custom, and indorsed and delivered by him to a bona fide holder who,
a citizen of a different State, furnishes the money represented by the
note directly to the corporation, the treasurer is not in fact an assignee
of the note within the meaning of the act of August 13, 1888, 25 Stat.
433, and suit may be brought by such holder in the Circuit Court of
the United States having jurisdiction of the parties, notwithstanding
such diversity does not exist as to the treasurer first indorsing the note.
(Falk v. Moebs, 127 U. S. 597; Holmes v. Goldsmith, 147 U. S.
150.)
Where there is a proper cause of action and diverse citizenship, jurisdiction
of the Federal courts exists, and the motive of the creditor who de-
sires to litigate in that forum is immaterial, and does not affect the
jurisdiction; nor is such jurisdiction if it actually exists, affected by
the fact that a receivership was in view when judgments were entered.
(South Dakota v. North Carolina, 192 U. S. 286.)
Where, as in this case, the attitude and claims of the municipality cast a
cloud upon the title to property consisting largely of franchises in the
hands of receivers and to be administered under orders of the court,
the receivers may, with the authority of the court, proceed by ancillary
bill to protect the jurisdiction and right to administer the property,
and to determine the validity of claims of parties which cast a cloud
upon such franchises and in such a case it is proper to grant an injunc-
tion until the rights of the parties can be determined.
Whether a corporation having a limited and definite capacity to purchase
and hold real estate has exceeded those limits concerns only the State
within whose jurisdiction the property is situated; the question can-
not, unless the statute expressly or by necessary implication authorizes
it, be raised collaterally by private persons. (Fritts v. Palmer, 132
U. S. 282.)
The generality of the title of a state statute does not invalidate it under a
provision of the constitution of the State that private and local laws
shall only embrace one subject which shall be expressed in the title,
so long as the title is comprehensive enough to reasonably include
within the general subject or the subordinate branches thereof, the
several objects which the statute seeks to effect, and does not cover
legislation incongruous in itself and which by no fair intendment can
be included as having any necessary and proper connection. (Mont-
clair v. Ramsdell, 107 U. S. 147.)
Although decisions of the highest court of a State are not binding on this
court in determining whether a contract was made by legislative action
of that State which is entitled to protection under the impairment of
obligation clause of the Federal Constitution, it will consider decisions
of that court on the point in question.
One asserting private rights in public property under grants of franchises
must show that they have been conferred in plain terms, for nothing
passes by the grant except it be clearly stated or necessarily implied.
Legislative grants of franchises which are in any way ambiguous as to
whether granted for a longer or a shorter period are to be construed
strictly against the grantee.
As a rule of construction a statute amended is to be understood in the same
sense exactly as if it had read from the beginning as it does amended.
Although a corporation be organized under a charter for a limited period
it may receive a grant inuring to the benefit of its lawful successors for
a period beyond its corporate life, but the right granted must be con-
strued with reference to the system of which it is a part and where that
general system is for a limited period a single ordinance, not naming a
specific term, will not be construed as granting a franchise in perpetuity.
A declaration in the title of state statutes that they concern horse railways,
where it is apparent that these terms were intended to indicate street
railways as distinguished from steam railways, will not, because of a
constitutional provision that the object of the statute must be expressed
in the title, prevent the city from exercising its powers under the stat-
ute in such manner as to authorize the use of other power such as cable
or electricity.
The repeal of a state statute authorizing every street railway to be operated
by such animal, electric or other power as the municipal authorities
may have granted would not destroy its effect to ratify contracts in
existence when it was passed.
Where a state statute requires the consent of a municipal officer to au-
thorize the extension of a street railway the abolition of that office
does not authorize the extension without any official consent; and
where the consent of municipal authorities is required for franchises
relating to special localities by a statute, and subsequently a general
act limits the time for which any such franchise can be granted in any
city or village, the consent given will be presumed, in the absence of
any period specified not to be in perpetuity, but for the period as so
limited.
Under the law of Illinois municipal corporations have a fee simple in, and
exclusive control over, the streets, and the municipal authorities may
do anything with, or allow any use of, the streets not incompatible with
the ends for which streets are established, and it is a legitimate use of
a street to allow a street railroad track to be laid down in it.
Applying the foregoing principles to the construction and effect of the various
acts of the legislature of the State of Illinois, and of the ordinances of
the municipal authorities of the city of Chicago and adjacent towns,
in regard to the franchises of the several street railway companies
owned and controlled by the Chicago Union Traction Company, and
the receivers thereof held, that:
1. The Circuit Court of the United States for the Northern District of
Illinois had jurisdiction to render the judgments against the Chicago Union
Traction Company, the North Chicago Street Railroad Company and the
West Chicago Street Railroad Company set up in the bills afterwards filed
for the appointment of receivers.
2. The proceedings for the appointment of receivers were not shown to
be collusive and fraudulent, and the court had jurisdiction to entertain
the bills and appoint the receivers and put them in possession of the prop-
erty of the railway companies.
3. The ancillary bills filed by the receivers were maintainable in aid
of the court's jurisdiction to settle controversies as to the property which
was to be administered and disposed of under the orders and decree of
the court.
4. The acts of 1859, 1861 and 1865 were not unconstitutional under the
constitution of Illinois of 1848 in force when the same were passed.
5. The act of February 6, 1865, amending the act of February 14, 1859,
had the effect to extend the corporate lives of the Chicago City Railway
Company, the North Chicago City Railway Company and the Chicago
West Division Railway Company, for the term of ninety-nine years. It
affirmed the contracts with the city prescribing rights and privileges in
the streets of Chicago in all respects as theretofore made, including time
limitations as contained in the ordinances previously passed. It recog-
nized and continued in force the right of the city and the companies to
make contracts for the use of the streets upon terms and conditions,
including the time of occupancy, as might be agreed upon between the
council and the corporations.
