author: Campbell J. : Manning J.:

text:
    Tilden Ames and another v. The Port Huron Log Driving and Booming Company.
    No one without express authority of law can become a purchaser of property whioh it is his duty to sell for the best price it will bring.
    Unless in proceedings to collect the public revenue, no person can legally be divested of his property without remuneration or against his will, unless he is allowed a hearing before au impartial tribunal, where he may contest the claim set up against him, and be allowed to meet it on the law and the facts.
    The statute of 1855 for the formation of Rafting Companies (.Comp, Laws, Chy 66), in so far as it undertakes to authorize the companies formed under it, with' out any necessity arising from the obstruction of their own business, to assume* the control and management of the logs of unconsenting parties which are being floated on public waters, and to enforce compensation against the logs for thus controlling and managing them, is unconstitutional.
    1, It allows persons thus organizing to assume a police power over the waters used, and thus to exercise a public office without either an election or an.ap*. pointment.
    2. It deprives persons of their property without due process of law, since under the statute the corporation or its agents must of necessity determine when the case arises which justifies assuming such control, and the corporation afterwards assesses its own charges, and proceeds to sell the property to pay them, with the added expenses of sale.
    Error to St. Clair Circuit. The case is sufficiently -stated in the opinion of Justice Campbell.

      W. T. Mitchell and A. B. Maynard, for plaintiffs in error :
    1. The act under which the Port Huron Log Driving and Booming Company was organized, is unconstitutional and void.
    It is in derogation of common right. It assumes to give to any company, organized under its provisions, the power and right to take charge and control of any public Stream or waters within this State, and to bar all others of right thereto and therein. It is in conflict with Sec. 4, Art. 18 of the Constitution, which provides that “No navigable stream in this State shall be either abridged or dammed, without authority from the Board of Supervisors of the proper county, under the provisions of law. No such law shall prejudice the right of individuals to the free navigation of such streams.”
    The whole intent and scope of the -law is to give to any company, organized under it, the entire and absolute control of the stream they may choose to do business upon. The company is made the sole arbiter and judge of the manner the stream shall be used, what are obstructions, and when they shall be removed.
    And notwithstanding all its provisions to the contrary, it puts such company in the sole control of such stream, and ousts all others from its use and navigation. Such, at least, have been found to be its practical operations.
    It is unconstitutional and void also because a company organized under it may take the property of third persons, make assessments thereon, sell and dispose of the same, without trial by jury, and without due process of law.
    This power is contained in Sec. 6 of said act, which confers upon any such company the highest attribute of sovereignty — that of eminent domain — and the right to take property without any of the guarantees or formalities of the law of the land.

      No opportunity whatever is given to the party dispossessed, to show that there was no necessity for the company to render the services, or that the assessment was too much, erroneous, or invalid; but the company is permitted, in its own volition, to take and dispose of the property of others, without the least showing of occasion, and no provision for remedy or defense is made.
    The phrase “ due process of law,” can not mean less than a prosecution or suit, instituted and conducted according to prescribed forms and solemnities, for determining guilt or ascertaining title to property. The same measure of protection against legislative encroachment is extended to life, liberty and property; and if the latter can be taken without a forensic trial and judgment, there is no security for the others: — Sedw. on Stat. and Constl. Law, 534; 4 Hill, 140; 10 Yerg. 59; 4 Dev. 1; 2 Green (Iowa) 22; 6 Barr, 87; 16 Penn. R. 256; 4 McLean, 498; Blackwell on Tax Titles, 27, 34; 11 How. Pr. R. 289; 4 Mic 125; 2 Hen. & M. 336.
    These rights have been too long guaranteed to be now disputed or done away with, to sustain any doubtful aot of the Legislature, especially to sanction any privileges conferred on a corporation, the grants to which are always strictly interpreted, and taken most strongly against the grantees. Such companies can take nothing by implication : — Sedgw. Const. and Stat. Law, 338.
    The only instances in which the right of property can be transferred, without strictly complying with these constitutional restrictions, are in the cases of assessments and sales of property for taxes, or charges imposed upon property either by the State, in the exercise of its sover eignty, or of local (that is, municipal) corporations, clothed with certain attributes of sovereignty, and these exceptions have been sustained only on the ground of immemorial usage and state necessity. The exceptions and the reason for them are proof conclusive of the universality and force of the rule in all other cases.
    2. If the law could be held to be constitutional, the sale would still be void, for the company could not act as both buyer and seller at the same time: — 14 Pick. 356; 2 Mich. 192; Walk. Ch. 346; 1 Mason, 341; 1 Harr, 259; 2 Johns. Ch. 241.

      Conger & Harris, for defendants in error:
    The Supreme Court in the case of Moore v. Sanborn, 2 Mich. 519, decided clearly, and with great particularity,, the rights and liabilities of individuals and the public upon the navigable streams of the State — and especially those connected with the vast lumber operations on its. Waters.
    That this decision was supported by the authorities, and founded upon the nature and necessities of one of the most important interests to the public, has never been questioned.
    At the next session of Legislature thereafter, the law Under consideration was passed; and its provisions coincide with, and conform to, the decision in the case above cited. The Court held that, “the length and magnitude of many of our rivers, the occasions and necessities for their use, and the nature and character of our internal commerce, all require a liberal adaptation of those doctrines to our circumstances and wants, both as to capability of our streams for public use, and for the occasions of such use, entirely different, from, and in many respects altogether new, to those which concurred to establish the common law rule. And, we accordingly find that, in all the States, that rule has been enlarged so as to meet the condition and wants of the public, and the necessities of trade and commerce: ”— Citing 1 McLean, 530; 2 McLean, 376; 10 Johns. 237; 2 Fairf. 278; 3 N. H. 321; 31 Me. 9; Angon Waterc. 546, 550.

      We claim that the object, design and operation of this law, accords as well with the spirit of the decisions quoted, as with the Constitution. The company was not organized for the purpose of making money for its members, but to facilitate great public interests, in which plaintiffs and defendants were alike interested; and was for a general beneficial purpose to all log owners on the stream.
   Campbell J. :

The facts material to the decision of this case are briefly as follows: Plaintiffs bring suit to recover for certain logs purchased by them of the Black River Steam Mill Company. That company had let out to certain parties a contract for cutting, hauling, running and delivering the logs at their boom at or near the mouth .of the Black River. The defendants, who were organized in due form under Chapter 66 of the Compiled Laws, assumed to exercise their functions over the main portion of the river over which these logs were to be floated. The contractors referred to did not make adequate provision for running the logs under their contracts. The amount of logs they contracted to deliver was two million feet, and there had been placed in the river, including this, sixty million feet belonging, except as above, to other owners. Defendants undertook and claimed to control all this lumber under the statute.. Jams and obstructions were caused from time to time by the accumulation of logs which filled the Stream-Defendants without the consent of any one assumed control of the logs of the plaintiffs, and run them down and delivered them at the boom, where they were run in by the owners or their employees or contractors. Defendants took from the boom logs enough to satisfy their claim for services, and advertised and sold them under the statute, and bid them in. The amount of their claim for expenses was made up by assessing the whole expenses of the company pro rata upon all the logs, including the office and incidental expenses of the company, a sum paid for the transportation by land of a large amount of logs of other persons to avoid crowding the stream, and an amount paid a dam owner for flooding the stream to aid in floating down the logs in it.

This statement will suffice to explain the points arising in the case, as far as we deem them material for that purpose.

Inasmuch as the control of the logs of the Black River Steam Mill Company was put in the hands of their contractors, there is no room for any contract relation between plaintiffs and defendants; and the proceedings and claims of the latter depend for their validity entirely upon the statute under which they assume to act. And we deem it proper, in consideration of the necessity which seems to exist of having the rights of the numerous parties concerned understood as far as may be, to pass upon the principal questions discussed in the case and presented by the exceptions.?

The defendants became purchasers at their own sale. This was clearly illegal. The statute does not authorize it; and it is a settled doctrine in this State that no one can, without express authority of law, become a purchaser of property which it is his duty to sell for the best price it will bring. The duties of a seller can not be permitted to be affected by the interest of a buyer; and our courts have adopted the rigid rule of avoiding all such sales absolutely: — Dwight v. Blackmar, 2 Mich. 330; Clute v. Barron, 2 Mich. 192.

It was also claimed on the hearing that if defendants ever had any valid lien they lost it by delivery of the logs. The facts are not clear on this point, and we therefore abstain from deciding whether such a delivery would or would not be a relinquishment of any of the rights which the statute was designed to secure.

The principal inquiry we are called upon to enter into relates to the' authority of such companies to assume control over logs of unconsenting parties, and to enforce compensation against the logs for thus controlling and managing them. As the exercise of such privileges is resisted upon grounds of constitutional immunity, it becomes necessary to understand in the outset precisely what condition such companies are placed in by the statute, and by other rules of law bearing upon the question.

