Illinois Central Railroad v. East Sioux Falls Quarry Co.

WHITING, P. J.

Plaintiff, a foreign corporation-, as lessee of the -owner thereof, another foreign- corporation, operates a lin-e of -railway extending -into -this -sta-te f-ro-m ¡the state of Io-wa, and brought this action -seeking to exercise the- -right of eminent domain, and- thereby condemn a right of way f-or a -spur or -industrial track, this proposed s-p-ur track to branch from the- main line of such railway, and to -extend across the land of defendants; its objective point being a private stone quarry -owned by'-one Lowe. Trial was h-a-d; a judgment condemning -such land- entered; motion for new trial -denied; and defendants appealed- from such judgment and order denying -a new trial.

[1] Appellants declare, and we think correctly, that it devolves upon a -party seeking, through delegated -power, -to- exercise t-he right of eminent domain to show: “ (1) That such party is within the class -to whom the power has -been delegated. (2) That all conditions precedent have been complied with. (3) That the purpose for which -the- property is to be taken -is one of the purposes enumerated in the statute. (4) That the property is to be taken for a public use. (5) That the -particular property -sought to be taken- is necessary to the accomplishment -of the public purpose intended.”

Appellants contend: (1) That the respondent does not passes-s the power to take private property for the purpo-se o-f building a branch to the road of its -lessor, because it'has not complied with the -statutory conditions precedent -to- -the exercise of such power -in such -case. (2) That respondent does not possess the ■power to -take -the land of appellants for -the branch road in ques *72 tion, because its board1 of 'directors did not adopt a resolution designating the route of such proposed extension or branch, and' file a copy thereof in the office of the secretary oif state; that it could not proceed under the resolution adopted 'by the grantor of its lessor because (a) that .resolution was far the main line, and did not include the branch in question; (b) the lease of such road by •respondent coiuld not transfer to it any franchise acquired by the grantor of its lessor, authorizing it to take private property for railway purposes. (3) That the statutes of ¡this state do not empower a railway company to condemn land for a spur or industrial track from a main line to a private establishment. (4) That the evidence in this Case show® that it was sought take appellants’ land for the private use of 'respondent and Lowe, and not for any public use -or purpose, and that there is no public necessity for taking the same.

[2] Has respondent complied w-ith' the statutory conditions precedent' to the exercise of the power of eminent domain in this case? The power of eminent domain being a power which is possessed by a railway corporation solely by being delegated to such corporation by the sovereign power of the state, its existence depends upon a strict 'compliance with each and every condition prescribed by s-uch sovereign power. 1 Lewis, Eminent Domain (3d Ed.) X 388; 15 Cyc. 812, 815; Chestatee, etc., Co. v. Cavenders Creek Co., 119 Ga. 354 , 46 S. E. 422 , 100 Am. St. Rep. 174 .

[3] It is conceded by appellants that -a lessee operating a railroad belongs to a class to whom is delegated the power of eminent domain; it is also 'conceded that respondent i® authorized to exercise such power for various purposes, but 'appellants contend that this authority come® from section 494, C. C., which provides among other 'things., that, before a foreign railroad corporation shall be permitted to avail itself of the provision® of such act, it “shall file with the secretary of state a duly certified copy of its charter or articles of incorporation, and comply with all other provisions of the laws of this state relating to foreign corporations,’’ and. appelants contend that respondent has not complied with the provision's of section 551, C. C., which provides: “Every railroad corporation organized or doing business in this state under the laws or authority thereof shall have and maintain *73 a public 'office or place within the state for the transaction of its business and where shall be kept for public inspection, books, in ■which shall be recorded the amount of capital stock subscribed and by whom, the names of the owners of its stock and the amount owned by them respectively, the 'amount of stock paid in and by whom, the transfer of stock, the-amount of -the assets -and liabilities of the corporation, and the names and places of residence -of its officers.”

