City of Erie v. Erie Canal Co.

The opinion of the court was delivered, January 5th 1869, by

Sharswood, J.

There are two questions which must be considered to have passed in res judicatas. The first is that where the state has made a grant of a public work to a corporation, the grantees are discharged from those duties to the public growing out of the work which the state has been accustomed to perform before the grant, unless there are express words in the transfer imposing those duties on the corporation. The second is that the charter of the Erie Canal Company does not impose upon that company the duty of making or keeping in repair public bridges connecting highways intersected by the canal: Pennsylvania Railroad Co. v. Duquesne Borough, 10 Wright 223; Meadville v. The Erie Canal Co., 6 Harris 66.

This leaves in this cause but one question, whether the Act of March 16th 1864, entitled “An act to compel the Erie Canal Company to construct and keep in repair the bridges made necessary by the construction of their canal,” is a constitutional exercise of legislative power.

Had the legislature seen fit to impose such a duty upon any municipal corporation within whose bounds the bridges were, it seems now well settled that they would have had the right to do so: Sharpless v. Philadelphia, 9 Harris 147; Kirby v. Shaw, 7 Harris 258; City of Philadelphia v. Field, 8 P. F. Smith 320.

On the other hand, it seems equally clear that they could not impose such a duty on a private individual or a private corporation, such as a bank or insurance company. That would be to take private property for a public use without compensation, and the power of taxation, though very great, still has limits, and does not extend so far as that.

Is there any reason, then, why a quasi public corporation, such as a turnpike company, a railroad or canal company, should stand on a different footing ?

The charter of a municipal corporation is not a contract within the protection contained in the prohibition of the declaration of rights against laws impairing contracts: Const. of Penna. Art. ix., § 17, 3 Story on the Const. 260. But it has been expressly decided by this court that a charter to a company to make a lock navigation in a public stream is a contract, and that no new terms can be subsequently imposed by the legislature, not within the scope of the original grant: Monongahela Navigation Co. v. Coon, 6 Barr 379. In that case the act of incorporation contained no clause subjecting the company to liability for consequential damages arising from the construction of the work committed to them, and it was held that the legislature could not by a subsequent act, without their acceptance, impose that responsibility upon them.

The power of the state would have been incompetent to burden the company with charges not originally imposed on it. Even when the state parts with its property by a gift to a corporation of its own creation, it is an executed grant, a contract within the meaning of the Constitution, which cannot be subsequently revoked or impaired: Commercial Bank of Natchez v. Chambers, 8 Smedes & Marshall 9.

In the act incorporating the Erie Canal Company, March 7th 1843, Pamph. L. 36, there was no power reserved to the state to alter or modify its provisions, but only to resume the canal upon certain conditions, and this reserved power the staté formally relinquished in consideration of the company agreeing to pay all damages and debts “ on account of the construction of the works of said company, while in possession of the Commonwealth:” Act of May 8th 1865, Pamph. L. 518. That while the state retained this power of resumption, the company submitted to and accepted, either expressly or tacitly, many impositions laid on them by acts of the legislature which they might have resisted, may be true; but there is nothing which can be construed to be an agreement express or implied to surrender to the state the poVer of making whatever changes they might see fit.

Many reasons may be suggested why a corporation of this character should not engage in a contention with the government, when it can be avoided; and why therefore they should not always stand to their arms when encroachments are made on their undoubted rights.

When this court, therefore, decided in Meadville v. The Erie Canal Company that the clause in the charter imposing on this company the duty to make and keep in repair all farm bridges and causeways on the line of the canal meant “ farm bridges and farm causeways,” — expressio unius est exclusio alterius — it followed as a logical sequence that they were under no obligation to make and keep in repair public bridges or causeways; and another consequence inevitably followed, that the legislature could not without their consent impose such duty upon them, for that would be for one of the parties without the other to insert a new term in the contract.

Judgment affirmed.