Hawaiian Tramways Co. v. Rapid Transit & Land Co.

-Estee, J. This is a bill in equity filed by the Hawaiian Tramways Company, Limited, and verified by the oalth of W. H. Pain, as manager for said company, to enjoin the defendant, its associates, counsellors, solicitors, agents, contractors 'and servants from entering -into or upon King street, in the city of Honolulu, for the purpose of locating, constructing or operating a street railway therein, 'adjoining, alongside of or parallel with the street railway of the Hawaiian Tramways Company, Limited, and from digging up or subverting; the soil, surface or paving of said King street ior doingi any other acts in islaid King street tending to obstruct in any way the free and common use thereof as had theretofore been enjoyed, or tending to intermeddle or interfere with or obstruct the rights of the petitioner therein, or in the beneficial enjoyment of its franchises therein. Petitioner 'also' prays for a preliminary -injunction -against the said Rapid Transit and Land Company from doing the aforesaid acts. An order to' show cause why a preliminary and temporary injunction should not issue against it, was directed toi the Bapicl Transit and Land Company, made returnable on the 11th. da.y of November, 1901. The facts as shown by the bill and the afiklavite and -oral testimony introduced at the hearing appear to be these: That tire Hawaiian Tramways Company, limited, is a foreign corporation organized' under the laws of Great Britain and Ireland, and operating in the streets of Honolulu, the street railway hereafter mentioned; that in 'and by Act XVIII. of' the Session Laws of 1884, of the Kingdom of Hawaii, a grant was made to “William II. Austin and his associates ‘and 'assigns or such corporation as may be incorporated or organized by him or -them, to> construct, lay down, maintain, and operate for the term of thirty years from the passage of this Act, a single track street railway with all the necessary curves, switches and turnouts, or double track street railway through such of the streets mentioned in this Act........'along and upon the following — 166 — streets in the city of Honolulu......”. Among said streets enumerated, was King1 street. The Hawaiian Tramways Company, Limited, is the successor in interest, of the said William R. Austin and his associates. On July 7th, 1898, Act- 69 of the Session Laws of 1898 was passed by tire Legislature of the Republic of Hawaii and duly sigued by the President of the Republic. In and by said Act 69, a grant was made to Clinton Gr. Bailentyne and others, conferring the right “to. construct, lay down, maintain and operate for the term of thirty year’s after1 the railway authorized by this Act shall have been commenced, a railway, either single, or double track, or partly single and partly double, witb such curves switches, turnouts, poles, wires underground or overhead conduits and such other appliances and appurtenances as may from time to time be necessary for the use and 'operation thereof along and upon the following streets, roads and places in the District of Honolulu..........” The portion of King Street in Palarna mentioned in the bill of plaintiff is not included in said list of streets and roads. Section 3 of said Act provides tbe nature of the motive power to be used by the grantees of tbe franchise. By Section 6 of the Act last ’aforesaid, it is provided— “1st. Authority is hereby given the said Association and others to occupy thei streets and use the tracks of tbei Hawaiian Tramways Company, Limited, in accordance with the provisions of Section 3 of Chapter 34 of tbei Laws of 1884, entitled ‘An Act granting to William R. Austin, and bis associates, tbe right to construct and operate a street railway upon certain streets in tbe city of Honolulú/ provided that tbe said Association and others shall comply with tbe provisions and requirements of this Section.” “2nd. Whenever it shall bei necessary to cross the tracks of any other railway, tbei said Association and others are authorized to construct and lay down ait their own expíense, proper crossings removing tire rails so crossed for that purpose; but such construction and renroval shall be done in such manner as to — 167 — least interfere with the traffic of such other- railway; and after-the crossings are laid, the expense of maintenance shall be borne equally by the said Association and others, and the owners or lessees of such other railway.” “3rd. In the use: of any portion of the tracks of the Hawaiian Tramways Company, the ears of the Hawaiian Tramways Company or- of the said Association and others, shall not remain standing on the portion used jointly, but shall make only such s-tops as are required to take: on and let off passengers.” It is further provided by Subdivision 11 of Section 2 of Act 69 of the Session Laws: of 1898, that “Whenever a majority of the: owners of property-on any street or road in said Honolulu shall, in writing, petition said association and others to lay a