This section was enacted pursuant to and- -for the purpose of carrying into effect -section 12, art. 17, Const., which, after reciting almost verbatim what was afterward enacted in said section 551, provides: “Anti the Legislature shall pass laws enforcing -by suitable penalties the provisions of this section. It is conceded that respondent has never complied with the above provisions of the -Constitution: and of said section 551; but respondent contends, and we think correctly, that a compliance therewith is not prerequisite to- its1 right to exercise the right of -eminent -domain. It will be noted that the Constitution provides that the Legislature should- pass laws enforcing, by suitable penalties, .the s-ai-d provisions -of the Constitution. In -compliance therewith the Legislature, ’by section 552, C. C., specifically provided 'for a penalty in the nature of a financial -forfeiture. This certainly precludes any presumption that any other penalty was to be visited upon a corporation for a failure to comply with- such provisions. It will also be observed that these constitutional and statutory provisions relate to railroad corporations' only, while the proviso in section 494 recited -that the corporation -should “comply w-ith- all other provisions of ¡the laws of this state relating to foreign corporations” — not with all other laws- relating to railroad corporations. It is -clear to our minds that this law -requires- that -the foreign railroad corporation shall comply with those -provisions of the statute o-n-ly which impose duties upon foreign corporations as distinguished from domestic corporations, such as laws requiring filing of articles of incorporation, appointing of resident agents for purpose cf service of process, etc. N-o claim is made but that respondent has complied, with all tire laws relating to- foreign corporations generally. It will be noted that neither the Constitution nor section 551, C. C., provides that the right on the part of a foreign corporation to exercise the power -of emin *74 ent domain depends in any manner upon a compliance with the provisions therein contained.

[4] Was it incumbent upon respondent to plead and prove that its board of directors toad"passed and filed with, the Secretary of State a resolution designating the route of the proposed spur or industrial track? Section' 506, C. C., authorizes the building of extensions and branches, but further provides: “Before making such extension or building any such 'branch road, such ■corporation shall, b}r, resolution of its directors, to be entered in the record of its proceedings, designate the route of such proposed extension or branch in the manner provided in section: 480, and file a copy of such record, certified by ¡the president and secretary, in .the office of the .secretary of state, and Cause the same ■to be recorded as provided in section 480.” Said section 480, C. C., authorizes the incorporating of a -company for the -constructing, maintaining, and operating -of a railro-ad, and provides for the' making and adopting -o-f -articles -of incorporation, which articles are to be filed with .the Secretary -oif State, and shall recite, among other things: “The place from and to which such railroad is to be constructed', or maintained and operated, as the case may be.-” It seems clear to us that the term, “branch road” as used in- s-aid section 506 — especially -when we read the same in ¡connection with and in the light of section 480 — .does not include a spur or industrial track. Certainly a railroad corporation need not, -in its. articles of incorporation, set forth each and ever)' -spur, switch, or side -track it contemplates constructing, but need- only, in general -terms-, describe the line of railroad it contemplates constructing or maintaining. In the case of Akens v. United N. J. R. R. Co., 43 N. J. Law, 110, in speaking of the term “branch railroad,” the court said: “The branch railroad here designated means more than these side tracks. It -denotes a -road, connected indeed with the main line, but not a mere incident of it, not constructed -simply -to facilitate the business of the chief railway, but designed to -have a business of its own, for the transportation of persons or property to and from p-laces net reached by the principal route.” We think -the above a -clear and excellent definition of w-hait is meant by a “branch railroad,” and it is in full accord with the classification made by the Interstate Commerce Commission: “Branch lines are defined as lines serving one or more stations *75 'beyond .the point of junction with the-main line or another branch line, and to or from which stations regular tariff rates are in effect. Spur tracks are defined as lines constructed to reach or serve industries-, such as mills, mines-, smelters-, factories, etc., -over which regular scheduled passenger or freight train service is -not performed, and for Itransportofioo -over which only a switching charge, if any, is made.” The proposed -spur or industrial track would not constitute a “branch” -road, and' therefore does not come unidor the provision® of section 480 and- 506, supra.

