Golconda Northern Railway v. Gulf Lines Connecting Railroad

Mr. Justice Dunn

delivered the opinion of the court:

Counsel for the appellant advance three propositions as the basis of their claim that the decree should be reversed, viz.: First, that the appellant was in possession of the pass and the appellee entered upon and invaded its possession; second, that the appellant made the first location of its lines through the pass; and third, that it has the better title. We do not agree with any one of these propositions.

First, as to the possession. Prior to November 25 the appellant had been working on its grade north of the pass and had done some construction work down to the entrance of the pass at the north end, and possibly a little work within the pass at that end. Phelps’ land was at the north end of the pass, and no attempt had been made to make a survey in the pass south of that land. At' that time the appellant’s engineer started in to survey south from the Phelps land and immediately met the surveying party of the appellee, which was engaged in cross-sectioning and setting grade stakes on the line which had previously been surveyed and marked. The next day the president of the appellant, having been advised by his attorney that if he could get the right of way fenced before the appellee’s construction outfit got there the attorney believed he could hold the right of way for the appellant, started a force of men to string two wires around the right of way. During the week the right of way was thus enclosed, the two forces of engineers of the appellant and the appellee all the time continuing their work on the land thus enclosed. This is all the work that appears to have been done by the appellant on the premises up to that time. It had no actual possession of any part of the premises, unless it was of a small part of the north end of the pass. It had not attempted elsewhere to exercise any dominion over the pass. The appellee, after the execution of the deeds to it on March 5, 1912, went upon the premises and made an examination of the line, preparing for the construction of the road, taking the grading cuts and fills, and making estimates for the' construction. It actually did enter into a construction contract, and the appellant had learned that the construction company was coming with its outfit and for that reason undertook the fencing of the right of way. It is clear that the appellant had no prior or exclusive possession of the pass on November 29, when it is claimed the tortious entry was made by the appellee. It did not afterwards acquire possession, except of such parts as it was actually engaged in working on. The most that could be claimed for it was a joint occupation with the appellee in a contest for the possession. The evidence does not sustain the essential allegation of the appellant’s bill that it was in the actual possession of the premises in controversy.

Second, the location. As between two railroad companies, the prior right to the appropriation of land for railroad purposes belongs to the company which first locates its line, and the first location belongs to that company which first defines and marks its route and adopts the same for its permanent location by authoritative corporate action. (Fayetteville Street Railway Co. v. Aberdeen and Rockfish Railroad Co. 142 N. C. 423; Williamsport and North Branch Railroad Co. v. Philadelphia and Erie Railroad Co. 141 Pa. 407; Chesapeake and Ohio Railroad Co. v. Deepwater Railway Co. 57 W. Va. 641.) The location of the line of a railroad is the act of the company and can be made only by the board of directors. (Black v. Chicago, Burlington and Quincy Railroad Co. 243 Ill. 534; East St. Louis, Columbia and Waterloo Railway Co. v. Illinois State Trust Co. 248 id. 559.) It appears in the record that the appellant’s board of directors, at a meeting held on December 6, 1909, adopted the location shown by its survey and map recorded in September, 1909. It is insisted that there is no evidence of a location made by the appellee. No record of any action taken by the board of directors of the appellee was shown and it is not claimed that any formal action locating its line was taken by them, but the appellee relies upon proof of a location made by its predecessor in title, the Toledo, St. Louis and New Orleans Railroad Company. Section 9 of chapter 109 of the Revised Stat-1 utes requires every railroad company to cause a plat of the location of its railroad to be made and recorded in the office of the recorder of deeds of the county in which the premises, or any part of them, are situated, within six months after said railroad is located. Such a plat was filed in the recorder’s office of Pope county by the president of the Toledo, St. Louis and New Orleans Railroad Company. It was certified, under oath, by the president as a true map of the company’s adopted, located line through Pope county, and we regard it as prima facie evidence, at least, of the location of the road. The company, through its agents and employees, was engaged, before and after the plat was filed, in obtaining deeds for the right of way on , this line and they cleared off the timber along the line. It does not appear whether the board of directors had ever voted for and adopted a ■ formal resolution directing the location of the road on this line, but all the work done by the company consisted in procuring the right of way and doing work preliminary to construction along the line shown by the map attested by the president of the company. The statute does not require the actions of the board of directors in the location of a 'railroad to be in any particular form or proved in any particular way. The location is the selection and adoption of the particular line upon which the railroad is to be constructed, and may be proved by such acts of the officers and agents of the company and other facts as show that such line has been selected with the approval of the directors, and such approval may be shown by the circumstances of the case. The location indicated by the map of the Toledo, St. Louis and New Orleans Railroad Company was earlier in time than that of the appellant,, but the appellant insists that the appellee is not entitled to the benefit of this location, and the question raised by this objection will be considered under the next head.