6. Corporate privileges can only be held to be granted as against public
rights, when conferred in plain and explicit terms. The ambiguous
phrase in the act of 1865, "during the life hereof," did not operate to
extend existing contracts for the term of ninety-nine years or limit the
right of the city to make future contracts with the companies covering
shorter periods.
7. The amending act of 1865 had reference to the North Chicago City
Railway Company as well as the corporations specifically named in the
first sections of the acts of 1859 and 1861.
8. The ordinances of May 23, 1859, granting rights and privileges in
certain streets to the Chicago City Railway Company and the North
Chicago City Railway Company, respectively, are radically different.
The grant to the former company for the south and west divisions of the
city is during all the term specified in the act of February 14, 1859, which
act expressly ratified the ordinance of 1858, granting the right to use the
streets therein named for the term of twenty-five years and until the city
shall purchase and pay for the same as set forth in said ordinance. On
the north side the term granted is for twenty-five years" and no longer."
The privileges conferred upon the Chicago City Railway Company and
its grantee were confirmed, as made, by the act of 1865, with the effect
to continue the right of the companies to occupy the streets named in
the ordinances of 1858, May 23, 1859, and similar ordinances, for the term
of twenty-five years and until the city shall elect to purchase and pay for
the property of said railway companies. On the north side, no such right
exists to remain in the use of the streets until purchase by the city.
9. Whatever rights existed in the streets, were not lost to the com-
panies by the acceptance of the ordinances granting a change from animal
to cable or electric power in the operation of the railways.
10. The grants in the town of Jefferson, having been made after the
acceptance of the Cities and Villages Act, are limited to the term of twenty
years.
11. The grants by the supervisor of Lake View are not in perpetuity,
as the Lake View road was but an extension of the North Side system,
which was expressly limited in the duration of its grants to the term of
twenty-five years. No intention will be presumed to make an extension
of this part beyond the life of the grant to the main lines of the North
Side road.
12. The grants by the trustees of Lake View will not extend beyond the
life of the corporation making them and upon the annexation of the town
of Lake View to Chicago, the further right to use the streets must be de-
rived from grants by the council of that city under power conferred by
the Cities and Villages Act.
The decree is reversed and cause remanded for further proceedings in
accordance with the views herein expressed. Blair v. Chicago, 400.
Power of removal from office-Right to compensation of one wrongfully dis-
charged.
The provisions of the Civil Service Act of January 16, 1883, are broad and
comprehensive; under it, the Executive order of May 16, 1896, Rule III,
and the order and list of the Secretary of the Interior of June 9 and
September 26, 1896, based thereon, stenographers receiving the specified
salaries employed in offices of surveyors-general were brought within
the protection of the law and can only be removed at least by a sub-
ordinate officer of the Department-for just cause and upon written
charges on notice with opportunity to defend; and until removed in
accordance with the law and rules thereunder, and so long as he remains
ready and willing to discharge the duties of his place, he cannot be de-
prived of the compensation legally belonging to one entitled to hold
the position notwithstanding the surveyor-general in whose office he
is employed attempts to discharge him and excludes him from the
office. United States v. Wickersham, 390.
CLASSIFICATION FOR LEGISLATION.
See CONSTITUTIONAL LAW, 6, 8.
CLASSIFICATION FOR TAXATION.
CLOUD ON TITLE.
See JURISDICTION, D 2.
COLLATERAL ATTACK.
See PUBLIC LANDS, 4.
See CONSTITUTIONAL LAW, 1;
CORPORATIONS, 1.
COMMERCIAL PAPER.
See JURISDICTION, C 3.
CONDITIONAL SALES.
See BANKRUPTCY;
MORTGAGE AND DEED OF TRUST.
ACTS OF. See Acts of Congress.
POWERS OF. See Corporations, 1.
1. Commerce clause-Validity of state requirements of railroad engaged in
interstate commerce.
An absolute requirement that a railroad engaged in interstate commerce
shall furnish a certain numbers of cars on a specified day, to transport
merchandise to another State, regardless of every other consideration
except strikes and other public calamities, transcends the police power
of the States and amounts to a burden upon interstate commerce; and
articles 4497-5000, Rev. Stat. Texas, being such a requirement, are,
when applied to interstate commerce shipments, void as a violation
of the commerce clause of the Federal Constitution. Such a regula-
tion cannot be sustained as to interstate commerce shipments as an
exercise of the police power of the State. Houston & Tex. Cent. Rail-
road v. Mayes, 321.
2. Contracts within impairment clause-Provision in state statute for special
rate of taxation in respect to particular corporation.
Provisions in a state statute for a special rate of taxation in respect to a
particular corporation, made with a view of inducing large expenditures
and the completion of an unfinished road of great public importance,
and which are formally accepted and complied with, amount to a con-
tract within the protection of the impairment clause of the Federal
Constitution, and no other tax can be imposed on the corporation.
Powers v. Detroit & Grand Haven Ry., 543.
3. Contracts within impairment clause-Municipal ordinance extending fran-
chises of street railway companies.
Ordinances granting an extension to a consolidated street railway corpo-
ration, possessing franchises expiring at different times, on conditions
involving great expense to the corporation and resulting in substan-
tial benefits to the public as to transfers for single fares and relat-
ing to the entire system as well as the extensions granted, and providing
that the right granted terminate with the then existing grants of the
main line at a specified date later than that of termination of some of
the franchises, amount, on the acceptance by the company and com-
pliance with the conditions, to a contract within the protection of the
impairment clause of the Constitution extending the various fran-
chises to that date; the period, in this case of four years, not being an
unreasonable one in view of the substantial benefits accruing to the
public. Cleveland v. Cleveland Electric Ry., 529.
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