Mayor of Wilmington v. Addicks , 7 Del. Ch. 56 ( 1893 )

Johnson, Chancellor ad litem.

The bill in this cause was filed on the 2d day of April, A. D. 1891, by the complainant, the mayor and council of Wilmington, a municipal corporation of the State of Delaware, at the instance of Joseph L. Carpenter, Jr., J. Newlin Gawthrop, and Samuel Chambers, the board of directors of the street and sewer department for the City of Wilmington, against the defendants', John Edward Ad-dicks, John G. Baker, Frederick P. Addicks, Simon B. Conde and Samuel Austin, to restrain them, their servants; agents and employees and all persons claiming to be servants, agents or employees of a certain alleged corporation called the Oxy-Hydrogen Cbmpany of the State of Delaware, from further opening or excavating or causing to be opened or excavated any of the streets 'of Wilmington for the purpose of laying gas pipes therein, without the permission first had and obtained of the said board of directors of the street and sewer department for the City of Wilmington, and on the same day a preliminary injunction was granted in accordance with the prayer of the bill. To this bill the defendants have demurred, and for cause of demurrer set forth that “ it appears by said complainant’s bill that the Oxy-Hydrogen Company of the State of Delaware, therein named, is a necessary party to the said bill, inasmuch as it is therein stated, in the fifth paragraph thereof, that the said Oxy-Hydrogen Company of the State of Delaware, by its counsel had notified the board of directors of the street and sewer department that it was its intention on the 31st day of March, 1891, to begin laying gas pipes in the streets of said city of Wilmington; that by section 6 thereof, it is further alleged that the present defendants claimed to be officers, servants and ag’ents of said company in the opening and excavation of Liberty street, in said city, as therein set forth; that by paragraphs 7 and 8 of said bill, it appears that said company was incorporated by an act of the General Assembly of the State of Delaware, a copy of which act is to said bill attached, and that said defendants claimed to be acting thereunder; that by paragraph 8 of said bill, it appears that the organization of said company is called in question by said complainant; that by paragraph 9 and other paragraphs- of said bill, it is alleged that even if said company is possessed of a legal organization, it would not have any right or authority under said act, without the 'permission of said board of directors-of the street and sewer department, to enter upon, open or excavate any of the streets of said city for the purpose of laying gas pipes therein; that it further generally appears by said bill, that the whole scope and object of said bill is the determination of the rights and powers of said company under its said charter to lay gas pipes in the streets of said city, and that, the result and effect of said suit will be to judicially determine the rights and powers of said company under its said charter; but the said complainant has not made the Oxy-Hydrogen Company of the State of Delaware a party to the said bill.”

Dor the purpose of the proper consideration of the only question which is raised and presented by this demurrer, viz.: whether or not a certain alleged corporatian, called the Oxy-Hydrogen Company of the State of Delaware, should be made a party defendant, I will quote several paragraphs from the bill.

Paragraph 5 of the bill is in the following language: “ That the said board of directors of tlie street and sewer department on the 30th day of March, A. D. 1891, was notified in writing by the counsel of certain persons designated as the Oxy-Hydrogen Company of the State of Delaware, that it was the intention of said alleged company on the day following, to-wit, on the 31st day of March, A. D. 1891, to begin the laying of gas pipes in the streets of said city; a full and true copy of which said notice is hereto annexed, marked B, and your orator prays that the same may be taken and considered as a part of this bill of complaint.”

Paragraph 6 of the bill is in the following language, viz.:

“ That afterwards, to-wit, in the day and year last aforesaid, pursuant to said notice, the said defendants, John Edward Addicks, John Gr. Baker, Frederick P. Addicks, Simon B. Conde and Samuel Austin, together with sundry other persons to your orator unknown, claiming to be officers, servants or agents of said alleged Oxy-Hydrogen Company of the State of Delaware, unlawfully and without the permission of the said board of directors of the street and sewer department, and without first making application to said board .for such permission pursuant to the aforesaid rule or regulation of said board, entered upon, opened and excavated a certain street of said city, known as Liberty street, for the purpose of laying gas pipes' therein, and still continue engaged in the opening and excavation of the said street for the purpose aforesaid, and threaten and intend to enter upon, opem and excavate other streets of said city for the purpose of laying gas pipes therein.”

Paragraph 7 of the bill is in the following language, viz.:

“ That said defendants claim and pretend that they were and are authorized and empowered to so enter upon, open and excavate any and all streets of said city for the purpose of laying gas pipes therein, under and by virtue of the charter of the said alleged Oxy-TIydrogen Company of the State of Delaware, without the consent or permission of said board of directors of the street and sewer department, and without making any application to said board as required by thei aforesaid rules or regulations of said board.”

