author: Mr. Justice Potter,

text:
    Robbins v. Scranton, Appellant.

      Constitutional law — Article XVI, sec. 8 of the constitution — Property injured by public works — Speculative loss.

    Under article XVI, sec. 8 of the constitution, compensation for property injured by public works is not limited to abutting property, but applies to any works sufficiently near to make the injury proximate, immediate and substantial. But unless the injury is so obvious as to admit of comparatively easy calculation as to the extent of the diminution of the value of the property, it may not fairly be considered as covered by ihe constitution. Remote or speculative losses in the conduct of a business do not constitute a legitimate basis upon which to estimate damages to the real estate.
    Where a city builds a viaduct in order to do away with a dangerous grade crossing, and it appears that access to a mill is cut off in one direction so that patrons of the mill are required to make a detour of two squares, and no land is taken from the mill owners, a jury, in estimating the damages to the mill should be allowed to compare the situation as it was after the completion of the entire scheme of improvements in connection With the viaduct with that which existed before its construction.
    In such a case it is a fair question for the jury to determine whether or not the substitution of a safe way over the tracks, even though it be a little longer, does not fully compensate in its effect upon the market value of the property for the taking away of the nearer, yet dangerous method of approach, by means of the grade crossing as it existed before the viaduct was built.
    Argued Feb. 25, 1907.
    Appeal, No. 278, Jan. T., 1906, by defendant, from judgment of C. P. Lackawanna Co., March Term, 1903, No. 175, on verdict for plaintiff in case of C. W. Robbins and Frank M. Spencer, Copartners, trading as Robbins & Spencer, v. City of Scranton.
    Before Fell, Bbown, Mestbezat, Potteb and Stewabt, JJ.
    Reversed.
    Appeal from award of jury of view. Before Kelly, J.
    At the trial when Henry Jifkins, a witness for plaintiff, was on the stand, the following offer was made:
    Mr. Davis: We propose to prove by the witness on the stand that Schnell court was widened to fifty feet before the completion of the viaduct. This to be followed by the testimony of the city clerk showing the legislation and the date thereof by the councils providing for the widening of Schnell court.
    Mr. Warren': Tell us the legal purpose of the offer.
    Mr. Davis: The legal purpose of this is that the jury may offset any damages which may be claimed by reason of the cutting off of their access by reason of the additional access afforded plaintiffs’ property by reason of the widening of Schnell court.
    Mr. Warren: The counsel for the plaintiffs object to the offer as incompetent, immaterial and irrelevant, not a legitimate and legal offset for the damages the plaintiffs may have sustained by reason of the construction of the viaduct, but at the maximum merely a general benefit to the public generally in the locality, in which plaintiff has the right to share and for which he cannot be asked to account or to reduce his claim in the case now trying.
    Mr. Davis: We propose to follow this by testimony showing that the widening of Schnell court was a direct and special benefit to the property of the plaintiffs in this case.
    The Court: It seems to me we ought to have the specific dates with reference to these two improvements and respective ordinances which authorized them, before passing upon this offer.
    Mr. Davis: The dates proposed to be proven by the defendant are as follows: That the ordinance providing for the construction of the viaduct, to wit: file of common council No. 31, 1900, was approved by James Moir, mayor, on November 17, 1900; that the date of the completion of the viaduct was August 5, 1904; that the resolution of council providing for opening of Schnell court between Seventh and Eighth streets to a uniform width of fifty feet and directing the director of public works to dispose of the buildings located upon the land necessary to be taken in the opening of said court, was approved March 14, 1904.
    Mr. Warren : You also agree that the ordinance providing for the construction of the viaduct in no way refers to any change in Schnell court ?
    Mr. Davis: Yes. Also that the work of opening Schnell court to a uniform width in pursuance of the resolution of councils directing the same, was done in the month of July, 1904.
    The Court: I will sustain the objection to the offer. It seems to me that the plaintiffs? damages were complete when the communication between Lackawanna avenue and Eighth street was completely cut off, and that the measure of damages must be ascertained according to the familiar rule of value before and after the injury, and that anything that was done subsequently to that by wav of afterthought in an effort to reduce the damage to the plaintiffs’ property cannot be considered in this case. The plaintiffs have a right to recover damages in money, and it is not within the power of the city to contribute or to confer any other benefit upon them that they would be bound to accept in lieu of damages in money; and for the further reason that the improvement offered to be shown on Schnell court was a general public improvement conferring no doubt some benefit upon the plaintiffs, but conferring benefits upon all other property owners in the immediate vicinity as well, and conferring more or less benefit upon the traveling public. There is nothing in the original ordinance which provides for the viaduct which shows any contemplated change upon this street or court in question as part of the proposed public iniprovement or change. Neither is there anything in the ordinance providing for the improvement for the court, showing that it has any reference whatever to the building of the viaduct. Therefore, it seems to me, that it is a separate proposition entirely and one which cannot figure in the ascertainment of damages in this case which it is alleged resulted from the building of the viaduct in question.
    Exception noted for defendant at whose request a bill is sealed. [1]
    Defendant presented this point:
    6. If the plaintiffs are still afforded safe, reasonable and convenient access to their property they cannot recover. Answer : The sixth point is refused; it is not necessary that I should read it to you. [3]
    Plaintiffs presented this point:
    4. The jury are to consider the subject-matter of this suit just as if they were called on to estimate the injury at the time of the construction of the viaduct when access from Lackawanna avenue to Eighth street was affected by the construction of the viaduct, which was in May, 1903. Answer: I affirm that proposition. [4]
    Yerdict and judgment for plaintiff for $10,350. Defendant appealed.

      Errors assigned were (1) ruling on evidence, quoting the bill of exceptions, and (3,4) above instructions, quoting them.

      David J. Davis, city solicitor, with him H. R. Van Deusen, assistant city solicitor, for appellant.
    Any fact which affects the value of the land at the time of the injury is admissible: Phila. v. Linnard, 97 Pa. 242; City of Allegheny v. Black, 99 Pa. 152; Phila. Ball Club v. Phila., 192 Pa. 632.
    April 22, 1907:

      S. B. Price and Everett Warren, for appellee.
   Opinion by

Mr. Justice Potter,

This case was a feigned issue, on an appeal from the award of viewers appointed to assess damages by reason of the construction of a viaduct on West Lackawanna avenue, from Seventh avenue to Ninth avenue in the city of Scranton. The property of plaintiffs is not situated on Lackawanna avenue, but it is upon the west side of Eighth avenue about 120 feet to the north of Lackawanna, the lot being forty feet wdde and extending from Eighth avenue to the railroad tracks with which it connects by means of a switch in the rear of the building. The plaintiffs conduct a large flour and feed mill on the premises, much of the grain being shipped in, and the product out, over the railroad. Formerly the tracks of the Delaware, Lackawanna & Western Railroad crossed Lackawanna avenue at grade, and as there were seven tracks in all, at this point, over which passed about 270 trains per day, it constituted a most dangerous grade crossing.

For the purpose of removing this great menace to the lives of all who were compelled to use the crossing, the city constructed a viaduct. Previous to its erection, patrons from the west side of the railroad, who wished to drive to the mill of the plaintiffs, could, after crossing the railroad tracks at grade, turn to the left around the corner of Eighth avenue, and reach the premises in that way. Since the completion of the viaduct, the same class of customers must now cross the viaduct and continue one square farther to the east, to Seventh avenue, and thence, by way of Schnell street, go directly back one square to the property of the plaintiffs. They are enabled in this way to escape a dangerous grade crossing, but in order to do so, ai-e required to travel two squares farther, that is, go one square beyond, and then one square back, to the mill. In returning to the west side of the tracks, the same class of patrons, in addition to escaping the crossing of the tracks at grade, find the grade of Lackawanna avenue from the railroad to Ninth avenue has been very much improved by the construction of the viaduct.

The only reason which plaintiffs have for complaining of the improvement is the fact that access to Lackawanna avenue at grade at the end of Eighth avenue, is, as we have just pointed out, cut off by the location of the viaduct, and patrons from the west side of the tracks are obliged to travel two squares farther in order to drive to the doors of the mill. Of course^ the building of the viaduct did not in any way affect the approach of patrons who came from the east, or the north, or the south. Its only effect was upon those desiring to use Lackawanna avenue, as a means of travel, to and from the west.

The ordinance providing for the erection of the viaduct was approved November 17, 1900, work upon it was begun April 27, 1903, and it was finally completed August 5, 1904. But access from the end of Eighth avenue to Lackawanna avenue, with teams and wagons, was no longer practicable after May 12, 1903. The sidewalks remained unobstructed so that foot passengers could go and come in that way.

Immediately opposite plaintiffs’ mill an alley twenty feet wide, called Schnell court, ran from Seventh to Eighth avenue parallel with Lackawanna avenue. By resolution of councils, approved March 14, 1904, it was ordered that Schnell court, between Seventh and Eighth avenues, be opened to a uniform width of fifty feet, and the work of widening was done in June or July, 1904, although the grading does not appear to have been completed until October, 1904. The result was to give plaintiffs the benefit of a street fifty feet wide, beginning directly across Eighth avenue from their property, and extending to Seventh avenue, which crossed Lackawanna avenue at grade, at the point where the elevation of the viaduct began.