It was decided in Moore v. Sanborn, 2 Mich. 519, that there was a common right of floatage in all streams susceptible of valuable use for lumbering. The statute under which the defendants were incorporated recognizes and attempts to secure this right. There can be no doubt of the fact, which indeed is apparent from the case before us, that there are many streams which are incapable of furnishing a commodious passage for all the lumber in their vicinity, and that in the attempt to crowd them to their utmost capacity, it is difficult if not impossible to insure the safe transit of logs without some general concert of action in keeping the stream open and clear of jams and obstructions. The statute however has not undertaken to regulate the use of any stream by uniform rules of priority or conduct; neither has it given to any person or company any monopoly, partial or total, in its enjoyment.

It authorizes any number of persons not less than five, to organize into a company, requiring them in their articles to show on what waters they design to carry on their operations. Any person who has logs to be run on those waters is entitled to become a member, and to have his logs run at a ratable proportion of the company expenses, and to have a longer notice previous to any sale for charges than strangers. The company is empowered to contract with those who are not members for the same work. The statute does not prohibit the creation of more companies than one to transact business on the same waters. We have heretofore, on a former hearing of these eases, decided that there is no constitutional objection to so much of the statute as allows companies to organize and enter into contracts: — Ames v. Port Huron Log Driving and Booming Company, 6 Mich. 266. The present controversy arises out of the part of the law which assumes to give rights not arising out of contract.

The sixth section provides that whenever any. person puts logs or lumber into such waters without providing adequate force and means for breaking rollways and jams, or running, driving, booming, rafting, securing or clearing the banks of the same, and shall thereby obstruct the navigation or clearing the banks, such company may cause the rollways or jams to be broken, and the lumber to be run, driven, boomed, rafted, secured, or cleared from the banks, at the owner’s expense, and shall have a lien on so much thereof as shall be sufficient to satisfy all just and. reasonable charges proportioned to their amount and the expenses of running and securing the same, with power to sell for these charges and for the expenses of sale, on ten days notice personally served, or posted in three places in the town where the lumber is held, and a like notice in the company’s office, 'describing the property by its marks and supposed ownership, and specifying the amount of their claim. A longer notice is given where log owners have filed a description of their log-marks in the office ; but it is to be given in the same way.

These companies, which can be formed by any persons at their option, and which require no intervention or approval of any public authority, are authorized by this act to exercise some very important prerogatives. Their powers, if valid, may be carried out without any necessity arising from the obstruction of their own business. The law permits them, whenever the stream is obstructed by logs or lumber not adequately manned, to assume possession and manage and control it entirely, and collect their own charges out of the proceeds of a sale in the mode referred to above. This renders them a species of river police, with power, not only to render help at the owner’s, expense so long as the obstruction continues, but also to absolutely deprive him, upon the first obstruction, of any further possession or management of his own property. Such a power bears no resemblance to that of persons who are obstructed in the exercise of their right of passage to remove a public nuisance which affects them individually, and must be abated before they can enjoy their own legal privileges. If the aggrieved party has á claim for expenses incurred in moving other property to forward his own, such a claim rests therefore on principles of its own, and if valid derives its validity from the circumstances which rendered the labor expended necessary. Those circumstances would not justify him in excluding the owner from aiding in the work, or in any interference beyond the fair exigencies of the case. A power of control over property, such as is set up and claimed by the corporation before us, depends for its validity entirely upon the statute. .

We are met therefore, at once, by the question whether, on a stream open to all persons, the' law can authorize a voluntary organization of persons, whether citizens or aliens, who may choose to assume a corporate character, to control, or authorize their servants and agents to control the property of those who are lawfully entitled to free navigation.

It is difficult to perceive by what process a public office can be obtained or exercised without either election or appointment. The powers of government are parcelled out by the Constitution, which certainly contemplates some official responsibility. Every officer not expressly exempted is required to take an oath of office as a preliminary to discharging his duties. It is absurd to suppose that any official power can exist in any person by Ms own assump-tion, or by the employment of some other private person; and still more so, to recognize in such an assumption a power of depriving individuals of their property. Such claims are inconsistent with any idea of government whatever. And it is plain that the exercise of such a power is an act in its nature public and not private.

The case, however, involves more than the assumption "of control. The corporation, or rather its various agents, must of necessity determine when the case arises justifying interference, and, having assumed possession, it assesses its own charges, and having assessed them proceeds to sell the property seized to pay them, with the added expenses of such sale. These proceedings are all ex parte, and are all proceedings in invitum. Their validity must therefore be determined by the rules applicable to such cases.

Except in those cases where proceedings to collect the public revenue may stand upon a peculiar footing of their own, it is an inflexible principle of constitutional right that no person can legally be divested of his property without remuneration, or against his will, unless he is allowed a hearing before an impartial tribunal, where he may contest the claim set up against him, and be allowed to meet it on the law and the facts. When his property is wanted in specie for public purposes, there are methods assured to him whereby its value can be ascertained. Where a debt or penalty or forfeiture may be set up against him, the determination of his liability becomes a judicial question, and all judicial functions are required by the Constitution to be exercised by courts of justice or judicial officer's regularly chosen. He can only be reached through the forms of law upon a regular hearing, unless he has by contract referred the matter to another mode ■of determination.

When a company proceeds under this statute to take charge of logs in the stream, several questions of a judi■cial nature present themselves. The principal are, first whether the circumstances exist which give the right of interference with the property in the stream; second, whether the company actually assumed charge of it, and safely and diligently moved and delivered it; and third, what was the legitimate expense of performing the services. All of these involve questions of fact, upon which there might easily be conflicting testimony. A party whom it is sought to charge has a right to have these questions of fact settled, before he can be compelled to pay such demands, or to have his property sold to satisfy them. If such a case does not come within the familiar constitutional rules, which assure to every one the right to due process of law, which preserve the right of trial by jury, and which vest judicial powers in stable hands, it would be difficult to find any meaning in those maxims. They have been so frequently and uniformly applied in cases like this that a citation of adjudged cases appears a useless ceremony. No case can be found anywhere, which would remove these questions from judicial cognizance.

The statute under which the company defendant 1 was incorporated not only makes all proceedings ex parte, but makes the company judge in its own cause, and empowers it to execute its own judgments. Such a proceeding is too plainly illegal to admit of an extended argument.

The judgment below should be reversed, and judgment rendered on the finding for plaintiffs, for nominal damages, with costs of both courts.

Martin Ch. J. and Christiancy J. concurred.

Manning J.:

I concur in a reversal of the judgment on the ground first stated in the opinion of my brother Campbell. The statute does not authorize the company to purchase at its own sale.

As this disposes of the case I should prefer to say nothing on the constitutional question. But as my brother Campbell has given an opinion concurred in by my brother Christiancy and the Chief Justice, holding that part of ■ the statute unconstitutional which for all practical purposes gives vitality and life to companies organized under the act, in which I can not concur, I feel bound to state my reasons for differing with them on so important a question.

It is important in the investigation of all questions, if we would arrive at the truth, to occupy a stand point from which every part of the ease may be seen, and appreciated.

State constitutions (it is different with the Federal Constitution, which in some respects resembles our State constitutions and in others not) are a limitation on, and not a grant of legislative powers. Hence, when the constitutionality of a statute is called in question, we look to the Constitution not for the power of the Legislature but for its negation. The question is, have the people by their Constitution withheld the power from the Legislature? This is the only question. Want of power is not to be presumed. It must appear from the language of the Constitution itself, or be clearly inferred from its several parts and general structure. But it is not to be inferred from 'the inexpediency or hardship of the law; for expediency is an element in the enactment of all laws, of which the Legislature is the sole judge.

In construing a statute, it is the duty of the Court, if possible, to give such a construction to it as will bring it within the Constitution, and not one that will make it void.

With these principles in view, I will proceed to give my reasons for holding the act in question constitutional.

t The act provides for the incorporation of companies, consisting of five or more pérsons, for running, driving, booming and rafting of logs, timber and lumber, on the navigable waters of the State. Many of our streams are small and navigable only for floating logs. And for this they are inadequate to the wants of the community, and can not be used to their full capacity, unless each person attends to his own logs in such a way as to prevent them of themselves, or in connection with the logs of others, from forming jams or obstructions in the stream. To secure such attention the act was passed, permitting persons running logs to form themselves into companies, and securing to every person having logs to run a right to become a member upon application, by signing the articles of the company, and paying his just proportion of the expense of managing and conducting its affairs: — Comp. L. §1941. No exclusive privileges are given by the act. Rival companies may be formed. And the common law rights of individuals to run logs are expressly reserved.

The next section (§1942), which contains all the provisions of the act obnoxious to the constitutional objection, is in these words:

“If any person or persons shall put, or'cause to be put, into said stream or waters any logs, timber or lumber, and shall not make adequate provision, and put on sufficient force for breaking rollways and jams of such logs, timber or lumber, in or upon such stream or waters, or for running, driving, booming, rafting, securing, or clearing the banks of the same, and thereby obstruct the floatage or navigation, or clearing the banks of such stream or waters, it shall be lawful for said company to cause such rollways or jams to be broken, and such logs, timber or lumber to be run, driven, boomed, rafted, secured or cleared from the banks of such stream or waters, at the charge and expense of the person or persons owning said logs, timber or lumber; and said company shall have a lien upon such quantity of said logs, timber or lumber, as shall be sufficient to pay and satisfy all just and reasonable charges against the same, proportionate to their number, quantity, and the expense of running and securing the same as aforesaid, and may sell at public action, on not less than ten days notice, either personally served upon such owner, or posted in three or more conspicuous places in the township where such logs are held; and in either case, by posting a like notice in the office of said company, of the mark,, description, and supposed owner of such logs, timber or lumber, and the amount of the. charges for which the same is to be sold, a sufficient quantity of such logs., timber or lumbei-, to satisfy such claim, charges or demands, with the expense of such sale.” See also the next section (1943). as to lien and compensation.