[5] Do tíre statutes of this state authorize respondent to -construct' and) maintain, as owner, this- spur track connecting with and to be used’ as a part of the railroad1 line of which it i-s- but a l-essee? Appellants contend- -that such spur will -constitute an in-lependent -line of railroad, that it is- not — like -a -switch or -side track — a mere incident ..to the main- line, and, as such, -authorized under section 505, C. C. Section 505 C. C., -reads- as follows: “Every .railroad corporation incorporated under this act, and any railroad corporation authorized to construct, operate or maintain a -railroad within this state, has power and -is authorized * * * to take, -hold and appropriate so much real estate -as may be necessary for -the location, construction -and convenient use of its road, including all necessary grounds for buildings, * * * switches-, side tracks, * * * all materials- for -the construction, of such road and -its appurtenances, and the right of way over -adjacent land sufficient to enable s-uch corporation to -construct and repair -its road and the right to conduct -water to- its water stations, and construct -and -maintain- proper drains, and may 'obtain, the right to such real estate by purchase or condemnation in the manner provided by law.” The above section con-ced-edly gives authority to respondent to appropriate such real estate as may be necessary for “the location, construction and convenient use * * * -of switches, side -tracks. * * *” Appellants s-tate: “It would1 establish a mo-st dangerous precedent to hold that under the general terms -of this ■section, which -so plainly relates only to -the main line and its incidental -side tracks, a railway company may, at its mere <w-ill and pleasure condemn a -right of way -over land® of private parties through any city or town in -the state from, its main line to some -distant objective point, s-uch -as a mill, mine, factory, or qauarry for the accommodation of the owners of such establishment.”

*76 It might be inferred from appellants’ word's that they were of the opinion that a corporation could at its mere will and pleasure condemn’ property for the 'things' specified in said section 505; certainly appellants did not intend their words to be so construed. Under section 505, a railroad corporation, otherwise authorized, has full authority, for public use, to condemn property for each and every purpose mentioned in section 505, and for no ■other purpose; but we understand appellants’ contention to be that section 505 does not contain- words- broad- -enough, in their import, to include -spur and industrial tracks, and that there never was, prior to the year 1913, any statute in -this state under which land could be condemned for s-pur or industrial tracks. We are satisfied that it was -the intention of the Legislature, when enacting sai-d Sec. 505, -to authorize the condemning- of land for the construction of lines of railway -including’ all things- usual -and necessary for their maintenance and operation, and that said section -authorizes the taking of -property for spur tracks, -and the legislature has noit seen fit to -impose any condition precedent upon- the construction of spur tracks such as are imposed' under sections 480 and 506 in case of the contemplated construction of main and branch lines — -such spur tracks being considered like a switch or side track, m-ere incidenitsi of the established- line, and to -be put in whenever there is public use for same.

[6] Appellants finally contend -that “the evidence does not establish either .a public -use or a public necessity for -the taking of ■the lands in question, but, on ith-e contrary, establishes the fact that the intended use is wholly private, and -no- public necessity exists requiring the talcing of these lands to enable the -railway company to -discharge its public -duties or effect the purposes of -ts incorporation.” The law-makers o-f -this state have never seen fit to clothe the courts with the -power to 'deny -to a railroad corporation the right to exercise the power of eminent domain, -for the reason that “no pu-b-lic necessity exists-” for the exercise of such power, or for the reason that the exercise of -such right -would not tend “to enable -the railr-o-ad company to -discharge its public -duties or effect the purposes of its incorporation.” This power is vested in the Legislature except when it has delegated the same to- other body or tribunal. Notes, 88 Am. St. Rep. 932 . But -this is -a power *77 .that might very properly be, and is often, vested in 'boards of railroad commissioners.

[7] There is, however, one question -that, in case of dispute, must be left to the courts for final determination': “Is the land to be taken for a public use?” As was said by the court in Hairston v. Danville, etc., R. Co., 208 U. S. 598 , 28 Sup. Ct. 331, 52 L. Ed. 637 , 13 Ann. Cas. 1008: “But when we come to-inquire what are public uses for which the right of compulsory taking may be employed, and what are private uses for which the right is forbidden, we find no agreement, either in reasoning or conclusion. The one and only principle in which all courts seem to- agree is that the nature of the uses, whether public or private, is ultimately a judicial question.”