The proceedings were somewhat prolonged, but the building of the viaduct and the widening and grading of Schnell street may, we think, under the evidence, be fairly regarded as part of the same general plan, by which it was sought to benefit the public, and minimize the inconvenience to the plaintiffs and other property holders in the vicinity, as much as possible. There could have been no object in improving Schnell street, and converting it from a narrow alley into a wide thoroughfare, except to improve tbe means of access to the end of the viaduct. Schnell street led directly from plaintiffs’ property to Seventh avenue, by which the viaduct could be directly gained. Necessarily, the viaduct had to bo elevated, and if the property on Eighth avenue was to get any advantage from the overhead crossing, an easy grade must be opened by which it could be reached. Schnell street afforded this approach.

This court held in Mellor v. Phila., 160 Pa. 614, that under a proper construction of article XVI, section 8 of the constitution, compensation for property injured by public works is not limited to abutting property, but applies to any works sufficiently near to make the injury proximate, immediate and substantial. But unless the injury is so obvious as to admit of comparatively easy calculation as to the extent of the diminution of the value of the property, it may not fairly be considered as covered by the constitution. Remote or speculative losses in the conduct of a business do not constitute a legitimate basis upon which to estimate damages to the real estate. In the present case, not an inch of ground was taken from plaintiffs, and there was no interference with the conduct of the business, except in so far as it was conjectured that some of the patrons upon the west side of the tracks might be deterred from driving to the mill, because they would have to use the viaduct which would carry them one square farther to the east, before turning to the mill, than when they were at liberty to risk the crossing at grade. It would seem to be a fair inference that this great public improvement by which the grade crossing was avoided would enure to the benefit of the patrons of the plaintiffs’ mill, as much as to any other portion of the public; and would rather tend to draw business to the mill from the vicinity west of the tracks, than otherwise.^ But at any rate the jury should have been allowed to compare the situation as it was after the completion of the entire scheme of improvements in connection with.the viaduct, with that which existed before its construction. Admittedly, none of the plaintiffs’ property was taken, and the only question was whether it was injured, and if so, to what extent. The problem before the jury was to determine whether the effect of the improvements as a whole had been to work any proximate, immediate and substantial injury to the value of the real estate. As we. have said, before the viaduct was built the patrons coming from the west had to run the gauntlet of the grade crossing, but when that was passed they could turn directly into Eighth avenue, and in that way reach the mill. After the viaduct was completed they could cross the tracks in peace and comfort, but had to travel about two blocks farther in all, to pass over the viaduct and back to the mill. Was this a drawback as compared with the former method, and if so, was it a substantial one, sufficient to depreciate the value of the real estate of the plaintiffs ? Only the retail portion of the business was affected, and of that, only the trade of the patrons on the west side of the tracks was concerned in the change. When the trial judge excluded the testimony in regard to the widening and grading of Schnell street, he prevented the jury from considering the situation as it actually existed when the whole scheme of improvements at that point was completed by the city. It was a fair question for the jury to determine whether or not the substitution of a safe way over the tracks, even though it were a little longer, did not fully compensate in its effect upon the market value of the plaintiffs’ property, for the taking away of the nearer, yet extremely dangerous, method of approach from the west, by means of the grade crossing as it existed before the viaduct was built. The beneficial effect of the viaduct in safeguarding the patrons of the mill, who approached from the west, and the possible injury to the trade by deflecting it from a direct approach, were so interwoven that it was not possible to ascertain one, without considering the other.

The court below applied to this case the rule as to the time for estimating the damages, which properly applies when property is actually taken under the right of eminent domain. But no property was actually taken here, and the degree of injury, if any, which was inflicted could only be determined after the entire plan of improvement had been worked out. We can see no good reason for attempting to confine the estimate of the injury to the conditions as they happened to exist on May 12, 1903. The scheme of improvement in connection with the building of the viaduct was by no means complete at that time. If as a result of the entire plan of improvement, the plaintiffs were afforded safe and convenient access to their property, they could not be said to have suffered any permanent, substantial and proximate injury, as the result of the change.

The first, third and fourth assignments of error are sustained and the judgment is reversed, with a venire facias de novo.


source: Caselaw Access Project

license: Public Domain

text:
    Firemen’s Relief Association v. Scranton, Appellant.

      Municipalities — Appropriations of money — Firemen’s relief association — Constitutional laxo — Repeal of ordixiance — Mandamus.
    The Act of June 28, 1895, P. L. 408, which appropriates to municipalities within the commonwealth one-half of the net amount received from the tax paid upon premiums by foreign insurance companies, does not appropriate the fund to any particular purpose. It may be used in the discretion of the local authorities for any lawful purpose.
    An ordinance of a city appropriating money received from the state under the above act of assembly, to a firemen’s relief association, does not create in the association any vested right in the fund prior to its actual payment. It constitutes at most merely an executory gift, subject to revocation, until the transfer of the money has actually been made.
    Argued Feb. 25, 1907.
    Appeal, No. 279, Jan. T., 1906, by defendant, from judgment of O. P. Lackawanna Co., May Term, 1905, No. 778, for plaintiff on demurrer to statement in case of Firemen’s Relief Association v. City of Scranton.
    Before Fell, Brown, Mesteezat, Potter and Stewart, JJ.
    Reversed.
    Assumpsit to recover moneys alleged to be due under an ordinance.
    Newcomb, J., found the facts to be as follows:
    This action is assumpsit. The defendant has demurred to a statement disclosing the following facts:
    1. By the Act of June 28, 1895, P. L. 408, a tax was imposed upon the business done in this state by foreign fire insurance companies, of which one-half the net amoun t was directed to be paid over by the state to the treasurers of the several cities and boroughs in proportion to the amount of tax derived from each, as shown by the annual reports of the insurance commissioner.
    2. By ordinance approved March 17, 1898, entitled, “ An ordinance to provide for the annual transfer of a certain fund received from the State treasury as revenue from the foreign insurance companies agreeably to an Act of Assembly approved June 28, 1895, to the Scranton Firemen’s Relief Association,” it was enacted:
    “ Sec. 1. Be it ordained, etc., that all such sums of money as may be received by the City Treasurer in accordance with the Act ‘of Assembly, approved June 28, 1895, be, and is hereby declared to be received for the benefit of the Scranton Firemen’s Relief Association.
    “ Sec. 2. That the City Treasurer is hereby directed to enter such sum on the receipt thereof, under a special account and to report the said amount annually to the City Clerk, who is, hereby directed to issue warrants therefor in favor of the Treasurer of the Scranton Firemen’s Relief Association immediately after the receipt thereof and on report to him of the City Treasurer.”
    3. June 6,1898, the Scranton Firemen’s Relief Association was incorporated by decree of this court. Its articles of association bear date of April 1, 1898, and it nowhere affirmatively appears that it had any actual existence prior to that date, and, therefore, when the ordinance was passed. Its purpose, as stated in the charter, is “ to provide for the maintenance of a society for beneficial or protective purposes to the members from funds collected therein.” Its qualification for membership is not defined by the charter, but section 3 of the by-laws provides that “the requisite qualifications for membership are that the beneficiary shall be or have been an active member of the Fire Department of the City of Scranton, and a citizen of the Commonwealth of Pennsylvania.”
    4. By section 2 of its by-laws the object of the association is stated to be “ the accumulation of a fund from the annual dues of its members, legacies, bequests, gifts and other sources for the purpose of relieving firemen who may be disabled through accident while in the performance of their duties as active firemen of the City of Scranton, and in case of death for the benefit of a member’s widow, orphans or estate.”

      5. At tlie time the ordinance was passed, and until 1901, Scranton was a city of the third class, but whether its fire department was a voluntary or paid organization does not appear.
    6. In pursuance of the ordinance the receipts from the tax in question for the years 1896 to 1899, inclusive, were paid over by the city to the plaintiff. After that date the treasurer refused to make report of the fund to the clerk, and pending mandamus proceedings to compel him to do so the ordinance was repealed by another, approved October 24, 1903. The fund in dispute, therefore, is the amount of receipts from the tax for the years 1900 to 1902, inclusive, still in the city treasury, as follows:
    For the year 1900 $2,579.37
    For the year 1901 3,023.67
    For the year 1902. 3,245.72
    Total $8,848.76
    Which the plaintiff claims, with interest on the several sums from the date when they respectively came to the hands of the city treasurer. These dates, however, do not definitely appear.
    The demurrer was argued upon the assumption that the plaintiff corporation had an associate existence under its present name prior to the passage of the ordinance under which its claim is made. While it is doubtful practice to supply such fact in that way we will in this instance assume it as counsel have done, and suggest that the statement be amended in that particular by agreement.
    The court entered judgment for plaintiff for $10,180.86. Defendant appealed.

      Error assigned was the judgment of the court.