To authorize the company to take possession of the logs of another two things must concur: 1st. The company must be obstructed by such logs, in running its own logs; 2d.. The owner or person running such logs, must have neglected to put on sufficient force to run them. I think this the-only construction that can fairly be given to this section, when we look to the whole act, in connection with its title, which is,.. “An act to provide for the formation of companies for running, driving, booming and rafting logs, timber and lumber, and for regulating the floatage thereof.” But, suppose it susceptible of a different construction, that would make it unconstitutional; that construction should be adopted that will give effect to the statute in preference to. one that will make it void.

If I am correct in my construction of the statute, there-is no ground for saying the act is for the voluntary formation of companies to exercise poli&e powers over navigable streams; and hence there is no occasion for discussing the constitutionality of such an act. Private rights are all it. attempts to define and regulate. And what are those-rights ?

The obstruction of a navigable stream, without authority of law, is a nuisance, which any person rightfully navigating the stream and injured thereby may remove. The company would have had a right to remove obstructions. that interfered with the prosecution of its business, had no such power been given to it by the act. Any person, stopped in the highway by a nuisance, may remove it so as to permit him to pass. But he can not take possession of the thing that formed the nuisance, and carry it with him, and retain possession of it until he is compensated by the owner for the labor and trouble it has given him. His only remedy for the detention it has occasioned him and for removing it, is an action on the case. So it would be with defendant, but for the additional remedy given the company by the ■act under which it was organized. The reason for this new remedy is obvious. The use of streams for floating logs is all in one direction. It is down stream. And when no one attends the logs to keep them in the current, they run aground or against the banks of the stream, and becoming entangled form obstructions to navigation. To® break these, the logs have got to be freed from their entanglement, and to be sent floating down the stream to form new obstructions lower down, if no one is sent with 'them, to be in their turn removed by the impeded navi, gator. In the case of a highway the obstruction may be removed from the beaten track to one side of the road, and the traveller pursue his journey without further molestation. When once rid of the nuisance.he has nothing further to apprehend from it. It is not ambulatory. It does not go before him to block up his path anew. And he is not under the necessity of carrying it with him, or causing it to precede him to get rid of.the evil. Hence the neces, sity for this new remedy and its reasonableness, and the duty of the Court to give it full force and effect.

I see nothing in it injuriously affecting the rights of individuals. If one puts on sufficient force to run his own logs, the company - can under no circumstances take possession of them under the act. And if he neglects this it is not right that he should have his logs run at the expense of the company, who must run them in order to run its own.

Neither do I see any thing of an official character in the exercise by the company of the powers conferred upon it. Is the distraining of cattle found trespassing upon the land of another an official act? Is a distress for rent an official act ? There is nothing whatever of an official character in either. They are the exercise of private rights, nothing more; as the taking possession of an estate that has been forfeited is a private and not an official act. Nor is there any thing judicial in either, for the act of the party does not determine his right, which may afterwards be inquired into and determined by a court of competent jurisdiction. It is not necessary to impannel a jury to ^lecide on the trespass, or the amount of rent due, before making the distress, or the forfeiture before taking possession of the thing forfeited. Neither is it necessary, at each successive step» in the accrual of the company’s rights under the act, that a judicial investigation should take place. The whole case is open in all its parts to judicial inquiry when any one claiming in opposition to the company thinks proper to contest its rights. Until this judicial investigation is taken away by the Legislature, or attempted to be, there is no ground for saying the company decides judicially on its own rights; or that the plaintiffs are deprived of their property without the forms of law, oían opportunity of being heard in a court of justice.

The policy of statutory laws is with the Legislature in all cases. It is not confined to acts for the collection of revenue. I know of no constitutional provision placing revenue laws, in this respect, on a different footing from other statutory laws. When the constitutionality of such laws have been questioned, courts have sometimes spoken of them as revenue laws, not because of any exception in the Constitution in favor of such laws, but as a reason for their apparent harshness or severity. Courts may ingraft exceptions on common law rules, because such rules originate with themselves; but I know of no power in the judiciary to interpolate constitutional exceptions. I will not say it may not have been done in some cases, but never I think, under a claim of right ■ in the court to do it.

The act has taken from plaintiffs in error the. most plausible pretext that could be urged against suoh a law, viz: that the company determines arbitrarily and on no fixed principle its own compensation. This would not be the case if the act was silent on that point. The company’s-compensation would be whatever it was proved to be worth to run the logs. But the act provides that the plaintiffs in error shall pay what the members of the company pay, and no more. The expenses of the company are assessed pro rata on all the logs run by it, whether they belong to a member of the company or to one who Is not a member.

Judgment reversed.

      At the same time with the foregoing was decided the cose of Jolm Beard and another v. The Port Huron Zog Driving and Booming Company, Id which the following opinion was delivered:
      Campbell J.: This was an action of assumpsit, and as we have decided [in Ames v. the same defendants, 6 Mick. 266], that these companies can make contracts, there is no objection to the use of that form of action. But the case was put to the jury in such a way as to involve the same questions
      raised in Ames against the same de. fendants. For this reason the judgment should be reversed and a new trial granted. As the evidence itself is not given, it is somewhat difficult to determine precisely the extent to which the other rulings were applicable, and* we therefore do not pass upon themr or undertake to decide how • far any inference of a contract relation between the parties could be justified.
      The other Justices concurred.


source: Caselaw Access Project

author: Christiancy J.: Manning J.: Campbell J.:

license: Public Domain

text:
    James F. Joy and others v. The Jackson and Michigan Plank Road Company and others.
    Sureties who have undertaken, not for the payment of the mortgage debt, but that the mortgagor shall provide a sinking fund in certain specific securities for its payment, cannot he joined as defendants in a suit to foreclose the mortgage, under §3567 of the Compiled Laws.

      A special law, authorising a plank road company to mortgage its road, is not in conflict with the constitutional provision prohibiting the Legislature from authorising the sale of any real estate of any person by private or special law.
    Such special law is to be regarded as an amendment of the company’s charter.
    An amendment to a charter of incorporation, which is merely auxiliary to the original object of the charter, and intended only to facilitate its attainment, is binding upon all tho stockholders when accepted by a majority thereof. And a vote of the stockholders, directing action to be taken under such amendment, constitutes acceptance.
    An amendment to the charter of a plank road company, authorizing it to mortgage its corporate property, to raise money for the completion of its road, is an amendment which may be thus accepted by a majority.
    Under a special act, empowering a plank road company to “mortgage the road and other property of tho company,” the franchise of taking toll is to be understood as included with the road and its fixtures.
    But the company could not, under this power, mortgage any franchise essentially corporate in its character, and which could not be eDjoyed by a natural person.
    The authority to mortgage is to be understood as authorising the ordinary power of sale to be inserted in the mortgage.
    Under an authority to mortgage the whole road, the company might give a valid mortgage on any specific portion of it, upon which separate tolls can lawfully be collected.
    Tho power of corporations, at common law, to sell or mortgage their corporate property and franchises considered, per Cheistianoy J.

      Heard November 19th and 20th, 1862.

      Decided January 13th.