What is meant by the term ‘ ‘public use” as’ the same is used in connection with the power of eminent domain? Rewis, in- the third edition of his work on Eminent Domain, after declaring that the question of public use -is not affected by the agency employed (section 253), nor by the fact that the use oir benefit is- local or limited (section 254), nor by the necessity oir lack of necessity for the condemnation (section 255), further says, in sections 256-258: “-Many courts seem to treat the- question of What is a public iise? as though the question was For what purposes- may the power of eminent domain he properly exercised? This is a •serious error. * * * To give these words any effect they must be construed as limiting the power to which they relate, that is, as limiting the purposes for which private property may be appropriated. As the power is by its nature limited to such purposes as promote the general welfare, it is evident that the words ‘public use/ if they are to- be construed as a limitation, cannot be equivalent to the general welfare or public good. They must receive a more restricted 'definition. The different views - which have been taken of the wo-rds ‘public use’ resolve themselves info -two- -classes; o-ne holding that there must be a uise o»r right of use on the part -o-f the public or some limited portion of i't, the other holding ‘that they are equivalent to public benefit, utility, -or advantage. It is, of course, impossible to reconcile these different .views, and .the question is, which one is correct? * * * The use of a thing is strictly and properly the employment or -application of the thing in some manner. The public use of anything *78 is the employment or application of the thing by the public. Public use means the same as use by the public, .and this, -it seems- to us, is the construction the word's- should receive in the constitutional provision in- question. The reasons which incline us to thi-s view are, first, that it accords with the primary -and1 more commonly understood meaning of the words-; second, it accords with the general practice in regard to- taking private property for public use in vogue when- the phrase was first brought into use in the earlier 'Constitutions; third, it is the only view which-gives the words any force as a limitation or renders them capable of any definite and practical' application.”

Thus, while the legislature may determine that railroads, irrigation systems-, midis, schools, etc., are public benefactors' and even public necessities, and that their establishment will promote ■ the general welfare; while it may determine that the exercise of the power of -eminent 'domain is a proper -agency through which such benefits and necessities may be secured; while- it may determine the conditions under which -su'dh agency may be employed' — yet •the fact that the Legislature ha-s enacted legislation covering all these matters in no manner determines- that any particular railroad, irrigation system, mill, or school if established, would in ■fact be one that wouldi be -established for “public use.” A railroad through -a densely populated district, if constructed for the use of it-s owners, and over which the state had no control, and to the use of which ite people had no rights, would not be - one constructed for public use; while -a railroad built 'ahead of the settler crossing- mile after mile of uninhabited country, would be constructed- for public use, if the people had the right to go out upon this uninhabited tract and demand of right the uses and benefits to be derived from the railroad.

[8] Thus -we find- that the matter that is- controlling- with the courts is not the necessity -of the use, not even toe fact of use-, but the right to use. In toe footnote to- the case of Kansas City, etc., R. Co. v. Louisiana Western R. Co., in 7 Ann. Cases, 835, it is said: “It is held' in a majority of the jurisdictions that the mere fact 'that toe primary purposes of such a spur i-s to accome modate a -particular private business enterprise is by no- means a controlling test. The character of the u-se, whether public or -private, is determined by the- extent of -the right of the publi-c to its use and *79 not by the extent to- which that right is or may be exercised. If the spur track may be used1 by the public generally upon equal terms, mot merely by permission, but as a right, and' if the track -is subject to governmental control, under general laws, as are the main lines o,f a railroad, then the use is a public one, and it is not material that but few persons -enjoy it, or that it also serves -a private use” — and a large number of authorities are -cited in support of the ab-ove.

In Butte, etc., R. Co. v. Montana Union R. Co., 16 Mont. 504 , 41 Pac. 232, 31 . L. R. A. 298, 50 Am. St. Rep. 508 , the oour-t said: “The character of a way, whether it is public or private, is determined by the extent of the right to- u-se- it, and not by the extent t-o whidi -that right is exercised. If all the peap-l-e have a -right to use it, it i-s a public way, although the number who have occasion -to- exercise the right is very s-mall. * * * All termini of -tracks and switches are more or 'l-ess beneficial to private parties; but the public character of the use of the tracks i-s never affected by this.”