      David J. Davis, city solicitor, with him H. R. Van Deusen, assistant city solicitor, for appellant.
    The court erred in entering judgment for plaintiff: Com. v. Pittsburg, 183 Pa. 202; Speer v. School Directors, etc., 50 Pa. 150; Wilkes-Barre City Hospital v. Luzerne County, 84 Pa. 55; Taylor v. Mott, 123 Cal. 497 (56 Pac. Repr. 256); Erie’s App., 91 Pa. 398; Wade v. Oakmont Boro., 165 Pa. 479; Black v. Chester City, 175 Pa. 101.
    April 22, 1907:

      A. A. Vosburg, with him Charles W. Dawson, for appellee.
    The ordinance of 1897 made a valid appropriation of all moneys derived from the state under the provisions of the act of 1895, not only of such money then in the treasurer’s hands, but as to .that subsequently paid in; and it was not necessary or proper to make an appropriation of this money yearly, in the annual appropriation ordinance: Ristine v. State, 20 Ind. 328; People ex rel. McCauley v. Brooks, 16 Cal. 11; Black v. Chester City, 175 Pa. 101; Wade v. Oakmont Borough, 165 Pa. 479; Erie’s App., 91 Pa. 398; Com. v. Barker, 211 Pa. 610; Carr v. State, 11 L. R. A. 370; Humbert v. Dunn, 84 Cal. 57 (24Pac. Repr. 111); People v. Miner, 46 Ill. 384; State v. Hickman, 8 L. R. A. 403; Com. ex rel. v. Gregg, 161 Pa. 582.
   Opinion by

Mr. Justice Potter,

This is an appeal from a judgment entered in favor of plaintiff upon a demurrer filed by defendant to the statement of claim. When the ordinance involved in the present case was under consideration by this court in Com. v. Barker, 211 Pa. 610, we held that it was a valid and sufficient appropriation of the fund in question, for the current year of its passage. Beyond that it was not then necessary to go. But now we 'are called upon to decide whether or not it may be- regarded as a valid appropriation for future years. We can see no sound reason for exempting this appropriation from the estimate of probable expenditures for each fiscal year which, in accordance with the requirements of article 6, section 10 of the Act of May 23, 1889, P. L. 277, is to be made up and presented to councils, before the commencement of the year to be covered by the annual appropriations. The fund for distribution comes from the state, under the Act of June 28, 1895, P. L. 408; section 2 of which provides as follows: “ On and after the first day of January, one thousand eight hundred and ninety-six, and annually thereafter, there shall be paid by the State Treasurer to the treasurers of the several cities and boroughs within the commonwealth, one half of the net amount received from the two per centum tax paid upon premiums by foreign insuranee companies. The amount to be paid to each of the treasurers of the several cities and boroughs shall be based upon the return of said two per centum tax upon premiums received from foreign insurance companies doing business within the said cities and boroughs as shown by the insurance commissioner’s report. Warrants for the above purposes shall be drawn by the auditor general, payable to the treasurers of the several cities and boroughs in accordance with this act whenever there are sufficient funds in the state treasury to pay the same.”

We do not find in the statute any direction, or any intimation to any municipality receiving this fund, that it is to be appropriated for the benefit of any private corporation, association or individual. It is to be paid into the treasuries of the several municipalities, without distinction as to its use, from any other fund therein. ' It may be used in the discretion of the local authorities for any lawful purpose. No good reason is apparent, why the disposition of this fund should not be subject to the restrictions which apply to the disbursement of all public moneys. Certainly there is nothing in the act of assembly to indicate that the plaintiff liad any right to it, and its claim thereto must rest upon the action of councils through the ordinance in question. Circumstances might arise in which this fund would be needed for the discharge of the current expenses of the city. If so, it is certainly subject to the disposal of councils. We feel impelled to construe the payment as one requiring the support of an annual appropriation made after consideration by councils, of the estimate of the probable receipts and expenditures for the fiscal year.

There is no foundation for the contention that the ordinance created in the plaintiff association a vested right in the fund. It was at most, merely an executory gift, subject to revocation, as long as the transfer had not actually been made.

As was pointed out in Com. v. Barker, 211 Pa. 610, the mere fact that the plaintiff association was a volunteer fire company, did not make it ineligible for the discharge of the municipal function of protecting the city from fire. But there is a serious question as to the right of the municipality to appropriate public funds to the support of an association over which it has no control or supervision.

It appears from the history of the case that the city of Scranton became a city of the second class in April, 1901, prior to which time its fire department had been a volunteer department. It further appears that the department is now a paid or permanent department, and that when it became so the volunteer department vacated the fire houses which were owned by the city, and sold to the city all furniture, fixtures, etc., not required by the association in furnishing their clubhouse; and all connection with or control over the association by the city was severed. On the organization of a paid fire department the city by ordinance established a pension fund for the benefit of her firemen, under the act of 1901, and appropriated to it the funds in the hands of the city treasurer received under the act of 1895. Prior to the organization of the paid fire department every member of the volunteer force was a member of the Firemen’s Relief Association, and entitled to receive benefits. No dues were assessed against him as an individual, but each company was assessed pro rata according to the number of members, which assessment was paid from the treasury of the different volunteer fire companies.

The purpose of the plaintiff corporation, as stated in its charter, was “ to provide for the maintenance of a society for beneficial or protective purposes to the members from funds collected therein.” The qualifications for membership were not fixed by the charter. The by-laws provided that the requisite qualifications for membership are that the beneficiary shall be or have been an active member of the fire department of the city of Scranton and a citizen of the commonwealth of Pennsylvania.' There does not appear to have been any provision in either charter or:by-laws giving the city any voice in or control over the management of the association.

The by-laws, of course, could be amended at any time by the action of the members, and the “ beneficial or protective purposes ” of the association extended to others than firemen or ex-firemen. The funds appropriated by the city could, therefore, be used for purposes other than the relief of firemen or ex-firemen, and for the benefit of persons to whom the city owed no duty other than such as was due to every citizen.

The words of Chief Justice Lowrie in Phila. Assn. v. Wood, 39 Pa. 73, with reference to a similar association, are equally applicable hero. He said, This is an association for charitable purposes, it is true; but still it is strictly a private corporation. No public officer has any official knowledge of its existence, or of its members, organization or acts. It renders no account of its proceedings or of its funds. It is a close corporation, fixing its own terms of membership, and changing its organization but not its object, as it pleases.”

There is a plain distinction in this respect between membership in a voluntary association, such as this, and that of a paid fire department, organized and controlled by the city authorities. In the latter case the membership, the discipline and the management are subject to the regulation of the city. The benefits can be confined to those who have actually rendered service to the city. It is this feature only which distinguishes the payment of such a benefit from the bestowal of a gift or gratuity, which is prohibited by section 7, article IX, of the constitution.

The case of Firemen’s Fund v. Roome, 93 N. Y. 313, relied upon by the court below, and by appellee, seems to be in direct conflict with our own case of Phila. Assn. v. Wood, 39 Pa. 73. It was furthermore distinguished, and limited in its scope by the New York court of appeals, in the later case of Fox v. Humane Society, 165 N. Y. 517. But upon the ground that the ordinance did not constitute a valid appropriation for anything more than the current year, and that it was merely an executory gift, subject to revocation at any time prior to the actual transfer, the judgment entered upon the demurrer is reversed.


author: Mr. Justice Brown,

text:
    Bechtel, Appellant, v. Fry.

      Counties — Contracts—Employment of special counsel — County solicitor —Act of May 22, 1895, P. L. 101 — Criminal prosecution.

    It is indispensable in order to render a county liable for the services of additional or special counsel in matters committed by the Act of May 22, 1895, P. L. 101, to the charge of the county solicitor, if such services may be engaged at all, that there be an explicit contract entered into by the commissioners with such counsel, engaging his services in' specifically designated matters, that such contract precede the rendition of the services for which compensation is claimed, and that the services have been rendered in pursuance of such contract of employment.
    County commissioners have no authority whatever to employ counsel in a criminal prosecution, inasmuch as the commonwealth through •the district attorney administers its criminal laws, and conducts all prosecutions under them.

      Counties — County commissioners — Warrants—Deputy controllers.

    If a warrant be issued by county commissioners to pay the holder of it moneys which he is not entitled to receive from the county, and which the county commissioners have no authority to pay him, its approval by the county controller does not make it conclusive evidence of the county’s liability. If the county treasurer has knowledge of the illegality of the warrant, either from its face, or from other sources, it is his duty to refuse to pay the warrant when presented.
    Argued March 4, 1907.
    Appeal, No. 251, Jan. T., 1906, by plaintiff, from order of C. P. Berks Co., Jan. T., 1906, No. 48, refusing mandamus in case of W. B. Bechtel v. Henry H. Fry.
    Before Mitchell, C. J., Brown, Mestrezat, Elkin and Stewart, JJ.
    Affirmed.
    Petition for writ of mandamus. Before Endlioh, J.
    The facts appear by the opinion of the Supreme Court.

      Error assigned was refusal of mandamus.