    Appeal in Chancery from. Jackson Circuit.
    The Jackson and Michigan Plank Road Company was incorporated April 3, 1848, for the purpose of constructing a plank road from Jackson to Michigan, now Lansiüg. On September 1, 1851, this company, for the purpose of providing means for the construction and completion of their road, buildings and equipments, in pursuance of an act of the Legislature supplementary to their act of incorporation, approved April 3, 1851, and which had been accepted by a vote of the' directors, and in pursuance of another vote of the directors, with the approval of a majority of the stockholders, given at a meeting called for the purpose, issued bonds to the amount of $15,000, payable in 1856, 1857 and 1858, with semi-annual interest at ten per cent., at the Michigan Insurance Bank at Detroit; in which bonds the complainants in this suit are named as obligees. As collateral to these bonds, the company at the same time, under the authority of the said supplementary act, executed to the complainants as trustees for the persons who should become the holders of said bonds, a mortgage “ of all that parcel of the plank road of the Jackson and Michigan Plank Road Company, now constructed and hereafter to be constructed, in and extending from the village of Jackson, in the county of Jackson, to and in the village of Eaton Rapids, in the county of Eaton, together with all the toll-houses, gates, and all other fixtures and erections and appurtenancés of every name and kind thereto belonging or in anywise appertaining, together with all the franchises and rights of the said Jackson and Michigan Plank Road Company therein and thereto-.” A condition, among others, was inserted in the mortgage, that the company should provide and pay to complainants a sinking fund for the payment of the said principal sum of $15,000, of eight per cent, per annum, to be invested by the trustees; first, in buying the bonds of the company;-or, secondly, the bonds of the Michigan Central Railroad Company; or, thirdly, the stock of the United States, New York, Massachusetts, Ohio, or the cities of Boston or New York, as the directors of the Plank Road Company might designate; or, in case they did not designate, as the trustees might deem expedient. The mortgage contained the usual power of sale of real estate mortgages.
    Simultaneously with the execution of this mortgage, John Sumner, Daniel B. Hibbard, and a number of other persons, executed a bond to said trustees, in the penal sum of $20,000, reciting the said mortgage and its terms; and conditioned that if the Plank Road Company should pay all the liabilities of the company then existing, or which might thereafter exist, and constituting a lien or encumbrance upon the road mortgaged, by virtue of the act under which it was given, or any subsequent law, and should keep the road free and clear of all such liens and encumbrances, so that there should be at no time any lien or encumbrance prior to said mortgage, and provide and pay to said trustees such a sinking fund as was specified in the condition of the mortgage, then the bond was to be void, otherwise of force.
    The bonds of the company so issued were negotiated, and $6,500 thereof not having been paid by the company at maturity, or a sinking fund provided therefor, complainants filed their bill against the company to foreclose the said mortgage, and joined thereto as parties defendants the surviving obligors in the collateral bond (several of them having deceased), praying the usual decree of foreclosure, and decree against said surviving obligors for any deficiency. A portion of the obligors in the collateral bond did not appear, and the bill was taken as confessed by them.
    The others, as well as the Plank Road Company, demurred to the bill, but the demurrer was overruled, and they afterwards answered, and the case was heard on pleadings and proofs.
    It was shown in the case that the estates of the deceased obligors were solvent.
    The Circuit Court in Chancery made decree as prayed, for the sale. of “ all and singular that parcel of the plank road of the Jackson and Michigan Plank Road Company, now (at the date of said mortgage) constructed and hereafter (after the date of said mortgage) constructed, in and extending from the village (now city) of Jackson, in the county of Jackson, to and in the village of Eaton Rapids, in the county of Eaton and State of Michigan, together with all the toll-houses, gates, and all other fixtures and erections and appurtenances, of every nature and kind thereto belonging or in anywise appertaining; together with all the franchises and rights of the said Jackson and Michigan Plank Road Company therein and thereto.” And decree was also made against the sureties in the collateral bond for the payment of any deficiency. The defendants appealed.

      Johnson & Higby, for complainants:
    1. The representatives of the deceased obligors in the collateral bond were not necessary parties. The statute authorizes the sureties to be joined in the foreclosure suit. Comp. L. §3567. The representatives do not come within .the description of the act. Payment by them could not be enforced as provided by the act, for an execution against an executor or administrator is expressly prohibited. Nor is the representative liable to be sued for a debt founded on contract. We submit that the intention of the statute is obvious, to give us the same remedy in these proceedings as we have in a court of law. Without the statute we could foreclose the mortgage' and sue the surviving sureties in a court of law, and have execution for the balance; with the statute we can do it all in this Court.
    But, independent of the statute, what are the reasons for making those representatives parties? If there are any, they must be on their account or on account of some of the other defendants. One reason assigned in the authorities is, that all the parties interested should be before the Court to aid in establishing or resisting the claim, or in taking an account, though they are not directly affected, by the decree.— 1 Johns. Ch. 437. There can be no pretence that the representatives are necessary parties for either of these purposes. Another reason for making joint obligors parties is to avoid the necessity of another suit for contribution.— Ventris, 348, note; 3 Atk. 405; 16 Ves. 321, note. This is the only reason that can exist in this suit. To effect contribution, if it can be effected in this manner, we must examine into the condition of these estates, and if they are found to be settled, then it becomes necessary that the legatees and devisees, and heirs at law, should also be made parties; and in ease of their decease,, then their representatives must be brought in. Will the-Court of Chancery enforce contribution under such circumstances ? By statute, creditors must present their claims, for proof within a given time, which may be enlarged by the Probate Court before the final settlement of the estate. If chancery has the power afterwards, we submit it must be an extraordinary case that would induce its exercise.
    The question of parties is one addressing itself to the-discretion of the Court, and will be governed by considerations of convenience: 9 Cow. 329; 1 Johns. Ch. 437; 10 Wheat, 152; 2. Mason, 181; 11 Ves. 429, note; Ib. 365, note; 16 Ves. 321, note.

      Lastly. The Court will not enforce contribution against the estates of deceased co-sureties. — 2 H. & Gill, 305; 1 Pars, on Cont. 32, note, 2.
    2. The objection that the sureties cannot be made parties, because their .obligation is not co-extensive with that of the principal, we submit upon the authority of Jones v. Steinbergh, 1 Barb. Ch. R. 250.
    3. The act of 1851 is not unconstitutional. In the first place, it was not necessary to enable the corporation to. give the mortgage. Private cor-porations, at common law, have the right of alienation, unless specially restrained by their charter or by statute. — 2 Kent, 281; A. & A. on Corp. 104; 1 Cow. 513; 3 Wend. 96; 5 Wend. 590; 2 Hill, 265; 9 Paige, 470; 1 Sand. Ch. 280. But if we must rely upon the act of 1851, it is not open to the objection made. The mischief the constitutional provivision referred to (Art. 4, §23) was designed to prevent,, was the great expense incurred in special legislation, and the rank injustice sometimes done to parties interested.Guardians, trustees and even administrators, were continually in the practice of making application to the Legisla'ture for power to sell, under the plausible pretence of' saving expense, while, in most instances, some ulterior-object was tbe moving cause. Tbe constitutional provision was intended to compel all these applications to be made before the proper tribunal, where all parties could be heard, and the rights of all protected.
    4. The mortgage is not invalid because not covering the whole road. How much it conveys is a question between the purchaser and the mortgagor. The mortgagor was competent to make it; and he is estopped from saying that he has no title to the property described, or that his description is imperfect.— Wanzer v. Blanchard, 3 Mich. 11.

      E. Pringle & C. I. Walker, for defendants:
    1. Without the aid of clear provisions of statute, a corporation of this kind has no right to mortgage or sell its road and franchise. The franchise was conferred for a public purpose, and the road is a public highway, subject to the franchise right of the corporation to take toll. The road and the franchise cannot, from their very nature, be separated. — 32 N. H. 484; Pierce on Railw. 397, 403, 514; Redf. on Railr. §235. It is true that corporations of a merely private character, like banks, &c., may convey all their property; but even such a corporation cannot transfer a franchise. And the property conveyed is not essential to the exercise of the franchise. — 7 Gray, 393; Town v. Bank of River Raisin, 2 Doug. Mich. 530.
    2. The act of 1851, conferring the special authority in this case, is in conflict with §23 of Art. 4 of the Constitution. — 5 Ibid. 4.
    3. The act was never accepted by the company. Acceptance by the directors was not sufficient. — 13 Penn. 81, 135.
    4. The mortgage given was unauthorized by the act. The road authorized to be mortgaged was the whole road authorized to be constructed. The road is a unit — an entirety — and the mortgage of a part was clearly unauthorized. And if the act authorized the mortgage of the-franchise, it is the whole franchise; for, from its very nature, it is indivisible. — 3 Green, Ch. 402; 25 Barb. 308; 32 N. H. 484. The company executing the mortgage are not estopped from setting up the illegality. — Redf. on Rail. 236.
    5. The obligors in the collateral bond are not proper parties to the bill under Comp. L. §3567. Their undertaking is not to pay the debt; it is entirely collateral.
    6. But if they were proper parties, then the representatives of the deceased obligors should have been joined. — Calvert on Parties, p. 234; 1 Dan. Ch. Pr. 316; Story Eq. Pl. §§138, 139; Edw. on Parties, 99; 2 Vern. 194 & note; 3 Atk. 406; 3 Swanst. 147 & note; 16 Ves. 326; 1 Sim. & Stu. 247; 3 G. & J. 499; 2 Edw. Ch. 392; 5 Paige, 505. The exceptions to the rule are clearly de finded, and none of them exist in this case.
    It is suggested, that as no execution can issue against administrators (Comp. L. §2975 ), they cannot be made parties to a bill where the decree must be enforced by execution. But, 1. Our statute only applies to cases where commissioners are appointed; and, 2. The provision does not apply to proceedings in a court of equity, but to '‘actions” at law. —10 Paige, 516.
   Christiancy J.:

We are all agreed that the obligors in the collateral bond were improperly made parties defendant, and that the bill, as to them, must be dismissed with costs against the complainants.

It is admitted that, but for the statute — Comp. L. §3567 — they could not be joined in a foreclosure bill upon this mortgage. We do not think the statute can be fairly construed as extending to an undertaking like the present, which is not for the payment of the debt or any part of it, but entirely collateral — that the company should (among other collateral matters) provide a sinking fund equal to eight per cent, per year of the sum loaned, to be invested by the trustees in bonds of tbe company or in certain specified stocks. The obligation of the makers of this bond would be discharged the moment the bonds or stocks were paid over into the sinking fund; yet the debt might remain entirely unpaid. Should the stock be lost or stolen, or become depreciated, this would not affect them. Their undertaking was purely collateral, and to be enforced by suit at law.

