speaking, and require no special notice. In the petition appellant sets out the fact that it is necessary to cross respond■ent’s railroad track at a certain point, and alleges that it has been unable to agree with that company upon the amount of compensation, ■or upon the character of the safety devices to be used at such crossing, and prays for the direction of the court with respect to that matter, alleging that it is the desire of appellant to condemn the easement and right to cross the railway at that point. Conceding that section 2642, G. S. 1894, made no provision, strictly speaking, for condemning an easement by one railroad company over the tracks of another, .appellant is authorized to exercise such right by the provisions of section 2915, R. L. 1905; for the right conferred by the latter is not limited to companies organized thereunder, but extends to corporations organized under the former, unless otherwise provided. 4. Respondents further claim that it does not appear from the petition that the village authorities of Tonka Bay have conferred on appellant the right to occupy the streets and alleys in the village, as provided by section 2841. While it may appear from the petition that the proposed right of way will cross some of the streets, we are un.able to discover that it is the purpose of appellant to occupy any of the streets, alleys, or public grounds within the village for the purpose of operating its railroad thereon. Section 2841 applies only where it is the intention to make use of the street or public ground for the purpose of operating such railway thereon; that is, upon or .along the street. But, when it is the purpose to merely cross a street, alley, or public ground as an incident in the construction of a railroad through the country, then, under the provisions of section 2916, the right of way may be condemned, unless the company and public .authorities otherwise agree as to the manner and terms of crossing. To hold that a franchise must be obtained as a prerequisite -to crossing a highway, road, or street would put it in the power of the town, — 152 — village, or city authorities throughout the state to practically block railroad extension. Such is not our yiew of the statute, and, since it does not appear from the petition that appellant proposes to occupy any of the streets, alleys, or public grounds of the village of Tonka Bay for the purpose of operating its railway thereon, it does not become necessary to obtain a franchise or right for that purpose from the village authorities; and it is unnecessary to discuss whether such franchise must be obtained as a prerequisite to maintaining the condemnation proceedings with respect to private property within the village limits. Order reversed.