railway in such street or road, and the Executive Council shall consent thereto, such railway may be 1-aid thereon and thereafter may be maintained and operated for the nnexpired term of said franchise.” By the provisions of Section 86 of an Act of the Congress of the United States, entitled “An Act to provide a government for the Territory of Hawaii,” approved the 30th cla,y of April, 1900, all of the powers and duties which by tlie laws of the Republic of Hawaii were conferred upon and required of said Executive Council, not inconsistent with the Constitution and laws of the United States, were conferred upon and required of the Governor of the Territory of Hawaii. The Honolulu Rapid Transit and Land Company, respondent herein, and a corporation organized and existing under -and by virtue of the law-s of the Republic of Hawaii, is the successor and assign of Clinton G. Ballentyn© and others. It further- appears that ever since- the assignment of the rights, pirivileges and franchises granted to William R. Austin and his associates', to the petitioner herein, to: wit: some time prior to the 14th day of November, 1890, the petitioner -herein has operated and maintained and still opea-ates and maintains upon the streets of Honolulu, a street railway including the street known as King street therein, -and on that portion thereof refer-ed to in said bill. — 168 — Tliat the Rapid Transit and Land Company, after becoming the assignee in interest of Clinton G. Ballentvna and his associatefe, and after its incorporation on August 31, 1898, began IDublicly to construct a street, railway in Honolulu, the said showing of cause alleging that said respondent “is now 'and since the 31st day of August last, has been operating a street railway of the type aforesaid through a number of the principal streets of said Honolulu under and by virtue of its said charter.” It is admitted that the Rapid Transit and Land Company bad at the time of the. filing of the bill herein, commenced toi construct and is constructing a street railway along King street for a distance of morei than 1700 feet thereon and along that portion thereof westward from Liliha street and referred to in the bill, and in such construction of said portion of said street railway is1 running parallel tor tbei railway track of the said plaintiff and petitioner. ■ It is claimed by the respondent that its action in so doing is in conformity with the grant in its franchise (Act 69 of the Session Laws of 1898 aforesaid,) and of a decision of the Supreme 'Court of the Territory of Hawaii, namely, the case of the Rapid Transit and Land Co. v. Hawaiian Tramways Company, Limited, reported in 13 Haw., P. 363, and in response to a petition of a majority of the property owners on said King street, and with the consent,' of the Governor of the Territory of Hawaii in accordance with law and the regulations of the departments of thei territorial government of Hawaii vested until authority in thei premises. The bill of plaintiff claims that the action of the said respondent is in derogation of the prior valid rights of petitioner under its franchise, and that the laying of such tracks will interfere with and impair the beneficial enjoyment of the. prior valid franchise of the petitioner. The jurisdiction of this 'Court is invoked through allegations in the bill that the charter of the respondent is unconstitutional, null and void, is in conflict AV-ith the constitution of thie United States of America.; and that siaid charter and each and every — 169 — portion thereof is in conflict with the laws of the United States and in particular with that certain Act of the Erst Session of the Pifty-sixth Congress, of the United States approved April 30th, 1900, and entitled “An Act to provide a government for the Territory of Hawaii.” It further appears -that W. H. Pain, from the year 1889, has been' and now is manager of the business of the said petitioner1 in the city of Honolulu. That prior to the filing of the bill in equity herein, to wit: on the 22nd day of January, 1901, in accordance with the provisions ¡of Section 1255 to 1258 inclusive of the Civil Laws of the Territory of Hawaii, a submission of certain alleged facts was made to the Supreme Court of the Territory of Hawaii, and a! decision therein rendered by the said Supreme Court on the 25th day of April, 1901, in an action entitled The Rapid Transit and Land Company v. The Hawaiian Tramways Company, Limited. Supra. The facts of 'the controversy as set forth in the said submission signed by tira parties thereto and, as appeal’s in the opinion and judgment of the, said1 Supreme Court of thei Territory of Hawaii, reported in 13 Haw., Page 363, were as follows: 1. “That the said Tramways Company, as authorized by law, ■is operating a street railway or tramway in Honolulu, in the Territory of Hawaii, and occupies a single track with switches and turnouts on King street from the Waikiki road to, a point near the Government pumping station at Kalihi. Said Tramways Company proposes to lay a double track other than the necessary turnout and switches along said King street and toi operate thereon a tramway by electricity. 