It is objected that the bill cannot be maintained against the company, for the following reasons:

I. That the company had not the right, under the general powers contained in its charter, and without a special provision of statute to that effect, to mortgage its road and franchises; its powers being conferred for a public purpose, which might be defeated by sale under a mortgage; and that the mortgage cannot, therefore, be maintained without the aid of the special act of 1851.

II. That it cannot be sustained under the act of 1851: because, 1st. The act conflicts with section 23 of article IV. of the Constitution, which prohibits the Legislature from authorising “by private or special law, the sale or conveyance of any real estate belonging to any person.” 2nd. Because the act was never duly accepted by the corn» pany. 3rd. If the act be constitutional, and its acceptance sufficient, it will not sustain the mortgage in this case; because the act only authorized a mortgage “ of the road or other property of said company;” which, it is insisted, must mean the entire road authorized by the charter to be 'Constructed, while that covered by the mortgage is only a part of the road so authorized; and if the act authorizes a mortgage of the franchise of the company at all, then it must be for the whole franchise, because it is in its nature indivisible. We will consider these objections in their order.

I. Can this mortgage be sustained and enforced to any, and if so, to what, extent, without the aid of the special act of 1851 ?

On the argument "of this cause, this question, so far as it relates to the franchises of the coloration, was treated as if all the rights and powers conferred by the charter constituted but one entire franchise, which in its nature must be indivisible, no part of which could be assigned or mortgaged without the whole. I do not think this the true view of the subject. But all the several rights and powers conferred by the charter, may, I think, be treated as so many different franchises, some of which are essentialj to the existence of the corporation, while others are not. Those which are essentially ^ corporate franchises, without which the corporation could not exist, and which are, in their nature, incapable of being vested in, or enjoyed by, a natural person- — -such as the right or franchise of being a corporation, of having corporate succession, &c.— cannot be made the subject of sale or transfer, without a positive provision of statute, giving the^ authority and pointing out some mode in which such transfer may be effected: as this would be allowing the corporation “to transfer its corporate existence into another body”— to create a new corporation, which is an act of the sovereign power only to be performed by the Legislature-The franchise, also, of taking private property for the use of a road, though not perhajjs necessarily a corporate right, yet being an exercise of the right of eminent domain, and to be exercised only by the officers, and in the manner specified in the charter, may also require positive legislative authority for its transfer. — See Pierce on Railr. 516, 517 & 518. — See also Opinion of Judge Curtis, in Hall v. Sullivan R. R. Co., given at length in a note to the same work, p. 520, et. seq., and in Redf. on Railw. p. 578, et seq. “But” (says J. Curtis in the case' last cited) “the franchises to build, own and manage a railroad, and to take tolls thereon, are not necessarily corporate rights: they are capable of existing and being enjoyed by natural persons, and there is nothing in their nature inconsistent with their being assignable. — See Redf. on Railw. pp. 573 to 589, where this whole subject is discussed.

As a general rule, corporations may, I think, be said to have an incidental power to dispose of their property, real and personal, either by sale absolute, or by mortgage or other mode of security, for any debt which they may rightfully contract, to the same extent as natural persons, except so far as that power may be restrained by their charter, by considerations connected with the purposes of their creation, or limited by express provision or just implication of some statute, or by the general policy of the State to be deduced from its legislation. — A. & A. on Corp. §§187, 191; Pierce on Railr. 513, 514, and cases cited; 2 Kent, 281; Barry v. Merch. Exch. Co., 1 Sandf. Ch. 280.

Certain franchises — such (among others) as that of keeping a fair, a market, or a ferry, and taking tolls — have generally been recognized as property, and when vested in individuals, at least, proper subjects of transfer and mortgage. — Com. Dig. Title “ Grant, C.; Powell on Mort. 17 (b); Coote on Mort. 101; Hilliard on Mort. Ch. 1, §4; Pierce on Railr. 518, note 2, and cases cited. The franchise of maintaining a plank road and taking tolls is not necessarily a corporate franchise, more than that of a ferry. And it is difficult to discover any substantial reason why one should be held a proper subject of sale and mortgage and not the other. If public confidence is reposed in a plank road corporation, and there is an implied obligation on its part to afford the proposed • public accommodation, these considerations .would seem to apply with equal force to the legislative grantee of a ferry franchise: and if a transfer by mortgage of the franchise of taking tolls is to be prohibited in the one case, lest it might disable the original grantees from performing their duties to the public, it is difficult to see why the same considerations do not equally apply to the other; and if a purchaser or assignee may perform those duties in the one case, why not in the other. — Bowman v. Wathen, 2 McLean, 376; and see Felton v. Deall, 22 Vt. 170; Trustees of Maysville v. Boon; 2 J. J. Marsh, 224; Phillips v. Bloomington, 1 Green (Iowa) 498 ; McCawley v. Given, 1 Dana, 261; Biggs v. Ferrell, 12 Ired. 1. The reasons against allowing such a transfer in the case of a railroad corporation would be stronger than in the case of a plank road, as more special guards are required for the protection of the public interest.

In Enders v. Board of Public Works, 1 Graft. 364, a dock company, whose charter declared the dock to be a public highway, was held to have the power to mortgage its dock, though the power was contested as conflicting with its duties to the public: and see Central Bridge Corp. v. Bailey, 8 Cush. 319. In Allen v. Montgomery Railr. Co. 11 Ala. 437, it was held that, upon general principles, a railroad company had the power to mortgage its property in such a manner as to transfer the beneficial use of its franchise for the benefit of creditors, and that a special power for that purpose in the charter did not abridge the general power; and see Mobile & Cedar Point Railway v. Talman, 15 Ala. 472.

“ The proposition” (says Mr. Pierce, in his able work on Railroads, p. 516), “that a corporation cannot perform acts as to its property which will disable it from performing its public duty, if admitted at all,, must be confined to a very limited operation; so limited as to make the proposition itself doubtful;” and he gives some pertinent reasons for this view; yet there are, doubtless, . many species of corporations as to which such considerations should be allowed to limit, if not to prohibit, the power of such transfer. But there are many cases where the public object for which the charter was granted would be promoted rather han orejudiced by a mortgage. The corporators or stockholders may not have the pecuniary ability to achieve the enterprise, while the necessary funds might be readily raised on the security of a mortgage; and the enterprise completed: and, for similar reasons, it cannot, in ordinary cases, necessarily follow that the public would be injured by a sale of the property on foreclosure — such as the road and toll houses of a plank road company, and the right to receive tolls — as the stockholders may be insolvent, or unable to perform their obligations to the public, while the purchaser is both able and willing to do it. And the purchaser on foreclosure sale must doubtless take the property and franchises, subject to the performance of substantially the same public duties, which would attach to the ownership or control of the property in the hands of the corporation. Whether any, or what, qualifications ought to be attached to this proposition in any particular case, it is not necessary here to decide. But unless it can be made clearly apparent to the court, that the necessary, or' at least the natural and probable result, of giving a mortgage or of a sale under it would be such as must defeat the public object, or injuriously affect the public interest, the mortgage cannot be pronounced illegal: and if not strictly an illegal contract, then it is difficult to perceive any satisfactory ground upon which the corporation can be allowed to set up the public interest in defeasance of its own solemn deed, after having obtained the money on the faith of it. It is a question between the mortgagee or purchaser, on the one hand, and the public on the other, with which the corporation have no concern. The state may choose to waive, or insist upon its rights. Central Bridge Corporation v. Bailey, 8 Cush. 323.

I am aware of no provision of the statute or of the charter, which either expressly or by just implication, can be fairly construed as prohibiting a plank road company from mortgaging their road and fixtures, with the franchise of taking tolls; nor was any such provision cited or relied upon in the - argument. There are some special duties imposed upon the company, to he performed by its officers (especially in the 9th and 18th sections of the general act of 1848), which might raise some difficult questions if the road, and the right of receiving the tolls, should come into the hands of a purchaser on foreclosure sale; but they are the same questions (and no others) which would arise in case of a sale on execution, And this brings us to the question of. the public policy of the State, in reference to the sale of a franchise vested in a corporation.