      Walter S. Young, with him D. E. Schroeder, for appellant.
    Prior to the Act of May 22, 1895, P. L. 101, creating the office and defining the duties of a county solicitor, the implied authority of the commissioners to employ counsel to attend to the legal matters of the county was never denied: County of Chester v. Barber, 97 Pa. 455; Fulton v. Lancaster County, 162 Pa. 294.
    The fact that the commissioners have a regularly appointed solicitor does not deprive them of the power to appoint special counsel to assist him in conducting important litigation involving the interests of the county. .The necessity'’ and expediency of such employment rests within the sound discretion of the commissioners: Cumberland County v. Beltzhoover, 6 Pa. Dist. Rep. 625; Mayor, etc., of New York v. Ins. Co., 22 N. Y. Super. Ct. 424; State v. Paterson, 40 N. J. L. 186; Smith v. Mayor of Sacramento, 13 Cal. 531; Hornblower v. Duden, 35 Cal. 664.
    April 22, 1907:

      George W. Wagner, for appellee.
    A county treasurer is not required to pay all warrants drawn upon him, but only such as are founded on orders of the board of supervisors for the payment of demands legally chargeable against the county and allowed by the board; and he may and should refuse to pay warrants known by him to have been drawn for claims not authorized by law, or expenditures beyond the power of the board to incur: Keller v. Hyde, 20 California, 594; Merkel v. Berks County, 81* Pa. 505; Loucks v. Thompson, 11 Pa. Dist. Rep. 563; Board of Commissioners v. Boyle, 9 Indiana, 296; Pike County v. Rowland, 94 Pa. 238.
    The employment of counsel for criminal prosecutions is not within the power of the commissioners: Hight v. Board of Commissioners of Monroe County, 68 Ind. 575; Board of Commissioners of Ripley County v. Ward, 69 Ind. 441; Clough v. Hart, 8 Kansas, 487; Brome v. Cuming County, 31 Neb. 362 (47 N. W. Repr. 1050); Smith v. City of Scranton, 2 Pa. C. C. Rep. 331; Frederick v. Douglas County, 71 N. W. Repr. 798.
   Opinion isy

Mr. Justice Brown,

On December 23, 1905, two of the commissioners of the county of Berks issued to the appellant a warrant upon the county treasurer, payable to his order, for $2,200. It appeared upon its face to be for special attorney county cases.” It was approved and countersigned by the deputy county controller. Upon presentation to the county treasurer payment was refused and the holder of the warrant — this appellant' — ■ applied to the court of common pleas for a writ of mandamus to compel its payment. Edwin C. Ruth was the treasurer at the time the writ was applied for, but, his term of office having expired before the return day of the alternative writ, his successor, Henry H. Fry, was, upon the petition of the appellant, substituted as respondent. He made return to the writ. It was demurred to by the petitioner, and on the demurrer judgment ivas entered for the respondent.

The return averred that the warrant was illegal, because neither the county commissioners in issuing it nor the county controller in approving it had authority in law for so doing, and it was without legal consideration. The third averment in the return was, “ The defendant further avers that prior to the time that said warrant was presented to him for payment, Jacob Miller, the other county commissioner of Berks county, filed in the county treasurer’s office a general notice dated December 23, 1905, notifying the treasurer as treasurer not to cash said warrant No. A4381; and also upon the same day that this general protest was filed the said Jacob Miller as county commissioner, filed an additional protest against the payment of said warrant, in which second protest the said county commissioner gave notice to the defendant that W. B. Bechtel was never employed by the county commissioners, nor did the county commissioners ever authorize anyone to employ him as counsel in any case of those for which payment was demanded by said warrant, excepting in the case of the county of Berks, v. F. F. Bressler, in which Mr. Shalters was the prosecutor; and also notifying the defendant that the said W. B. Bechtel was not entitled to draw any fees from the county for professional services; a copy of which two notices is hereto attached, marked respectively A ’ and ‘ B ’ and made part of this return.” The eighth averment was that the warrant was not founded upon a contract of the county of Berks with the said plaintiff, W. B. Bechtel, or issued in consequence of any liability of the county of Berks to the said W. B. Bechtel.”

In the statement of the questions involved the appellant says one is, “ Has a board of county commissioners, having a county solicitor, regularly appointed under the provisions of the Act of May 22, 1895, P. L. 101, the power to employ special counsel to assist the county solicitor in certain specified litigation in which the county is a party ? ” This question was not passed upon by the court below, for the judgment in favor of the respondent was based'entirely upon the fact alleged in the return and admitted by the demurrer to be true, that the warrant was not founded upon any contract of the county of Berks with the appellant.

The Act of May 22, 1895, P. L. 101, authorizing the appointment of a county solicitor by the county commissioners, directs that such solicitor “shall commence and prosecute all and every suit and suits brought or to be brought by the county, wherein or whereby any of the rights, privileges, properties, claims or demands of the county are involved, as well as defend all actions or suits brought against the county, and shall perform all duties now enjoined by law upon county solicitors, and shall do all and every professional act, incident to the office, which may be required by the officers named in said board.” In view of this direction, one of the contentions of the respondent was that all the legal business of the county is to be attended to by the solicitor, and that the commissioners are without power or authority to employ and pay out of the county funds any special counsel in prosecuting or defending suits brought by or against the county. The learned and careful judge below expressly avoided passing upon this question, intimating, however, that there might be implied power in the commissioners to employ special counsel if necessity for such employment should arise, as, for instance, the sickness, absence or adverse interest of the solicitor. What was decided, and properly decided, was that as the act of 1895 imposes upon the solicitor selected by the county commissioners the duty of commencing and prosecuting all suits brought by the county wherein or whereby any of its rights, privileges, properties, claims or demands may be involved and to defend all actions or suits brought against the county, the commissioners cannot employ anyone else to take the place of the solicitor, or act as his assistant generally ; and if in any case they can employ special counsel it is only in specific matters to be distinctly pointed out, and a contract in all exceptional cases must be made by the county commissioners with special counsel and precede the rendition of the services for which compensation is claimed. This was manifestly correct, and nothing need be here added to the following taken from the opinion of the court below in speaking of the position of the respondent that in no case can special counsel be employed: “It is, however, not essential in this case to decide whether the extreme position taken by respondent is correct or not. Leaving that question open, it is certainly indispensable, in order to render the county liable for the services of additional or special counsel in matters committed by the act of 1895 to the charge of the county solicitor, if that can be done at all, that there be an explicit contract entered into by the commissioners with such counsel engaging his services in specifically designated matters, and that the services for which compensation is claimed have been rendered in pursuance of such contract of employment. In other words, the statute having designated a certain salaried officer to conduct the legal affairs of the county generally, it cannot be lawful for the commissioners to employ anyone else, either to take his place or to act as his assistant, generally, but only in specific matters to be distinctly pointed out. Next, the employment of such person must be by the commissioners acting as a board, not by the county solicitor or anyone else acting by delegation from the commissioners, and the act of employment must be unequivocal and precise, — not necessarily fixing the rate or amount of the compensation, nor evidenced by a written agreement or a record upon the minutes, but possessing all the elements of a contract binding not only the county to accept, but also the attorney to render the services in question. And, finally, that cbntract must precede the rendition of the services for which compensation is claimed. That this must be so seems to be the clear teaching of Eulton v. Lancaster County, 162 Pa. 294. That it is demanded by the settled policy of our law is even clearer. The constitution, in art. III, sec. 11, forbids the legislature to provide for the payment of any claim against the commonwealth not founded upon previous authority of law. The municipal act of 1889, in art. IV, sec. 5, imposes, mutatis mutandis, the same restriction upon city councils. Manifestly counties are for the same reasons entitled to the protection of the same rule, and to this extent the doctrine of ratification must be deemed inapplicable to them. No fair-minded person can dispute the fact that the plaintiff here has rendered services to the county which were valuable and advantageous to it. Nor in this proceeding is the reasonableness of the compensation allowed him in dispute, if he is entitled to be compensated for his services. But if they were rendered, as the return avers and as for present purposes. the court must believe, without a distinct and binding antecedent employment with reference to the specific matters in which they were rendered, except in one particular, they must be treated as having been to that extent voluntarily rendered for the public good, without right to claim or authority to accord compensation therefor out of the county treasury.”

Upon the assumption that the averment in the return that the county commissioners never authorized anyone to employ the appellant as counsel in any of the cases for which payment was demanded, except in the case of the county of Berks v. F. F. Bressler (which ought to have been, as appears in the sixth averment of the return, Commonwealth v. F. F. Bressler), might be construed as an admission that the county had employed the appellant in that criminal prosecution, the learned judge held that even if a valid contract can be entered into by the county for the employment of special counsel in civil cases, no such contract can be entered into in a cri minal case. It is not within the express power of county commissioners to employ special counsel in any case, civil or criminal, and, even if it be within their implied powers to do so in a civil case, there is no such power in criminal cases. The commonwealth itself administers its criminal laws. It commits to a special officer the duty of prosecuting offenders against its peace and dignity and bringing them to punishment, and a county has no more interest in public prosecutions than any private individual, and county commissioners, therefore, have no more right to take out of the public treasury moneys to pay for special counsel in criminal prosecutions than has an individual. The prosecution of Bressler may have been instituted because he had criminally appropriated or withheld moneys belonging to the county, but the object of his prosecution was not to secure the return to the county of any moneys which it may have lost through him, but to vindicate public justice, and the county, as a county, had, therefore, no more direct interest in his prosecution than any individual. The rights, privileges and properties of a county are no more involved in public prosecutions than the rights, privileges and properties of an individual. That a county may pay the costs of public prosecutions makes no difference as to this. It pays such costs out of public moneys simply as the representative of the state, and because the state commands it to do so.