2. “That the said Honolulu Bapid Transit and Land Company is thei lawful holder of a franchise granted to Clinton G. Balle-rityme and ¡others by Acts 69 and 70 of the Session Laws of 1898, and baring received ¡a petition from the majority of the owners of property on said King street and the Executive Council having consented thereto, for that portion of said King street lying betunen Nuuanu stream and Thomas Square, it — 170 — proposes toi lay such railway and to operate thei same on said street, between said points, thia distance between said points 'being greatly in excess of seventeen hundred (1700) feet.” 3. “Th'at no act which could be construed as an act of acceptance of the Act of 1890, was done by the Hawaiian Tramways Company, Limited, until after the expiration of the time limit set out in the Act of 1895.” 4. “That in the month of June, 1899, the Hawaiian Tramways Company, Limited, notified thei Minister of the Interior of its intention to lay a double track on all the roads covered by its franchise, and inclosed in the notification toi the Minister of the Interior a statement of the proposed- alignment -of the double track on. the streets and requested the Minister of the Interior to notify the Company if ha had any suggestion to make as to the grade or alignment. About the 25th. day of July, 1.899, the Minister of tire Interior replied toi thei Hawaiian Tramways Company, stating that he had no objection to' offer to the laying of the proposed tracks and no suggestions to offer as to the grade or alignment, and thei Hawaiian. Tramways Company, Limited thereupon proceeded with the work, preparatory to laying the double track.” The following’ are the issues -of la.w: 1. “Has the Hawaiian Tramways Company, Limited, the right to- lay a. double track along King street as above described? 2. “Has the Hawaiian Tramways Company, Limited, the right to operate a tramway by electricity? 3. “Has the Honolulu Rapid Transit and Land Company the right to 1-ay a track on King street for more than 1700 feet?” The judgment of the Supreme Court being that the first of the two last above questions were answered in the nleg’ative, and the third question in tire affirmative-. Upon the submission in the aforesaid case, Messrs. Kinney, Ballou & McClanaham appeared as attorneys for the Rapid Transit and Land Company, and Messrs. Paul Neumann and — 171 — Holmes & Stanley appeared as 'attorneys of record for the Hawaiian Tramways. Company, Limited. Thereafter, on the 6th. clay of November, 1901, the date of the filing of the bill herein, a bill jn equity was filled in the Circuit Court of the Limit. Judicial Circuit of the Territory of Hawaii by the Hawaiian Tramways Company, Limited, verified by "W. H. Lain, as manager of said Company, in an action entitled The Hawaiian Tramways Company, Limited, v. The Rapid Transit and Land Company, wherein J. J. Dunne, John T. De Bolt and Thomas Litoh represented the. petitioner. The said bill sets up substantially the same facts with thiei exception of the jurisdictional clause., and prays for substantially the sarnie relief as in the bill herein. In the hill filed in the Lirst Circuit Court of the Territory, the following sworn allegation appears (the same allegation "being substantially set up in the affidavit of said W. IT. Pain, filed herein in support of his hill) to wit: “Your orator further shows that on the 22nd day of Jaamary, 1901, a. certain purported controversy was attempted to he submitted for decision' to' the Justices of the Supreme Court of said territory; and that thereafter on March 27th, 1901, a purported ‘stipulation to submit additional facts’ was sought to be filed in said submission of said purpoafed controversy; and thereafter on the 28th and 29th days of March, 1901, said submission of said purported controversy came on for hearing before said Supreme Court of siaid Territory; and in this "behalf. your orator shows that a duly certified copy of said submission and of the pretended proceedings had therein, is attached hereto' 'and is made a part hereof and is marked' “Exhibit A.” And your .petitioner further shows that, thereafter, towit: on April 28tfc, 1901, said Supreme Court acting solely in pursuance to said pretended and purported submission of said pretended controversy, made and gave its decision thereon, which said decision is fully reported — 172 — “Your petitioner further shows that said pretended, submission and all proceedings had therein, and the decision made and given tteea’edn and all pretended rights and privileges flowing therefrom, >or defined or limited thereby, was and were anld are wholly null 'and void, and of no effect, value or validity whatever; and in this behalf your orator respectfully shows that said Supreme Court was then and there in (the matter of said pretended submission of said xorateuded controversy, and