If the State had adopted a policy calculated to prohibit, or had failed to provide for, a sale on execution, of the franchise of taking tolls against plank roads and similar corporations, this would be a strong argument against the power to dispose of the same by mortgage: but if'the State has waived, for the benefit of creditors, the injury •which might result to the public by a transfer under execution, then in the absence of any prohibition against mortgaging, I am at a loss to discover upon what ground it can .be held that a mortgage of the same property should not be held valid and to authorize a sale to the same extent. The power of the corporation to contract a debt cannot be doubted, and the power of this corporation to contract the debt for which the mortgage is given was not denied upon the argument, nor do I think it can be successfully controverted: see Gordon v. Preston, 1 Watts, 385; Union Bank v. Jacobs, 6 Humph. 515; Barry v. Merchants' Exch. Co. 1 Sandf. Ch. 280. If not paid, the law, at the instance of the creditors, would compel a sale on execution. Why may not the parties provide by contract, on the like failure to pay, for a sale to the same extent under a mortgage, as the law would have compelled, had no mortgage been given? The reasons are the same in both cases, and the effect upon the corporation and the public the same. But if the sale on execution is, by the statute, a qualified or restricted sale, these restrictions and qualifications might ¡ perhaps apply equally to a sale under the mortgage. The Legislature has, by general statute, provided for the sale on execution of the franchise of any corporation authorized to receive tolls: R. S. of 1846, Ch. 55; Comp. L. Ch. 73, §§9 to 19: and though the language of the ninth section would seem to-authorize a sale of all the franchises of the corporation, yet it is manifest from the twelfth and thirteenth sections, that nothing is sold or conveyed but the right to the possession of the road and its fixtures, and the right or franchise of receiving the tolls, and these not absolutely, but during the least period of time for which any bidder 'shall agree to take the same and pay the debt. And it is expressly provided by the fifteenth section, that the corporation “shall in all other respects retain the same powers, and be bound to perform the same duties, and liable to the same penalties and forfeitures as before such sale. It is clear from this, that no franchise, which is-essentially and exclusively a corporate franchise, is authorized to be sold. That this statute, though previously passed applies to these plank road corporations, see James v. Pontiac and Groveland Plank Road Co., 8 Mich. 91.

The fact that the whole road authorized by the charter was not covered by the mortgage is, I think, no objection to its validity, and if -the view I have taken of the ease thus far be correct, the mortgage of a part is even less objectionable as regards both the public and the company, than a mortgage of the whole.

But again, there is nothing in the case tending to show that any portion of the balance of the road, from Eaton Bapids towards Lansing, has ever been constructed. We cannot presume without proof that it has been: as no legal duty rested upon the company to construct it. People v. The Jackson and Mich. Plank Road Co., 9 Mich. 285. My conclusion, therefore, is that the mortgage in this case was valid under the incidental or implied powers granted by the charter : though the sale on the mortgage, so far as it depends upon those incidental or implied powers, might perhaps be required to conform substantially to the mode of sale provided for on executions. Whether it would be otherwise, or whether the result at which I have arrived would be, in any respects, altered by the special act of 1851, is a question to be considered under that act, if valid.

II. We do not think this act comes in conflict with the twenty-third section of the fourth article of the Constitution against authorizing “by -private or special law, the sale or conveyance of any real estate belonging to any person”; but that so far as the act has any effect, it'must be treated as ap amendment of the charter. The eighth section of the fifteenth article of the Constitution, authorizes the Legislature to amend any'act of incorporation theretofore granted (of which this was one), by a vote of two-thirds of all the members elected to each house. The act in question was declared to take immediate effect (§ S). By the twentieth section of the fourth article of the Constitution it could not be ordered to take immediate effect without a vote of two-thirds of the members elected to each house,1 which is the same majority as that required to amend an act of incorporation. W e must, therefore, presume that the act was passed by the requisite majority. Whether it would be competent to prove the contrary we need not decide, as no such proof is offered.

But it is objected that this act was never accepted-by the company. Its acceptance by the board of directors is admitted, and that a certificate of accejffance, signed by the president and secretary, and under the corporate seal, was filed in the office of the secretary of state, as provided in the third section of the act. Admitting that it is competent for the company to set up in defense to the mortgage, the want of assent by any stockholder to the amendment, to the same extent that a stockholder not assenting might avail himself of the same matter, when called upon to pay a subscription, or in a bill in equity to restrain the corporation from applying the corporate funds in a manner only authorized by the amendment — a proposition which may admit of some doubt — it certainly cannot be pretended that it could be made available to the company to -any greater extent. But granting the rule to be the same in both cases, the objection in this case can not be sustained. If the amendment were such as purported to effect a fundamental change, in the object, nature of the enterprise, or character of the business authorized by the charter, then I am inclined to think it would not be in the power of the Legislature to bind, by the amendment, any individual stockholder without his assent. But this amendment relates only to the mode of transacting the business, and effecting- the enterprise which it was the object of the . charter to authorize: it is merely auxiliary to the original object, and was intended only to facilitate its attainment. In such cases it seems to be now well, and I think - justly, settled, that the stockholder has no right to complain; and that his assent will be presumed. Every man by becoming a stockholder, must be conclusively presumed to assent to the rule that a majority is to govern, touching the mode of carrying on the business or enterprise authorized by the charter, unless the Legislature has prescribed some other rule. He must therefore be held to agree that, to this extent, the majority may ask for, and accept, amendments to their charter.

In the present case it appears by the evidence in the record, that, at a meeting of the stockholders specially called for the purpose of taking into consideration the question of making this loan and securing the same by mortgage, the holders of a majority of the stock voted for a resolution to make the loan and to secure the same by a mortgage 'of the road, and that there was not a vote against it; and that the holders of three-fourths of' the stock voted at the same meeting for a resolution, authorizing the sale of the bonds at not less than ninety cents on their par value. These resolutions, and the call of the meeting, refer to the act of 1851, and if that act was at all necessary to authorize the loan or the mortgage, these votes are sufficient to show clearly its acceptance by the act of the majority of the stockholders.

The act of 1851 must therefore be held to be valid and to authorize the mortgage, whether it was previously authorized under the incidental powers of the corporation or not, unless the mortgage is to be held void because it does not cover the whole road authorized by the charter. But what is the extent of the operation of this act? Does it authorize the company to mortgage any other of its franchises than those I have endeavored to show might have been mortgaged under the incidental or implied powers contained in the charter. I think it does not. It authorizes the company to “mortgage the road or other property’’ of the company “to secure their bonds.” It is silent on the subject of franchises; but as the road could be of no value without the power or franchise of receiving tolls, and its object was to enable the company to raise money on the security of the mortgage, the franchise of receiving tolls must be understood as included with the road and fixtures. And in thus expressly authorizing a mortgage for this specific purpose, it is fair to presume the Legislature intended a mortgage with the usual power of sale, and which on default should authorize an absolute sale of the property mortgaged, as the usual and most effectual means of rendering the security available.

But I think it very clear that no power is given by the act to mortgage any franchise essentially corporate in its character, and which could not be enjoyed by a natural person — such as the right of being a corporation. In other words, there is nothing in the language of the act,. or in the nature of the provision, which would authorize the corporation to transfer its corporate existence to the mortgagee, or the person who might become the purchaser under the mortgage. Such a power could hardly be implied in any case, and to authorize such a construction the language ought to be very plain and express: and it would at least be natural to expect, if such were the intention, some legislative provision for the mode of carrying it into effect. Is the old stock to be extinguished, or held in trust for the purchaser? May the purchaser on the mortgage foreclosure issue new stock, and if he may, can he be compelled to do so? If the purchase be made by •a single individual, how are the directors and officers to be chosen ? Or is he to be a corporation sole, without any of the officers required by the charter? These, and many other questions, would naturally require some legislative provision.

I am, therefore, satisfied no other franchises are authorized to be mortgaged than those I have endeavored to show would have been authorized under the incidental powers of the corporation; and the same considerations will •apply, so far as relates to the question of mortgaging the whole or a part of the road.

So much of the decree of the Court below as relates •to the obligors in the collateral bond must be reversed, and the bill as to them dismissed, with costs against complainants of both courts. And the decree of foreclosure and sale, entered in the Court below, must be so modified as to confine the sale to so much of the road between Jackson and Eaton Rapids as may have been already constructed, together with the toll-houses, gates, and other fixtures and erections appurtenant thereto,- with the franchises and rights of keeping up and maintaining the said road, fixtures, erections and appurtenances, and of taking ■tolls thereon, and the cause must be remitted to the Court below for further proceedings. Neither party to recover-costs- on the appeal.

Martin Ch. J. concurred in this opinion.

Manning J.:

I think the mortgage good under the act, and on that ground concur in the opinion of my brother Christiancy. Whether it would be valid without the act I have some doubt, and do not wish to express an opinion on that, point, as it is not necessary to a decision of the cause.

Campbell J.:

I concur entirely with my brother Christiancy, that the signers of the collateral bonds in question are not proper defendants for the reasons he has given. I am also of' opinion, that the law which authorized a mortgage to be executed by the plank road company was properly accepted. Whether any amendment to a charter is not Valid which is accepted by a majority in interest of the corporators, is a question upon which I express no opinion. This amendment is for a beneficial purpose, and. creates no charge or liability, except against the common property for a common object.

I think the mortgage in controversy is within the authority expressly granted by the statute. A power to-mortgage the whole, includes a power to mortgage less than -the whole, provided the whole is divisible. The company in question had authority to build a road beyond the limits covered by this security; but a forfeiture for its non-completion -could not, under the terms of the law, extend to the part actually completed within those limits. The light to take toll was not dependent on the completion of the road from Jackson to Lansing, but was apportioned according to the distance completed. The tolls are not made collectable in gross, but may be taken at intervals along the road as completed, for the several separate spaces travelled. The road is thus, in fact, divided up into a series of toll districts, where there maybe, and generally must be, separate receivers. There is, therefore, no practical difficulty, and no apparent objection to allowing any specific portion of the road, upon which separate tolls can be lawfully collected, to be mortgaged by itself.