A second contention of the appellant is that a county treasurer, upon presentation to him of a county warrant, properly endorsed, regularly issued at a duly convened meeting of county commissioners, signed by a majority of them, and countersigned by the deputy controller, in payment of a debt or claim, audited and approved by the controller, has no right to refuse payment of the same and to inquire into the regularity of the issuance of the warrant in the admitted absence of fraud or collusion. If a warrant be issued by county commissioners to pay the holder of it moneys which he is not entitled to receive from the county, and which the county commissioners have no authority to pay him, its approval by the county controller does not make it conclusive evidence of the county’s liability. His duty is to approve claims “ legally due: ” Act of June 27, 1895, P. L. 403; and if he approve a claim not legally due — which has no legal existence — his certificate cannot make it so. A warrant signed by a majority of or the entire board of county commissioners is no more conclusive evidence of the county’s liability with the county controller’s counter signature upon it than it was before the office of county controller was created. What was illegal then could not be enforced against the county even upon a commissioners’ warrant, and what is illegal now cannot be enforced with commissioners and controller all together a party to the warrant.

This warrant, having been illegally issued, if it was not founded upon a contract between the county of Berks and the appellant, any taxpayer, after its issuance, could have filed a bill to enjoin its payment. Such bill would have been against the treasurer of the county. He was notified of the illegality of the warrant, and warned not to pay it. If he had not been county treasurer and the notice of its illegality had come to him as a citizen, a court of equity would have been open to him, but, being himself the treasurer of the county, what would have been sufficient to enjoin such officer from paying the warrant is sufficient to justify his refusal to pay it. He would hardly be expected to file a bill against himself, and, upon the notice received 'by him, it was his duty to refuse payment. “ A county treasurer is not required to pay all warrants drawn upon him, but only such as are founded on orders of the board of supervisors for the payment of demands legally chargeable against the county and allowed by the board; and he may and should refuse to pay warrants known by him to have been drawn for claims not authorized by law, or expenditures beyond the power of the board to incur: ” 11 Ency. of Law and Procedure, 540. There was sufficient upon the face of this warrant to put the treasurer on notice, and he might well have refused for this reason alone to pay it until satisfied that there had been a contract entered into by the county for the special services before they wore rendered. When orders are issued appropriating public money to purposes that are illegal and the county treasurer has knowledge or means of knowledge of their illegality, it is his duty to refuse to pay them when they are presented. lie is bound to know the extent and limit of the authority conferred upon him by the law under which he accepted his office: Merkel v. Berks County, 81* Pa. 505. In that case, as in this, express notice was given to the treasurer that the orders were drawn for illegal purposes.

The assignment of error is overruled and the judgment of the court below is affirmed, without prejudice to the right of tbe appellant to recover for any services which lie may have rendered in civil cases in pursuance of a legal contract with the county commissioners that he should render them.


author: Mr. Justice Elkin,

text:
    Kaufman, Appellant, v. Pittsburg & Castle Shannon Railroad Company.

      Railroads — Lease—Power to lease — Act of May 25, 1871, P. L. 1170.
    A railroad company incorporated under the general railroad Act of April 4, 1868, P. L. 62, with additional powers, enabling it to own and operate coal mines, conferred by the special Act of February 21, 1872, P. L. 142, and to construct and operate inclined planes by a special Act of April 5, 1873, P. L. 546, may lease its railroad to a railway company organized with omnibus powers under the special Act of May 25, 1871, P. L. 1170.
    If a railroad company has the chartered power to construct a railroad for another company to operate, and to operate a railroad for itself, it has the power to lease a railroad for its own use for a term of years. The power to purchase outright includes the power to lease and operate for a definite term. The greater includes the lesser power.

      The question whether the legislature was improvident in conferring omnibus powers upon certain corporations chartered by special acts during the legislative sessions of 1870 and 1871, is a legislative, and not a judicial, one.
    The general railroad Acts of April 23, 1861, P. L. 410, and February 17, 1870, P. L. 31, requiring the railroads of a lessor and lessee to be “connected,” do not apply to the Act of May 25, 1871, P. L. 1170.
    Where- a railroad company under its act of incorporation has the power to take a lease of the property of another railroad company, and there is no limitation on the power of the second company to enter into the lease, the second company has an implied power to make the lease in question.
    Argued March 5, 1907.
    Appeal, No. 40, Oct. T., 1907, by plaintiff, from decree of O. P. No. 1, Allegheny Co., Sept. T., 1905, No. 839, dismissing bill in equity in case of Sibilla Kaufman v. Pittsburg & Castle Shannon Railroad Company, Pitts-burg Railways Company et al.
    Before Mitchell, C. J., Brown, Elkin and Stewart, JJ.
    Affirmed.
    Bill in equity for an injunction.
    Maoearlane, J., found the facts to be as follows:
    1. The Pittsburg & Castle Shannon Railroad Company, hereinafter called the railroad company, is a corporation organized under the general railroad Act of April 4, 1868, P. L. 62, and having by the special Act of February 21,1872, P. L. 142, the right to own real estate and mine coal therefrom, and by the special Act of April 5, 1873, P. L. 546, the right to construct an incline plane. The plaintiff was in August, 1905, and still is the owner of fifty shares of stock of the said company.
    2. The Pittsburg Railways Company, hereinafter referred to as the railways company, was incorporated by a special Act of assembly, May 25, 1871, P. L. 1170, under the name of the “ Surety Contract Company,” subsequently changed to the present name, and its principal business is that of operating traction lines and passenger railways in the county of Allegheny.
    3. The Pittsburg Coal Company, hereinafter referred to as the coal company, is a corporation under the laws of the state of New Jersey, having its principal office in the city of Pitts-burg, Allegheny county, and is engaged extensively in the mining and selling of .coal in the said and adjacent counties; and it is the owner of 7,756 shares of the stock of the Pitts-burg & Castle Shannon Railroad Company, out of a total of 9,628 shares.

      4. The board of directors of the railroad company, ten in number, is with one exception composed of officers and directors of the coal company, and the railroad company has been for several years controlled and managed by the coal company.
    5. The executive officers of the railroad company, its superintendent, engineer and accounting officers, were officers in a similar capacity of the coal company, which charged the railroad company for their services a reasonable amount, and the operating expenses of the railroad company were, in this respect, much less than they would have been if independently officered.
    6. The railroad operated by the railroad company extends from Arlington Station, Scott township, Allegheny county, to a point on Bailey avenue in the thirty-second ward in the city of Pittsburg, and then by an incline plane with the road running from Bailey avenue to Carson street in the city of Pitts-burg. It also owns and operates coal mines in Scott township. Prior to January 1, 1893, the railroad ran by a horseshoe curve track north of Washington avenue, in the thirty-second ward, in the city of Pittsburg, via a coal tunnel and coal incline to Carson street in the thirtieth ward, Pitts-burg, where there was and is now located a coal yard of the railroad company. About the last mentioned date the company constructed a shorter and more direct line diverging from the former route at a point near Washington avenue, in Montooth borough, and by incline planes reaching Carson street at a point adjoining the coal yard. Upon the completion of the new short line the horseshoe curve track, coal tunnel, etc., were used solely for the transportation of coal from the mines of the company to the yard, and were not used for the transportation of freight and passengers, except on several occasions prior to the year 1900, passengers were so transported on account of accidents to the incline planes on the shorter route, which from January, 1893, was used exclusively for passengers and freight and became the main line of the railroad. The horseshoe curve portions of the track were nsecl in connection with the coal yard as.apartof the terminal facilities of the railroad company in its mining and shipping of coal.
    7. On July 13, 1904, the railroad company leased to the coal company, at $30.00 a month, for the term of three years from July 1, 1904, a lot which had been used as a dump for refuse, and the coal company erected thereon a laboratory for its use and the use of the railroad company.
    8. For some time prior to any negotiations for the lease in this case, the coal company had erected telephone wires, at its expense, along the right of way of the railroad, and this line was used by the coal company and the railroad company without charge to the latter.
    9. The coal company has, and has had, no agreement or understanding with the railroad company for the use of the horseshoe curve portion of the tracks, and has not, at any time, used these tracks or any part thereof, and it does not own, control or operate in any way any mines or other property on or near the line of the railroad company.
    10. The railroad company was, in August, 1905, and had been for several years previous, insolvent. Its coal property was valuable and was capable of being operated with profit, but the railroad had for a long time been operated at a loss of more than $3,000 a month, which was almost an offset to the earnings of the coal business of the company.
    11. During the months of July and August, 1905, the railroad company began negotiations with one Baxmyer for the lease of the railroad, and a meeting of the stockholders of the railroad company was called on August 16, 1905, for the purpose of considering a proposition for the leasing or selling of certain of its property, and there was then presented to the stockholders a resolution authorizing the execution of a lease and it was then stated that the proposed lessee was the railways company, and that the proposed lease was in pursuance of a resolution of the board of directors, made on July 21,1905. Objections were made by some of the stockholders, including the plaintiff, and a verbal offer was made to take a lease at the rent of $20,000 per annum. The meeting adjourned to August 17, at which time William Kaufman, acting on behalf of a principal whose name he refused to disclose, but with whom the plaintiff had no privity, hut who was, some time after the execution of the lease, disclosed to be Robert C. Hall, a broker and promoter, of the city of Pittsburg, offered in writing that he, Kaufman, would, on or before August 24, bid at least $17,500 for the lease in the same form as that submitted, and as evidence of his good faith ho deposited three bonds of $1,000 each. The meeting was adjourned to August 24, at which time Kaufman did bid $17,500 per annum for the lease for a term of ninety-nine years, and for a further term of ninety-nine years at $20,000 per annum. This bid was in writing. The said bid was not submitted for the consideration of the stockholders, for the reason that the identity of the principal was not disclosed, although demanded, and it appeared on the bid that there w'as no corporation competent to take the lease; and it was known by the directors and by the plaintiff and most of the stockholders present that the railways company was ready and willing to execute the lease, and that it was a strong corporation, of a good credit, and capable of carrying out the terms of the lease.
    12. The action of the coal company as a majority stockholder, and of the officers of the railroad company, in voting for the lease and in subsequently executing it, was prudent and in good judgment and was advantageous to all of the stockholders, and the refusal of the Kaufman bid was in good faith and in the exercise of good judgment. It developed upon the trial of this case that Mr. Hall had no connection with or control over any corporation capable of taking a lease, and his purpose in desiring to acquire the lease was simply as a, speculation.
    13. At the last mentioned meeting an election was had upon the proposed lease. The coal company cast its stock in favor of the resolution, and out of a total of 9,628 shares 8,153' shares were cast in favor to sixty-six against the resolution, the affirmative vote being composed of the stock of the coal company and its officers, directors and employees, with the exception of 350 shares, and of the sixty-six shares, fifty were owned by the plaintiff and sixteen by E. F. Hays.
    14. Neither the coal company nor any of its officers nor any of its subsidiary companies or their officers have received or will receive any pecuniary or other benefit or advantage in consideration of voting its stock in favor of the lease, except such benefits and advantages as accrue equally to all of the stockholders of the railroad company.
    15. The lease dated August 25, 1905, was executed for the railroad company by its president on the morning of August 25, and by its secretary in the evening of that day, and was executed by the railways company on August 26; and as early as 12: 25 p. m. August 25, notice was served upon the railways company by plaintiff, requiring the defendant not to execute the lease or to pay on t any money on account thereof.. This bill was filed on August 30 and served the same day. The railways company entered into possession, and since that time has been operating the portion of the railroad leased to it.
    16. On or before September 1, 1905, the railroad of the defendant railroad company did not connect with nor intersect any other railroad nor .physically with the road or railway of any street railway company, and the railways company did •not own, control, lease or operate a railroad physically connected with that of the railroad company. The railways company’s tracks are situated, with reference to the railroad company’s tracks, at a number of points, as follows: at Carson street within sixty feet, at which point passengers have been for several years transferred between the respective companies under the terms in an agreement; on Bailey avenue, within four or five feet; near Arlington avenue the railways’ tracks cross the railroad above grade; the Washington avenue line parallels the railroad for more than a quarter of a mile, at a distance from twenty to sixty feet; at another point the lines are 150 feet apart, and the ■ intervening land is leased by the railways company; from Arlington to Castle Shannon the 'lines parallel for about half a mile, at a distance from twenty-five to 200 feet; and in Castle Shannon a spur of the railroad extends to within ten feet of the railways’ tracks. At all but one of these points the transshipment- of passengers from one road to the other is easy and convenient.
    CONCLUSIONS OF LAW.
    1. There being no fraud or undue advantage, the lease is not void on that ground.