Tfyird, the title. The Toledo, St. Louis and New Orleans Railroad Company, prior to the organization of the appellant, obtained from the owners deeds for the right of way over all the lands in the pass. Some of these deeds were subject to a condition subsequent for the building of the railroad by December i, 1904. New deeds were later executed in place of these, in which the date of building was December 1, 1909. No entry was ever made by any of the grantors or their heirs for failure to comply with this condition and no attempt was ever made to declare a forfeiture. Some of the deeds were conveyances in fee simple. The deeds of March 5, 1912, from the Toledo, St. Louis and New Orleans Railroad Company to the Gulf Lines Connecting Railroad of Illinois purported to convey the located line for a railroad beginning at station 3985 of the location survey, situated on Main street, East Carmi, White county, Illinois, extending southerly through various counties, including Pope, to a point on the Ohio river near Brookport, in Massac county, including all rights of way and the lands conveyed to the grantor company in Pope county, including the land through the pass in controversy. This constitutes the appellee’s title.

The appellant’s title consists of the resolution of its board of directors locating its line, and deeds from the owners of the land through the pass in controversy, obtained subsequent to the deeds to the Toledo, St. Louis and New Orleans Railroad Company. The validity of this title depends upon the invalidity of the appellee’s title, and the appellant insists that the latter is void because of the expiration of the time limited for the building of the road in some of the deeds to the Toledo, St. Louis and New Orleans Railroad Company, because that company made no location of its railroad, because the appellee has made no location of its railroad, because the Toledo, St. Louis and New Orleans Railroad Company had no power to convey its right of way, located line, franchises and all its property to the appellee and the deeds by which it purported to do so are void, and because the Toledo, St. Louis and New Orleans Railroad Company having failed to complete its railroad and put it in operation within ten years from its incorporation and having abandoned its intention to build a railroad, the property conveyed to it for that purpose reverted to the grantors' and passed by their subsequent deeds to the appellant.

So far as the appellant’s claim rests upon the failure of the grantee to comply with the condition subsequent for the building contained in some of the deeds it is of no force. A court of equity will not lend its aid to enforce a forfeiture because of a breach of a condition subsequent in a deed. (Toledo, St. Louis and New Orleans Railroad Co. v. St. Louis and Ohio River Railroad Co. 208 Ill. 623; Douglas v. Union Mutual Life Ins. Co. 127 id. 101; 2 Story’s Eq. Jur. sec. 1319.) Moreover, a breach of a condition subsequent can be taken advantage of only by the grantor, his heirs or devisees. His grantees, whether be-, fore or after the breach, acquire no right to enforce a forfeiture. ( Waggoner v. Wabash Railroad Co. 185 Ill. 154; Boone v. Clark, 129 id. 466; Ruch v. City of Rock Island, 97 U. S. 693; 2 Washburn on Real Prop.—6th ed.—secs. 954, 957.) Non-compliance with a condition subsequent does not, of itself, determine the estate. After breach, an entry, or some act equivalent thereto, is necessary to re-vest the estate in the grantor. Mott v. Danville Seminary, 129 Ill. 403; Ruch v. City of Rock Island, supra; 2 Washburn, supra.

We have held that the evidence justifies the conclusion that the Toledo, St. Louis and New Orleans Railroad Company had made a location of its road on July 23, 1909. The sale and conveyance of its located line, right of way, franchise and other property to the appellee, if valid, conveyed to the latter the prior right which the grantor had .to construct a railroad on this located line. It is insisted, on behalf of the appellant, that the attempted conveyance to the appellee was contrary to public policy and beyond the power of the grantor, and was therefore void and of no effect whatever. A railroad corporation has not, as a general rule, the power to sell its road and franchise without statutory authority. The powers of all corporations are such, only, as are conferred by the statute under which they are organized, and a public service corporation cannot, without the assent of the State, sell or lease its entire property and franchise to another corporation and disable itself from performing the duties to the public imposed by its charter. (Chicago Gas Light Co. v. People’s Gas Light Co. 121 Ill. 530; Union Trust and Savings Bank v. Kinloch Telephone Co. 258 id. 202; Thomas v. West Jersey Railroad Co. 101 U. S. 71; Central Transportation Co. v. Pullman’s Palace Car Co. 139 id. 24.) It would not, however, enable the appellant to maintain its bill even if we were to hold the deed of the Toledo, St. Louis and New Orleans Railroad Company to the appellee void. The only effect of such holding would be to leave the title in the former company, but it would not confer any right upon the appellant or give to it any title or enable the grantors of the Toledo, St. Louis and New Orleans Railroad Company to grant any title to the complainant. The fact that because of its failure to finish the road and put it in operation within ten years from the time of filing its articles of association section 26 of the Railroad and Warehouse act declares that the corporate existence and- powers of that corporation should cease does not affect the question. The State, alone, could take advantage of the failure of the company in this regard, and until it did so no other person could question its existence or the validity of its corporate acts. Ross v. Chicago, Burlington and Quincy Railroad Co. 77 Ill. 127; Chicago and Eastern Illinois Railroad Co. v. Wright, 153 id. 307.