in its decision 'and1 judgment there wholly without ’any authority, power, warrant of law or jurisdiction either1 to hear or to determine said pretended submission of said pretended controversy; that your orator never appeared in said alleged submission, either in persiom or by attorney, nor did your orator sign or authorize any person in its behalf to sign or consent to the said pretended submission; that your orator never received, accepted or acknowledged service of process of any character in said alleged submission, either in person, attorney or otherwise; that the pretended appearance in said 'alleged submission of P'aul Neumann, Esq., or of Messrs. I-Iolmes & Stanley, or either of them as attorneys or as counsel for your orator herein, wiais wholly unauthorized by your orator, and was entirely without either the knowledge or consent of your orator; and that your orator never knew anything concerning said pretended submission of said alleged controversy, until after the said pretended submission had been made and gaid decision rendered, mlaid'e and given.” Hpon1 thlei hearing of the order to show cause, a motion was filed by the Rapid Transit and Land Company, through its attorneys, and upon idle affidavit of Clinton G. Ballentyne, for a rule against J. J. Dunne and John, T. De Bolt, to show their authority to act as 'attorneys1 for tire petitioner herein. An order was made by the Court for th’e s,aid J. J. Duranei and J. T. De Bolt to show their authority toi act as attorneys for the petitioner, anld ialso to show their compliance with tbei provisions of the Civil Laws of the Territory of Hawaii, relative to tire filing by foreign' corporations of certain documents in tbe — 173 — archives of the territory. In response to said order a voluminous affidavit was filed by W. H. Pain, as manager of tifie petitioner, together with certain other documentary evidence. In said affidavit, said Pain alleges the following: “This affiant further shows that from 1889 to the present lime he has been 'and still -is the sole manager and representative of said plaintiff and petitioner, corporation 'aforesaid, and as such had control, direction and management exclusively of all the transactions of said corporation in said Honolulu, during all the times herein mentioned; and this affiant diming all the times herein mentioned and as part of his authority and duties as said manager, had the exclusive control.and management of all the business, affairs and transactions of said corporation in Honolulu, and represented isiaid corporation therein including...... the employment and discharge of attorneys and counsellors, control and management of all litigation..........with full power of representation of said corporation in all of said matters and in 'all matters incidental thereto or connected therewith )) After the introduction of certain oral evidence, these two impositions and the general question of the issuance' of a preliminary injunction were argued1 before the Court 'and the matter submitted for its decision. The, complainant is a foreign' Corporation organized under the laws of Great Britain and Ireland. It has no, director or other officer, except its manager, W. H. Pain, residing within the jurisdiction of this Court or without the jurisdiction of Great Britain and Ireland. Since 1889, W. IT. Pain, as ha testifies, has acted as the sole manager of this corporation in these Islands; during this tima he has had the exclusive control of all its affairs in this territory, “including the employment and discharge of attorneys and counsellors, and the management and control of all litigation.” ■Complainant is now seeking for a temporary injunction against respondent, which is allowable only when, from a full statement of the facts a permanent injunction might he granted. — 174 — It appeal’s from the facts brought out on the bearing, and as hereinbefore stated, that the complainant and respondent were heretofore parties to certain litigation affecting their charter rights to construct and maintain street railways in the city of Honolulu, and especially in relation to their right to lay a street-railway track on King street in the city of Honolulu; and being desirious of settling their differences as to their respective rights to the use of King street in Honolulu, they did, pursuant to Sections 1255 and. 1258 inclusive of the Civil Laws of the Territory of Hawaii, -on the 22nd day of January, 1901, enter inito an agreement whereby their differences were submitted to1 the Supreme Court of the Territory of Hawaii for its adjudication and which adjudication the parties agreed to abide by. This agreement and statement of facts was originally signed by “Honolulu Rapid Transit and Land Company, by W. R. Castle, and Kinney, Ballou & IVIcC'kna-han. Hawaiian Tramways Company, Ltd. By Holmes & Stanley, of counsel.” And a further agreement or stipulation was also' made and executed on the 27th day of March, 1901, which was signed by “Kinney, Ballon & McOlaniaham, attorneys