Adams v. St. Johnsbury & Lake Champlain R. R. , 57 Vt. 240 ( 1884 )

The opinion of the court was delivered by

Yeazey, J.

This case has been twice argued. The right of the orators to a decree, upon the facts reported, is established by recent cases in this court. Kendall and Wife v. M. &. C. R. R. R. Co. 55 Vt. 438; Kittell v. Missisquoi R. R. R. Co. 56 Vt. 96. Those cases stand on the principle, that when land is taken for public use, the owner has a lien upon it for its “ equivalent in money” (art. 2, ch. 1, Constitution of Vermont), which a court of equity will enforce, unless the owner has done that which in law precludes him from asking its enforcement,

We hold that the land-owner is not estopped by an agreement as to the amount of damages, where he does not consent to the taking of the land before payment, but objects and forbids and threatens, to interrupt and prevent, and is thereupon enjoined from so doing, which was this case. But it is claimed the case at bar differs from those cited in that it is brought not by the land-owner but by persons who held the interest of the mortgagee at the time of the entry and construction of the railway.

The foreclosure of the mortgage was not obtained until after the land was taken, and the defendants claim that the orators acquired title only as purchasers at the date of the foreclosure. This is not sound; because the mortgage débt, or a portion of it, was overdue long before the land was taken; and it is settled, that after condition broken the interest of the mortgagor becomes at law absolutely vested in the mortgagee. Kimball v. Sattley, 55 Vt. 285; Hagar v. Brainerd, 44 Vt. 294. See, also, Wade v. Hennessy, 55 Vt. 207.

The orators claim that the agreement as to damages which the land-owner and mortgagor made with the company that took the land, is the true'basis of recovery in this case. They agreed that the damages were $1,100. The masters find the damages were $900.

We are unable to see how the mortgagor, who had no' right except to redeem, could bind the mortgagees on the question of value of the mortgage premises, or a portion thereof, any more than in the matter of title. The title and the right of each party to the mortgage were defined by well settled rules of law; and neither could be affected by agreements of the other with third parties. The mortgagees’ title was perfect, subject to the right of redemption, which has since been foreclosed; and they will be made whole, when they receive the actual damages to the farm, which the taking of the land and the building thereon of a railroad has caused it. They will then have received an “equivalent in money” for land “taken for public use.” This amount the masters have found. They would not have been bound by an agreement of the mortgagor for a less amount. The agreement was not made by authority in their behalf. Not being bound by it, it was not such an agreement that they can take advantage of it. No claim is made that the damages were different when the present company took possession from what they were when the former company first took the land.

Another question arises on the report in respect to the damages. The defendants offered to prove that the value of the standing timber on this farm has been increased from two to four thousand dollars on account of the market created by the railroad, which evidence was excluded by the masters,' to which exception was taken.

The orators urge two answers to this claim; first, that under our constitution the benefits to the land through which a railroad, is built cannot be deducted in determining the compensation; second, that if this wp,s allowable the offer was not specific and broad enough in this case. Without passing upon the first objection, we think the second is well taken. The deduction for benefits must be limited to the particular tract which is in part taken, and the benefits be-confined to such as are direct and peculiar to the Owner, excluding those which he shares with others whose property is not taken. If the benefit is only personal and does not affect the land, it cannot be considered. Pierce R. R. p. 221, et seq. and cases there cited. The railroad could not have increased the value of Malavin’s wood and timber without increasing that of his neighbors. To allow deductions on account of his benefit would therefore be exacting contribution from him and relieving others benefited in like manner. The offer was not to show the benefit specified was peculiar to him; nor was it an offer to show a fact that was necessarily a peculiar benefit, and not common. The offer was to show a fact in substance like the rise of real estate resulting from the building of a railroad, which is held to be a general advantage, common to all in the vicinity not peculiar to any one. Pierce R. R., 223; Childs v. New Haven & Northampton Co. 133 Mass. 253.

Another question is as to when interest shall begin to run on the damages found by the masters. The orators claim it should be from the time the Lamoille Valley Railroad Company entered upon the land. This would be so as against that company; but the St. Johnsbury & Lake Champlain Railroad Company denies that it is liable for interest prior to its possession of the road. The question as here raised has not been passed upon in previous cases in this State. This railroad was mortgaged to a trustee for bondholders to secure a large bonded indebtedness. This mortgage was foreclosed in December, 1879, and the decree expired without redemption and became absolute. The bondholders then proceeded under the statute and organized into a corporation called The St. Johnsbury & Lake Champlain Railroad Company, and took possession of the road July 1, 1880, and have retained possession ever since. This company included in its possession and use the land in question. It never had any right to this land or to the use of it, because the railroad mortgage, which was prior to the possession of the land by'the former company, conveyed no interest in it. This company simply took and used the land for railroad purposes, without right, and became liable therefor. It was not bound to take the land, or it might have taken it under the right of eminent domain, as provided by statute. It neither assumed nor succeeded to any of the debts of the former company. The liability of that company for its taking and use still exists. The mortgage of the railroad and foreclosure thereof, without redemption, did not work a dissolution of that company. Its corporate existence and general corporate powers continued as before. Eldridge v. Smith et al., 34 Vt. 484. This is a suit in equity, and the orators are seeking to enforce an equitable remedy. They rested on their claim, for which they had remedies in law as well as in equity, for many years and until the old company became insolvent and a new one was organized by its creditors and took the road. They now seek to enforce a lien upon this land, for the damages in taking it, by foreclosure or injunction against both companies. If the new company had not entered upon this land it would have incurred no liability. Having taken it a liability was thereby created. No judgment had been obtained by tlie land owner on account of the previous taking as in the case of Pfeifer v. S. & F. R. R. Co. 18 Wis. 155. The new company being organized under the statute independent of the former company, did -not directly become the owner of the road by contract of purchase; nor indirectly of this land through the mortgage or otherwise. In the absence of any right or liability established by contract or by judicial proceeding as between the original parties, and of any contract succession to the present company, and of any obligation of this company as to this land prior to entering upon it, hut having the right to take it de novo in exercise of the right of eminent domain, we think the fact that the act of this company was a continuance of the wrongful use of the former company, is not sufficient to make this company responsible anterior to its own possession. Such a holding would in effect be to make this company liable for the other company’s use of this land. Interest should be reckoned as against each company from the date of its possession.

The decree is reversed and the cause remanded with a mandate pursuant to these views.

Taft, J., dissents.