      2. The lessor has not violated any duty to the commonwealth.
    3. The lessee has the right to take the lease.
    4. The lessor has the right to make the lease.
    5. It is not necessary under the charter of the lessee that the lines bo mechanically connected, and it is sufficient that they are in proximhy so as to afford convenient transfer of passengers.
    6. The bill should be dismissed at the costs of the plaintiff.

      Error assigned was decree dismissing the bill.

      Wm. Kaufman, with him E. F. Hays, for appellant.
    The lease is ultra vires as to defendant Pittsburg & Castle Shannon Railroad Company: Bly v. White Deer Mountain Water Co., 197 Pa. 80; Schroeder v. Gas & Water Co., 20 Pa. Superior Ct. 255; Van Steuben v. R. R. Co., 178 Pa. 367; Pittsburg, etc., Railroad Co. v. Railroad Co., 196 Pa. 452; Penna. R. R. Co. v. Bridge Co., 131 U. S. 371 (9 Sup. Ct. Repr. 770); Central Transportation Co. v. Pullman Palace Car Co., 139 U. S. 24 (11 Sup. Ct. Repr. 478).
    The defendant railways company and the defendant railroad company are subject to the general laws of the state in force on the date of their incorporation, including the general railroad act of 1868, and the railroad leasing acts of 1861 and 1870: Penna. R. R. Co. v. Kelly, 31 Pa. 372; Penna. R. R. Co. v. Duncan, 111 Pa. 352; Penna. R. R. Co. v. Miller, 132 U. S. 75 (10 Sup. Ct. Repr. 34).
    The charter of the defendant railways company standing by itself does not authorize it to take the lease; and even if it were so constructed, the lease cannot be held valid if it is ultra vires as to the defendant railroad company: Bly v. White Deer Mountain Water Co., 197 Pa. 80; Schroeder v. Gas & Water Co., 20 Pa. Superior Ct. 255; Pennsylvania Railroad Company’s Appeal, 93 Pa. 150; Commonwealth v. Erie, etc., R. R. Co., 27 Pa. 339; Hampe v. Traction Co., 165 Pa. 468.
    In this state there have been numerous decisions holding contracts of corporations void because ultra vires as to the powers of one of the parties thereto: Bosshardt & Wilson Co. v. Crescent Oil Co., 171 Pa. 109; Stewart’s App., 56 Pa. 413; Pittsburg & C. R. R. Co. v. Allegheny County, 63 Pa. 126; Pittsburg & Steubenville R. R. Co. v. Allegheny County, 79 Pa. 210; Louisville, etc., R. R. Co. v. Kentucky, 161 U. S. 677 (16 Sup. Ct. Repr. 714); Pennsylvania R. R. Co. v. Bridge Co., 131 U. S. 371 (9 Sup. Ct. Repr. 770); Central Transportation Co. v. Pullman Palace Car Co., 139 U. S. 24 (11 Sup. Ct. Repr. 478).
    April 22, 1907:

      David A. Reed, of Reed, Smith, Shaw de Beal, with him Charles M. Johnston, for appellees. —
    Power to take the lease was given by the charter whether or not the railways company had a connecting line: International Navigation Co. v. Com., 104 Pa. 38; Hespenheide’s App., 4 Pennypacker, 71; Carothers v. Phila. Co., 118 Pa. 468; Phila. & Erie R. R. Co. v. Catawissa R. R. Co., 53 Pa. 20; Philadelphia v. Philadelphia Traction Co., 206 Pa. 35; Hampe v. Pittsburg, etc., Traction Co., 165 Pa. 468.
    Power to make the lease is given by clear implication from the Pittsburg railways charter: In re Prospect Park & Coney Island R. R. Co., 67 N. Y. 371; N. Y. & N. E. R. R. Co. v. N. Y., N. H. & H. R. R. Co., 52 Conn. 274; Hunting v. Hartford St. Ry. Co., 73 Conn. 179 (46 Atl. Repr. 824).
   Opinion by.

Mr. Justice Elkin,

The answer to the third proposition contained in appellant’s statement of the question involved will control all the material questions raised by this appeal. Does the charter of the defendant railway company authorize it to take the lease, the execution of which is sought to be enjoined by appellant, and if so, will the lease be held valid for that reason, even though the charter of the railroad company did not in express terms confer the power to enter into such a contract ?

The defendant railroad company is a corporation organized under the general railroad Act of April 4, 1868, P. L. 62, and by the special Act of February 21, 1872, P. L. 142, it is given the power to purchase and own real estate and mine coal therefrom. Under the Act of April 5, 1873, P. L. 546, it has the right to construct an incline plane. The learned court below has found as a fact that said railroad company was in August, 1905, and had been for several years prior thereto, insolvent. Its coal property was valuable and was capable of being operated with profit, but the railroad had for a long period of time been operated at a loss of more than $3,000 per month. The railroad company, being desirous of relieving itself from the operation of the road, opened negotiations for the purpose of making a lease of the same for a term of years. Several meetings were held for the purpose of considering a proposition looking to a leasing of the railroad, and on August 24, 1905, the final meeting of the stockholders of the railroad company was held, at which 8,153 shares were voted in favor of the lease and sixty-six against it. The appellant voted fifty shares out of the total of sixty-six against the resolution. The learned court below has found as a fact that the lease was an advantageous one for the stockholders of the railroad company to make, and that there was no fraud or collusion in the transaction. Indeed, we do not understand that the learned counsel for appellant raises any such question on this appeal, but relies entirely on the legal proposition above stated.

The Pittsburg Railways Company derives all of its powers under the special Act approved May 25, 1871, P. L. 1170. This company is one of seven or eight corporations chartered by the legislatures of 1870 and 1871 which have been granted very broad and comprehensive powers. It is clearly within the power of this company to engage in the transportation of passengers and freight by land or water, for it is so expressly written in the act creating it. In section two it is given the power “to build, construct, maintain or manage any work or works, public or private, which may tend or bo designed to improve, increase, facilitate or develop trade, travel or the transportation or conveyance of freight, live stock, passengers and any other traffic, by land or water.” In section four it is given the power to purchase, make, use and maintain any works or improvements connected or intended to be connected with the works of said company, and to merge or consolidate or unite with said company the improvements, property and franchises of any other company.