for the Hon. Rapid Transit and Ld. Go.,” and by “Holmes & Stanley, Attys. for Hawaiian Tramways Go., Ltd.,” and submitted to' the Supreme Court of the Territory of Hawaii, as appears by the Exhibit “A” which is made a part -of the affidavit of W. H. Pain, filed in support of his hill in this proceeding. It also ap-peaiB from said Exhibit “A,” that Clinton Gr. Ballentyne, as manager of the Honolulu Rapid Transit and Land Otompamy, and W. L. Stanley of Holmes & Stanley, attorneys for the Hawaiian Tramways Company, made oath before Edmund Hart, a notary public, that the controversy “is real -and the proceedings in good faith to test idle rights of the parties.” The minutes of the clerk of the Supreme Court of the Territory of Hawaii for the 28th day of March, 1901, (a portion of said Exhibit “A”) show, that all the attorneys for both sides of said controversy appeared before said Court, and that W. L. Stanley, one of said attorneys for the, Hawaiian Tramways Com — 175 — pany, read said agreed statement of facts to the Count and argued the case on the part of said company; that Mr. McClamalian argued the case for the Honolulu Rapid Transit and Land Company, and that on the 29th day of March, 1901, both Mr. Stanley and Mr. Paul Neumann replied to the argument of Mr. MeOlamahan. It was also uneontradictad that Mr. Pain was present in the said Supreme Oourt and listened to the argument made therein at that time, and at no time until the institution of the proceedings in .this Oourt has he objected to said submission on¡ tbe part of the complainant or eren to the decision of the Oourt. The case was decided by the Supreme Court of tbe territory on the 25th day of April, 1901, and that decision remains the law of that case by which the rights of the parties in this case to the use of King street, were settled. It appears further from tbe evidence in this proceeding, that from 1889 to the present time, Mr. W. II. Pain has been and still is the sole manager and representative of the said plaintiff and petitioner in this territory, and as such he has had control, direction and management of all the 'transactions of said corporation in said Honolulu, “including......the employment and discharge of attorneys and counsellors and the control and management of all litigation.” The complainant is now trying to avoid the effect of the der cisiom of the Supreme Court of the territory in the case referred to, alleging that no statement of facts was agreed upon bv it or by any person authorized to agree upon such statement of facts, and that it had no knowledge of any such submission, notwithstanding that Mr. W. II. Pain is its exclusive representative here and has the “management and control of all litigation of the- company,” and is now acting as tire manager and representative of the company in instituting the proceeding in -this C'onrt; Mr. Pain being also the only person testifying to tire effect that complainant is not bound by the aforesaid decision and that the said agreement and statement of facts was without tire authority or knowledge of the complainant. — 176 — It has been shown in this proceeding that Mr. Pain was in the. Supreme Court during the argument and submission of the facts in that ease. lie testifies that he was present; and it is uncontradicted that ha is the only officer or agent of the corporation ini Honolulu. Now, if from 1889 to the present time, Mr. Pain has had the exclusive control .and management of all the business of the complainant, “including the employment and discharge of attorneys and counsellors, and the control and man'ageanient of all litigation,” he must have 'had power to control this litigation, if what he swears to. in his affidavit is true. And if he had power to control all of the litigation of complainant from the year 1889, why did he sit quietly by without making a protest toi the,- Court or to any one else on behalf of the company he represented until a final judgment was entered in that ease against his. company, and not even then? If the attorneys therein were not acting within his. authorization, he had the right to. discharge them, and it was his duty to his principal to discharge them and toi make a summary ‘application to- -the Court for redress. He admits he was in- Court during the proceedings in the territorial Supreme Court, and he testified on the hearing herein, when examined in relation to. the, stipulation for' submission of further facts in the Suprrne Court matter, that “he knew some question arose as to whether they should do something .and they did,” showing his entire familiarity with lire case and the action being taken by the attorneys therein. “There is no principle of practice better settled in our American law, than that an appearance in Court by an attorney for a client, carries with it the presumption of authority to. appear.” Bonnifield et al v. Thorp, 71 Fed. Rep. 924. It is always presumed -that an attorney appearing and acting for a party to a cause has authority to do so. and