It is true that no franchise which the law entrusts to the discretion of specific legal bodies can be exercised by any other person in violation of that trust. But it does not follow, because a certain authority is vested in a corporation, that its delegation must always amount to such a violation of trust. No corporation, for business purposes, was ever created which did not require a considerable portion of its affairs to be transacted by agents who are not corporate officers. In building a plank road, for example, the location of the road, and the steps necessary to secure the right of way against unwilling owners of land, must in general be acts of the corporation itself, and must derive their validity from the exercise of the discretionary authority which the charter has placed in particular hands. When the board of directors, or any other named body, are required to manage any particular business requiring the .exercise of a statutory discretion, they cannot give their authority to any one not authorized by statute to receive it. But those acts of a ministerial character, -which involve no further exercise of discretion than is called for in the business of private parties, transacted by ordinary business agencies, are usually allowed to be performed by corporation agents as freely as by private agents. The actual work of grading and planking a road is not a franchise which must be exercised by the directors or stockholders. The actual collection of tolls is not such a franchise. All of the peculiar corporate acts are done at corporate meetings by vote, if required to be done by the corporation itself; and I doubt whether anything not susceptible of being done at such a meeting, can be regarded as beyond their power to delegate to any person whom they may select, unless it has been confined by the charter itself to some particular officer or agent. And what this company could authorize to be managed by separate agents for the corporate benefit, may, I think, be mortgaged separately under the statute. The mortgagees, in taking charge of and managing the road, act precisely like any other persons who might be employed for a similar purpose, the only difference being that the moneys are applied, when collected, to the benefit of different parties.

In receiving a mortgage of corporate property, where there is a statutory power to mortgage, the mortgagees must necessarily take it subject to such duties or encumbrances as the law attaches to the enjoyment of the property mortgaged, but not to such as may exist against the corporation without reference to that property. It is not necessary, in the-case before us, to consider what liabilities are appended to the ownership of the portion of road mortgaged to the complainants, and I shall make no attempt to determine them.

Entertaining these views, I do not deem it necessary to express any opinion upon the power of the plank road company to make such a mortgage independent of the statute.

I am inclined to think that such a power exists in regard to such matters as require no strictly official or corporate interference to manage, and that it would, therefore, .cover the use and enjoyment of most of the corporate property. But in the absence of any express authority to alienate' or mortgage, a very serious question may arise, whether the alienee of such property may not take it subject to a somewhat larger liability, for corporate acts and omissions. As the law upon this subject cannot be regarded as very clearly defined upon all points, I prefer to reserve my opinion upon it, as the mortgage was made under a statutory power, and valid under that, beyond question.

I concur, therefore, in the result arrived at by my brother Ohristiancy.

Decree against the plank road company modified, and against the other parties reversed.


author: Martin Ch. J.:

text:
    Elizabeth Van Brunt v. Clement Wakelee.
    A mortgagor of chattels, notwithstanding the forfeiture of the condition of the mortgage, may redeem in equity at any time before the mortgagee has foreclosed by a reduction of tbe property into possession, or by a sale pursuant to the power conferred by the mortgage.

      Submitted on briefs October 24th.

      Decided December 6th.

    Appeal in Chancery from Calhoun Circuit.
    Complainant filed her bill to redeem from a chattel mortgage a quantity of wheat, which she had mortgaged while growing, and which at the time of filing the bill had been harvested and stacked upon her premises. The mortgage fell due August 1st, 1861, and on the next day defendant, who was assignee of the mortgage, came upon complainant’s premises and took possession of the wheat, but without removing it, and refused to allow complainant to redeem. Two weeks thereafter she tendered the amount due on the mortgage, and on defendant refusing to receive it, and stating that he should take the whole wheat, she filed this bill to redeem. Defendant demurred generally. The Circuit Judge overruled the demurrer, and decreed a redemption. Defendant appealed.

      Hughes & Wooley for complainant:
    This cause presents the broad question — Whether there is an equity of redemption to mortgaged chattels, which may be asserted by the mortgagor after default in payment and before foreclosure of the mortgage by an execution of the power of sale.'
    The common law knows no equity of redemption in lands or goods mortgaged, but such equity is a creation of the Court of Chancery, and no reason, in the nature of things, exists why it should not apply to all mortgages, real and personal, alike: — 1 Washl. Real. Prop. 478.
    It may be said not to exist, for the reason that such an equity is inconsistent with the rule at law established in our courts, that the legal title to goods mortgaged is •in the mortgagee. But courts- have frequently held, in this country, that a mortgage of real estate vested the legal title in the mortgagee, ánd yet these courts never denied the existence of an equity of redemption on this ground.
    There is no difference in principle between a mortgage of goods or lands. The estate in the subject of the mortgage conveyed by one is precisely like the other. Judge Story says with reference to chattel mortgages: “It is
    a conditional transfer of the property, and if the condition is not performed, the whole title vests absolutely; at law, in the mortgagee, exactly as it does in the case of a mortgage of lands.” — 2 Eg. Juris. § 1030.
    The same learned jurist makes no distinction, so far as the equity of redemption is concerned, between real and personal mortgages: “In mortgages of chattels, although tbe prescribed condition has not been fulfilled, there exists, as in mortgages of land, an equity of redemption, which may be asserted by the mortgagor, if he brings his bill to redeem 'within a reasonable time.” — Ibid. §1031. See also Kemp v. Westbrook, 1 Ves. Sr. 278; Hart v. Ten Eyck, 2 Johns. Ch. 100 and 101; Domendary v. Metcalf, Prec. in Ch. 149; Wenderzee v. Willis, 3 Bro. 21; Harrison v. Hart, Comyn, 392, 411; 1 Bouv. Inst. 349; Cutts v. York Man. Co., 6 Shop. 201; Hinman v. Judson, 13 Barb. 629.

      L. D. Dibble for defendant:
    The theory of a chattel mortgage is, that it is a conditional sale of property, liable to be defeated only by performance of the condition at the time specified in the instrument itself, and to become an absolute and unconditional sale, by failure to perform the condition at the time specified therein: —1 Hill, 473; 2 Denio, 170; 3 Mich. 104, and cases cited.

    The only question to be determined in this case is, can the property' be redeemed after the sale has become absolute, and the title has become vested, absolutely, in the mortgagee, or in his assignee, by the failure of the mortgag-or to perform the condition of the mortgage on the day. 2 Denio, 170, on the subject of redemption in equity, is but a dictum of the court, without deciding anything or citing authority. 3 Mich. 104 is also a mere dictum. 2 Story Eq. § 1031, refers for authority to Kemp v. Westbrook, 1 Ves. 278, and to Hart v. Ten Eyck, 2 Johns. Ch. 101, and to Comyn, 392, 411, and does not add anything to the law of those cases. The case of Hart v. Ten Eyck was one of pledge and not of chattel mortgage, the distinction between which has long been well defined in law. The case in 3 Pro. Ch. 21, referred to in 2 Johns.. Ch. 101 was also a case of pledge of securities deposited, and not of chattel mortgage, and is, therefore, not authority.. •It is stated in Story on Bailments, § 287, that “ equity will interfere to compel a redemption” of chattel mortgaged property, but the statement is not borne out by the authorities which he cites. 2 Pick. 206 was a “bill of ■sale” to secure a debt, and an agreement to reconvey upon certain conditions. The Court, in that case, says it is questionable whether it was a mortgage, and that it was unnecessary to decide whether it was or not. That ■case does not decide that a redemption could be had in equity. 2 Pick. 249 does not reach the question, for that was a “bill of sale” and a “covenant” given back to reconvey on certain conditions, upon which instrument the Court say suit could be brought. 3 Pick. 495 is not at •all in point. It must, in this connection, be remembered, that in Massachusetts, Maine and Pennsylvania, there are statutes allowing a redemption, within a given time after condition of chattel mortgage broken, so that decisions, in those States, under those statutes, can avail nothing to complainant as authority, but are rather authority for defendant, that, in those States, the Legislature have by legislative ■construction decided that there can be no redemption in equity, without a statute authorizing it. 8 Johns. 96 does not touch the question, but it does decide that, when the condition of a chattel mortgage is broken the title of the mortgagee becomes absolute. 1 Hill, on Mort. 314, referred to in some of the authorities cited and examined, refers only to mortgages on real estate, and is not applicable to the question under consideration. In 2 Hill. on Mortg. 478 et seq., 494 et seq., 504 et seq., the subject of redemption is ully discussed, and from which it appears that some States have passed laws providing for redemption, which would be, at least, a legislative construction in those States, that ■a bill to redeem could not be sustained: from the same authority it also appears that it has not been settled that a «bill to redeem could be sustained.

