Cross v. Peach Bottom Railway Co. , 1879 Pa. LEXIS 269 ( 1879 )

Mr. Justice Gordon

delivered the opinion of the court,

Whilst we agree with the judgment of the court below, we cannot approve of some of the reasoning which leads to that judgment. We do not think it follows that because this railway company was, in its erection, made subject to the Act of 1849, in which act the power is reserved to alter or amend any charter granted under it, that a subscriber to its stock would be held to payment, notwithstanding some material change might be made in the organization or powers of the corporation. It is not legislative power that we have to regard, but the contract of the subscriber. The legislative reservation is in the nature of a police power designed for the protection of the public welfare, and where such protection becomes necessary, the law-making power may act without consulting either the interests or will of the company, and in such case it may well be that, not only the company, but its stockholders, must submit to the legislation thus imposed upon them. Where, however, this legislation results from the motion, and for the benefit of the corporation, the case is different; for when an alteration in the charter is made on the suggestion of the company itself, the Act of 1849 has nothing to do -with the ease; the legislature always had such power. The reservation in the act just named, was only intended to enable the legislature to act without the consent and against the will of the corporation.

It is manifest, therefore, that in considering the'case in hand, we must leave this act out of the question, for, by the finding of the referee, the supplement of 1873 was made for and accepted by the company.

It is certain, then, that if this supplement had made a material change in either of the termini of the road, or if the alteration in the charter were so extensive and radical as to superadd to the oi’iginal undertaking an entirely new enterprise, the case ivould be governed by the rulings found in the Turnpike-road Co. v. Phillips, 2 P. & W. 184, and the Turnpike-road Co. v. Arndt, 7 Casey 317, and the plaintiff could not recover. But we cannot see that the supplement works any such change or alteration.

It confers upon the company an additional privilege, in that, it authorizes it to extend its main line to the town of Berlin, in the county of Adams, but,- if we understand the case, this interferes with neither of the present termini. If, for example, the defendant was interested in one or both the terminal points now reached by the road, these points, notwithstanding the railway should hereafter be extended to Berlin, would still be reached by the road; neither of them would be affected or cut off from the line of improvement. The additional power conferred upon the company is only that of extension, and it in no way interferes with the rights of the defendant as vested in him by the contract of subscription. It follows that the governing rule is that found in Gray v. The Monongahela Navigation Co., 2 W. & S. 156, to wit: “ An alteration in a charter of incorporation, by which additional privileges are given to it, is not such an invasion of the contract of subscription as will relieve the subscriber to its stock from his liability to pay.” The language used by Chief Justice Gibson, in the case cited, is so thoroughly applicable to the one in hand, that we have but to adopt it in order to fully dispose of the question in controversy. “ In this instance then what has the legislature of Pennsylvania done ? It has not pretended to take away any corporate franchise, or to impinge upon any right before granted. That is not pretended. On the contrary it has enlarged a corporate privilege. But the exercise of it, it is alleged, may plunge the company into an expense not originally contemplated. What of that ? The defendant is not hound to contribute to it beyond the amount of his original subscription, and; as to that, his contract remains the same. But it is said that by taking off the limitation of the company’s expenditure, the legislature has altered its power to incur responsibility for greater damages than it otherwise could have done. In that lie's the fallacy. The legislature has not made it incumbent on the company to use the additional privilege granted to it, but it has left the use of it to its discretion. It may, in fact, never use it, and whether it shall .do so, will depend on the volition of the defendant’s corporate- agents, the president and managers, by whose acts he is necessarily to be bound as his own, even in the modification of the charter for the public good, provided it does not extend to a change of the structure of the association, as was attempted in'the Indiana and Ebensburg Turnpike v. Phillips, 2 P. & W. 184.”

The applicability of all this language to the case in hand will appear in the mention of a few of the facts: The supplement of 1873 only confers the power upon the company to extend its road to Berlin ; it has, however, as yet not availed itself of that power; it may never do so, but if it does the defendant is not hound to contribute to the expenses necessary to accomplish such extension. The power is a discretionary one, and if it is ever exercised it must be so exercised only at the will of the defendant’s corporate agents, the president and managers of the corporation. As, however, the case stands ah the present time, the defendant is asked to pay for nothing that he did not contract to pay for, that is, the building of the road as it now exists; this he agreed to do, and it is but right that he be held to his bargain.

The judgment is affirmed.