Paragraph 8 of the bill is in the following language, viz.:

“ That an act of incorporation, entitled ‘An act to incorporate the Oxy-Hydrogen Company of ' the State of Delaware,’ was passed by the General Assembly of this State on the 3d day of April, A. D. 1873; a copy of which said act, marked 0, is hereto annexed, which your orator prays may be taken and considered as a part of this bill of complaint; under which said act the said defendants claim to be acting as aforesaid; but your orator is informed, believes and charges that no' legal or valid organization has ever been effected; and your orator denies that under or by virtue of said act of incorporation the said defendants or any of them have any right or authority to' enter upon, open or excavate any of the streets of said city for the purpose of laying gas pipes therein.”

Paragraph 9 of the bill is in the following language, viz.:

“ That your orator is advised, believes and avers that the said alleged Oxy-ITydrogen Company of the State of Delaware has not, and even if possessing a legal organization would not have any right or authority under the said act of incorporation, without the permission of said board of directors of the street and sewer department, to enter upon, open or excavate any of the streets of said city for the purpose of laying gas pipes therein.”

Paragraph 10 of the bill is in the following language, viz.:

“ That before the expenditure by or on behalf of the said alleged Oxy-Hydrogen Company of the State of Delaware, of any money in or for the prosecution of the business for which said charter was granted, said board of directors of the street and sewer department became possessed of and vested with entire jurisdiction and control of the streets of said city as hereinbefore set forth; and the power granted by said charter to said company to lay gas pipes in the streets in this State was thereby subordinated to the paramount power and authority of said board to control the streets of said city and to prescribe and regulate the use thereof.”

Paragraph 13 of the bill is in the following language, viz.:

“ That heretofore, to wit, on the 1st day of April, A. D. 1891, copies of the aforesaid preambles and resolutions of said board were delivered respectively to the counsel of the said alleged Oxy-Hydrogen Company of the State of Delaware, and to the said defendant John Q. Baker, who claims to be the president thereof; yet the said defendants persist in their wrongful and illegal opening and excavating of the streets of said city as aforesaid.”

It is a well-established and undoubted rule in equity proceedings that all persons materially interested should be parties to the suit, either as complainants or defendants, in order that the court may determine the rights of all parties interested in the subject-matter of the suit and make a complete decree. 1 Del. Ch. 167-174; 4 id. 249.

This rule, however, is subject to certain exceptions not necessary here to mention. It is contended on the part of the defendants, that this rule in regard to parties has been violated by the complainant by its omission to make a party defendant in this cause a certain alleged corporation called the Oxy-Hydrogen Company of the State of Delaware, which said company-the defendants claim is a legally existing corporation under the laws of this State, possessing a legal and valid organization, and for the omission on the part of the complainant to make the said company a party defendant, have demurred to the bill.

It is undoubtedly true that whenever a want of proper parties appears on the face of a bill, the proper mode to take advantage of this objection is. by a demurrer, Mitf. Ch. Pl. & Pr. 206.

Does it appeal’ on the face of the bill filed in this cause that the complainant has failed or omitted to make a party a defendant who ought to have been made such?

While it is true that the complainant in certain paragraphs of the bill, and which are fully set forth above, refers to a certain alleged corporation called the Oxy-Hydrogen Company of the State of Delaware, yet at the same time in no way recognizes in said paragraphs or in any other parts of the bill, the valid or legal existence of such a corporation as the Oxy-Hydrogen Company of the State of Delaware, but on the contrary, expressly charges that no legal or valid organization of said company has ever been effected. It nowhere appearing on the face of the bill that there is in existence a corporation possessing a valid or legal organization by the name of the Oxy-Hydrogen Company of the State of Delaware; but a corporation by that name, possessing a legal and valid organization, being expressly denied by the bill, I do not see how a demurrer for want of proper parties, would properly lie.

By demurring to the bill instead of adopting some other course of pleading, the defendants have necessarily admitted the truth of the matters and facts contained in the bill, and as it is alleged in the bill that no legal or valid organization of the said Oxy-Hydrogen Company of the State of Delaware has ever been effected, the effect of the demurrer is to admit the truth of such allegations.

If it is the object and. purpose of the defendants to controvert the allegations contained in the bill, they should do so by some other mode of pleading than by demurring.

As it is my opinion that this demurrer should be overruled, for the. reasons above given, I have not thought it necessary to deal with many of the questions discussed at the argument, especially as most of them will more appropriately arise at some subsequent stage of the cause, when the cause shall be at issue upon the proper pleadings.

The demurrer must be overruled, and leave is granted to the defendants to plead or answer.

Note. - The Chancellor having "been counsel for respondents before his anpointment as Chancellor, in matters respecting this suit, upon his application to the Governor for the appointment of a Chancellor ad litem, H. R. Johnson was appointed to try this case.