       So little direct authority is there on the subject of redemption of goods mortgaged, that the Circuit Judge could only decide the case upon general principles and the analogy of chattel mortgages to mortgages of lands. The oase of Hinman v. Judson, 13 Barb. 629, was referred to by him as nearest to a direct decision on the right of re~ demption.
      The hooks, however, are full of dicta on the subject, and in the following cases, in addition to those cited by counsel, the right of redemption has been assumed to exist: — Jucker v. Wilson, 1 P. Wins. 261; Patchin v. Pierce,
        12 Wend. 61; Leighton v. Shapley, 8 N. H. 361; Wendell v. New Hampshire Bank, 9 N. H. 420; Leach v. Kimball, 34 N. H. 473-4; Long Dock Co. v. Malley, 1 Beasley, 96; Gilchrist v. Patterson, 18 Ark. 579; Constant v. Malteson, 22 Ill. 559; Nichols v. Webster, 1 Chand. 203; Flanders v. Thomas, 12 Wis. 410.
      But in non© of these oases does the Court undertake to define precisely what acts of tho mortgagee, short of actual sal© of the property, will he sufficient to "bar the equity of redemption.

   Martin Ch. J.:

Without going into any extended discussion of the respective rights of a mortgagor and mortgagee of chattels after foreclosure, it is very clear from all the analogies of the law, and upon general principles, that a mortgagor has a right to redeem at any time before foreclosure. In the case of a mortgage of chattels this can only be done by a reduction of the property into possession, or by a sale pursuant to the power contained in the instrument. Neither was done in this case. The assertion of Wakelee that he refused the tender, and that he should take the entire wheat, so long as he did not take it, was no foreclosure j and the offer to pay the debt as alleged in the bill was in season, and discharged the mortgage.

The decree is affirmed, with costs.

The other Justices concurred.


author: Campbell J.:

text:
    John W. Kermott and others v. James C. Ayer and another.
    The courts of Michigan can not take judicial notice of the value of Canada cur* rency, or the rate of Canadian interest.
    It is not a presumption of law that the rate of interest in a foreign country is the same as that established by statute in Miohigm.
    The relative value of foreign and American currency is a question of commercial usage, and may be proved by any one acquainted with the usage.
    Foreign statutes can not be proved by parol without some showing why secondary evidence becomes necessary. And statutes regulating the rates of interest are no exception to this general rule. *
    It was assigned as error that the Circuit Court allowed parol evidence of the rate of interest in a foreign oountry. It did not appear by the record that the rate was established by statute, and this Court, on the ground that all presumptions, must be in favor of the judgment, and error be affirmatively shown, affirmed the judgment.

      Submitted on briefs January 9th.

      Decided January 13th.

    Error to Wayne Circuit.
    The defendants in error brought suit in the Court below-to recover the amount of two promissory notes, upon one of' which no question arises. The other was for £190 9s. lid., given and made payable in Canada West, and due‘in August 1856. On the trial, after the giving’ of the notes had been proved, T. W. Lockwood was sworn as a witness for the plaintiffs, and testified that ho had had several business transactions with attorneys and bankers in Canada, and in that way had had occasion to learn the value of Canada and Halifax currency in common- use there, as compared with our own, and that one pound was equivalent to four dollars, and five, shillings was a dollar. This evidence was objected to, but the Circuit Judge admitted it, and, remarked that the value of a pound in Halifax currency was historically well known and established, and in common use in Canada West, to be of the -value of four dollars legal currency of the United States; and that in the same way the legal interest established by law and common usage in Canada West was known to be six per centum per annum. It was then admitted by the defendants that an attorney residing in Canada West would, if produced, testify that the legal rate of interest in Canada was six per cent., and that if this evidence was deemed admissible, it should be considered as having been produced. But it was objected to on the ground that the statute of Canada regulating the rate of interest in that province should be produced. The objection was overruled.
    The foregoing was all the evidence on these questions.

      D. J. Davidson, for plaintiff in error,
    argued that Lockwood’s evidence was incompetent, because he was not shown to be an expert; and that parol evidence of the rate o* interest was also incompetent: — 20 Ill. 201; 3 Fost. 496; 5 Mich. 349. It sufficiently appeared that the rate of interest was fixed by statute. “According to the laws thereof” must be interpreted to mean the statute laws. But the Court in the absence of any showing to the contrary was bound to presume that the rate was fixed by statute. It is a commercial regulation, and in its nature an appropriate subject of statutory enactment: — 2 Wash. C. C. 1; Ibid, 175. Interest is not allowed by the common law.
    What the Circuit Judge designed to be understood by “historical knowledge” • is not clear. Historical knowledge can hardly inform us of the present value of the pound. But if he meant that in the absence of all evidence on the subject, the Judge might act upon his own knowledge, he was clearly in error.

      T. W. Lockwood, for defendants in error,
    referred to the statute of the United States — 9 Stat. at Large, 14; Brightly, 156 — which fixes the custom house value of the Canada pound at four dollars. But its value was a mere matter of ordinary business knowledge, which any one dealing with the province may prove. The rate of interest is not shown to be fixed by statute. But it was incumbent,
    on the party claiming that it differed from our own, to establish that fact by evidence, or it will be presumed to be the same: — Leavenworth v. Brockway, 2 Hill, 201; State v. Rood, 12 Vt. 396; Crane v. Hardy, 1 Mich. 63; Jones v. Palmer, 1 Doug, Mich. 380; Rue High's case, 2 Doug. Mich. 519. Besides, the rate of interest like the value of currency is a matter of commercial regulation, and may be proved in the same way.
   Campbell J.:

In this case the errors complained of are alleged to have arisen in regard to proof of the value of Canada currency, and the rate of Canadian interest. The remarks made by the Judge oh the trial that these are such matters of historical knowledge as to be judicially known, are not, •we think, legally correct. These are provable facts unless recognized by our own laws, and a judge’s knowledge of facts will not dispense with proof. The decision must be made upon the evidence. Had the decision in the case before us been based upon the historical knowledge referred to, we think the error would have been’ffatal. And the same remark will apply in regard to the presumption of foreign law being the same as our own. Interest in Michigan is purely statutory, and we think no presumption can exist that any country has adopted our local statutes. But the judgment is not rendered on that hypothesis, and the question therefore can not be regarded as having prejudiced the case.

The questions to be decided are therefore confined to those arising on the admission of Lockwood’s evidence, and that of the Canadian attorney.

Lockwood was allowed to testify that a pound in Canada currency.was equivalent to four dollars in American. This being a question of mercantile usage, was open to proof in that way. We think Ms testimony showed sufficient acquaintance with that usage, and was admissible.

The evidence of the attorney from Canada concerning the Canadian law of interest could not properly be .received to show the terms of a Canadian statute. Foreign statutes can not be proved by parol, without some showing why secondary evidence becomes necessary. This doctrine has been recognized by this Court in People v. Lambert, 5 Mich. 349, and is the settled American doctrine: — 1 Greenl. Ev. §§ 587-8. The rate of interest is a matter of such common notoriety that there might be reason for excepting it from this general rule, and there is no doubt that in many cases it has been proved by parol without objection-But there would be danger in allowing- such an exception as an arbitrary one, and the mistakes made in works current among business men on the rates of interest in different States show that business knowledge of statutory provisions is not always reliable. We have been in some doubt whether, for this reason, there was not error in admitting the evidence objected to. But it does not appear that Canadian interest is regulated by statute; and we are not justified in making any inference not required by the facts set out, in order to establish error. The presumptions must always be in favor of the judgment. It is therefore affirmed, with costs.

The other Justices concurred.


text:
    William A. Hatch v. Thersey Squires.
    The acts and declarations of one who assumes to be acting as the agent of another are not evidence against the supposed principal until the fact of agency is established by other evidence.

      Heard November 11th, 1862.

      Decided January 13th.

    Error to Washtenaw Circuit.
    Hatch, as agent for one McCormick, took from the possession of Squires certain personal property which was described in a chattel mortgage executed by him to McCormick. Squires replevied the property, and the principal question in the replevin suit was as to the validity of this mortgage, the consideration of which was a reaper and mower purchased of McCormick, and which was alleged to be worthless. On the trial, considerable evidence was given by plaintiff of the acts, declarations and promises of one Walker, who assumed to be acting as the general agent of McCormick in the sale of reapers and mowers, and had issued hand bills as such. This evidence was objected to, on the ground that it was not shown that Walker was employed by McCormick as his agent, or empowered to make declarations on his behalf. It did not distinctly appear in the case whether Walker acted in making the sale to Squires, nor was there any evidence beyond Walker’s own acts and declarations to establish his agency.
    Judgment having been given for the plaintiff in the Court below, Hatch brought error.

      H. J. Beakes, for plaintiff in erro.

      O. Hawkins, for defendant in error.
   Martin Ch. J.:

This case hinges almost entirely upon the admissibility of the acts and declarations of Walker — who purported to act as the agent of McCormick — without proof of such .agency. The- authority of an agent must be positively shown, either by proving his authority to act, or by proving his acts with the knowledge and recognition of his principal. In this case nothing of the kind was accomplished or attempted. The only attempt- to prove the agency of Walker was by proving his own acts and assertions. This is insufficient. As - these would not bind McCormick, so they would not hind the plaintiff in this cause. It is too obvious to need •demonstration that an agent’s authority can not be proved by his own assertion alone. There must be some evidence of •authority beyond his assertion, or of ratification of his acts, before any party can be bound by such acts.

There was error, therefore, in admitting evidence of the acts, declarations and promises of Walker; and the judgment must be reversed, with costs, and a new trial granted.

The other Justices concurred.