Admitting that the conveyance by the Toledo, St. Louis and New Orleans Railroad Company was beyond the corporate powers of that corporation, the law does not permit third persons having no interest in the corporation or its trust to dispute the validity of its conveyance. The ultra vires acts of the corporation may be objected to by the State, the corporation, its stockholders or creditors, or the persons with whom the ultra vires transactions are had, but not by third persons having no interest in the subject matter. Railroad corporations have power, under certain circumstances, to make sales and conveyances of real and personal property. Whether any particular conveyance is in excess of this power is a question which concerns only the corporation itself, the State, or those persons having some interest or title in the corporation or the property involved. Where a corporation has power to hold real estate under any circumstances or for any purpose, its title cannot be questioned by any person except the State. (Hough v. Cook County Land Co. 73 Ill. 23; Barnes v. Suddard, 117 id. 237; Hamsher v. Hamsher, 132 id. 273; Cooney v. Booth Packing Co. 169 id. 370; Ehrman v. Union Central Life Ins. Co. 35 Ohio St. 324.) A national bank is prohibited from making loans on real estate security, but a mortgage given to such a bank to secure future advances is a ‘.valid security, which can be questioned only by the government. (Genesee Nat. Bank v. Whitney, 103 U. S. 99.) Only the sovereign can object to a conveyance to a corporation incompetent by its charter to take the title to real estate. It is valid until assailed in a direct proceeding instituted for that purpose. (Fritts v. Palmer, 132 U. S. 282; Hickory Farm Oil Co. v. Buffalo, New York and Philadelphia Railroad Co. 32 Fed. Rep. 22; Bone v. Delaware and Hudson Canal Co. 2 Sad. (Pa.) 55; Chicago, Burlington and Quincy Railroad Co. v. Lewis, 53 Iowa, 101; Carlow v. Altman, 28 Neb. 672.) Where the statute prohibited a corporation from owning over five thousand acres of land, the question whether a corporation owning a greater quantity of land exceeded its powers in purchasing an additional quantity is a question between the corporation and the State, only, and does not concern the vendors or others. (American Mortgage Co. v. Tennille, 87 Ga. 28.) These are cases in which the conveyance was made to the corporation and not by the corporation, but there is no difference, in principle, whether the excess of power is in purchasing or in selling. The corporation having the power in such cases to sell and convey propert)q the question whether it exceeded its power is for the State, only.

The appellant has no such interest as entitled it to enjoin the appellee from constructing a railroad in this pass. The only injury of which it can complain in a judicial tribunal is the invasion of some legal or equitable rights. It alleges that the appellee is acting beyond its authority under the law because the conveyance under which it claims was beyond the charter power of its grantor to make. This conveyance, however, did not injuriously affect any right of the appellant, and it has, therefore, no ground to complain. Neither the Toledo, St. Louis and New Orleans Railroad Company nor the appellee owed any duty to the appellant in regard to this land or to the title thereto. A stockholder in the grantor company might have an interest in restraining it within the limits of its corporate powers and the State might have an interest in preventing the usurpation and perversion of its franchises, but the appellant has no interest in these questions and cannot raise them to enable it to seize the property which is the real subject matter of the controversy. New Orleans, Mobile and Texas Railway Co. v. Ellerman, 105 U. S. 166.

It is urged that by the abandonment of the right of way by the Toledo, St. Louis and New Orleans Railroad Company the property reverted to the original grantors of that company, and that they had the power to convey a good title to the appellant. There is no evidence of any intention to abandon the right qf way. To constitute such an abandonment there must not only be non-user but an intention to abandon. (Stannard v. Aurora, Elgin and Chicago Railroad Co. 220 Ill. 469; Durfee v. Peoria, Decatur and Evansville Railway Co. 140 id. 435.) In the latter case the railway company took up the rails and ties over the place in controversy and failed to occupy it for nine or ten years but without an intention to abandon it, and it was held that there was no abandonment. Here the railroad company was unable to construct its railroad within ten years after filing its articles of association, but there is ho evidence that it ever ceased its efforts to procure its construction or intended to do so. The sale of the right of way was not an abandonment, but was an attempt to secure the application of the right of way to railroad purposes. It is immaterial, that the particular corporation was unable to build the railroad. The right of way cannot be said to have been abandoned so long as the original grantee or its grantees are occupying it for railroad purposes. Crolley v. Minneapolis and St. Louis Railway Co. 30 Minn. 541; Noll v. D., B. & M. Railroad Co. 32 Iowa, 66; Hatch v. Cincinnati and Indiana Railroad Co. 18 Ohio St. 92; 1 Redfield on Railways, 221.

The decree of the circuit court dismissing the bill was right, and it is affirmed.

affirmed.