It will be observed that this company is given the express power to merge, consolidate or unite with its works or business the improvements, property or franchises of any other company. It also has the power to purchase, malee, use and maintain any works or improvements of another company connecting or intended to be connected with the business of said company. When these general powers are considered in connection Avith the power to build, construct, maintain or manage any Avork or works, public or private, intended to improve, increase, facilitate or develop trade, travel or the transportation or conveyance of freight, passengers and other traffic by land or Avater, conferred by section two, there can be no doubt that the railways company had the power to enter into a contract of lease Avith the railroad company, under the terms of which it is to use and maintain the property of the railroad company for a term of years at a fixed annual rental agreed upon. It cannot be seriously questioned that the railways company under its charter has the poAver to build a railroad for another corporation to operate, nor can it be doubted that it has the power to build and operate a railroad for its own use, and it necessarily follows that if it can construct a railroad for another company to operate and can operate a railroad for itself, it can lease a railroad for its own use for a term of years. The poAver to purchase outright certainly includes the poAver to lease and operate for a definite term. The greater includes the lesser power.

It may be objected that the legislature was improvident in conferring upon this and the several other companies created by the special acts during the legislative sessions of 1870 and 1871, such omnibus powers, but this is a legislative and not a judicial question. In International Navigation Company v. Commonwealth, 104 Pa. 38; Hespenheide’s Appeal, 4 Pennypacker, 71; and Carothers v. Philadelphia Company, 118 Pa. 468, it Avas held that the rights and franchises granted by these special acts Avere a valid exercise of the legislative power. In the last case cited it Avas distinctly held that the power conferred was sufficiently comprehensive to authorize that particular company to engage in the production, distribution and supply of natural gas for fuel.

It seems to be conceded in the argument of the learned counsel for appellant that the .raihvays company has the general power to engage in the transportation of freight or passengers, but it is earnestly contended that the provisions of the acts of 1861 and 1870, requiring the railroads of a lessor and lessee to be “ connected,” should apply, and that the lines of the defendant railways company and railroad company do not have a physical connection, and for this reason the lease must fall. In this connection.it should be observed that the words “connected or intended to be connected,” in the act of 1871 which created the defendant railways company, are of much wider significance in the matter of acquiring connecting lines than are the provisions of the general railroad acts referred to. The question involved in this case has nothing to do with the rights or limitations of railroad companies under the general acts of 1861 and 1870. The defendant railways company, in so far as these general powers are involved, looks to the act of its incorporation and is not controlled by the acts referred to. Even under the railroad acts of 1861 and 1870 it has been held that the roads of the lessor and lessee need not bo so connected that the same cars shall pass from one road to the other without interruption, but only that they shall be so connected that a convenient interchange of passengers and freight is possible: Philadelphia & Erie Railroad Company v. Catawissa R. R. Co., 53 Pa. 20; Hampe v. Pittsburg & Birmingham Traction Company, 165 Pa. 468. However, it is unnecessary to discuss the question whether the lines of the two companies were so connected as to meet the requirements of the acts of 1861 and 1870, because the rights of the lessor and lessee in this case are controlled by the act of 1871, under which the lessee company was incorporated.

It is now urged, however, that even conceding that the railways company had the power to take the lease in question, the railroad company did not have the power to make it. This does not now seem to be an open question in this state, as it has been expressly held by this court that the power to take, expressly conferred upon the railways company, implies the power in the lessor company to make the lease: Pinkerton v. Pennsylvania Traction Company, 193 Pa. 229. In that case, the present chief justice, speaking for the court, said: “ Nor is there any weight in the objection that the passenger railway company had no power to lease its road. The power to take a lease is expressly given to the motor company, and the corresponding power in the passenger railway company, as owners, to give a lease, is necessarily implied. Without it, the grant in the act would be nugatory.” To the same effect are the cases in other jurisdictions: In re Prospect Park and Coney Island Railroad Company, 67 N. Y. 371; N. Y. & N. E. R. R. Co. v. N. Y., N. H. & H. R. R. Co., 52 Conn. 274; Hunting v. Hartford Street Railway Company, 73 Conn. 179.

From the rule stated in these cases it clearly appears that the railways company, under its act of incorporation having the power to enter into the lease with the' railroad company, and there being no limitation on the power of the railroad company to enter into the lease, and, therefore, no violation of any statutory requirement, it had an implied power to make the lease in question.

Decree affirmed.


author: Mr. Justice Mestrezat,

text:
    Fleming’s Estate.

      Trusts and trustees — Insolvent trustee — Will—Election—Right to take against will as an asset.

    A power of election to take under the intestate law is not an asset for the discharge of trust liabilities.
    Where the wife of an insolvent trustee creates by her will a spendthrift trust for her husband, persons interested in the insolvent trust estate cannot by an attachment against the person of the husband, compel him to elect to take against his wife's will.
    Argued March 13, 1907.
    Appeal, No. 47, Oct. T., 1907, by Cochran Fleming, from decree of O. C. Allegheny Co., Sept. Term, 1904, No. 116, awarding an attachment in Estate of John Fleming, deceased.
    Before Fell, Brown, Mestrezat, Elkin and Stewart, JJ.
    Reversed.
    Petition for attachment.
    The facts appear by the opinion of the Supreme Court.

      Error assigned was the decree awarding the attachment.

      J. M. Swearingen of Swearingen, Lewis c& Newmyer, with him Fleming Nevin, for appellant.
    The right to elect to take against a will is not an asset: Standard Oil Co. v. Hawkins, 74 Fed. Repr. 395; Bliss v. Geer, 7 Ill. App. 612; Clarke’s App. 79 Pa. 376; Crozier’s App., 90 Pa. 384; Greiner’s App., 103 Pa. 89.
    April 22, 1907:

      Watson B. Adair, with him Arthur L. Over, for appellees.
    —Appellant’s right to elect to take against his wife’s will is assets for the satisfaction of the decree: Kerr v. Day, 14 Pa. 112; Napier v. Darlington, 70 Pa. 64; Horne & Co. v. Petty, 192 Pa. 32; Day v. Ins. Co., 111 Pa. 507; Patterson v. Caldwell, 124 Pa. 455; Bakewell v. Keller, 11 W. N. C. 300; Rutter’s App., 8 Atl. Repr. 170; Ager v. Murray, 105 U. S. 126; Pancoast v. Gowen, 93 Pa. 66; Eliot v. Merchants’ Exchange, 14 Mo. App. 234; Ritterband v. Baggett, 4 Abb. N. C. (N.Y.) 67.
   Opinion by

Mr. Justice Mestrezat,

As suggested by the learned judge of the court below, the real question in this case is whether or not a power of election to take under the intestate law is an asset for the discharge of trust liabilities.

John Fleming died in 1870, leaving a will, in which, inter alia, ho bequeathed $20,000 to his brother, Cochran Fleming, in trust to pay the incometo James P. Fleming for life and then the principal to the latter’s children, the petitioners in this proceeding. James P. Fleming having died, Cochran Fleming filed his account, and on December 16, 1904, a decree was entered by the orphans’ court of Allegheny county that he pay to James Pressley Fleming and John L. Fleming, the children of James P. Fleming, each the sum of $10,000, the legacies bequeathed them in the will of John Fleming, deceased. Having failed to comply with this decree by paying the legacies, a citation was awarded against Cochran Fleming on November 18, 1905, at the instance of the legatees, to show cause why an attachment should not be issued against him for contempt for failure to comply with the decree of distribution heretofore made in this case.” Subsequently, on May 8,1906, on petition of the legatees praying the court for the reasons therein set forth to make an order refusing said attachment,” the court entered a decree that the prayer of the petition asking that the attachment be refused “ is granted and the attachment refused.”

On August 9, 1906, Sarah A. Fleming, the wife of Cochran Fleming, died leaving an estate of . $59,000 and by her will, duly admitted to probate, bequeathed the estate to her executor in trust to pay the interest thereon to Cochran Fleming during life without liability for his debts. Shortly thereafter John L. Fleming and James Pressley Fleming presented their petitions to the court below reciting the fact of the death of Cochran Fleming’s wife and the bequest to him in her will, also the decree of the court directing him to pay their legacies, and praying the court to “ allow a writ of attachment whereby the interest of said Cochran Fleming in the estate of said Sarah A. Fleming may be attached' in satisfaction of said decree in accordance with the acts of assembly.” An attachment was awarded to which the executor of Sarah A. Fleming answered that Cochran Fleming was not entitled to any Interest under the will of the said Sarah A. Fleming which was subject to attachment in his hands.

On October 8, 1906, John L. Fleming and James Pressley Fleming presented their petitions to the court below reciting the bequests to them in the will of John Fleming, deceased, the failure of Cochran Fleming to pay the legacies, the death of Cochran Fleming’s wife, and the legacy bequeathed him in her will, averring that Cochran Fleming has no interest in his deceased wife’s estate subject to attachment, but that he had the right under the law to elect to take against her will the one-third part of the personal estate of his wife, and averring further that should he die prior to making such election, the right to make the same might be lost and they would take nothing from the attachment executions, and further showing that said Cochran Fleming has it within his power to secure the payment now or in the near future of a substantial part of said decree and that he has refused to exercise said power, pray your Honorable Court to issue an attachment against the said Cochran Fleming for his noncoin pliance with tho decree of your Honorable Court.” A citation was granted to show cause why the attachment should not issue as prayed for; and subsequently, on January 15, 1907, the court entered a decree awarding the attachment. From that decree we have this appeal.