In Riley v. Louisville, etc., R. Co., 142 Ky. 67 , 133 S. W. 971 , 35 L. R. A. (N. S.) 636, Ann. Cas. 1912 D, 230 it is said: “It is therefore plain that the mere -fact that one or more persons or establishments, -on account of the location o-f their property, will derive exceptional -advantages from the construction of the rood does not furnish any argument in support of -the proposition that the. roa-d i-s noit for a public use. If it did no road's would- be built. It is als-o well settled- that the improvement need not be used by or 'necessary to- the public generally, or any -considerable number thereof. The constitutional requirement will be satisfied if all the public desiring -to use -it have the -right to do- so- upon the same terms and -conditions, although -only a few may choose to avail th-ems'elves of the opportunity. As was said in Chesapeake Stone Co. v. Moreland, 126 Ky. 656 , 104 S. W. 762 , 16 L. R. A. (N. S.) 479, in which- -it -was -sought -to- -condemn -land to- build a tram-road to -a rock quarry: 'It seems entirely probable that only a few persons-, aside -from the i-nid-ividual at whose instance it was established, will have occasion to use this .tramway; but this fact' ■does -no-t destroy its public use in the meaning oif -th-e constitution. It is n-ot the number of people who- use the property taken under the law of eminent domain -that constitutes the use of it a *80 public -one, nor does the fact that the benefits will be in a large measure -local enter -into the question. In -short, according to the generally recognized1, -rule, the length -of the public way, the places -between which it runs, or the number 'of people who- use ii, is not the essential inquiry. The -controlling -and decisive question-is, Have the public the- -right to- its use -up-oii1 the same terms as the person at whose instance -the wajr was- established? IE they have, it is- a public use; if they have -not; it is a private one. If the owner can -exercise the same kind of dominion over it as -he does -over other -property owned by him, if he can close it up, if lie can prohibit all or -any part of the -public from its, use, then it is clear that its establishment would be private, and not public, and the right -of eminent domain could n-ot be invoked in its creation.’ ”

The following from -the opinion in Zircle v. Southern Ry. Co,. 102 Va. 17 , 45 S. E. 802 , 102 Am. St. Rep. 805 , is peculiarly pertinent to the -facts before us: “The authorities practically speak with one v-o-i-ce to the -effect that, if t-he use to he subserved is a public use, -the fact that 'the branch road inures to the advantage o-f a particular individual, o-r class of individuals, will not render the u-se any the less p-ublic. Indeed, it is- a matter of common observation that the .possibility of reaching- industrial enterprises -along the proposed route of a railway is a legitimate and important factor in determining the question -of location. * * * The test whether a use is public or not may be determined by the fact ¡that where the use is public -a trust attaches to- the subject condemned for the benefit of the public, of the enjoyment of which it cannot be deprived -by the -company without a reasonable excuse, and by the further .fact that the sítate retains the -p-ower to- regulate and -control the franchises of the company, and to prescribe the amount of charges and tolls which it shall be lawful -for the- company to exact for the transportation of passengers- and freight.”

And in C. & N. W. Ry. Co. v. Morehouse, 112 Wis. 1 , 87 N. W. 849 , 56 L. R. A. 240, 88 Am. St. Rep. 918 , the court said: “A brief reference to- some- of the leading authorities will amply sh-o-w that the -fact that a spur track may ru-n to- a single industry does not militate against -the devoti-om of the property -thereto being a public use thereof, so long as the purpose of maintaining the track is to serve all- persons- who may desire it, and all can demand, as a right, to b-e served, -without discrimination.”

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[9] Weighed in the light of the above authorities, it seems clear to us that, while the spur track in question is sought by one individual, and he will undoubtedly, for the present at least, be the sole person, other than the railroad corporation, to receive much if any, benefit from the construction of such spur, such spur will he open to the use of any other shipper who- may demand service upon the same; suoh spur and the service -thereon will be subject to the supervision and control of the railroad commissioners of this state; no person -can be denied an -equal right, with Lowe, to the use of such spur. Therefore respondent seeks to condemn the right o-f way in question for a public use.

The judgment and- order appealed- from are affirmed.