to. do all other acts necessary or incidental to the proper conduct of the case, and the burden of proof rests on the party denying such authority to sustain his denial by a clear preponderance of thei evidence. — 177 — Hill v. Mendenhall, 21 Wall U. S. 453; Osborn v. Bank of United States, 9 Wheaton, U. S. 741. And this is especially so in relation to> foreign corporations, which can only appear by attorney. It is clear that managing officers of corporations have power to employ attorneys and counsellors without delegations of power or formal resolutions to that effect. And while Mr. Pain claims that hie did mot authorize these attorneys, Messrs. Holmes' & Stanley or Paul Neumann, Esq., now deceased, to act as the attorneys for thei corporation complainant in that case, yet the whole of the proceedings in the case, including thei appearance in Court of the manager of thei complainant (and its only representative ini these Islands) during the proceeding, and the silence of complainant ever since. the rendition -of the decision, shows that it tacitly admitted to. that Court the. authority of tire attorneys to act in the matter. And again-, while Paul Neumann-,, Esq., has since deceased, yet Messrs. Holmes & Stanley arc hiere, amid if tire complainant soi desired could have h’ad their testimony in this proceeding. The decision of the Supreme Court, construing the charter’s, of the parties to. that action and their respective rights thereunder, including -the right to lay the track on King street on the part of respondent herein for a, distance of more than seventeen hundred feet thereon, is binding upon this Court in the event there was no Federal question involved. Western Union Telegraph Co. v. Call Publishing Co., 181 U. S. 92; Egan v. Hart, 165 U. S. 188; Chicago, Burlington etc., R. R. Co. v. Chicago, 166 U. S. 116, 242; Gardner v. Bonestell, 180 U. S. 362. It was said in the case of the Guaranty Trust Co. of N. Y. v. Galveston City R. Co., 107 Fed. 311, 320, that: “We follow the interpretation given to the statutes of a state as appears by the decision of the Suprema Court of the state.” Aberdeen Bank v. Chehalis County, 166 U. S. 440; Nobles v. Georgia, 168 U. S. 398; Fordyce v. DuBose, 87 Texas, 78. No federal question appears -to be involved in the proceedings before this Court and no- argument was presented in favor — 178 — of any such question. It is true the petition of complainant alleges that there is a constitutional question involved in that the granting' of the franchise to the Rapid Transit and Land Company was in violation of the prior valid rights of the complainant, but I find furthfer in the submission of facts to the Supreme Court that it was admitted that the said “Honolulu Rapid Transit and Land Company is the lawful holder of a franchise .■granted to Clinton Gr. Ballenitynie and others by Acts 69 and '.7.0 of the Session Laws of 1880. .. .” ■Can the complainant, after admitting in one Court of oom■pebent jurisdiction the lawful holding of a franchise by the respondent, -and having the case tried upon that theory, then come into another Court of different jurisdiction, and deary the validity of that franchise in an attempt' to invoke the jurisditetion of that other Court in a proceeding in equity? rIMsCourt will not consider such an attempt. It does not seem necessary to pass upon the question whether the complainant has complied with all the statutes of the Territory of Hawaii in relation to foreign corporations, in rendering the decision in this matter. One of the questions submitted to' the Supreme Court of the territory as appears from the foregoing statement of facts is: “Has the Honolulu Rapid Transit and Land Company the right to lay a track on Tlinig' street for more than seventeen hundred feet?” To Which inquiry the Supreme Court, after an exhaustive inquiry -into the various statutes and franchises under which the two parties were acting-, decided in the affirmative). And that is substantially the only qiiestion now before this Court, and which has been settled by tbe decision of the- Supreme Court of the territory. This Court will not listen to a collateral attack made in this ■ease upon a judgment of the Supreme Court of the territory. It is an established principle of equity jurisprudence, elementary in its nature, that “he who seeks equity must do equity.” And that he who asks equitable relief must come into Court — 179 — with, clean hands. The complainant has not come into- this Court with clean hands. Calliher v. Cadwell, 145 U. S. 368; Whitney v. Fox, 166 U. S. 637; Penn. Mutual Life Insurance Co. v. Austin, 168 U. S. 685, 698. Messrs. Dunne and De Bolt, attorneys for the complainant, this Court holds are properly authorized to act in this proceeding, yet from all the facts there has not been such a showing made as will entitle this Court to assume jurisdiction in this matter, or entitle the complainant to any equitable relief herein. The preliminary injunction is denied, and the bill dismissed with costs.