Page:Henry Osborn Taylor, A Treatise on the Law of Private Corporations (5th ed, 1905).djvu/516

 § 490.] THE LAW OF PRIVATE CORPORATIONS. [CHAP. VIII. of a railroad corporation under a mortgage, in terms covering the franchises of the corporation, immunity of the property of the corporation from taxation does not accompany the prop- erty in its transfer to the purchaser. The court held that the franchises of a railroad corporation are positive rights and priv- ileges without which the road could not be successfully worked, and that immunity from taxation is not one of them. Franchises may pass to the purchaser as part of the property ; immunity from taxation is personal, and incapable of transfer, without express statutory direction. 1 When a railroad comes into the possession of the state, whatever immunity from taxation may have existed in respect to it ceases ; and will not pass to the grantee of the state, if the state at the time of taking pos- session is forbidden by the state constitution to grant immunity from taxation. 2 And when by reason of restrictions in a state constitution it is incompetent for the legislature to make an original grant of exemption from taxation, it is also incompe- tent for the legislature to provide that the assignee of a rail- road company which had enjoyed a personal non-assignable immunity from taxation shall enjoy the immunity possessed by pass an exemption from taxation to a corporation formed out of the bond- holders after foreclosure. Memphis & L. R. R. R. Co. v. Railroad Com- missioners, 112 U. S. 609. 1 Morgan v. Louisiana, 93 U. S. 217; followed in Louisville & Nashville R. R. Co. ». Palmes, 109 U. S. 244; Chesapeake and O. Ry. Co. v. Miller, 114 U. S. 176; Picard 8. Tennessee, etc., R. R. Co., 130 U. S. 637; Rail- road v. Pendleton, 156 U. S. 667; Mercantile Bank v. Tennessee, 161 U. S. 161 ; B. C. & A. R'y Co. v. Ocean City, 89 M'd 89; B. C. & A. R'y Co. v. Wicomico Co., 93 M'd 113; see Phoenix Ins. Co. v. Same, ib. 174; Railroad Cos. v. Gaines, 97 U. S. 697; State v. Morgan, 28 La. Ann. 482; Railroad Co. v. County of Hamblen, 102 U. S. 273; Humphrey v. Pegues^ 16 Wall. 244; Wilson v. Gaines, 103 496 U. S. 417; Memphis & L. R. R. R. Co. v. Railroad Commissioners, 112 U. S. 609; compare City of Bridge- port v. New York & N. H. R. R. Co., 36 Conn. 255, 266; and Trnckee Turnpike Co. v. Campbell, 44 Cal. 89. Compare County of Traverse v. St. P., M. & M. R'y Co., 73 Minn. 417. 2 Trask v. Maguire, 18 Wall. 391. A corporation was organized to do an insurance business, with a partial exemption from taxation. There- after the state constitution was passed prohibiting such exemptions. Still later the state by legislation changed the business of the corpora- tion from insurance to banking. Held that the exemption ceased. Memphis City Bank v. Tennessee, 161 U. S. 186. Under the same cir- cumstances, the immunity was held not to survive a change of name and