This statement of the facts is sufficient for an intelligent understanding of the proceedings and the final decree entered in the court below. The view we take of the case renders it unnecessary to determine the power of the court to issue successive attachments to enforce its decrees for the payment of money, as we are clearly of the opinion that the learned court below was in error in awarding the attachment against Cochran Fleming on the ground that his power of election to take against the provisions of his wife’s will is an asset for the discharge of the legacies bequeathed to the petitioners. It was solely upon this ground that the attachment was awarded, and if that reason is not sufficient, the decree awarding the attachment must be reversed. In doing so, however, we must not be regarded as holding that the court below could not have entered a decree granting an attachment to enforce obedience to the primary decree directing the payment of the legacies. That question does not arise here under the view we take of the case.

The question involved in this controversy is a very narrow one and of first impression in this state, and we have been referred to no decision in any other jurisdiction that discusses or determines it. We, however, have no difficulty in reaching a conclusion on the question presented. By the Act of April 8, 1833, P. L. 315, 1 Purd. (12th ed.) 1067, that part of the real and personal estate of a decedent remaining after the payment of his debts, “ which shall not have been sold or disposed of by will, or otherwise limited by marriage settlement,” is directed to be divided among his widow and children in the proportions named in the statute. The Act of June 8, 1893, P. L. 344, 2 Purd. (12th ed.) 2101, authorizes a married woman to dispose of her property “ in the same manner as if she were unmarried,” saving to her husband his light as tenant by the curtesy and to take against her will. By section 11 of the act of 1833, 2 Purd. (12th ed.) 2103, it is provided that a devise or bequest by a husband to his wife shall be in lieu of her dower, but shall not deprive the widow of her choice, either of dower or the estate devised or bequeathed to her. The power of a married woman to dispose of her property by will is so restricted by the Act of May 4, 1855, P. L. 430, 2 Purd. (12th ed.) 2104, “ that any surviving husband, may, against her will, elect to take such share and interest in her real and personal estate, as she can, when surviving, elect to take against his will in his estates, or otherwise to take only her real estate as tenant by the curtesy.”

The learned court below held that the right of election under the statute is assets of Cochran Fleming’s estate, and that he was required to exercise the right and take his share of his wife’s estate under the intestate laws, so that it might be applied in discharge of the legacies bequeathed by John Fleming to John L. Fleming and James Pressley Fleming, and that by failing to exercise the right accorded to him by the act of assembly, he was in contempt of court and could be compelled by an attachment against his person to elect to take against his wife’s will. With this position we do not agree.

The word “ assets ” is derived from the French assez, meaning sufficient, and originally signified a sufficiency of property to pay the decedent’s debts: 11 Am. & Eng. Ency. of Law (2d ed.), 828. Its meaning has been enlarged, and it now signifies any property available for the payment of debts, as the assets of a partnership, of a corporation, of a decedent, or of a bankrupt. The word represents something over which a man has dominion and can transfer with or without a consideration, and may be reached by execution process. It has been held that a general power of appointment is not an interest in property which can be transferred to another, or sold on execution, or devised by will, or a chose in action, and hence does not constitute assets of a bankrupt which passes to an assignee: Jones v. Clifton, 101 U. S. 225, 230. It has also been ruled that a bankrupt, seized for life, with a general power of appointment, with remainder in default of appointment, to the heirs of his body, cannot be compelled by decree in equity to execute the power for his creditors: Thorpe v. Goodall, 17 Ves. Jr. 388. Lord Elden delivering the opinion in the last case said: “ if the ground of relief is, that upon principles of equity the bankrupt is to exercise his power, upon those principles the creditors have nothing to do with the power, unless the party chooses to execute it. They cannot compel him to do so.”

Turning now to our statutes which declare that an intestacy exists only as to such property as a decedent died seized of and has not disposed of by will, and which give to the husband the interest he has the right to take in the estate of his wife who dies testate, we see that Cochran Fleming, his wife having died testate, “ may, against her will, elect to take such share and interest in her real and personal estate ” as the laws in cases of intestacy provide. An election, says Mr. Bispham (Principles of Equity, 5th ed., p. 408), is a choice which a party is compelled to make between the acceptance of a benefit under a 'written instrument, and the retention of some property already his own, which is attempted to be disposed of, in favor of a third party, by virtue of the same paper. The husband and wife are on a par with each other as to the power of each to will away property from the other: Clarke’s Appeal, 79 Pa. 376; and we have distinctly ruled in numerous cases that the right given by the statute to a widow to elect not to take under her husband’s will is purely personal, so much so that in the event of her death without having exercised the right, her heirs or personal representatives cannot make the election: Crozier’s Appeal, 90 Pa. 384; Jackson’s Appeal, 126 Pa. 105; Anderson’s Estate, 185 Pa. 174. Ve have also held that the right of a widow to retain real or personal property of her deceased husband’s estate to the value of $300 is a personal privilege, which she may waive: Davis’s Appeal, 34 Pa. 256.

We think that the right of the husband to elect to take against the provisions of his wife’s will is simply a personal privilege and is not an asset for the payment of his debts, or a right which he can be compelled to exercise so as to discharge his trust liabilities. Every sane person of lawful age in this commonwealth has a right to dispose of his property by will, and the policy of the law is to encourage the exercise of that right. A married woman has now the same right as her husband to devise her property and that right should not be curtailed by the court compelling an unwilling husband to defeat it by an election to take against her will. His action in the premises is optional with him, but if he wishes to respect the last wishes of his wife as well as carry out the manifest policy of the kw he refuses to interfere with the disposition which she makes of her property. Aside from any sentimental feeling in the matter, the husband should permit the will to stand, thereby recognizing the right of his wife to determine the disposition of her own property.

If the court may compel the husband to take under the intestate laws and against his wife’s will, it may, with the same reason and by the exercise of the same authority, compel him to elect to take under the will. The action of the court would then depend in each case upon the interest of the creditor or .other party to whom the husband was liable, and would deprive him of his statutory right to make the election. If the husband’s interest in his wife’s estate under the intestate law was greater than his interest under the provisions of her will, the court at the instance of the creditor would compel the husband to elect to take against the will. If, on the contrary, the interest of the husband under the will should be greater than his interest under the intestate laws, the court would at the instance of the creditor compel the husband to accept the provisions of the will. The election, therefore, would not be a personal privilege of the husband, which this court has declared it to be, but would be a right which the husband’s creditor could control as his interest should demand. This would not be an election by the husband but by his creditor. Such was certainly not the intention of the legislature in conferring upon the husband the right of election. Under the act of 1855, the power of the husband and wife to take against each other’s will is the same, and we think the right of the court to control the husband’s action is inferentially negatived by the fact that the legislature, by the Act of March 29, 1832, P. L. 190, 1 Purd. (12th ed.) 703, authorizes the orphans’ court on application of any interested party to cite the widow to make her election. While this authority is conferred on the orphans’ court and is frequently exercised, it has never even been suggested that the court has authority, on such application, to direct whether the election should be made to take under the will or against it. The court will compel the widow to elect whether she will accept the provisions of the will or the interest which the intestate laws give, but the statute does not authorize the court to decree which of the two alternatives the widow must select. If, however, the position of the appellees be correct, the court can on such application direct not only that an election shall be made, but also which of the two alternatives must be selected by the widow. In other words, the position of the appellees here is that the husband may be deprived of his personal right to make an. election and may be compelled to elect to take under or against his wife’s will solely as his creditor or his cestui que trust may determine; and that if the husband refuses to obey such command, the court will require him to do so or be deprived of his liberty. Such are the consequences of the contention of the appellees and of the position assumed by the orphans’ court. It clearly overlooks the property rights of both husband and wife, their unquestioned right, subject to statutory limitations, to dispose of their property by will, and the language as well as the plain intent of the statutory provisions regulating the rights of each in the property of the other when he or she has made a testamentary disposition of it.

It is true, as argued by the appellees, that the husband has an absolute legal right to take against his wife’s will, but that is a right, the exercise of which cannot be controlled by a creditor or a cestui que trust or by the court at their instance. It is not, as argued by the appellees, the same right as an option to buy real estate, or an interest in a partnership, or a seat or membership in a stock exchange or board of trade, or any property right acquired by contract. The right thus acquired puts the party in possession of something which is tangible and which by legal or equitable process may be reached and subjected to the payment of the party’s indebtedness. It is more nearly analogous to a general power of appointment which, as we have seen, is not an asset for the payment of debts. In the case at bar, it is conceded tha,t no writ, legal or equitable, can grasp the thing or interest in question and utilize it for the benefit of a creditor or a cestui que trust.

We think it was error for the learned court below to award an attachment for the reasons set forth in its opinion, and, therefore, the seventh assignment of error is sustained, and the decree is reversed at the costs of the appellees.